What the 120th Congress Means for FMCSA Rules and DOT Oversight

Will the 120th Congress change FMCSA enforcement or DOT grant oversight?

The 120th Congress takes office in January 2027 with a divided government and a packed agenda that includes surface transportation reauthorization, Department of Transportation oversight investigations, and state-level artificial intelligence regulation. For carriers, the immediate impact is uncertainty about whether current FMCSA enforcement priorities will shift and whether DOT grant funding for safety programs will face new scrutiny.

The first legislative priority is the Surface Transportation Reauthorization bill, known as the BUILD America 250 Act. This bill authorizes funding for infrastructure projects across the country, including the rail system. Infrastructure funding directly affects construction fleets and maintenance schedules for all carriers traveling roads undergoing repair or expansion.

After surface transportation funding, Congress will shift focus to the Federal Aviation Administration. Between funding approvals, Democrats are expected to introduce investigations and oversight of the Department of Transportation, especially regarding regulations and grant funding, according to Sean McKenzie, vice president of the U.S. Chamber of Commerce's transportation and infrastructure division.

State AI regulation could fragment compliance for interstate carriers

McKenzie cautioned carriers to watch artificial intelligence regulations and standards closely. The focus has been on regulating AI developers and the systems themselves, but the U.S. Chamber of Commerce is concentrating on AI regulation as it relates to the deployers of this technology.

For the transportation industry, how individual states regulate AI use could have a major impact on operations, especially for companies that operate across state lines. If 50 different states adopt different standards on how carriers can use AI-powered dispatch, route optimization, or driver monitoring technology, it will significantly slow adoption.

"If we have 50 different states adopting different standards on how you can use this technology, it's going to significantly pivot the adoption of it," McKenzie said.

Carriers using AI-based ELD (electronic logging device) analysis, predictive maintenance systems, or automated compliance tools should monitor state legislatures in every state where they operate. A patchwork of conflicting AI standards could require carriers to disable certain software features when crossing state lines or maintain separate technology stacks for different regions.

Tariff policy remains uncertain after midterm elections

Tariffs heavily impacted the transportation industry during the first year of the second Trump administration. While the initial shock of those tariffs has subsided and many have been modified, they still affect businesses across the U.S. Whether midterm election results will bring tariff policy changes is up in the air, McKenzie said, although he noted that repealing Canadian tariffs has garnered bipartisan support.

For carriers hauling cross-border freight or equipment manufactured with imported components, tariff uncertainty complicates budgeting for 2027 and beyond. The UCR (Unified Carrier Registration) lawsuit already threatens to disrupt state safety funding, and tariff volatility adds another layer of financial unpredictability.

How carriers can prepare for regulatory whiplash

The past several years of political whiplash have given industry leaders reason to prepare for a storm of regulatory implementation, execution, or reversal. Will the incoming 120th Congress push electric vehicles again? Will tariffs increase or decrease? Will the Iran conflict wind down so carriers see relief at the pump?

Even the most researched and best-educated economists and industry players don't know the answers. McKenzie summed up the preparation strategy in one word: Diversify.

"The businesses that we represent that are successful, they're the ones that pursue all of those options and are ready to activate whenever the time is ready," he said, referencing fleet businesses that have created plans or tested multiple powertrain options, from EVs to natural gas and even hydrogen.

Another strategy carriers can take is to use the tools and technology currently available to increase profits and optimize operations, Kevin Tynan, director of research at the Presidio Group, said. This is a way for companies to take the net profit or the operating profit lines into their own hands.

What to do before the 120th Congress convenes

Carriers should review their current compliance technology stack for AI-powered features that could face state-level regulation in 2027. Document which systems use machine learning for route planning, driver scoring, or maintenance prediction. Identify which states in your operating authority footprint have introduced AI regulation bills.

For cross-border carriers, monitor Canadian tariff repeal efforts and budget for multiple tariff scenarios when planning equipment purchases or rate negotiations for 2027 contracts.

Watch for DOT oversight investigations that could change FMCSA enforcement priorities or grant funding for state safety programs. If your state receives DOT grants for roadside inspection equipment or data systems, those programs could face new scrutiny that affects inspection frequency or technology requirements.

The best thing carriers can do to weather the political storms ahead is act on the certainties and plan for the uncertainties. The 2027 NOx rule is still expected to finalize in December with a January 1 effective date, regardless of Congressional action. Focus compliance resources on the rules with confirmed effective dates while monitoring the legislative calendar for changes that could reshape the regulatory landscape in 2027.