diff --git a/api/src/routes/dot-lookup.ts b/api/src/routes/dot-lookup.ts
index 461a903..cc43360 100644
--- a/api/src/routes/dot-lookup.ts
+++ b/api/src/routes/dot-lookup.ts
@@ -306,9 +306,11 @@ router.get("/api/v1/dot/lookup", async (req, res) => {
 
     // ── State-Level Compliance Checks ──────────────────────────────
     const phyState = (carrier?.phyState || census?.phy_state || "").toUpperCase();
+    // carrier_operation: A = Interstate, B = Intrastate Hazmat, C = Intrastate Non-Hazmat
     const isInterstate = carrier
-      ? (carrier.censusTypeId?.censusTypeDesc || "").toLowerCase().includes("interstate")
-      : (census?.carrier_operation || "").toLowerCase().includes("interstate");
+      ? (carrier.censusTypeId?.censusTypeDesc || "").toLowerCase().includes("interstate") ||
+        (carrier.carrierOperation?.carrierOperationCode === "A")
+      : (census?.carrier_operation || "").toUpperCase() === "A";
     const isForHireCarrier = census?.authorized_for_hire || false;
 
     if (phyState && phyState.length === 2) {
diff --git a/scripts/workers/fmcsa_deficiency_flagger.py b/scripts/workers/fmcsa_deficiency_flagger.py
index 7cd7040..5d3f27a 100644
--- a/scripts/workers/fmcsa_deficiency_flagger.py
+++ b/scripts/workers/fmcsa_deficiency_flagger.py
@@ -163,7 +163,8 @@ def flag_carriers(dry_run: bool = False) -> dict:
             stats["zero_fleet"] += 1
 
         # State-level flags based on carrier's physical state
-        is_interstate = carrier_op and "interstate" in (carrier_op or "").lower()
+        # carrier_operation: A = Interstate, B = Intrastate Hazmat, C = Intrastate Non-Hazmat
+        is_interstate = (carrier_op or "").upper() == "A"
         sr = state_reqs.get(state) if state else None
         if sr:
             # Interstate carriers need IRP and IFTA