Bills in the U.S. House and Senate seek to permanently allow states and local governments to bypass a requirement that school bus driver applicants include engine component identification when performing the pre-trip vehicle inspection skills testing necessary to obtain their commercial driver’s licenses (CDLs).

The National School Transportation Association (NSTA) successfully asked the Federal Motor Carrier Safety Administration (FMCSA) in January 2022 for a three-month waiver of the so-called “under-the-hood” inspection test used to determine a school bus driver’s familiarity with engines and related components for noting potential hazards prior to starting a school bus route.

That particular skills test is mainly designed for long-haul truckers who might need to make minor repairs on the road. That is not the case for school bus drivers. Instead, they normally call dispatch after a breakdown, and a technician with a substitute bus is sent to the scene so school bus driver and students can proceed to school sites or afternoon bus stops.

NSTA Executive Director Curt Macysyn wrote at the time that the engine compartment inspection test presents a “significant obstacle” to applicants getting in their CDL and school bus companies from quickly hiring otherwise qualified drivers to address staff shortages.

FMCSA approved a three-month waiver and followed with two more. NSTA asked for a five-year waiver, but FMCSA responded with two, two-year waivers, the most recent announced in December to run through the end of 2026. NSTA said contractor members have hired 1,200 new school bus driver applicants as a result of the waiver.

Rep. John Carter of Texas, who said he drove school buses while in law school, discussed his recent reintroduction of H.R. 2360, The Driving Forward Act, to make the exemption permanent during a dinner last month at NSTA’s “Bus-in” lobbying event in Washington, D.C. A companion bipartisan bill, S. 1284, was introduced last week by Republican Sen. John Cornyn of Texas and Democratic Sen. Tammy Baldwin of Wisconsin.

Carter’s first attempt at passing the Driving Forward Act, introduced last April, failed to make it out of the House transportation and infrastructure committee. The legislation seeks to permanently extend the exemption from the “under the hood” engine compartment portion of the pre-trip vehicle inspection skills test required for obtaining CDL. This exemption is expected to make it easier for individuals to become school bus drivers, helping to alleviate the ongoing driver shortage.

In addition to making the skills test exemption permanent, the Driving Forward Act would require participating states to submit annual reports on the number of drivers licensed under the exemption over a six-year period. This data would help demonstrate success in addressing the driver shortage, the bill notes.

During the Capitol Hill Bus-in March 26-27, NSTA said school bus company members held 153 meetings with congressional offices and secured additional support for the Driving Forward Act.

“The path to getting an under-the-hood testing exemption for school bus drivers has been a long journey, but with the introduction of the Driving Forward Act in both the House and Senate, we are poised to achieve final success,” said Macysyn in a statement.

Not a ‘Silver Bullet?’

NSTA said 13 states have adopted the under-the-hood exemption. But some of those states are either no longer utilizing the exemption or questioned if the waiver is worth the effort.

Texas last year switched to the FMCSA’s new voluntary modernized CDL skills test developed by the American Association of Motor Vehicle Administrators, which was approved in August 2022. Rather than require driver applicants determine a driver applicant’s ability to identify all under-the-hood engine components, the modernized skills test for the front of any commercial vehicle including a school bus checks fluid levels and for air leaks.

Anthony Shields, director of transportation for San Marcos Consolidated Independent School District near Austin, Texas, said the modernized skills test makes it easier for applicants to test under the hood by utilizing skills cards that don’t provide answers to the applicants but instead “jolt their brains.”

“We didn’t find value in [the under-the-hood exemption], It didn’t really make it simpler,” commented Shields, before adding, ”It’s a good start to make changes for a school-bus-only CDL.”

Another state to adopt the under-the-hood skills test waiver is New York. At a recent meeting with the state DMV, the New York Association for Pupil Transportation shared very few driver candidates were opting for the waiver.

“I know some driver candidates have taken advantage of the waiver, but I don’t believe it is catching on,” commented David Christopher, NYAPT’s executive director. “The issue: It is a temporary license at this point, and it restricts the driver to in-state driving only. We have never believed this would encourage new drivers to the business. Most people who apply to drive a bus have no idea what the pre-trip entails. Therefore, the under-the-hood requirement would not seem to deter them because they are not aware of what is even required.”

He added that school district members have relayed that if new applicants are trained correctly, the under-the-hood portion of the test is not a problem.

In the end, Christopher said NYAPT supports the waiver, but with a caveat.

“If it helps a district get bus drivers, that would be great,” he added. “We don’t think it is the silver bullet that will solve the problem.”

David Johnson, executive director of the Iowa Pupil Transportation Association, also weighed in.

“My understanding is the process the state [Department of Transportation] had to go through to get the waiver was a bit of a nightmare, almost to the point where if they knew it was going to be such a hassle they may not have done it. That’s just my opinion, but that’s how it sounds,” he explained. “I have not heard of any districts that are saying, ‘Hey, this is making it easier to get drivers.’ What I have heard is districts [are] still having the under-the-hood stuff as a part of their in-house training, as they still want them to have that knowledge and check those components. I personally do not agree with the waiver. I think drivers need to know what to be looking for under the hood.”

Related: Does Taking a Peek ‘Under the Hood’ Impact Driver Shortage?
Related: NSTA’s Macysyn Discusses “Under-the-Hood” Waiver, Clean School Bus Program
Related: Tales From Under the Hood

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School Transportation News has opened registration for its third-annual Innovator of the Year award, which features a private school bus contractor employee who exemplifies the adoption of cutting-edge technology and programs.

The magazine partners with the National School Transportation Association (NSTA) to present the award. Readers may submit an online nomination through April 30 to recognize an individual who works for a school bus contractor company and meets the criteria.

Qualifications include making “significant, tangible contributions” to the school transportation industry within the past 12 months. Innovations could include technology implementation, operations, safety initiatives and green energy adoption.

Read about & hear podcasts with previous years’ winners:

July 2022: The Great Innovator
(STN Podcast E120) Onsite at STN EXPO Reno: Electric Innovator Pulls Back the Curtain

July 2023: There Is No ‘I’ in Team
(STN Podcast E170) Meet the Innovator of the Year: Maintaining a Fast-Growing Bus Fleet

July 2024: Driven by Students, Driven by Technology, Driven by Partnerships
(STN Podcast E217) From Submariner to Innovator of the Year: Fleet Electrification for Student Success

“I believe that change begins with the ability to recognize an innovator when you meet one. It is vitally important to share the achievements of our leaders to help elevate our industry. School Transportation News is honored to share this story of innovation with the entire school transportation industry,” said Tony Corpin, publisher of STN magazine and president of STN Media Group.

This year’s winner will be announced at the NSTA Annual Meeting and Convention held July 21-24 in Nashville, Tennessee, and featured in the July edition of STN magazine.

Related: Start Your Green Fleet Innovation Strategy
Related: School Bus Contractors Compete in Driver Applicant Pool
Related: School District, Bus Contractor Partnerships Vital When Transporting Special Needs Students

The post Innovator Award Seeks Nominations of Trailblazing School Bus Contractors appeared first on School Transportation News.

The Corporate Transparency Act is back in play for small businesses including those in the student transportation industry. 

The U.S. Supreme Court on Thursday granted a stay of a 5th Circuit Court of Appeals decision in December that issued a temporary injunction on enforcing the law. In the hope of preventing criminals from hiding illegal acts through corporate anonymity, Congress passed the Corporate Transparency Act in 2021, sandwiched into a larger 1,482-page defense bill. The law initially took effect on Jan. 1, 2024, requiring companies to disclose stakeholder information to the Department of Treasury’s Financial Crimes Enforcement Network, or FinCEN, by Jan. 1, 2025.

In an order that called the law outright Orwellian, however, a federal judge in Texas on Dec. 3 granted an injunction blocking the Corporate Transparency Act from being enforced — a decision that U.S. attorneys quickly appealed to the 5th Circuit, putting the fate of the act in legal limbo.

On Dec. 23, the 5th Circuit granted the government’s motion to keep the law in place through the appeal, only to reverse on Dec. 26. On Jan. 24, the U.S. Supreme Court lifted the stay, through the completion of review before the 5th Circuit.

To make matters even more confusing for business owners, the high court reviewed the government’s request to lift the stay only in the Texas case, leaving in place a second Texas case, Smith v. U.S. Department of Treasury, in which a stay remains, making current reporting voluntary.

A third federal judge in Oregon denied a similar request for an injunction in September, which will be reviewed by the 11th Circuit Court of Appeals.

The U.S. Supreme Court did not provide an explanation for granting the request for a stay — Justice Ketanyi Brown Jackson was the only dissenting voice, noting she did not see a need for the nation’s highest court to intervene because the 5th Circult already expedited its consideration of the appeal by the federal government’s appeal, which already delayed enforcement of the law by nearly four years.

Parties often ask the U.S. Supreme court to review split decisions among appeals court, but since the high court holds arguments for less than 1 percent of the cases submitted, it is impossible to know whether it will step in.

Meanwhile, FinCEN issued an alert last week clarifying the current status of Beneficial Ownership Information (BOI) reporting. While the Supreme Court lifted the injunction in the Texas Top Cop Shop case, a separate injunction in the Smith case remains, temporarily blocking CTA enforcement, FinCEN continued. The government has yet to appeal the Smith ruling.

That means companies do not have an immediate filing requirement, but voluntary filing is available.

If CTA proceeds, small businesses would have to file the required benefit ownership report very quickly. Failure to report required information could result in $591 fines per day of violation as well as up to two years in jail and up to $10,000 in penalties.

“In a limbo like this the best practice is to be ready to file,” Megan Henderson, an attorney at the Longmont, Colorado firm Lyons and Gaddis, advised last month.

Specializing in real estate and business transactions, Henderson said she spent much of the past year advising clients on becoming compliant under the Corporate Transparency Act.

Most businesses that filed paperwork with their state to become incorporated are now required to disclose their beneficial owners with the federal government, but exemptions abound. One big carve out is for larger companies generating more than $5 million in gross receipts annually. The umbrella of “beneficial owners” might be broader than some people think and covering not just owners but indispensable managers as well.

FinCEN published a brief guide to help businesses navigate the requirements. While neither a lawyer nor an accountant is required to file the paperwork, the process can seem daunting, especially for mom and pop establishments with limited time and resources.

“It’s going to impact the contractors that service the school districts,” said Chris Wojciechowski, an accountant at the Bonadio Group in Rochester, New York.

Wojciechowski said the regulation is more burdensome to small businesses with fewer resources.

“There’s such a tight timeline regarding compliance,” he continued. “So how is our businesses going to deal with this? They’re going to have to be nimble and be on top of the transition if they turn the law back on.”

Related: (STN Podcast E238) Time Will Tell: Shakeups in the School Bus Business World (+ Thomas Built Buses CEO Interview)
Related: IRS Publishes Final Rule on Direct Pay for Tax-exempt Government Agencies
Related: Business As Usual for Collins Bus Customers, Says Forest River

Similar legislation to the Corporate Transparency Act have already been introduced at the state level. One of the first copycat laws comes from New York lawmakers, requiring companies to report ownership by Jan. 1, 2026.

“It’s tricky because every state has their own regulations. I’ve seen companies who operate in one state come to another state and get slapped pretty hard with fines because they did not dig deep into the state regulations for school buses in that state,” said Mark Szyperski, president of On Your Mark Transportation, a consultancy firm based in Nashville, Tennessee.

For Szyperski, who grew up on the seat of his father’s Greyhound bus between Bay City and Detroit, Michigan, transportation is a family business.

Upon entering a new state, Szyperski said he often arranges to speak with the state’s school bus administrator to go over the basics. To be ready for the court’s outcome on the Corporate Transparency Act, he set up a Google alert and included news of the injunction in his newsletter.

“People need to be aware that [the injunction] could be overturned and then you best be getting ready to put the information into the system,” he said.

Ryan Gray contributed to this report.

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