Charter Service, 7526-7546 [E7-2715]
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Federal Register / Vol. 72, No. 31 / Thursday, February 15, 2007 / Proposed Rules
DEPARTMENT OF TRANSPORTATION
Federal Transit Administration
49 CFR Part 604
[Docket No. FTA–2005–22657]
RIN 2132–AA85
Charter Service
AGENCY:
Federal Transit Administration,
DOT.
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ACTION:
Notice of proposed rulemaking.
SUMMARY: Pursuant to the direction
contained in the Joint Explanatory
Statement of the Committee of
Conference, for section 3023(d),
‘‘Condition on Charter Bus
Transportation Service’’ of the Safe,
Accountable, Flexible, Efficient
Transportation Equity Act: A Legacy for
Users (SAFETEA–LU) of 2005, the
Federal Transit Administration (FTA)
established a committee to develop,
through negotiated rulemaking
procedures, recommendations for
improving the regulation regarding
unauthorized competition from
recipients of Federal financial
assistance. The proposed revisions
contained in this notice of proposed
rulemaking (NPRM) represent a
complete revision to the charter service
regulations contained in 49 CFR part
604. The NPRM contains the consensus
work product of the Charter Bus
Negotiated Rulemaking Advisory
Committee (CBNRAC), which was able
to reach consensus on a majority of the
regulatory language. Where the
CBNRAC was unable to reach
consensus, FTA proposes revisions to
the charter service regulations based on
the open, informed exchange of
information that took place during
meetings with the CBNRAC.
DATES: Comments must be received by
April 16, 2007. Late filed comments will
be considered to the extent practicable.
ADDRESSES: You may submit comments
by any of the following methods:
Federal e-Rulemaking Portal: Go to
https://www.regulations.gov. Follow the
online instructions for submitting
comments.
Web site: https://dms.dot.gov. Follow
the instructions for submitting
comments on the DOT electronic docket
site.
Fax: 202–493–2251.
Mail: Docket Management Facility;
U.S. Department of Transportation, 400
Seventh Street, SW., Nassif Building,
PL–401, Washington, DC 20590–0001.
Hand Delivery: Room PL–401 on the
plaza level of the Nassif Building, 400
Seventh Street, SW., Washington, DC,
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between 9 a.m. and 5 p.m., Monday
through Friday, except Federal holidays.
Instructions: When submitting
comments electronically to
Department’s Docket Management
System (DMS) Web site located at
https://dms.dot.gov, you must use docket
number 22657. This will ensure that
your comment is placed in the correct
docket. If you submit comments by
mail, you should submit two copies and
include the above docket number. If you
wish to receive confirmation that FTA
received your comments, you must
include a self-addressed stamped
postcard. Note that all comments
received will be posted without change
to https://dms.dot.gov. This means that if
your comment includes any personal
identifying information, such
information will be made available to
users of DMS. You may review the
Department’s complete Privacy Act
Statement in the Federal Register
published on April 11, 2000 (65 FR
19477) or you may visit https://
dms.dot.gov.
FOR FURTHER INFORMATION CONTACT:
Linda Lasley, Senior Advisor, Office of
the Administrator, Federal Transit
Administration, 400 Seventh Street,
SW., Room 9328, Washington, DC
20590, (202) 366–4011 or
Linda.Lasley@dot.gov; Nancy-Ellen
Zusman, Attorney-Advisor, Office of the
Chief Counsel, 200 West Adams Street,
Suite 320, Chicago, IL 60606, (312) 353–
2789 or Nancy-Ellen.Zusman@dot.gov;
or Elizabeth Martineau, AttorneyAdvisor, Office of the Chief Counsel,
400 Seventh Street, SW., Room 9316,
Washington, DC 20590, (202) 366–1966
or Elizabeth.Martineau@dot.gov.
SUPPLEMENTARY INFORMATION:
I. Statutory Authority
Pursuant to the direction contained in
the Joint Explanatory Statement of the
Committee of Conference, for section
3023(d), ‘‘Conditions on Charter Bus
Transportation Service’’ of SAFETEA–
LU, FTA established a Federal Advisory
Committee on May 5, 2005, to develop
recommendations through negotiated
rulemaking procedures for improvement
of the regulation regarding unauthorized
competition from recipients of Federal
financial assistance.
II. Advisory Committee
The Charter Bus Negotiated
Rulemaking Advisory Committee
(CBNRAC) consisted of persons who
represented the interests affected by the
proposed rule (i.e., charter bus
companies, public transportation
agencies—recipients of FTA grant
funds), and other interested entities.
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The CBNRAC included the following
organizations:
American Association of State Highway
and Transportation Officials;
American Bus Association;
American Public Transportation
Association;
Amalgamated Transit Union;
Capital Area Transportation Authority;
Coach America;
Coach USA;
Community Transportation Association
of America;
FTA;
Kansas City Area Transportation
Authority;
Lancaster Trailways of the Carolinas;
Los Angeles County Municipal
Operators Association
Monterey Salinas Transit;
National School Transportation
Association;
New York State Metropolitan
Transportation Authority;
Northwest Motorcoach Association/
Starline Luxury Coaches;
Oklahoma State University/The Bus
Community Transit System;
River Cities Transit;
Southwest Transit Association;
Taxicab, Limousine & Paratransit
Association;
Trailways; and
United Motorcoach Association.
The CBNRAC met in Washington, DC
on the following dates:
May 8–9
June 19–20
July 17–18
September 12–13
October 25–26
December 6–7
FTA hired Susan Podziba &
Associates to facilitate the CBNRAC
meetings and prepare meeting
summaries. All meeting summaries,
including materials distributed during
the meetings, are contained in the
docket for this rulemaking (#22657).
During the first meeting of the CBNRAC,
the committee developed ground rules
for the negotiations, which are
summarized briefly below:
Æ The CBNRAC operates by
consensus, meaning that agreements are
considered reached when there is no
dissent by any member. Thus, no
member can be outvoted.
Æ Work groups can be designated by
the CBNRAC to address specific issues
or to develop proposals. Work groups
are not authorized to make decisions for
the full CBNRAC.
Æ All consensus agreements reached
during the negotiations are assumed to
be tentative agreements contingent upon
additional minor revisions to the
language until members of the CBNRAC
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reach final agreement on regulatory
language. Once final consensus is
achieved, the CBNRAC members may
not thereafter withdraw from the
consensus.
Æ Once the CBNRAC reaches
consensus on specific provisions of a
proposed rule, FTA, consistent with its
legal obligations, will incorporate this
consensus into its proposed rule and
publish it in the Federal Register. This
provides the required public notice
under the Administrative Procedure Act
(APA), 5 U.S.C. 551 et seq., and allows
for a public comment period. Under the
APA, the public retains the right to
comment. FTA anticipates, however,
that the pre-proposal consensus agreed
upon by this committee will effectively
address virtually all the major issues
prior to publication of a proposed
rulemaking.
Æ If consensus is reached on all
issues, FTA will use the consensus text
as the basis of its NPRM, and the
CBNRAC members will refrain from
providing formal negative comments on
the NPRM.
Æ If the CBNRAC reaches agreement
by consensus on some, but not all,
issues, the CBNRAC may agree to
consider those agreements as final
consensus. In such a case, FTA will
include the consensus-based language
in its proposed regulation and decide all
the outstanding issues, taking into
consideration the CBNRAC discussions
regarding the unresolved issues and
reaching a compromise solution. The
CBNRAC members would refrain from
providing formal negative comments on
sections of the rule based on consensus
regulatory text, but would be free to
provide negative comments on the
provisions decided by FTA.
Æ In the event that CBNRAC fails to
reach consensus on any of the issues,
FTA will rely on its judgment and
expertise to decide all issues of the
charter regulation, and CBNRAC
members may comment on all
components of the NPRM.
Æ If FTA alters consensus-based
language, it will identify such changes
in the preamble to the proposed rule,
and the CBNRAC members may provide
formal written negative or positive
comments on those changes and on
other parts of the proposed rule that
might be connected to that issue.
A complete description of the ground
rules is contained in the docket for this
rulemaking.
Finally, the CBNRAC reached
consensus on the issues the committee
would consider during its negotiations.
The committee agreed to consider the
four issues included in the Conference
Committee report:
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1. Are there potential limited
conditions under which public transit
agencies can provide community-based
charter services directly to local
governments and private non-profit
agencies that would not otherwise be
served in a cost-effective manner by
private operators?
2. How can the administration and
enforcement of charter bus provisions
be better communicated to the public,
including the use of Internet
technology?
3. How can enforcement of violations
of the charter bus regulations be
improved?
4. How can the charter complaint and
administrative appeals process be
improved?
The CBNRAC also agreed to consider
four additional issues:
1. A new process for determining if
there are private charter bus companies
willing and able to provide service that
would utilize electronic notification and
response within 72 hours.
2. A new exception for transportation
of government employees, elected
officials, and members of the transit
industry to examine local transit
operations, facilities, and public works.
3. Review and clarify, as necessary,
the definitions of regulatory terms.
4. FTA policies relative to the
enforcement of charter rules and the
boundary between charter and mass
transit services in specific
circumstances, such as university
transportation and transportation to/
from special events.
III. Overview
The negotiated rulemaking process is
fundamentally different from the usual
process for developing a proposed rule.
Negotiation allows interested and
affected parties to discuss possible
approaches to various issues rather than
simply being asked in a regular notice
and comment rulemaking proceeding to
respond to details on a proposal already
developed and issued by an agency. The
negotiation process involves the mutual
education of the parties on the practical
concerns about the impact of various
regulatory approaches.
The negotiated rulemaking process for
the charter service regulation resulted in
a complete overhaul of the regulation.
This was done in response to
longstanding concerns that the existing
regulation is hard to understand because
it is unclear about what activities
constitute ‘‘charter service.’’ In addition,
members of the CBNRAC agreed that the
existing exceptions to the prohibition on
charter service should be clarified.
Concerns were also raised about the
complaint process. Some members felt
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that complaints were filed in a
vindictive manner and without a
substantive basis. Others felt that once
a complaint was filed, the standard
contained in the existing regulation
made it nearly impossible to receive the
relief requested. All members of the
CBNRAC felt that the complaint and
appeal process takes too long.
What follows is a description of the
decisions reached on each of the issues
that the CBNRAC agreed to consider
during negotiations. Each issue raised
sub-issues that the committee agreed
were also worth considering, and those
sub-issues are also discussed. If
consensus was reached on an issue (or
sub-issue), we explain the consensus. If
consensus was not reached, we explain
the relative positions of the two main
groups: the public transit caucus and
the private charter caucus, and then
offer a proposal by FTA. We encourage
interested parties to review the meeting
summaries in the docket for a more
complete description of the positions of
the caucuses and the negotiations of the
CBNRAC.
Furthermore, two major changes are
worth noting at the outset. First, the
CBNRAC agreed to discard the concept
of ‘‘willing and able,’’ that had persisted
for more than 20 years. As a result,
private charter operators interested in
performing requests for charter service
received by recipients would now be
‘‘registered charter providers.’’ This
term is appropriate because, as
explained in further detail later in this
document, private charter operators
would register on an Internet site. This
website, known as the FTA Charter
Registration Website, would store the
names of private charter operators
interested in receiving notice from
recipients. This new process would
replace the old ‘‘willing and able’’
process.
Second, the existing regulation
contains very limited requirements
regarding complaints, hearings, and
appeals. This proposal contains a more
robust complaint, hearings, and appeals
process. This would ensure that FTA
has an appropriate mechanism for
weeding out frivolous or vindictive
complaints while ensuring that
substantive complaints contain the
necessary information to inform all
parties involved. Further, while the
existing regulations contain an option
for a hearing, there are no procedures
for a hearing. This NPRM contains
procedures for a hearing if a complaint
merits one.
To summarize, the proposals
contained in this NPRM represent
consensus language and informed
decisions by FTA. The complete rewrite
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of part 604 has been a long time in the
making, and is necessary. It is the hope
of FTA that the clarifications made in
this proposal will assist public transit
agencies in complying with charter
service regulations and ensure that all
parties understand when compliance
has been achieved.
IV. Conference Committee Report
Issues
Issue #1: Limited Exceptions for
Providing Community-Based Charter
Services
Under the current regulations
governing charter service, an FTA
recipient is generally prohibited from
providing charter service unless one of
the exceptions applies. The existing
exceptions are: (1) When there is no
‘‘willing and able’’ private charter
operator; (2) leasing equipment; (3) rural
hardship; (4) special events; (5) nonprofit organizations serving individuals
with disabilities; (6) non-profit social
service agencies listed in Appendix A;
(7) non-profit organizations serving lowincome or transit-dependent persons; (8)
rural non-profit organizations serving
the elderly; and (9) formal agreement
with all willing and able private charter
operators.
The CBNRAC agreed that the revised
regulation should also contain
exceptions. The committee reached
consensus on six exceptions: (1)
Government officials; (2) qualified
human service organizations; (3) leasing
equipment; (4) events of regional or
national significance; (5) when no
registered charter provider responds to
notice from a recipient; and (6)
agreement with registered charter
providers. We discuss each of these
exceptions below. We also discuss one
exception where the committee could
not reach consensus, which was the
‘‘hardship’’ exception. We have added
an exception that the committee did not
consider, but due to past and recent
events, we believe should be added; an
exception for the Administrator. Finally,
we discuss three sub-issues for all
exceptions: Reporting requirements,
fully allocated costs, and recipients with
1,000 or more buses in peak hour
service.
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(a) Government Officials
This is a new exception to the charter
regulations and would allow recipients
to provide charter service to government
officials for non-transit related purposes
as long as the recipient provides the
service in its geographic service area,
does not generate revenue (except as
required by law), and records the trip.
The CBNRAC also agreed that there
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should be an hourly annual limit for
this exception, but could not reach
consensus on the number of hours. The
public transit caucus proposed an
annual limit of 125 charter service
hours. The private charter caucus
proposed an annual limit of 80 charter
service hours. Neither caucus explained
why one limit should prevail over the
other.
Since this is a new exception to the
charter regulations, FTA proposes to
accept the private charter caucus’
annual limit of 80 hours of charter
service to government officials for nontransit related purposes within the
recipient’s geographic service area. In
accepting this proposal, however, FTA
believes that extenuating circumstances
may arise where additional hours may
be necessary. As a result, FTA added a
provision to allow for additional charter
service hours under this exception, at
the Administrator’s discretion, in rare or
unusual circumstances, if the recipient
submits a written request: (1) Describing
the event; (2) explaining why registered
charter providers in the geographic
service area cannot perform the service
(e.g., equipment, time constraints, or
other extenuating circumstances); (3)
describing the number of charter service
hours requested to perform the service;
and (4) presenting evidence that the
recipient has sent the request for
additional hours to registered charter
providers in its geographic service area.
FTA would review the request and
respond to the recipient. The recipient
would then be responsible for emailing
FTA’s response to the registered charter
providers in its geographic service area.
As with all exceptions under the
proposed regulation, the recipient
would be responsible for recording the
service in an electronic log.
(b) Qualified Human Service
Organizations
This exception would essentially
collapse three exceptions contained in
the existing regulation pertaining to the
elderly, individuals with disabilities,
and low-income individuals into one
exception for ‘‘qualified human service
organization.’’ Consistent with the
President’s Executive Order on Human
Service Transportation Coordination
(February 24, 2004), the CBNRAC
reached consensus on allowing
recipients to provide charter service to
‘‘persons with mobility limitations
related to advanced age, persons with
disabilities, and persons struggling for
self-sufficiency * * *’’ If an
organization serving the above
individuals also receives funds from one
or more of the 65 Federal programs to
be listed in Appendix A to the
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regulation, then the recipient would
only need to record the charter service
in order to provide it. If the organization
does not receive Federal funds from the
programs listed in Appendix A, but
serves individuals described in this
section, then the organization would
need to register on FTA’s Charter
Registration Web site and the recipient
would need to record the charter
service. FTA will provide Appendix A
in the final rule and will update it from
time to time as new Federal programs
are created to assist individuals and
organizations covered by this exception
or when a party sends a petition to the
Administrator requesting an update to
Appendix A.
(c) Leasing FTA-Funded Equipment and
Drivers
The existing exception under the
charter regulations allows for a recipient
to lease equipment to a private charter
operator if the private charter operator
receives a request that exceeds its
capacity, or the private charter operator
does not have equipment accessible to
the elderly or individuals with
disabilities. The CBNRAC reached
consensus on maintaining this
exception with a few minor changes.
First, the private charter operator would
have to be registered on the FTA Charter
Registration Website. Second, the
private charter operator would have to
own and operate a charter service
business. Third, the private charter
operator would have to exhaust all
available vehicles from other private
charter operators in the recipient’s
geographic service area. Fourth, the
recipient would have to record the
vehicles leased and retain the
documentation provided by the private
charter operator that demonstrates
compliance with the first three
requirements.
(d) Events of National or Regional
Significance
This exception in the current
regulation requires a petition to the
Administrator personally in order to
provide charter service for a special
event. The only limitation is that the
service can be provided ‘‘to the extent
that private charter operators are unable
to provide the service.’’ The CBNRAC
reached consensus on retaining this
exception, but with a more formal
process for petitioning the
Administrator. The revised exception
would require recipients to first consult
with private charter operators registered
in the recipient’s geographic service
area. After consultation, the recipient
may petition the Administrator only if
the recipient (1) submits the petition at
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least 90 days before the event; (2)
describes the importance of the event,
the amount of charter service needed,
and how private charter operators will
be utilized; and (3) files the petition in
the special events docket. The
Administrator would review the
petition, request any additional
information necessary to make a
decision, and then post the decision in
the special events docket. The
Administrator’s approval of a petition
under this exception would be limited
to the event described in the petition.
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(e) When No Registered Charter
Provider Responds to Notice From a
Recipient
The existing regulation allows a
recipient to provide any and all charter
service to the extent that there are no
private charter operators interested in
providing the service. The CBNRAC
reached consensus on retaining this
exception, but with a modification
designed to make the whole process
more responsive. As noted earlier, the
implementation of an FTA Charter
Registration Website would allow
recipients and registered charter
providers to respond in real time
regarding charter service requests.
Under this exception, a registered
charter provider would have 72 hours to
respond to a request for charter service
to be provided in less than 30 days and
14 days to respond to a request for
charter service to be provided in more
than 30 days. If a registered charter
provider responds to the request, then
the recipient may not provide the
service, even if the registered charter
provider and the customer are not able
to agree upon a price. Alternatively, if
no registered charter provider responds
to a request, then the recipient may
provide the service so long as it records
the proper information in an electronic
log.
(f) Agreement With Registered Charter
Providers
This exception in the current
regulation allows a recipient to enter
into an agreement with all private
charter operators in its geographic
service area to allow it to provide
charter service directly to a customer.
The CBNRAC reached consensus on
retaining this exception with certain
modifications to account for the use of
the Charter Registration Website instead
of the annual willing and able process.
Under the revised exception, the
recipient would have to ascertain
registered charter providers in its
geographic service area from the Charter
Registration Website by January 30th of
each year. The recipient would have to
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enter into an agreement with those
registered charter providers by February
15th of each year.
1. Additional Exceptions
(i) ‘‘Hardship’’
The CBNRAC was unable to reach
consensus regarding the ‘‘hardship’’
exception that currently exists in the
charter regulation. This exception is
intended to allow non-urbanized (rural)
areas to provide charter service if a
private charter operator’s provision of
this service would create a hardship on
the customer because the private charter
operator imposes a minimum duration
that is longer than the trip length or the
private charter operator is located ‘‘too
far’’ from the origin of the charter
service.
The CBNRAC could not reach
consensus on what constitutes ‘‘too far.’’
The private charter caucus proposed
retaining the exception as is. The public
transit caucus offered to replace ‘‘too
far’’ with ‘‘deadhead time exceeding
total trip time from initial pick-up to
final drop-off.’’
FTA proposes to retain the hardship
exception and replace ‘‘too far’’ with the
public transit caucus’ proposal. We
believe that this proposal sufficiently
clarifies what is meant by ‘‘too far’’
without opening up the exception to
abuse.
(ii) Administrator’s Discretion
FTA proposes to add a new exception
to address unique situations in which it
may not be practical or feasible to
provide notice to registered charter
providers. Specifically, FTA proposes
an Administrator’s discretion exception
that would allow the Administrator to
personally approve a recipient’s use of
Federally-funded assets to provide
charter service for such events as
funerals of local, regional, or national
significance. Such an event is
unanticipated and requires an
immediate response. For example, the
deaths of Presidents Ronald Reagan and
Gerald Ford underscore the need for
flexibility when using Federally-funded
assets to assist in funeral preparation
activities and on the day of the funeral.
Thus, FTA proposes an Administrator’s
discretion exception to the charter
regulations. A recipient would have to
submit a written request, by facsimile or
e-mail, that describes the event,
describes the charter service requested,
explains the time constraints for
providing the charter service, describes
the anticipated number of charter
service hours needed for the event, the
type of equipment requested,
approximate number of vehicles
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needed, duration of the event, and
explains how provision of the charter
service is in the public’s interest.
Recipients granted an exception under
this section would need to retain the
record of approval from the
Administrator for three years and
include the approval in its electronic
records for quarterly reporting on the
Charter Registration Web site.
(2) Reporting Requirements for All
Exceptions
The CBNRAC agreed that for most of
the exceptions a recipient must record
certain information about the charter
service provided. Specifically, the
committee reached consensus on
reporting that would require recipients
to record an organization’s name,
address, phone number, e-mail address,
date and time of service, number of
passengers, destination, trip length
(miles and hours), fee collected, and
vehicle number. This would be required
for charter service provided under the
exceptions for government officials,
qualified human service organizations,
hardship, and when no registered
charter provider responds to a notice.
For the leasing equipment exception,
the recipient would have to record the
registered charter provider’s name,
address, telephone number, number of
vehicles leased, types of vehicles leased,
vehicle identification numbers, and
documentation presented to the
recipient in support of the rule’s
requirements. A recipient would have to
retain this information in an electronic
format and for at least three years. The
recipient would also identify in the
record the exception that the recipient
relied upon when providing charter
service.
The CBNRAC could not reach
consensus on whether or not the above
electronic records should be posted on
the Charter Registration Web site. The
public transit caucus believes that
posting their electronic records to a
public Web site may implicate privacy
concerns. That caucus instead favors the
provision of records via e-mail upon
request. The private charter caucus
insisted that electronic records should
be posted to the Web site in order to
facilitate transparency. FTA agrees with
the private charter caucus, but also
recognizes that there may be some
situations where certain information
should not be posted on the Web site.
Thus, FTA proposes to include a
provision in the regulation that allows
recipients to provide only generalized
origin and destination information
when safety or security is an issue.
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(3) Fully Allocated Costs
The CBNRAC was unable to reach
consensus on whether the concept of
‘‘fully allocated costs’’ should apply to
public transit agencies that provide
charter service. The public transit
caucus felt as though the requirement
would be a barrier to providing
community-based transportation, but
the private charter caucus argued that
the requirement is necessary to protect
private charter operators.
In the past, FTA required public
transit agencies to recover fully
allocated operating and capital costs
and ensure that the charter service did
not interfere with the intended use of
the asset. FTA allowed this ‘‘incidental
use’’ because it believed the charter
service provided supported the mission
of FTA.
We propose to eliminate the concept
of ‘‘fully allocated costs.’’ The
exceptions included in the proposed
regulation would allow recipients to
provide charter service that is in the
public interest, and is consistent with
the overall mission of public transit
operators as mobility managers within
their communities. Hence, the charter
service that would be allowed under the
proposed rule would be an incidental
use of FTA-funded equipment and
facilities, and the recovery of fully
allocated costs would not be required.
Further, in the case of service
provided to ‘‘qualified human service
organizations,’’ the Federal Interagency
Coordinating Council on Access and
Mobility is currently engaged, in
cooperation with the Office of
Management and Budget, in developing
cost allocation principals to share fairly
the costs of human service
transportation. To require FTA
recipients to recover fully allocated
costs from those qualified human
service organizations, including a share
of capital costs already subsidized by
FTA, would impose unfair conditions
on those interagency deliberations.
That being said, FTA encourages and
expects recipients that provide charter
services under the provisions of part
604 to develop fair charges to recover as
much as possible of the marginal
operating cost of the service, consistent
with the public purpose of the charter
service, and the ability of the requesting
entity to pay. As noted earlier, under
section 604.12, if a registered charter
provider responds to the request for
charter service, the recipient may not
provide the service, even if the private
charter operator’s fee for the service
prevents the requester from purchasing
the trip. This provision protects the
private charter industry from
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competition with transit operators that
receive subsidies from FTA.
(4) 1,000 or More Buses in Peak Hour
Service
The CBNRAC reached consensus on
limiting the application of two
exceptions—qualified human service
organizations and government
officials—to recipients with 1,000 or
more buses in peak hour service. The
public transit caucus requested this
limitation, but the private charter
caucus wholly supported it because of
the potentially negative impact on
private charter operators in urban areas
where there are higher concentrations of
qualified human service organizations
and government officials. Both caucuses
viewed the potential number of requests
as problematic and felt that it was in
each caucuses’ interest to place a
limitation on those two exceptions. FTA
requests comments from qualified
human service organizations and
governmental officials on the practical
impact of this limitation in the final
regulation.
Issue #2: How Can We Better
Communicate Charter Administration
and Enforcement to the Public?
The CBNRAC reached consensus on
the use of Internet technology to
improve communications regarding the
charter service regulations. Members of
the committee acknowledged that
virtually all private charter companies
and public transit agencies have access
to the Internet and to email. The ability
to maintain lists of private charter
companies, informing the public about
allowable activities for public transit
under the charter service regulations,
and posting FTA decisions and
complaints were all cited as valuable
ways to use the Internet.
To effectuate the Internet-based
approach, FTA would develop a Charter
Registration Web site that would serve
as a single point of contact for private
charter operators, recipients, and
members of the public to obtain
information regarding charter service in
their geographic area. In addition, while
FTA currently posts decisions regarding
charter complaints on its Web site,
under the revised regulation, we
propose to make better use of the
Department’s Docket Management
System (DMS) by establishing an
exemption docket, special event docket,
advisory opinion docket, complaint
docket, and hearing docket. These
dockets would be available 24 hours a
day and seven days a week. Further,
DMS has listserv capabilities so that the
public can receive notice each time the
government places a document in the
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docket. We believe this level of
transparency would go a long way
toward informing the public as to which
transit agencies do not provide charter
service (exemption docket); private
charter operators as to when a public
transit agency requests a special event
exception (special event docket); when
FTA provides formal advice to private
charter operators and recipients
(advisory opinion docket); when a
complaint has been filed against a
transit agency (complaint docket); and
when a complaint has been referred for
a hearing (hearing docket). The
CBNRAC reached consensus on this
issue.
Issue #3: How Can Enforcement of
Violations of the Charter Bus
Regulations Be Improved?
The CBNRAC reached consensus on
improved enforcement of charter service
regulations by focusing on deterrence of
risky behavior. Members of the
committee noted that the seminal
question regarding enforcement is:
‘‘What is charter service?’’ For the
public transit caucus, it is important to
protect the public transit agency’s
ability to provide public transportation
and serve its community. This includes
the ability to modify routes to address
congestion or improve mobility for the
elderly, disabled or low-income
populations. For the private charter
caucus, charter service by public transit
agencies should not be ‘‘dressed up’’ to
look like public transportation. The
private charter caucus believed that
service for special events of an irregular
nature constitutes charter service and
the public transit agencies should be
prohibited from providing such service
unless there is no private charter
operator interested in performing the
service.
The proposed regulation would
implement a new remedial scheme,
giving the decision-maker discretion to
determine the type and amount of the
remedy based on a number of relevant
factors, including, but not limited to, the
gravity of the violation, the revenue
earned by providing charter service, and
the operating budget of the recipient.
The remedy could take the form of
withholding a ‘‘reasonable percentage’’
of available Federal financial assistance,
a complete bar on receiving future
Federal funds, or a refund to the U.S.
Treasury of revenue collected in
violation of the rule.
Besides flexibility in the assessment
of a remedy, the CBNRAC reached
consensus on several other ways to
improve the enforcement process,
specifically (1) issuing advisory
opinions and (2) conducting
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investigations. The CBNRAC could not
reach consensus on whether the
following measures should be included
in a new and improved charter service
enforcement regime: (1) Cease and
desist orders, (2) using neutral decisionmakers, and (3) considering a pattern of
violations as an aggravating factor to any
remedy assessed. We discuss each of
these issues below.
hsrobinson on PROD1PC76 with PROPOSALS2
(a) Advisory Opinions
CBNRAC reached consensus that the
new rule should incorporate a provision
enabling public transit agencies and
registered charter providers to obtain
advisory opinions on a case-by-case
basis regarding whether or not a
particular type of transportation would
constitute charter service. These
advisory opinions would serve as a
mechanism for expedited review by
FTA before the recipient performs the
service. Through this mechanism,
recipients and registered charter
providers alike would receive formal
advice about compliance with charter
service requirements. An advisory
opinion would represent the formal
position of FTA on a matter and may be
used in administrative or court
proceedings. The advisory opinion
would be limited, however, to the
factual circumstances described in the
request and would not be binding upon
a decision-maker adjudicating a charter
complaint.
Advisory opinions represent a more
formalized ‘‘letter of determination,’’
which is currently issued when private
charter operators or recipients seek
regulatory advice from FTA before
providing charter service. This more
formal process would provide
transparency and consistency regarding
FTA’s advice. The CBNRAC reached
consensus on this issue.
(b) Investigations
Another way to improve enforcement
is to ensure that a complaint filed has
a substantive basis. Members of the
CBNRAC raised concerns regarding the
filing of incomplete complaints or
frivolous complaints. Thus, the
proposed regulation includes a new
provision allowing FTA ninety days to
conduct an investigation regarding a
complaint. This provision is consistent
with the statutory requirement: ‘‘On
receiving a complaint about a violation
of an agreement, the Secretary of
Transportation shall investigate and
decide whether a violation has
occurred.’’ 49 U.S.C. 5323(d) (2). Thus,
the CBNRAC reached consensus on
revised regulatory language that would
allow FTA to conduct an investigation
after a registered charter provider files a
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complaint. The proposed revision
would also allow FTA to investigate on
its own initiative. After an investigation
is complete, FTA may dismiss the
complaint, issue an initial decision
based on the pleadings to date, or refer
the matter to a neutral decision-maker
for a hearing.
(c) Cease and Desist Orders
The CBNRAC was unable to reach
consensus on whether advisory
opinions should also offer an
opportunity to request a cease and
desist order. The public transit caucus
worried that such an order could be
issued wrongfully, thus preventing
public transit agencies from providing
public transportation. The private
charter caucus encouraged the inclusion
of a cease and desist provision as a way
to prevent financial harm to private
charter operators without going through
a full-blown complaint and hearing
process.
This NPRM does not include a cease
and desist provision. While FTA
believes that a properly worded cease
and desist provision would protect
against ‘‘wrongfully’’ issued cease and
desist orders, we are reluctant to
implement a cease and desist process
because FTA does not have the human
resources to administer a cease and
desist provision. FTA is concerned that
interested parties would inundate the
agency with cease and desist requests.
Furthermore, we believe that revisions
to the charter service definition,
coupled with clear exceptions and
strong remedies for violations of the
regulation provide sufficient protection
of a private charter operator’s financial
interest.
(d) Neutral Decision-Maker
During the CBNRAC negotiations,
members of the committee expressed
the deeply held belief that FTA
decisions regarding charter service
complaints are inconsistent. Both
caucuses described experiences of
receiving inconsistent decisions from
FTA regarding whether a particular
service is prohibited charter service.
The private charter caucus also stated
that FTA was biased in favor of public
transit agencies by advising agencies on
how to tailor the charter service so as to
look like public transportation. As a
consequence, members of the committee
agreed that decision-making regarding
charter service complaints should be
removed from the regional offices and
sent to FTA headquarters. The caucuses
differed, however, on who should
render a determination once a
complaint is sent to FTA headquarters.
The public transit caucus favored
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having FTA headquarters make the
initial decision regarding the complaint.
The private charter caucus contended
that FTA headquarters is biased in favor
of public transit agencies regarding
charter service complaints. Thus, the
private charter caucus favors the use of
an Administrative Law Judge (ALJ) to
make the initial decision regarding a
complaint.
After careful consideration of the
above positions, and considering FTA’s
limited resources, we propose to
include a new provision in the proposed
regulation that would allow a
headquarters office to make an initial
decision regarding a charter service
complaint or to refer the matter to a
neutral decision-maker (Presiding
Official) for a hearing. The Presiding
Official might be an Arbitrator or other
hearing officer and the parties to the
proceeding would be the public transit
agency and the complaining party. The
Presiding Official would then issue a
recommended decision to an
appropriate headquarters office that
would reject, ratify, or adopt with
modifications the recommended
decision. Any initial decision may be
appealed to the Administrator. This
proposed process allows FTA to make a
determination that a hearing is
unnecessary and issue an immediate
decision based on the pleadings to date
or to refer the matter for a hearing. We
believe that this approach is less
resource intensive but still provides a
neutral decision-maker for more serious
cases that require a hearing.
(e) Pattern of Violations
As part of the revised rule’s more
rigorous enforcement scheme, the
proposed regulation contains language
that would increase any remedy ordered
if the decision-maker determines that
there is a ‘‘pattern of violations.’’ The
CBNRAC could not reach consensus on
this issue. The private charter caucus
believed that more than one violation of
the charter service regulations should
incur a severe penalty. The public
transit caucus believed that more than
one violation of the same requirement
should be treated more severely. The
public transit caucus argued that more
than one violation of different charter
service requirements should not
constitute a pattern of violations,
because the public transit agency is
unlikely to know what constitutes a
violation of the charter service
regulations until FTA informs the
public transit agency of the violation.
As will be discussed later in the
definitions section of this NPRM, we
propose to define a pattern of violations
as: ‘‘more than one finding of non-
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hsrobinson on PROD1PC76 with PROPOSALS2
compliance of this Part by FTA
beginning with the most recent finding
of noncompliance and looking back over
a period of 72 months.’’ We intend to
apply this definition in the ‘‘remedies’’
section of the rule. Under that section,
if the decision-maker determines there
is a pattern of violations, then the
decision-maker ‘‘shall bar a recipient
from receiving Federal transit assistance
in an amount * * * considered
appropriate.’’ This means that a public
transit agency violating the charter
service regulation for the first time
would be treated differently, and less
severely, than a public transit agency
that has violated the charter service
regulations more than once over the past
six years. Further, we determined that
looking at a six year period would be
sufficient to determine whether the
public transit agency has a history of
non-compliance with the charter service
regulations. FTA believes that the new
provision on ‘‘pattern of violations’’
would deter conduct that leads to
complaints, would reduce the number
of complaints, and would promote
consultation with FTA.
Issue #4: How Can the Charter
Complaint and Administrative Appeals
Process Be Improved?
All CBNRAC members agreed that the
complaint process should be designed
so as to produce consistent decisions on
charter bus complaints. The perceived
inconsistency in past charter decisions
by FTA was attributed in part to regionbased adjudication under the current
rule. The committee expressed concern
over the diverse approaches for
addressing charter violations taken by
different regions. To this end, the
committee recommended that regional
offices should no longer handle charter
complaints. Instead, complaining
parties would bypass the regional
offices and file their complaints directly
with the FTA Office of the Chief
Counsel. FTA headquarters would
receive complaints, post complaints in a
complaint docket, and investigate
alleged violations.
Furthermore, the committee reached
consensus on a more detailed complaint
process. The existing rule only requires
the filing of a complaint that ‘‘is not
without obvious merit and that * * *
states grounds on which relief may be
granted.’’ This generalized pleading
process has led to frivolous filings or
complaints that do not contain enough
information to determine the violation
of the charter service regulations. The
revised regulations would require a
complainant to identify the specific
provisions of the charter service
regulation allegedly violated, provide a
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complete and concise statement of the
facts relied upon in filing the complaint,
and submit all documents offered in
support of the complaint.
Additionally, the CBNRAC reached
consensus on new filing and service
provisions. In the past, there were
instances where the complainant failed
to notify the public transit agency.
Instead, the FTA regional office sent the
complaint. The revised regulation
would require a complainant to file the
complaint with the public transit agency
and send proof of service to FTA
headquarters. Furthermore, the
committee agreed that associations may
file a complaint as a duly authorized
representative of a registered charter
provider. The private charter caucus
advocated for this position so that
registered charter providers who work
with public transit agencies would not
have to file a complaint directly. Even
so, the association would have to
identify on whose behalf the complaint
is filed.
Moreover, we would appreciate
comments on how to address State
involvement in the complaint process.
For instance, in the case of a complaint
against a rural transit operator funded as
a subrecipient of a State under section
5311, we propose that the private
charter provider should submit a
complaint with the State Department of
Transportation (FTA’s direct recipient)
first. If the State Department of
Transportation cannot resolve the
complaint, then the private charter
operator would proceed under subpart
F. This option was not presented to the
CBNRAC and we have not revised
regulatory text to reflect this proposal.
We would, however, appreciate
comment on the topic.
In addition to a more detailed
complaint process, the CBNRAC agreed
that the appeals process should have
more flexibility, the conciliation period
should be eliminated, parties should be
able to complain about a private charter
operator or qualifed human service
organization’s registration on the FTA
Charter Registration Web site, and it
should be easier for FTA to dismiss
incomplete or non-substantive
complaints. Each of these points is
discussed below.
(a) Appeals
The CBNRAC reached consensus on
an improved appeals process that gives
the Administrator discretion to take an
appeal or modify an initial decision.
Previously, the Administrator could
only consider an appeal if ‘‘the
appellant presents evidence that there
are new matters of fact or points of law
that were not available or not known
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during the investigation of the
complaint.’’ 49 CFR 604.20(b). Members
of the committee viewed that provision
as too limiting, and advocated for
broader discretion. Thus, the new
provision would allow an appeal so
long as the appellant meets the relevant
deadlines. Further, even if the appellant
has not filed an appeal, the
Administrator, on his or her own
motion, may review an initial decision.
As noted earlier, the initial decision
would be made either by a headquarters
office or by an Arbitrator after a hearing
and ratification by a headquarters office.
Additionally, the new regulation would
set out specific timeframes for FTA to
make decisions regarding the complaint
and appeal. Specifically, the initial
decision would have to be issued 110
days after the investigation is complete.
A decision on an appeal would have to
be made within 30 days.
(b) Conciliation Period
The committee also determined that
the mandatory conciliation period in the
existing rule was almost never used and
had no effect other than delaying the
adjudicatory process. The committee
recommended that FTA remove this
requirement from the new rule and
instead include a statement that
encourages the parties to resolve their
dispute informally before filing a
complaint. Thus, we proposed not to
include a conciliation period in the
revised regulation.
(c) Removal From Charter Registration
Web Site
The CBNRAC reached consensus on
providing a new provision that allows
registered charter providers or
recipients to file a complaint
challenging the registration of a private
charter operator or qualified human
service organization on the Charter
Registration Web site. Members of the
committee approved of this provision
because it would allow the removal of
private charter operators that act
vindictively when responding to
requests for charter service. In other
words, a private charter operator that
responds affirmatively to a notice from
a recipient requesting charter service
but then does not contact the customer
or negotiates in bad faith with the
customer could be removed from the
Web site and not receive future requests
for charter services. The proposed
regulation sets out specific reasons why
FTA could remove a registered charter
provider from the registration list. In
addition, we plan to develop an
Appendix B that would set out
examples of each basis for removal.
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On the other hand, a registered
charter provider could file a complaint
to remove a qualified human service
organization from the registration list.
FTA may remove a qualified human
service organization for the same
reasons a registered charter provider
may be removed from the registration
list (e.g., bad faith and lack of
documentation).
Thus, under this new process, a
complaint would be filed electronically
in the complaint docket and a response
would be required in seven days. FTA
would then consider the complaint and
response and issue a decision in ten
business days. FTA’s decision would be
posted in the complaint docket and
would identify the reasons for removing
or allowing the private charter operator
or qualified human service organization
on FTA’s Charter Registration Web site.
If removal is ordered, the decision
would identify the length of time for
removal and when the party may
reapply for registration.
(d) Dismissals
Furthermore, to ensure the integrity of
the complaints filed, the CBNRAC
reached consensus on new provisions
that would allow FTA to dismiss a
complaint, without prejudice, if it is
incomplete. FTA may also dismiss a
complaint, with prejudice, if the
complaint, on its face, is outside the
jurisdiction of FTA, fails to state a claim
that warrants further investigation, or if
the complainant lacks standing to file
the complaint.
V. Additional Issues Considered by the
CBNRAC
hsrobinson on PROD1PC76 with PROPOSALS2
Issue #5: A New Process for Determining
If There Are Private Charter Bus
Companies Willing and Able To Provide
Service That Would Utilize Electronic
Notification and Response
The CBNRAC discussed this issue
because the private charter caucus and
public transit caucus were close to an
agreement on this issue during previous
negotiations before the formation of the
CBNRAC. Essentially, the committee
viewed the current ‘‘willing and able’’
process as protection for private charter
operators from unsuccessful
negotiations with customers who might
expect lower prices from public transit
agencies. The current process also
allows public transit agencies to provide
charter service when there is no private
charter operator interested in
performing the service. Even so, the
committee recognized that the existing
willing and able process is outdated and
agreed to eliminate it in favor of a webbased registration process.
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The Charter Registration Web site
would serve as a database of private
charter operators who are interested in
receiving notice from recipients
regarding requests for charter service. In
order to register, private charter
operators would have to answer several
questions about their business and the
geographic areas they serve. Recipients,
upon receiving a request for charter
service that a recipient is interested in
providing, would be required to send an
email to registered charter providers
listed on FTA’s Charter Registration
Web site in the recipient’s geographic
service area. The notification would
have to be sent by close of business on
the day the recipient receives the
request, unless the recipient received
the request after 2 p.m., in which case
the recipient would have to send the
notice by the close of business the next
business day. The recipient may then
provide charter service if no registered
charter provider responds to the notice
within 72 hours for charter service
requested to be provided in less than 30
days; or within 14 calendar days for
charter service requested to be provided
in 30 days or more. The recipient would
have to retain an electronic copy of the
notice and the list of registered charter
providers notified of the requested
charter service for a period of at least
three years from the date the notice was
sent. The recipient would also record
certain information about the charter
service for purposes of quarterly
reporting. Members of the CBNRAC
expressed approval of this real-time
process over the existing annual
notification process.
The CBNRAC could not reach
consensus on whether a private charter
operator should be required to answer
whether it would provide free or
reduced rate services to qualified
human service organizations. The
public transit caucus argued in favor of
such a requirement while the private
charter caucus argued against a
requirement and advocated instead that
it be optional.
The proposed regulation includes
language that would make it optional for
a private charter operator to indicate
whether they would provide free or
reduced rate charter services to
qualified human service organizations.
We believe that private charter operators
wish to support their communities in
the same way that many recipients
support their communities and that they
would likely take advantage of this
option because qualified human service
organizations can conduct a search on
the Charter Registration Web site to look
only for those private charter operators
with free or reduced rates. We do not
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7533
believe, however, that private charter
operators should be required to provide
such information.
(a) Registration of Qualified Human
Service Organizations
In addition to registering private
charter operators, the Charter
Registration Web site would also serve
as a database for qualified human
service organizations that do not receive
funding from the Federal programs
listed in Appendix A to the regulation.
In order to register, qualified human
service organizations would have to
answer several questions about their
organization, its funding, and its
mission.
After registering, these qualified
human service organizations would be
eligible to receive free or reduced rate
charter services from either recipients or
registered charter providers. The
committee reached consensus on this
issue.
FTA requests comment from qualified
human service organizations, not
receiving funding from the Federal
programs listed in Appendix A, on the
practical impact of these registration
requirements.
Issue #6: A New Exception for
Transportation of Government
Employees, Elected Officials, and
Members of the Transit Industry To
Examine Local Transit Operations,
Facilities, and Public Works
The CBNRAC reached consensus on a
new applicability provision for the
charter service regulations. Under the
new provision, the charter service
regulations should not apply to a
recipient transporting its own
employees, other transit system
employees, management officials,
contractors and bidders, government
officials and their contractors and
official guests to or from transit facilities
or projects within their geographic
service area for the purpose of
conducting oversight functions such as
inspection, evaluation, or review.
During the discussions on this issue,
members of the CBNRAC noted that
movement of transit employees or
officials for transit purposes is simply
not charter service. Further, as
discussed in greater detail in the next
section, under the new definition of
charter, movement of transit employees
from one work station to another is also
not charter service. The CBNRAC also
reached consensus on the following
applicability provisions:
(a) The charter service regulations
would not apply to a recipient that
transports its employees, or other transit
system employees or officials for
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emergency preparedness planning and
operations.
(b) The charter service regulations
would not apply to recipients of 49
U.S.C. 5310, 5316, or 5317 funds, when
used for program purposes.
(c) The charter service regulations
would not apply in the case of local,
regional, or national emergencies lasting
fewer than three days. Otherwise, the
recipient would have to follow the
provisions of 49 CFR part 601 subpart
D.
(d) The charter service regulations
would not apply to a non-urbanized
area transporting its employees outside
of its geographic service area for training
purposes.
The CBNRAC could not reach
consensus on whether the charter
service regulations apply to private
charter operators receiving funds,
directly or indirectly, from programs
under 49 U.S.C. 5307, 5309, 5310, 5311,
5316, 5317 or section 3038 of the
Transportation Equity Act for the 21st
Century. The private charter caucus
requested this provision because it
believes that the receipt of Federal
funds should not hinder the private
charter operator’s ability to conduct its
business. The public transit caucus
asserted that private charter operators
receiving Federal funds should be
subject to the same limitations as public
transit agencies.
We propose to include this provision
because the receipt of funds from the
Federal government should not interfere
with a private charter operator’s
business. This regulation has its genesis
in the protection of the private charter
operators from unfair competition by
public transit agencies. To subject
private charter operators to the charter
service regulations undermines the very
purpose of these regulations.
hsrobinson on PROD1PC76 with PROPOSALS2
Issue #7: Review and Clarify, as
Necessary the Definitions of Regulatory
Terms
One of the main points of contention
for the CBNRAC was the definition of
‘‘charter service’’ and ‘‘pattern of
violations.’’ For all other definitions, the
CBNRAC was able to reach consensus.
Additionally, since the conclusion of
the negotiations, we decided that
definitions of ‘‘qualified human service
organization’’ and ‘‘charter service
hours’’ are necessary. Thus, what
follows is a discussion of the
negotiations regarding the definitions of
charter service and pattern of violations.
We also offer our proposed definitions
of qualified human service organization,
charter service hours, and special
transportation.
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(a) Definition of Charter Service
CBNRAC was unable to come to an
agreement on the definition of the term
‘‘charter service.’’ The controversy
centered on a particular category of
transportation service provided on an
irregular basis for occasional local
events such as golf tournaments,
festivals, state fairs, July 4th
celebrations, flower shows, home
shows, and sporting events. The public
transit caucus considers open-door bus
service to these types of events to be
public transportation that serves the
community at large (by providing traffic
mitigation and other public benefits)
even though the transit agency may
need to create new or modified routes
on a temporary basis for the duration of
the event in order to provide the service.
The private charter caucus believes that
such services constitute ‘‘charter
service’’ because a third party event
sponsor is usually involved through
some type of contractual arrangement; a
new, temporary route has to be created
to transport people to and from the
event (as opposed to published, regular
transit routes); and because the service
is not continuous, and lasts only for the
duration of the event. Despite lengthy
discussions and an exchange of various
proposals between the two sides, these
differences could not be resolved by the
committee. We recommend that
interested parties review the docket for
the exact proposals offered by each
caucus.
In response to the discussions held by
the CBNRAC, we propose a definition of
charter service that recognizes concerns
raised by each caucus and provides
examples of what would be considered
charter service. In providing this
definition of charter service, we note
that the term ‘‘buses’’ includes rubbertire replica trolleys.
First, the caucuses were able to agree,
although they did not reach consensus,
on the proposition that charter service
has three components: The
transportation of a group of persons
pursuant to a single contract with a
third party; a fixed charge; and an
itinerary determined by someone other
than the public transit agency. The
CBNRAC agreed that these three
elements would have to be present in
order for a particular service to be
considered charter service.
Second, members of the CBNRAC felt
it was important to provide examples of
what is and is not charter service. Thus,
we propose a definition that includes
three examples of charter service: (1)
Use of buses or vans to transport school
students, school personnel or school
equipment; (2) shuttle service to events
PO 00000
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that occur on an irregular basis or for
limited duration; or (3) shuttle services
limited to a group of individuals
pursuant to a contract with an
institution, university, corporation or
government.
We also include in the definition
examples of what is not charter service.
Specifically, we propose that the
following do not constitute charter
service: (1) Adding equipment or days
to an existing route; (2) extending
service hours on an existing route; (3)
demand-responsive service that is part
of coordinated public transit human
service transportation; and (4) new or
modified service that is open to the
public, where the recipient establishes
and controls the route and the service
continues from year to year.
In an effort to provide further
clarification of what service would be
considered charter service or public
transportation, FTA will publish an
Appendix C with the final rule that
contains more examples and frequently
asked questions. We would appreciate
comments with questions that should be
included in Appendix C.
(b) Definition of Pattern of Violations
The CBNRAC did not reach agreement
on the definition of ‘‘pattern of
violations.’’ Some participants
advocated that the term should mean
‘‘more than one instance of
noncompliance with charter service
regulations.’’ Under this interpretation,
FTA could find in a single decision that
a transit agency engaged in a pattern of
charter service violations. A pattern
could be established, for instance, if the
public transit agency’s one-time
provision of charter service violated
several requirements of the charter
service rule.
Others sought a more limited
definition, whereby a recipient commits
a pattern of violations of the charter
service regulations only if FTA makes a
series of findings of successive charter
service violations over a period of time.
Still others advocated a definition that
recognizes a pattern only if the same
regulation is violated more than once
over a period of time.
We propose to adopt a definition of
pattern of violations that looks at
violations over a period of time. The
violation need not be a violation of the
same regulation, although it could be, in
order for FTA to find a pattern of
violations. Further, we propose to look
at the recipient’s six-year history to
determine whether or not it has engaged
in a pattern of violations. Thus, a
violation in the year 2006 means that
FTA could look back to the year 2000
to determine whether other violations
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exist, which would constitute a pattern
of violations. Violations found by FTA
in 1999 could not be used to find a
pattern of violations. This definition
strikes a balance between the need to
penalize recipients that routinely violate
the charter service requirements and the
need to place a time limit on how far
back FTA may look for other violations.
This definition, as with all provisions of
this rulemaking, does not take effect
until FTA issues a final rule.
(c) Definition of Qualified Human
Service Organization
After the conclusion of negotiations,
and as we began to make decisions
about the outstanding issues, it became
clear that we needed to include a
definition of ‘‘qualified human service
organization’’ in the proposed
regulation. We believe this definition is
necessary to elaborate on the exception
for qualified human service
organizations contained in the
regulation with the Executive Order on
Human Service Transportation
Coordination signed by the President on
February 24, 2004. Thus, we propose to
define ‘‘qualified human service
organization’’ as an organization that
serves persons who qualify for human
service or transportation-related
programs or services due to disability,
income, or advanced age.
hsrobinson on PROD1PC76 with PROPOSALS2
(d) Definition of Charter Service Hours
We also did not present a definition
of ‘‘charter service hours’’ to the
CBNRAC. While the committee reached
consensus that charter service hours is
the appropriate measurement for the
annual limit contained in the
‘‘government officials’’ exception, FTA
did not provide a definition of charter
service hours for review by the
committee. Thus, we now propose to
define charter service hours as the total
hours operated by buses or vans while
in charter service, including the hours
operated while carrying passengers for
hire and associated deadhead hours.
(e) Definition of Special Transportation
The CBNRAC did not discuss the
definition of special transportation
during its deliberations, but we believe
the term should be defined to avoid
confusion in the future. The statutory
definition of ‘‘public transportation’’
includes a reference to ‘‘special
transportation.’’ There is no definition
of ‘‘special transportation’’ in statute or
in the charter service regulations.
Legislative history, however, indicates
that the term includes service
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exclusively for the elderly and persons
with disabilities, and service for
workers who live in the innercity but
commute to a factory in the suburbs.
See, H.R. Rep. No. 1785, 90th Cong., 2d
Sess., reprinted in 1968 U.S. Code Cong.
Ad. & News 2941. In order to provide
clarity, we believe it would be helpful
to include a definition of ‘‘special
transportation’’ in the proposed charter
service regulation. Thus, we propose to
define ‘‘special transportation’’ as
demand response or paratransit service
that is regular and continuous and is a
type of ‘‘public transportation.’’
Issue #8: FTA Policies Relative to the
Enforcement of Charter Rules and the
Boundary Between Charter and Public
Transit Services in Specific
Circumstances, Such as University
Transportation and Transportation to/
from Special Events
The committee reached consensus to
include an appendix to the final rule
that would provide specific examples of
situations that do or do not qualify as
charter service. In close cases, the
parties affected by the rule could refer
to these illustrative situations for
guidance in making decisions about
whether or not requested service would
constitute charter or public
transportation under the charter service
regulation.
CBNRAC members reached consensus
to include in the proposed rule a limited
exception to allow transit operators to
provide transportation to events of
regional or national significance on a
case-by-case basis. In order to take
advantage of this exception, a recipient
would petition the Administrator after
first consulting with registered charter
providers in the recipient’s geographic
area to determine whether registered
charter providers are capable of
performing the service. To be eligible for
the exception, the recipient would also
have to satisfy a number of conditions
set out in the rule. The Administrator
would have full discretion to grant or
deny the request.
VI. Other Revisions to the Charter
Service Regulations
The CBNRAC also reached consensus
on the revision to the general purpose
statement and the charter service
agreement. The committee was unable
to reach consensus on whether the
regulation should contain an exemption
provision.
The general purpose statement for the
charter service regulation simply states
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7535
that the purpose of the regulation is to
protect private charter operators from
unauthorized competition with
recipients of Federal financial
assistance. There was no major
discussion or disagreement on this
provision, and, therefore, we propose
the language developed by the
CBNRAC.
The charter service agreement has not
been updated for over twenty years.
This regulation updates the charter
service agreement, which is included in
the Grant Agreement or Cooperative
Agreement entered into by the recipient
of Federal funds. The CBNRAC reached
consensus that the charter service
agreement should incorporate by
reference the terms of the charter service
regulations, and, therefore, we propose
to include those provisions.
Finally, the CBNRAC was unable to
agree to the terms of an exemption
provision. An exemption provision
would allow a recipient to make an
affirmative declaration that it would not
provide charter service, under any
conditions, in or out of its geographic
service area. This provision was
developed to address concerns by the
committee that recipients that do not
wish to provide charter service should
be readily identifiable by the public,
other recipients, and private charter
operators. The private charter caucus
supported such a provision because
such an exemption would assist private
charter operators in determining when a
recipient is in violation of the charter
service regulations. The public transit
caucus did not object to the specific
terms of the provision, but believed that
no public transit agency would utilize
an exemption provision.
We propose to include an exemption
provision. The process would be for the
recipient to provide its declaration by
the third week of September each year.
The recipient would file this declaration
in an exemption docket. Thus, a
member of the public could easily
determine which recipients have
declared that they would not provide
charter service. If after three years there
are no recipients that use the exemption
provision, FTA proposes to rescind that
portion of the rule.
Distribution Tables
For ease of reference, we provide a
distribution table to indicate proposed
changes in section numbering and titles.
Section Title and Number:
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Old section
New section
(Subpart A)
Purpose ..........................................
Applicability ....................................
Definitions .......................................
Charter Agreement .........................
Charter Service ..............................
Procedures for determining if there
are any willing and able private
charter operators.
Reviewing evidence submitted by
private charter operators.
Filing a complaint ...........................
§ 604.1 ..........................................
§ 604.3 ..........................................
§ 604.5 ..........................................
§ 604.7 ..........................................
§ 604.9 ..........................................
§ 604.9(a) ......................................
§ 604.9(b)(1) .................................
§ 604.9(b)(2) .................................
§ 604.9(b)(3) .................................
§ 604.9(b)(4) .................................
§ 604.9(b)(5) .................................
§ 604.9(b)(6) .................................
§ 604.9(b)(7) .................................
§ 604.9(b)(8) .................................
§ 604.11 ........................................
(Subpart A)
Purpose ........................................
Applicability ...................................
Definitions .....................................
Charter Agreement .......................
Exceptions ....................................
.......................................................
.......................................................
.......................................................
.......................................................
.......................................................
.......................................................
.......................................................
.......................................................
.......................................................
.......................................................
§ 604.13 ........................................
Registration of private charter op- § 604.16.
erators.
....................................................... removed.
(Subpart B) ...................................
§ 604.15(a) ....................................
§ 604.15(b) ....................................
§ 604.15(c) ....................................
§ 604.15(d) ....................................
§ 604.15(e) ....................................
§ 604.15(f) .....................................
§ 604.15(g) ....................................
§ 604.15(h) ....................................
§ 604.15(i) .....................................
Remedies ....................................... § 604.17 ........................................
Appeals ..........................................
Judicial Review ..............................
§ 604.19(a) ....................................
§ 604.19(b) ....................................
§ 604.19(c) ....................................
§ 604.19(d) ....................................
§ 604.19(e) ....................................
§ 604.21 ........................................
hsrobinson on PROD1PC76 with PROPOSALS2
Rulemaking Analyses and Notices
All comments received on or before
the close of business on the comment
closing date indicated above will be
considered and will be available for
examination in the docket at the above
address. Comments received after the
comment closing date will be filed in
the docket and will be considered to the
extent practicable. In addition to late
comments, we will continue to file
relevant information in the docket as it
becomes available after the comment
period closing date, and interested
persons should continue to examine the
docket for new material. A final rule
may be published at any time after close
of the comment period.
Executive Order 12866 (Regulatory
Planning and Review) and DOT
Regulatory Policies and Procedures
FTA has determined preliminarily
that this rulemaking is not a significant
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Jkt 211001
Complaints .................................... (Subpart F).
....................................................... § 604.27(a).
....................................................... removed.
....................................................... § 604.27(b).
....................................................... § 604.27(c).
....................................................... § 604.34 or 46.
....................................................... § 604.32 or 33.
....................................................... (Subpart I).
§ 604.36.
....................................................... § 604.37.
....................................................... § 604.45.
Remedies ...................................... § 604.47.
Appeal to Administrator and final
agency orders.
(Subpart J).
....................................................... § 604.48(a).
....................................................... § 604.48(b).
....................................................... § 604.48(c).
....................................................... § 604.48(a).
....................................................... § 604.48(b).
....................................................... (Subpart K).
§ 604.50.
regulatory action within the meaning of
Executive Order 12866, and is not
significant under Department of
Transportation regulatory policies and
procedures. This NPRM contains
revisions that are clarifying in nature.
Where possible, we have adopted
provisions to lessen the burden on
public transit agencies while ensuring
that those entities do not engage in
unfair competition with private charter
operators.
FTA has not conducted a cost analysis
for this rulemaking because the changes
proposed do not impose any cost on the
industry. Since this rulemaking is
designed to protect private charter
operators from unfair competition by
public transit agencies, the changes
should increase opportunities for
private charter operators when the
requested service is not subject to one
of the community-based exceptions.
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Frm 00012
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§ 604.1.
§ 604.2.
§ 604.3.
§ 604.5.
(Subpart B).
§ 604.12(b).
removed.
§ 604.10.
§ 604.9.
§ 604.11.
§ 604.8.
§ 604.8.
§ 604.8.
§ 604.13.
(Subpart C).
Sfmt 4702
FTA welcomes comments on whether
there are economic impacts from this
proposed regulation. Comments
regarding specific burdens, impacts, and
costs would be most welcome and
would aid us in more fully appreciating
whether there are cost impacts for this
proposed rule.
Regulatory Flexibility Act
When an agency issues a rulemaking
proposal, the Regulatory Flexibility Act
(RFA) requires the agency to ‘‘prepare
and make available for public comment
an initial regulatory flexibility
analysis,’’ which will ‘‘describe the
impact of the proposed rule on small
entities.’’ (5 U.S.C. 603(a)). Section 605
of the RFA allows an agency to certify
a rule, in lieu of preparing an analysis,
if the proposed rulemaking is not
expected to have a significant economic
impact on a substantial number of small
entities.
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The nature of this rulemaking is to
prevent unfair competition by public
transit agencies with private charter
operators. Thus, any economic impact
on small entities will be a positive one.
FTA hereby certifies that the proposals
for the charter service regulation
contained in this NPRM, if adopted,
would not have a significant economic
impact on a substantial number of small
entities. FTA invites comment from
members of the public who believe
there will be a significant impact on
small entities.
Executive Order 13175 (Tribal
Consultation)
Unfunded Mandates Reform Act of
1995
We have analyzed this action under
Executive Order 13211, ‘‘Actions
Concerning Regulations That
Significantly Affect Energy Supply,
Distribution, or Use,’’ dated May 18,
2001. We have determined that it is not
a significant energy action under that
order and is not likely to have a
significant adverse effect on the supply,
distribution, or use of energy. Therefore,
a Statement of Energy Effects is not
required.
This proposed rule would not impose
unfunded mandates as defined by the
Unfunded Mandates Reform Act of 1995
(Pub. L. 104–4, March 22, 1995, 109
Stat. 48). This proposed rule will not
result in the expenditure of non-Federal
funds by State, local, and Tribal
governments, in the aggregate, or by the
private sector, of $120.7 million in any
one year (2 U.S.C. 1532).
This proposed action has been
analyzed in accordance with the
principles and criteria contained in
Executive Order 13132, and FTA has
determined that this proposed action
would not have sufficient federalism
implications to warrant the preparation
of a Federalism assessment. FTA has
also determined that this proposed
action would not preempt any State law
or regulation or affect the States’ ability
to discharge traditional State
governmental functions. Comment is
solicited specifically on the Federalism
implications of this proposal.
hsrobinson on PROD1PC76 with PROPOSALS2
Paperwork Reduction Act
Under the Paperwork Reduction Act
of 1995 (PRA) (44 U.S.C. 3501 et seq.),
Federal agencies must obtain approval
from the Office of Management and
Budget (OMB) for each collection of
information they conduct, sponsor, or
require through regulations.
FTA has an existing approved
information collection (OMB Control
Number 2132–0543) that expires on
December 31, 2007. FTA has
determined that revisions in this
proposal will require an update to the
information collection request.
However, FTA believes that any
increase in burden hours per
submission is more than offset by
decreases in the frequency of collection
for these information requirements and
the use of electronic technology.
16:55 Feb 14, 2007
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Executive Order 13211 (Energy Effects)
Regulation Identification Number
Executive Order 13132 (Federalism)
VerDate Aug<31>2005
FTA has analyzed this action under
Executive Order 13175, dated November
6, 2000, and believe that the proposed
action would not have substantial direct
effects on one or more Indian Tribes;
would not impose substantial direct
compliance costs on Indian Tribal
governments; and would not preempt
Tribal laws. Therefore, a Tribal
summary impact statement is not
required.
A regulation identification number
(RIN) is assigned to each regulatory
action listed in the Unified Agenda of
Federal Regulations. The Regulatory
Information Service Center publishes
the Unified Agenda in April and
October of each year. The RIN contained
in the heading of this document can be
used to cross-reference this action with
the Unified Agenda.
7537
604.12 When no registered charter provider
responds to notice from a recipient.
604.13 Agreement with registered charter
providers.
604.14 Administrator’s discretion.
604.15 Reporting requirements for all
exceptions.
Subpart C—Procedures for Registration
and Notification
604.16 Registration of private charter
operators.
604.17 Notification to registered charter
providers.
Subpart D—Procedures for Registration of
Qualified Human Services Organizations
and Duties for Recipients Regarding
Charter Registration Web Site
604.18 Registration of qualified human
service organizations.
604.19 Duties for recipients with respect to
charter registration Web Site.
Subpart E—Advisory Opinions
604.20 Purpose.
604.21 Request for an advisory opinion.
604.22 Processing of advisory opinions.
604.23 Effect of an advisory opinion.
604.24 Special considerations.
Subpart F—Complaints
604.25 Purpose.
604.26 Complaints and decisions regarding
removal of private charter operators or
qualified human service organizations
from registration list.
604.27 Complaints, answers, replies, and
other documents.
604.28 Dismissals.
604.29 Incomplete complaints.
604.30 Filing.
604.31 Service.
List of Subjects in 49 CFR Part 604
Subpart G—Investigations
604.32 Investigation of complaint.
604.33 Agency initiation of investigation.
Charter Service.
In consideration of the foregoing, FTA
proposes to revise title 49, Code of
Federal Regulations, part 604 as set
forth below:
Subpart H—Initial Decisions by FTA and
Referrals to a Presiding Official (PO)
604.34 Initial decisions and referrals to a
PO.
604.35 Separation of functions.
Title 49—Transportation
Subpart I—Hearings
604.36 Powers of a PO.
604.37 Appearances, parties, and rights of
parties.
604.38 Discovery.
604.39 Depositions.
604.40 Public disclosure of evidence.
604.41 Standard of proof.
604.42 Burden of proof.
604.43 Offer of proof.
604.44 Record.
604.45 Waiver of procedures.
604.46 Recommended decision by a PO.
604.47 Remedies.
1. Revise Part 604 to read as follows:
PART 604—CHARTER SERVICE
Subpart A—General Provisions
Sec.
604.1 Purpose.
604.2 Applicability.
604.3 Exemption.
604.4 Definitions.
604.5 Charter service agreement.
Subpart B—Exceptions
604.6 Purpose.
604.7 Government officials.
604.8 Qualified human service
organizations.
604.9 Hardship.
604.10 Leasing FTA funded equipment and
drivers.
604.11 Events of regional or national
significance.
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Subpart J—Appeal to Administrator and
Final Agency Orders
604.48 Appeal from a headquarters office
initial decision.
604.49 Administrator’s discretionary review
of a headquarters offices initial decision.
Subpart K—Judicial Review
604.50 Judicial review.
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Authority: 49 U.S.C. 5323(d); 49 CFR 1.51
Subpart A—General Provisions
§ 604.1
Purpose.
(a) The purpose of this Part is to
implement 49 U.S.C. 5323(d), which
protects private charter operators from
unauthorized competition from
recipients of Federal financial assistance
under the Federal Transit Laws.
(b) This subpart specifies which
entities shall comply with the charter
service regulations; defines terms used
in this Part; explains procedures for an
exemption from this Part; and sets out
the contents of a charter service
agreement.
hsrobinson on PROD1PC76 with PROPOSALS2
§ 604.2
Applicability.
(a) The requirements of this Part shall
apply to recipients of Federal financial
assistance under the Federal Transit
Laws, except as otherwise provided in
paragraphs (b) through (g) of this
section.
(b) The requirements of this Part shall
not apply to a recipient transporting
their employees, other transit system
employees, transit management
officials, transit contractors and bidders,
government officials and their
contractors and official guests, to or
from transit facilities or projects within
their geographic service area or
proposed geographic service area for the
purpose conducting oversight functions
such as inspection, evaluation, or
review.
(c) The requirements of this Part shall
not apply to private charter operators
that receive, directly or indirectly,
Federal financial assistance under any
of the following programs: 49 U.S.C.
5307, 49 U.S.C. 5309, 49 U.S.C. 5310, 49
U.S.C. 5311, 49 U.S.C. 5316, 49 U.S.C.
5317 or section 3038 of the
Transportation Equity Act for the 21st
Century, as amended.
(d) The requirements of this Part shall
not apply to a recipient transporting
their employees, other transit system
employees, transit management
officials, transit contractors and bidders,
government officials and their
contractors and official guests, for
emergency preparedness planning and
operations.
(e) The requirements of this Part shall
not apply to a recipient that uses
Federal financial assistance from FTA,
for program purposes only, under 49
U.S.C. 5310, 49 U.S.C. 5316, or 49
U.S.C. 5317.
(f) The requirements of this Part shall
not apply to a recipient in the event of
a national, regional, or local emergency
lasting fewer than three business days.
If an emergency exists that the recipient
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expects to last longer than three
business days, the recipient shall follow
the procedures set out in subpart D of
49 CFR part 601.
(g) The requirements of this Part shall
not apply to a recipient in a nonurbanized area transporting their
employees, other transit system
employees, transit management
officials, transit contractors and bidders
to or from transit training outside its
geographic service area.
§ 604.3
Exemption.
(a) Recipients, who do not engage or
intend to engage in charter services
using equipment or facilities funded
under the Federal Transit Laws, may file
an affidavit certifying that they will not
provide charter services covered by this
Part.
(b) If a recipient files an affidavit
described in this section, the recipient
shall not provide charter service under
any of the exceptions contained in
subpart B and shall be exempt from the
notification requirements of subpart C.
(c) The affidavit described in this
section shall state:
I, (insert name and title), hereby swear
or affirm that (insert name of applicant
or recipient) and all contractors or
recipients through (insert name of
applicant or recipient) will not provide
charter service that uses equipment or
facilities funded under the Federal
Transit Laws.
I, (insert name and title), also understand
that by swearing out this affidavit, (insert
name of applicant or recipient) and all
contractors or recipients through (insert
name of applicant or recipient) could be
subject to the penalties contained in 18
U.S.C. 1001 for submitting false information
to the government and may subject (insert
name of applicant or recipient) and all
contractors or recipients through (name of
applicant or recipient) to a withholding of
Federal financial assistance as described in
49 CFR part 604 subpart I.
(d) The affidavit described in
paragraph (c) of this section shall be
notarized and an original copy sent to:
Office of the Chief Counsel, TCC–20,
Room 9316, Washington, DC 20590. In
addition, the above affidavit shall be
submitted electronically to https://
dms.dot.gov and placed in the Charter
Service Exemption Docket number
xxxxx.
(e) An affidavit described in this
section shall be sent to FTA by the third
week of September each year.
(f) A recipient may revoke an affidavit
filed under this part by sending a notice
to the address and docket identified in
paragraph (d) of this section indicating
they revoke the affidavit and agree to
comply with charter service
requirements of this Part.
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Sfmt 4702
§ 604.4
Definitions.
All terms defined in 49 U.S.C. 5301 et
seq. are used in their statutory meaning
in this Part. Other terms used in this
Part are defined as follows:
(a) The term ‘‘Federal Transit Laws’’
means 49 U.S.C. 5301 et seq., and
includes 23 U.S.C. 103(e)(4), 142(a), and
142(c), when used to provide assistance
to public transit agencies for purchasing
buses and vans.
(b) The term ‘‘Administrator’’ means
the Administrator of the Federal Transit
Administration or their designee.
(c) The term ‘‘charter service’’ means
providing transportation service using
buses or vans to a group of riders
pursuant to a single contract with a
third party, for a fixed charge, and
according to an itinerary determined by
someone other than the recipient.
(1) The term charter service includes,
but is not limited to, the following when
the conditions in paragraph (c) of this
section are met:
(i) The use of buses or vans for the
exclusive transportation of school
students (e.g., elementary, secondary,
university, or trade), school personnel,
or school equipment;
(ii) Shuttle service to events such as
festivals, sporting events, conventions,
and similar functions that occur on an
irregular basis or for a limited duration;
or
(iii) Shuttle services limited to a
specific group of individuals, provided
under an agreement with an institution,
such as a university, corporation, or
government.
(2) The term charter service does not
include the following:
(i) Addition of equipment or days to
an existing route;
(ii) Extending service hours for an
existing route;
(iii) Demand responsive service that is
part of coordinated public transit
human service transportation;
(iv) New or modified service that is
open to the public, where the recipient
establishes and controls the route, and
the service continues from year to year;
or
(v) The transportation of transit
employees from one work location to
another work location.
(d) The term ‘‘charter service hours’’
means total hours operated by buses or
vans while in charter service including
(1) hours operated while carrying
passengers for hire, plus (2) associated
deadhead hours.
(e) The term ‘‘Chief Counsel’’ means
the Office of the Chief Counsel within
the Federal Transit Administration.
(f) The term ‘‘days’’ means calendar
days. The last day of a time period is
included in the computation of time
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unless the last day is a Saturday,
Sunday, or legal holiday, in which case,
the time period runs until the end of the
next day that is not a Saturday, Sunday,
or legal holiday.
(g) The term ‘‘FTA’’ means the
Federal Transit Administration.
(h) The term ‘‘interested party’’ means
an individual, partnership, corporation,
association, or other organization that
has a financial interest that is affected
by the actions of a recipient providing
charter service under the Federal
Transit Laws. This term includes states,
counties, cities, and their subdivisions,
and tribal nations.
(i) The term ‘‘registration list’’ means
the current list of registered charter
providers and qualified human service
organizations maintained on FTA’s
charter registration website.
(j) The term ‘‘geographic service area’’
means the entire area in which a
recipient is authorized to provide public
transportation service under appropriate
local, state, and Federal law.
(k) The term ‘‘pattern of violations’’
means more than one finding of noncompliance with this Part by FTA
beginning with the most recent finding
of non-compliance and looking back
over a period of 72 months.
(l) The term ‘‘public transportation’’
has the meaning set forth in 49 U.S.C.
5302(a)(10).
(m) The term ‘‘qualified human
service organization’’ means an
organization that serves persons who
qualify for human service or
transportation-related programs or
services due to disability, income, or
advanced age. This term is used
consistent with the President’s
Executive Order on Human Service
Transportation Coordination (February
24, 2004).
(n) The term ‘‘registered charter
provider’’ means a private charter
operator that wants to receive notice of
charter service requests directed to
recipients and has registered on FTA’s
charter registration website.
(o) The term ‘‘recipient’’ means an
agency or entity that receives Federal
financial assistance, either directly or
indirectly, under the Federal Transit
Laws. This term does not include thirdparty contractors.
(p) The term ‘‘special transportation’’
means demand response or paratransit
service that is regular and continuous
and is a type of ‘‘public transportation.’’
§ 604.5
Charter service agreement.
(a) A recipient seeking Federal
assistance under the Federal Transit
Laws to acquire or operate any public
transportation equipment or facilities
shall enter into a ‘‘Charter Service
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Agreement’’ as set out in paragraph (b)
of this section.
(b) A recipient shall enter into a
Charter Service Agreement if it receives
Federal funds for equipment or facilities
under the Federal Transit Laws. The
terms of the Charter Service Agreement
are as follows:
The recipient agrees that it, and each of its
subrecipients and third party contractors at
any tier, may provide charter service using
equipment or facilities acquired with Federal
assistance authorized under the Federal
Transit Laws only in compliance with the
regulations set out in 49 CFR part 604 et seq.,
the terms and conditions of which are
incorporated herein by reference.
(c) The Charter Service Agreement is
contained in the certifications and
assurances published annually by FTA
for applicants for Federal financial
assistance. Once a recipient receives
Federal funds, the certifications and
assurances become part of their Grant
Agreement or Cooperative Agreement
for Federal financial assistance.
Subpart B—Exceptions
§ 604.6
Purpose.
The purpose of this subpart is to
identify the limited exceptions under
which recipients may provide
community-based charter services.
§ 604.7
Government officials.
(a) Except for a recipient with 1,000
or more buses in peak hour service, a
recipient may provide charter service to
government officials (Federal, State, and
local) for non-transit related purposes, if
the recipient:
(1) Provides the service in its
geographic service area;
(2) Does not generate revenue from
the charter service, except as required
by law; and
(3) Records the charter service in a
separate log that identifies the purpose
of the trip, date, time, destination,
number of government officials on the
trip and vehicle number.
(b) A recipient that provides charter
service under this section shall be
limited annually to 80 charter service
hours for providing trips to government
officials for non-transit related
purposes.
(c) A recipient may petition the
Administrator for additional charter
service hours only if the petition
contains the following information:
(1) Description of the event and the
number of charter service hours
requested;
(2) Explanation of why registered
charter providers in the geographic
service area cannot perform the service
(e.g., equipment, time constraints, or
other extenuating circumstances); and
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(3) Evidence that the recipient has
sent the request for additional hours to
registered charter providers in its
geographic service area.
§ 604.8 Qualified human service
organizations.
(a) Except for a recipient with 1,000
or more buses in peak hour service, a
recipient may provide charter service to
a qualified human service organization
serving persons:
(1) With mobility limitations related
to advanced age;
(2) with disabilities; or
(3) struggling for self-sufficiency.
(b) If an organization serving persons
described in paragraph (a) of this
section receives funding, directly or
indirectly, from the programs listed in
Appendix A of this Part, the
organization shall not be required to
register on the FTA charter registration
Web site.
(c) If an organization serving persons
described in paragraph (a) of this
section does not receive funding from
any of the programs listed in Appendix
A of this Part, the organization shall
register on the FTA charter registration
Web site in accordance with § 604.18.
(d) A recipient providing charter
service under this exception shall
record the qualified human service
organization’s name, address, phone
number, e-mail address, date and time
of service, number of passengers, origin,
destination, trip length (miles and
hours), fee collected, if any, and vehicle
number.
§ 604.9
Hardship.
(a) A recipient in a non-urbanized
area may provide charter service to an
organization if the charter service
provided by a registered charter
provider would create a hardship on the
organization because:
(1) The registered charter provider
imposes a minimum trip duration and
the requested charter service is less than
the minimum trip duration; or
(2) The registered charter provider has
deadhead time exceeding total trip time
from initial pick-up to final drop-off.
(b) A recipient providing charter
service under this section shall record
the organization’s name, address, phone
number, e-mail address, date and time
of service, number of passengers,
destination, trip length (miles and
hours), fee collected, if any, and vehicle
number.
§ 604.10 Leasing FTA funded equipment
and drivers.
(a) A recipient may lease FTA-funded
equipment and drivers for charter
service only if the following conditions
exist:
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(1) The private charter operator is
registered on the FTA charter
registration Web site;
(2) The registered charter provider
owns and operates a charter service
business;
(3) The registered charter provider
received a request for charter service
that exceeds its available capacity either
of the number of vehicles operated by
the registered charter provider or the
number of accessible vehicles operated
by the registered charter provider; and
(4) The registered charter provider has
exhausted all of the available vehicles of
all registered charter providers in the
recipient’s geographic service area.
(b) A recipient leasing vehicles and
drivers to a registered charter provider
under this provision shall record the
registered charter provider’s name,
address, telephone number, number of
vehicles leased, types of vehicles leased,
vehicle identification numbers, and
documentation presented by the
registered charter provider in support of
paragraph (a)(1) through (3) of this
section.
hsrobinson on PROD1PC76 with PROPOSALS2
§ 604.11 Events of regional or national
significance.
(a) A recipient may petition the
Administrator for an exception to the
charter service regulations in order to
provide charter service directly to a
customer for a special event of regional
or national significance. In order to
petition the Administrator under this
exception, a recipient shall first consult
with registered charter providers in the
geographic service area to determine
whether or not registered charter
providers are capable of providing the
service.
(b) After completing the consultation
required in paragraph (a) of this section,
a recipient may petition for an
exception under the following
conditions:
(1) The recipient shall submit its
petition for an exception to the
Administrator at least 90 days before the
first day of the special event;
(2) The recipient’s petition shall
describe the event, explain how it is
special and of regional or national
significance, explain the amount of
charter service that registered charter
providers are not capable of providing,
explain how registered charter providers
will be utilized for the event; and
(3) File the petition in the Special
Events Docket number XXXX at https://
dms.dot.gov.
(c) Upon receipt of a petition that
meets the conditions set forth in
paragraphs (a), (b)(1), (b)(2), and (b)(3) of
this section, the Administrator shall
review the materials and issue a written
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decision denying or granting in whole
or in part the request. In making this
decision, the Administrator may seek
such additional information as the
Administrator deems necessary.
(d) Any exception granted by the
Administrator under this procedure
shall be effective only for the special
event identified in paragraph (b)(2) of
this section.
§ 604.12 When no registered charter
provider responds to notice from a
recipient.
(a) A recipient may provide charter
service to a customer if no registered
charter provider responds to the notice
issued in § 604.17:
(1) Within 72 hours for charter service
requested to be provided in less than 30
days; or
(2) Within 14 calendar days for
charter service requested to be provided
in 30 days or more.
(b) A recipient shall not provide
charter service under this section if a
registered charter provider indicates
interest in providing the charter service
set out in the notice issued pursuant to
§ 604.17.
(c) A recipient shall record the charter
service in a separate log that identifies
the customer name, address, phone
number, email address, date and time of
trip, origin and destination, number of
passengers, trip length (miles and
hours), fee collected, if any, and vehicle
number.
§ 604.13 Agreement with registered
charter providers.
(a) A recipient may provide charter
service directly to a customer after
entering into an agreement with all
registered charter providers in the
recipient’s geographic service area.
(b) For purposes of entering into an
agreement with all registered charter
providers as described in paragraph (a)
of this section, a recipient shall
determine the registered charter
providers in its geographic service area
each year before January 30th.
(c) A recipient shall enter into an
agreement with all registered charter
providers in its geographic service area
under this section before February 15th
of each year.
§ 604.14
Administrator’s discretion.
(a) A recipient may petition the
Administrator personally for an
exception to the charter service
regulations in order to provide charter
service directly to a customer for a
unique and time sensitive event, usually
funerals of local, regional, or national
significance. In order to petition the
Administrator under this exception, a
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recipient shall submit a request with the
following information:
(1) A description of the event and
why it is unique and time sensitive;
(2) The type of charter service
requested and the type of equipment;
(3) The anticipated number of charter
service hours needed for the event;
(4) The anticipated number of
vehicles and duration of the event; and
(5) A description of how provision of
the requested charter service is in the
public’s interest.
(b) Upon receipt of a petition that
meets the requirements set forth in
paragraph (a) of this section, the
Administrator shall review the materials
and issue a written decision under his
or her own signature denying or
granting in whole or in part the request.
In making this decision, the
Administrator may seek such additional
information as the Administrator deems
necessary.
(c) Any exception granted by the
Administrator under this procedure
shall be effective only for the unique
event identified in paragraph (a) of this
section.
(d) A recipient shall send the request
to the Administrator by facsimile or
email.
(e) A recipient shall retain a copy of
the Administrator’s approval for a
period of at least three years and shall
include it in the recipient’s quarterly
report posted on the charter registration
Web site.
§ 604.15 Reporting requirements for all
exceptions.
(a) A recipient that provides charter
service in accordance with one or more
of the exceptions contained in this
subpart shall maintain the notice and
records required electronically and for a
period of at least three years from the
date of the charter service or lease.
(b) The records required under this
subpart shall include a clear statement
identifying which exception the
recipient relied upon when it provided
the charter service.
(c) Starting the first quarter after the
effective date of this rule, a recipient
providing charter service under these
exceptions shall post the records
required under this subpart on the FTA
charter registration Web site 30 days
after the end of each calendar quarter
(i.e., January 30th, April 30th, July 30th,
and October 30th).
(d) In unusual circumstances
described in the record for the service,
a recipient may record generalized
origin and destination information for
safety or security reasons.
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Subpart C—Procedures for
Registration and Notification
§ 604.16 Registration of private charter
operators.
(a) Private charter operators shall
provide the following information to be
considered a registered charter provider:
(1) Company name, address, phone
number, email address, and facsimile
number;
(2) Federal or State motor carrier
identifying number;
(3) The geographic service areas of
public transit agencies that the private
charter operator is able to provide
charter service in;
(4) A certification that the private
charter operator has valid insurance;
and
(5) A private charter operator may
also indicate whether they are willing to
provide free or reduced rate charter
services to registered qualified human
service organizations.
(b) A private charter operator that
provides valid information in this
subpart is a ‘‘registered charter
provider’’ for purposes of this Part and
shall have standing to file a complaint
consistent with subpart F.
(c) A recipient, a registered charter
provider, or their duly authorized
representative, may challenge a
registered charter provider’s registration
and request removal of the private
charter operator from FTA’s charter
registration Web site by filing a
complaint consistent with subpart F.
(d) FTA shall refuse to post a private
charter operator’s information if the
private charter operator fails to provide
all of the required information as
indicated on the FTA charter
registration Web site.
(e) Registered charter providers shall
provide current and accurate
information on FTA’s charter
registration Web site, and shall update
that information no less frequently than
every two years.
hsrobinson on PROD1PC76 with PROPOSALS2
§ 604.17 Notification to registered charter
providers.
(a) Upon receiving a request for
charter service, a recipient may:
(1) Decline to provide the service and
refer the requestor to FTA’s charter
registration Web site;
(2) Provide the service pursuant to an
exception set out in subpart B of this
Part; or
(3) Provide notice to registered charter
providers as set out in this section and
provide the service pursuant to the
exception contained in § 604.12.
(b) Upon receipt of a request for
charter service, a recipient interested in
providing the charter service shall
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provide notice to registered charter
providers in the recipient’s geographic
service area in the following manner:
(1) Notice of the request shall be sent
by the close of business on the day the
recipient receives the request unless the
recipient received the request after 2
p.m., in which case the recipient shall
send the notice by the close of business
the next business day;
(2) Notice sent to the list of registered
charter providers shall include:
(i) Customer name, address, phone
number, and email address (if
available);
(ii) Requested date of service;
(iii) Approximate number of
passengers;
(iv) Whether the type of equipment
requested is (are) bus(es) or van(s); and
(v) Trip itinerary and approximate
duration.
(c) A recipient shall retain an
electronic copy of the notice and the list
of registered charter providers that were
sent notice of the requested charter
service for a period of at least three
years from the date the notice was sent.
Subpart D—Registration of Qualified
Human Service Organizations and
Duties for Recipients Regarding
Charter Registration Web site
7541
(1) Registers on the FTA Web site in
accordance with paragraph (a) of this
section at least 60 days before the date
of the requested charter service;
(2) Verifies FTA’s receipt of its
registration by viewing its information
on the FTA charter registration Web
site; and
(3) Certifies that the funding received
from a state or local program includes
funding for transportation.
(c) A registered charter provider may
challenge a qualified human service
organization’s status to receive charter
services from a recipient by requesting
removal of the qualified human service
organization from FTA’s charter
registration Web site by filing a
complaint consistent with subpart F.
(d) A qualified human service
organization shall provide current and
accurate information on FTA’s charter
registration, and shall update that
information no less frequently than
every two years.
§ 604.19 Duties for recipients with respect
to charter registration Web site.
A recipient that provides charter
service allowed under this Part shall
train its affected employees and
contractors on how to use the FTA
charter registration Web site.
§ 604.18 Registration of qualified human
service organizations.
Subpart E—Advisory Opinions
(a) Qualified human service
organizations that do not receive funds
from Federal programs listed in
Appendix A but serve individuals
described in § 604.8, shall register on
FTA’s charter registration Web site by
submitting the following information:
(1) Name of organization, address,
phone number, email address, and
facsimile number;
(2) The geographic service area of the
recipient in which the qualified human
service organization resides;
(3) Basic financial information
regarding the qualified human service
organization and whether the qualified
human service organization is exempt
from taxation under sections 501(c)(1),
(3), (4), or (19) of the Internal Revenue
Code, or is a unit of Federal, State or
local government;
(4) Whether the qualified human
service organization receives funds
directly or indirectly from a State or
local program, and if so, which
program(s); and
(5) A narrative statement describing
how the requested service is consistent
with the mission of the qualified human
service organization.
(b) A qualified human service
organization is eligible to receive charter
services from a recipient if the qualified
human service organization:
§ 604.20
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Purpose.
The purpose of this subpart is to set
out the requirements for requesting an
advisory opinion from FTA regarding
specific, factual events. Advisory
opinions are intended to give formal
advice to a recipient, registered charter
providers, or their duly authorized
representative, regarding the
requirements of this Part. This subpart
also describes the conditions under
which an advisory opinion may be used
in subsequent proceedings.
§ 604.21
Request for an advisory opinion.
(a) A recipient, a registered charter
provider, or their duly authorized
representative, may request an advisory
opinion from the Chief Counsel on a
matter regarding specific, factual events
only.
(b) A request for an advisory opinion
shall be submitted in the following
form:
[Date]
Chief Counsel, Federal Transit
Administration, 400 Seventh Street,
SW., Room 9316,
Washington, DC 20590
Re: Request for Advisory Opinion
The undersigned submits this request
for an advisory opinion of the FTA
Chief Counsel with respect to [the
general nature of the matter involved].
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A. Issues involved.
[A concise statement of the issues and
questions on which an opinion is
requested.]
B. Statement of facts and law.
[A full statement of all facts and legal
points relevant to the request.]
The undersigned certifies that, to the
best of his/her knowledge and belief,
this request includes all data,
information, and views relevant to the
matter, whether favorable or
unfavorable to the position of the
undersigned, which is the subject of
the request.
[Signature]
[Printed name]
[Title of person making request]
[Mailing address]
[Telephone number]
[email address]
(c) A request for an advisory opinion
may be denied if:
(1) The request contains incomplete
information on which to base an
informed advisory opinion;
(2) The Chief Counsel concludes that
an advisory opinion cannot reasonably
be given on the matter involved;
(3) The matter is adequately covered
by a prior advisory opinion or a
regulation;
(4) The Chief Counsel otherwise
concludes that an advisory opinion
would not be in the public interest.
hsrobinson on PROD1PC76 with PROPOSALS2
§ 604.22
Processing of advisory opinions.
(a) A request for an advisory opinion
shall be sent to the address indicated in
§ 604.21(b) of this subpart; filed
electronically at https://dms.dot.gov or
sent to the dockets office located at 400
Seventh Street SW., PL–401,
Washington, DC 20590, in the Charter
Service Advisory Opinion Docket
number xxxx; and sent to the recipient,
if appropriate.
(b) The Chief Counsel shall make
every effort to respond to a request for
an advisory opinion within ten days of
receipt of a request that complies with
§ 604.21(b). The Chief Counsel will send
the response to the requestor, the
docket, and the recipient, if appropriate.
(c) The Chief Counsel may respond to
any request to FTA for regulatory
guidance as a request for an advisory
opinion, in which case the request will
be filed in the Charter Service Advisory
Opinion Docket, and a copy sent to the
recipient, if appropriate.
§ 604.23
Effect of an advisory opinion.
(a) An advisory opinion represents the
formal position of FTA on a matter, and
except as provided in § 604.24 of this
subpart, obligates the agency to follow
it until it is amended or revoked.
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(b) An advisory opinion may be used
in administrative or court proceedings
to illustrate acceptable and
unacceptable procedures or standards,
but not as a legal requirement and is
limited to the factual circumstances
described in the request for an advisory
opinion. The Chief Counsel’s advisory
opinion shall not be binding upon a
Presiding Official conducting a
proceeding under subpart I of this Part.
(c) A statement made or advice
provided by an FTA employee
constitutes an advisory opinion only if
it is issued in writing under this section.
A statement or advice given by an FTA
employee orally, or given in writing, but
not under this section, is an informal
communication that represents the best
judgment of that employee at the time
but does not constitute an advisory
opinion, does not necessarily represent
the formal position of FTA, and does
not bind or otherwise obligate or
commit the agency to the views
expressed.
§ 604.24
Special considerations.
Based on new facts involving
significant financial considerations, the
Chief Counsel may take appropriate
enforcement action contrary to an
advisory opinion before amending or
revoking the opinion. This action shall
be taken only with the approval of the
Administrator, who may not delegate
this function.
Subpart F—Complaints
§ 604.25
Purpose.
This subpart describes the
requirements necessary for filing a
complaint with FTA regarding the
provision of charter service by
recipients or filing a complaint
challenging the listing of a private
charter operator or qualified human
service organization on the FTA charter
registration Web site. Note: FTA expects
all parties to attempt to resolve matters
informally before beginning the official
complaint process, which can be timeconsuming and expensive to all parties
involved.
§ 604.26 Complaints and decisions
regarding removal of private charter
operators or qualified human service
organizations from registration list.
(a) A recipient, a registered charter
provider, or their duly authorized
representative, may challenge the listing
of a registered charter provider or
qualified human service organization on
FTA’s charter registration Web site by
filing a complaint that meets the
following:
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(1) States the name and address of
each entity who is the subject of the
complaint;
(2) Provides a concise but complete
statement of the facts relied upon to
substantiate the reason why the private
charter operator or qualified human
service organization should not be listed
on the FTA charter registration website;
(3) Files the complaint electronically
by submitting it to the Charter Service
Complaint Docket number xxxx; and
(4) Serves the complaint by email (or
facsimile number if no email address is
available) and attaches documents
offered in support of the complaint
upon all entities named in the
complaint.
(b) The private charter operator or
qualified human service organization
shall have 7 days to answer the
complaint and shall file such answer
and all supporting documentation in the
Charter Service Complaint Docket
number xxxxx.
(c) A recipient, qualified human
service organization, or a registered
charter provider, or their duly
authorized representative, shall not file
a reply to the answer.
(d) FTA shall determine whether to
remove the private charter operator or
qualified human service organization
from the FTA charter registration
website based on probative evidence of
one or more of the following:
(1) Bad faith;
(2) Fraud;
(3) Lapse of insurance;
(4) Lapse of other documentation; or
(5) The filing of more than one
complaint, which on its face, does not
state a claim that warrants an
investigation or further action by FTA.
(e) A determination whether or not to
remove a private charter operator or
qualified human service organization
from the registration list shall be sent to
the parties within 30 days of the date of
the response required in paragraph (b)
of this section. FTA’s decision, after
consultation with the Chief Counsel,
shall state:
(1) Reasons for allowing the
continued listing or removing the
private charter operator or human
service organization from the
registration list;
(2) if removal is ordered, the length of
time (not to exceed three years) the
private charter operator or qualified
human service organization shall be
barred from the registration list; and
(3) the date by which the private
charter operator or qualified human
service organization may re-apply for
registration on the FTA charter
registration website.
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(f) FTA’s determination in this section
shall not be subject to review under
subparts J or K of this Part.
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§ 604.27 Complaints, answers, replies, and
other documents.
(a) A registered charter provider, or
their duly authorized representative
(‘‘complainant’’), affected by an alleged
noncompliance of this Part may file a
complaint with the Office of the Chief
Counsel.
(b) Except as provided otherwise in
§ 604.26, complaints filed under this
subpart shall—
(1) Title the document ‘‘Notice of
Charter Service Complaint;’’
(2) State the name and address of each
recipient who is the subject of the
complaint and, with respect to each
recipient, the specific provisions of the
Federal Transit Laws that the
complainant believes were violated;
(3) Serve the complaint in accordance
with § 604.31, along with all documents
then available in the exercise of
reasonable diligence, offered in support
of the complaint, upon all recipients
named in the complaint as being
responsible for the alleged action(s) or
omission(s) upon which the complaint
is based;
(4) Provide a concise but complete
statement of the facts relied upon to
substantiate each allegation;
(5) Describe how the complainant was
directly and substantially affected by
the things done or omitted by the
recipients; and
(6) Identify each registered charter
provider associated with the complaint.
(c) Unless the complaint is dismissed
pursuant to § 604.28 or § 604.29, FTA
shall notify the complainant,
respondent, and state recipient, if
applicable, within 30 days after the date
FTA receives the complaint that the
complaint has been docketed.
Respondents shall have 30 days from
the date of service of the FTA
notification to file an answer.
(d) The complainant shall file a reply
within 20 days of the date of service of
the respondent’s answer.
(e) The respondent may file a rebuttal
within 10 days of the date of service of
the reply.
(f) The answer, reply, and rebuttal
shall, like the complaint, be
accompanied by supporting
documentation upon which the parties
rely.
(g) The answer shall deny or admit
the allegations made in the complaint or
state that the entity filing the document
is without sufficient knowledge or
information to admit or deny an
allegation, and shall assert any
affirmative defense.
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(h) The answer, reply, and rebuttal
shall each contain a concise but
complete statement of the facts relied
upon to substantiate the answers,
admissions, denials, or averments made.
(i) The respondent’s answer may
include a motion to dismiss the
complaint, or any portion thereof, with
a supporting memorandum of points
and authorities.
(j) The complainant may withdraw a
complaint at any time after filing by
serving a ‘‘Notification of Withdrawal’’
on the Chief Counsel and the
respondent.
§ 604.28
Dismissals.
(a) Within 20 days after the receipt of
a complaint described in § 604.27, the
Office of the Chief Counsel shall
provide reasons for dismissing a
complaint, or any claim in the
complaint, with prejudice under this
section if:
(1) It appears on its face to be outside
the jurisdiction of FTA under the
Federal Transit Laws;
(2) On its face it does not state a claim
that warrants an investigation or further
action by FTA; or
(3) The complainant lacks standing to
file a complaint under subparts B, C, or
D of this Part.
§ 604.29
Incomplete complaints.
If a complaint is not dismissed
pursuant to § 604.28, but is deficient as
to one or more of the requirements set
forth in § 604.27, the Office of the Chief
Counsel will dismiss the complaint
within 20 days after receiving it.
Dismissal shall be without prejudice
and the complainant may re-file after
amendment to correct the deficiency.
The Chief Counsel’s dismissal shall
include the reasons for the dismissal
without prejudice.
§ 604.30
Filing.
(a) Filing address. Unless provided
otherwise, the complainant shall file the
complaint with the Office of the Chief
Counsel, 400 Seventh Street, SW., Room
9316, Washington, DC 20590 and file it
electronically at https://dms.dot.gov or
mail it to the docket at 400 Seventh
Street, SW., PL-401, Washington, DC
20590. Filings sent to the docket shall
include the Charter Service Complaint
docket number xxxx.
(b) Date and method of filing. Filing
of any document shall be by personal
delivery or U.S. mail. Unless the date is
shown to be inaccurate, documents to
be filed with FTA shall be deemed filed:
(1) On the date of personal delivery;
(2) On the mailing date shown on the
certificate of service;
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(3) On the date shown on the
postmark if there is no certificate of
service; or
(4) On the mailing date shown by
other evidence if there is no certificate
of service and no postmark.
(c) E-mail. A party may also send the
document by facsimile or email, but
delivery by either facsimile or email
shall not constitute service as described
in § 604.31.
(d) Number of copies. Unless
otherwise specified, an executed
original shall be filed with FTA.
(e) Form. Documents filed with FTA
shall be typewritten or legibly printed.
In the case of docketed proceedings, the
document shall include a title and the
docket number of the proceeding on the
front page.
(f) Signing of documents and other
papers. The original of every document
filed shall be signed by the person filing
it or the person’s duly authorized
representative. Subject to the
enforcement provisions contained in
this subpart, the signature shall serve as
a certification that the signer has read
the document and, based on reasonable
inquiry, to the best of the signer’s
knowledge, information, and belief, the
document is—
(1) Consistent with this part;
(2) Warranted by existing law or that
a good faith argument exists for
extension, modification, or reversal of
existing law; and
(3) Not interposed for any improper
purpose, such as to harass or to cause
unnecessary delay or needless increase
in the cost of the administrative process.
§ 604.31
Service.
(a) Designation of person to receive
service. The initial document filed by
the complainant shall state on the first
page of the document for all parties to
be served:
(1) The title of the document;
(2) The name, post office address,
telephone number; and
(3) The facsimile number, if any, and
email address(es), if any.
If any of the above items change
during the proceeding, the person shall
promptly file notice of the change with
FTA and the Presiding Official, if
appropriate, and shall serve the notice
on all other parties to the proceeding.
(b) Docket numbers. Each submission
identified as a complaint under this Part
by the submitting party shall be filed in
the Charter Service Complaint docket
number xxxx.
(h) Who must be served. Copies of all
documents filed with FTA shall be
served by the entity filing them on all
parties to the proceeding. A certificate
of service shall accompany all
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documents when they are tendered for
filing and shall certify concurrent
service on FTA and all parties.
Certificates of service shall be in
substantially the following form:
I hereby certify that I have this day served
the foregoing [name of document] on the
following persons at the following addresses
and email or facsimile numbers (if also
served by email or facsimile) by [specify
method of service]:
[list persons, addresses, and email or
facsimile numbers]
Dated this l day of l, 20l.
[signature], for [party]
(i) Method of service. Except as
otherwise provided in § 604.26, or
agreed by the parties and the Presiding
Official, as appropriate, the method of
service is personal delivery or U.S. mail.
(j) Presumption of service. There shall
be a presumption of lawful service—
(1) When acknowledgment of receipt
is by a person who customarily or in the
ordinary course of business receives
mail at the address of the party or of the
person designated under this section; or
(2) When a properly addressed
envelope, sent to the most current
address submitted under this section
has been returned as undeliverable,
unclaimed, or refused.
Subpart G—Investigations
§ 604.32
Investigation of complaint.
(a) If, based on the pleadings, there
appears to be a reasonable basis for
investigation, FTA shall investigate the
subject matter of the complaint.
(b) The investigation may include a
review of written submissions or
pleadings of the parties, as
supplemented by any informal
investigation FTA considers necessary
and by additional information furnished
by the parties at FTA request. Each
party shall file documents that it
considers sufficient to present all
relevant facts and argument necessary
for FTA to determine whether the
recipient is in compliance.
(c) The Chief Counsel shall send a
notice to complainant(s) and
respondent(s) once an investigation is
complete, but not later than 90 days
after receipt of the last pleading
specified in § 604.27 was due to FTA.
hsrobinson on PROD1PC76 with PROPOSALS2
§ 604.33
Agency initiation of investigation.
(a) Notwithstanding any other
provision of law, FTA may initiate its
own investigation of any matter within
the applicability of this Part without
having received a complaint. The
investigation may include, without
limitation, any of the actions described
in § 604.32.
(b) Following the initiation of an
investigation under this section, FTA
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sends a notice to the entities subject to
investigation. The notice will set forth
the areas of FTA’s concern and the
reasons; request a response to the notice
within 30 days of the date of service;
and inform the respondent that FTA
will, in its discretion, invite good faith
efforts to resolve the matter.
(c) If the matters addressed in the FTA
notice are not resolved informally, the
Chief Counsel may refer the matter to a
Presiding Official.
Subpart H—Initial Decisions by FTA
and Referrals to a Presiding Official
(PO)
§ 604.34
PO.
Initial decisions and referrals to a
(a) After receiving a complaint
consistent with § 604.27, and
conducting an investigation, the Chief
Counsel may:
(1) Issue an initial decision, signed by
a headquarters office, based on the
pleadings filed to date;
(2) Refer the matter to a PO; or
(3) Dismiss the complaint pursuant to
§ 604.28.
(b) If the Chief Counsel refers the
matter to a PO, the Chief Counsel shall
send out a hearing order that sets forth
the following:
(1) The allegations in the complaint,
or notice of investigation, and the
chronology and results of the
investigation preliminary to the hearing;
(2) The relevant statutory, judicial,
regulatory, and other authorities;
(3) The issues to be decided;
(4) Such rules of procedure as may be
necessary to supplement the provisions
of this Part;
(5) The name and address of the PO,
and the assignment of authority to the
PO to conduct the hearing in accordance
with the procedures set forth in this
Part; and
(6) The date by which the PO is
directed to issue an initial decision.
§ 604.35
Separation of functions.
(a) Proceedings under this Part shall
be handled by an FTA attorney.
(b) After issuance of an initial
decision by a headquarters office, the
FTA employee or contractor engaged in
the performance of investigative or
prosecutorial functions in a proceeding
under this Part will not, in that case or
a factually related case, participate or
give advice in a final decision by the
Administrator or designee on written
appeal, and will not, except as counsel
or as witness in the public proceedings,
engage in any substantive
communication regarding that case or a
related case with the Administrator on
written appeal, or FTA employees
advising those officials in that capacity.
PO 00000
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Subpart I—Hearings
§ 604.36
Powers of a PO.
A PO may:
(a) Give notice of, and hold, prehearing conferences and hearings;
(b) Administer oaths and affirmations;
(c) Issue administrative subpoenas
and issue notices of deposition
requested by the parties;
(d) Limit the frequency and extent of
discovery;
(e) Rule on offers of proof;
(f) Receive relevant and material
evidence;
(g) Regulate the course of the hearing
in accordance with the rules of this part
to avoid unnecessary and duplicative
proceedings in the interest of prompt
and fair resolution of the matters at
issue;
(h) Hold conferences to settle or to
simplify the issues by consent of the
parties;
(i) Dispose of procedural motions and
requests;
(j) Examine witnesses; and
(k) Make findings of fact and
conclusions of law, and issue an initial
decision.
§ 604.37 Appearances, parties, and rights
of parties.
(a) Any party to the hearing may
appear and be heard in person and any
party to the hearing may be
accompanied, represented, or advised
by an attorney licensed by a State, the
District of Columbia, or a territory of the
United States to practice law or appear
before the courts of that State or
territory, or by another duly authorized
representative. An attorney, or other
duly authorized representative, who
represents a party shall file a notice of
appearance in accordance with § 604.30
and § 604.31.
(b) The parties to the hearing are the
respondent(s) named in the hearing
order, the complainant(s), and FTA, as
represented by the PO.
(c) The parties to the hearing may
agree to extend for a reasonable period
of time the time for filing a document
under this Part. If the parties agree, the
PO shall grant one extension of time to
each party. The party seeking the
extension of time shall submit a draft
order to the PO to be signed by the PO
and filed with the hearing docket. The
PO may grant additional oral requests
for an extension of time where the
parties agree to the extension.
(d) An extension of time granted by
the PO for any reason extends the due
date for the PO’s initial decision and for
the final agency decision by the length
of time in the PO’s decision.
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§ 604.38
Discovery.
(a) Permissible forms of discovery
shall be within the discretion of the PO.
(b) The PO shall limit the frequency
and extent of discovery permitted by
this section if a party shows that—
(1) The information requested is
cumulative or repetitious;
(2) The information requested may be
obtained from another less burdensome
and more convenient source;
(3) The party requesting the
information has had ample opportunity
to obtain the information through other
discovery methods permitted under this
section; or
(4) The method or scope of discovery
requested by the party is unduly
burdensome or expensive.
hsrobinson on PROD1PC76 with PROPOSALS2
§ 604.39
Depositions.
(a) For good cause shown, the PO may
order that the testimony of a witness
may be taken by deposition and that the
witness produce documentary evidence
in connection with such testimony.
Generally, an order to take the
deposition of a witness is entered only
if:
(1) The person whose deposition is to
be taken would be unavailable at the
hearing;
(2) The deposition is deemed
necessary to perpetuate the testimony of
the witness; or
(3) The taking of the deposition is
necessary to prevent undue and
excessive expense to a party and will
not result in undue burden to other
parties or in undue delay.
(b) Any party to the hearing desiring
to take the deposition of a witness
according to the terms set out in this
subpart, shall file a motion with the PO,
with a copy of the motion served on
each party. The motion shall include:
(1) The name and residence of the
witness;
(2) The time and place for the taking
of the proposed deposition;
(3) The reasons why such deposition
should be taken; and
(4) A general description of the
matters concerning which the witness
will be asked to testify.
(c) If good cause is shown in the
motion, the PO in his or her discretion,
issues an order authorizing the
deposition and specifying the name of
the witness to be deposed, the location
and time of the deposition and the
general scope and subject matter of the
testimony to be taken.
(d) Witnesses whose testimony is
taken by deposition shall be sworn or
shall affirm before any questions are put
to them. Each question propounded
shall be recorded and the answers of the
witness transcribed verbatim. The
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written transcript shall be subscribed by
the witness, unless the parties by
stipulation waive the signing, or the
witness is ill, cannot be found, or
refuses to sign. The reporter shall note
the reason for failure to sign.
§ 604.40
Public disclosure of evidence.
(a) Except as provided in this section,
the hearing shall be open to the public.
(b) The PO may order that any
information contained in the record be
withheld from public disclosure. Any
person may object to disclosure of
information in the record by filing a
written motion to withhold specific
information with the PO. The person
shall state specific grounds for
nondisclosure in the motion.
(c) The PO shall grant the motion to
withhold information from public
disclosure if the PO determines that
disclosure would be in violation of the
Privacy Act, would reveal trade secrets
or privileged or confidential commercial
or financial information, or is otherwise
prohibited by law.
§ 604.41
Standard of proof.
The PO shall issue an initial decision
or shall rule in a party’s favor only if the
decision or ruling is supported by, and
in accordance with, reliable, probative,
and substantial evidence contained in
the record and is in accordance with
law.
§ 604.42
Burden of proof.
(a) The burden of proof of
noncompliance with this Part,
determination, or agreement issued
under the authority of the Federal
Transit Laws is on registered charter
provider.
(b) Except as otherwise provided by
statute or rule, the proponent of a
motion, request, or order has the burden
of proof.
(c) A party who has asserted an
affirmative defense has the burden of
proving the affirmative defense.
§ 604.43
Offer of proof.
A party whose evidence has been
excluded by a ruling of the PO may offer
the evidence on the record when filing
an appeal.
§ 604.44
Record.
(a) The transcript of all testimony in
the hearing, all exhibits received into
evidence, all motions, applications,
requests and rulings, and all documents
included in the hearing record shall
constitute the exclusive record for
decision in the proceedings and the
basis for the issuance of any orders.
(b) Any interested person may
examine the record by entering the
docket number at https://dms.dot.gov or
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7545
after payment of reasonable costs for
search and reproduction of the record.
§ 604.45
Waiver of procedures.
(a) The PO shall waive such
procedural steps as all parties to the
hearing agree to waive before issuance
of an initial decision.
(b) Consent to a waiver of any
procedural step bars the raising of this
issue on appeal.
(c) The parties may not by consent
waive the obligation of the PO to enter
an initial decision on the record.
§ 604.46
Recommended decision by a PO.
(a) The PO shall issue a recommended
decision based on the record developed
during the proceeding and shall send
the recommended decision to a
headquarters office for ratification or
modification not later than 110 days
after the referral from the Chief Counsel.
(b) The headquarters office shall ratify
or modify the PO’s recommended
decision within 30 days of receiving the
recommended decision. The
headquarters office shall serve its initial
decision, which is capable of being
appealed to the Administrator, on all
parties to the proceeding.
§ 604.47
Remedies.
(a) If the headquarters office
determines that a violation of this Part
occurred, the headquarters office shall
take any of the following actions:
(1) Bar the recipient from receiving
future Federal financial assistance from
FTA;
(2) Order the refund of revenue
collected in violation of this Part to the
U.S. Treasury; or
(3) Order the withholding of a
reasonable percentage of available
Federal financial assistance.
(b) In determining the type and
amount of remedy, the headquarters
office shall consider the following
factors:
(1) The nature and circumstances of
the violation;
(2) The extent and gravity of the
violation;
(3) The revenue earned by providing
the charter service;
(4) The operating budget of the
recipient; and
(5) Such other matters as justice may
require.
(c) The headquarters office shall
mitigate the remedy when the recipient
can document corrective action of
alleged violation. The headquarters
office’s decision to mitigate a remedy
shall be determined on the basis of how
much corrective action was taken by the
recipient and when it was taken.
Systemic action to prevent future
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violations will be given greater
consideration than action simply to
remedy violations identified during
FTA’s inspection or identified in a
complaint.
(d) In the event the headquarters
office finds a pattern of violations, the
remedy ordered shall bar a recipient
from receiving Federal transit assistance
in an amount that the headquarters
office considers appropriate.
(e) The headquarters office may
propose to withhold Federal financial
assistance in a lump sum or over a
period of time not to exceed five years.
Subpart J—Appeal to Administrator
and Final Agency Orders
§ 604.48 Appeal from a headquarters office
initial decision.
hsrobinson on PROD1PC76 with PROPOSALS2
(a) Each party adversely affected by
the headquarters office’s initial decision
may file an appeal with the
Administrator within 21 days of the
date of the headquarters office issued
their initial decision. Each party may
file a reply to an appeal within 21 days
after it is served on the party. Filing and
service of appeals and replies shall be
by personal delivery consistent with
§§ 604.30 and 604.31.
(b) If an appeal is filed, the
Administrator reviews the entire record
and issues a final agency decision and
order based on the record within 30
days of the due date of the reply. If no
appeal is filed, the Administrator may
take review of the case on his or her
own motion. If the Administrator finds
that the respondent is not in compliance
with the Federal Transit Laws or any
regulation, or agreement the final
agency order includes a statement of
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corrective action, if appropriate, and
identifies remedies.
(c) If no appeal is filed, and the
Administrator does not take review of
the initial decision by the headquarters
office on the Administrator’s own
motion, the headquarters office’s initial
decision shall take effect as the final
agency decision and order on the
twenty-first day after the actual date the
headquarters office’s initial decision is
issued.
(d) The failure to file an appeal is
deemed a waiver of any rights to seek
judicial review of a headquarters office
initial decision that becomes a final
agency decision by operation of
paragraph (c) of this section.
§ 604.49 Administrator’s discretionary
review of a headquarters office’s initial
decision.
(a) If the Administrator takes review
on the Administrator’s own motion, the
Administrator shall issue a notice of
review by the twenty-first day after the
actual date the headquarters office’s
initial decision that contains the
following information:
(1) The notice sets forth the specific
findings of fact and conclusions of law
in the initial decision subject to review
by the Administrator.
(2) Parties may file one brief on
review to the Administrator or rely on
their post-hearing briefs to the
headquarters office. Briefs on review
shall be filed not later than 10 days after
service of the notice of review. Filing
and service of briefs on review shall be
by personal delivery consistent with
§ 604.30 and § 604.31.
(3) The Administrator issues a final
agency decision and order within 30
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days of the due date of the briefs on
review. If the Administrator finds that
the respondent is not in compliance
with the Federal Transit Laws,
regulations or agreement, the final
agency order includes a statement of
corrective action, if appropriate, and
identifies remedies.
Subpart K—Judicial Review
§ 604.50 Judicial review of a final decision
and order.
(a) A person may seek judicial review,
in an appropriate United States District
Court, of a final decision and order of
the Administrator as provided in 5
U.S.C. 701–706. A party seeking judicial
review of a final decision and order
shall file a petition for review with the
Court not later than 60 days after a final
decision and order is effective.
(b) The following do not constitute
final decisions and orders subject to
judicial review:
(1) An FTA decision to dismiss a
complaint as set forth in §§ 604.28 and
604.29;
(2) FTA’s determination to remove or
allow a listing on FTA’s charter
registration website in accordance with
§ 604.26;
(3) A recommended decision issued
by a PO at the conclusion of a hearing;
(4) A headquarters office decision that
becomes the final decision of the
Administrator because it was not
appealed within the stated timeframes.
Issued this 12th day of February, 2007.
James S. Simpson,
Administrator.
[FR Doc. E7–2715 Filed 2–14–07; 8:45 am]
BILLING CODE 4910–57–P
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Agencies
[Federal Register Volume 72, Number 31 (Thursday, February 15, 2007)]
[Proposed Rules]
[Pages 7526-7546]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E7-2715]
[[Page 7525]]
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Part III
Department of Transportation
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Federal Transit Administration
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49 CFR Part 604
Charter Service; Proposed Rule
Federal Register / Vol. 72, No. 31 / Thursday, February 15, 2007 /
Proposed Rules
[[Page 7526]]
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DEPARTMENT OF TRANSPORTATION
Federal Transit Administration
49 CFR Part 604
[Docket No. FTA-2005-22657]
RIN 2132-AA85
Charter Service
AGENCY: Federal Transit Administration, DOT.
ACTION: Notice of proposed rulemaking.
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SUMMARY: Pursuant to the direction contained in the Joint Explanatory
Statement of the Committee of Conference, for section 3023(d),
``Condition on Charter Bus Transportation Service'' of the Safe,
Accountable, Flexible, Efficient Transportation Equity Act: A Legacy
for Users (SAFETEA-LU) of 2005, the Federal Transit Administration
(FTA) established a committee to develop, through negotiated rulemaking
procedures, recommendations for improving the regulation regarding
unauthorized competition from recipients of Federal financial
assistance. The proposed revisions contained in this notice of proposed
rulemaking (NPRM) represent a complete revision to the charter service
regulations contained in 49 CFR part 604. The NPRM contains the
consensus work product of the Charter Bus Negotiated Rulemaking
Advisory Committee (CBNRAC), which was able to reach consensus on a
majority of the regulatory language. Where the CBNRAC was unable to
reach consensus, FTA proposes revisions to the charter service
regulations based on the open, informed exchange of information that
took place during meetings with the CBNRAC.
DATES: Comments must be received by April 16, 2007. Late filed comments
will be considered to the extent practicable.
ADDRESSES: You may submit comments by any of the following methods:
Federal e-Rulemaking Portal: Go to https://www.regulations.gov.
Follow the online instructions for submitting comments.
Web site: https://dms.dot.gov. Follow the instructions for
submitting comments on the DOT electronic docket site.
Fax: 202-493-2251.
Mail: Docket Management Facility; U.S. Department of
Transportation, 400 Seventh Street, SW., Nassif Building, PL-401,
Washington, DC 20590-0001.
Hand Delivery: Room PL-401 on the plaza level of the Nassif
Building, 400 Seventh Street, SW., Washington, DC, between 9 a.m. and 5
p.m., Monday through Friday, except Federal holidays.
Instructions: When submitting comments electronically to
Department's Docket Management System (DMS) Web site located at https://
dms.dot.gov, you must use docket number 22657. This will ensure that
your comment is placed in the correct docket. If you submit comments by
mail, you should submit two copies and include the above docket number.
If you wish to receive confirmation that FTA received your comments,
you must include a self-addressed stamped postcard. Note that all
comments received will be posted without change to https://dms.dot.gov.
This means that if your comment includes any personal identifying
information, such information will be made available to users of DMS.
You may review the Department's complete Privacy Act Statement in the
Federal Register published on April 11, 2000 (65 FR 19477) or you may
visit https://dms.dot.gov.
FOR FURTHER INFORMATION CONTACT: Linda Lasley, Senior Advisor, Office
of the Administrator, Federal Transit Administration, 400 Seventh
Street, SW., Room 9328, Washington, DC 20590, (202) 366-4011 or
Linda.Lasley@dot.gov; Nancy-Ellen Zusman, Attorney-Advisor, Office of
the Chief Counsel, 200 West Adams Street, Suite 320, Chicago, IL 60606,
(312) 353-2789 or Nancy-Ellen.Zusman@dot.gov; or Elizabeth Martineau,
Attorney-Advisor, Office of the Chief Counsel, 400 Seventh Street, SW.,
Room 9316, Washington, DC 20590, (202) 366-1966 or
Elizabeth.Martineau@dot.gov.
SUPPLEMENTARY INFORMATION:
I. Statutory Authority
Pursuant to the direction contained in the Joint Explanatory
Statement of the Committee of Conference, for section 3023(d),
``Conditions on Charter Bus Transportation Service'' of SAFETEA-LU, FTA
established a Federal Advisory Committee on May 5, 2005, to develop
recommendations through negotiated rulemaking procedures for
improvement of the regulation regarding unauthorized competition from
recipients of Federal financial assistance.
II. Advisory Committee
The Charter Bus Negotiated Rulemaking Advisory Committee (CBNRAC)
consisted of persons who represented the interests affected by the
proposed rule (i.e., charter bus companies, public transportation
agencies--recipients of FTA grant funds), and other interested
entities. The CBNRAC included the following organizations:
American Association of State Highway and Transportation Officials;
American Bus Association;
American Public Transportation Association;
Amalgamated Transit Union;
Capital Area Transportation Authority;
Coach America;
Coach USA;
Community Transportation Association of America;
FTA;
Kansas City Area Transportation Authority;
Lancaster Trailways of the Carolinas;
Los Angeles County Municipal Operators Association
Monterey Salinas Transit;
National School Transportation Association;
New York State Metropolitan Transportation Authority;
Northwest Motorcoach Association/Starline Luxury Coaches;
Oklahoma State University/The Bus Community Transit System;
River Cities Transit;
Southwest Transit Association;
Taxicab, Limousine & Paratransit Association;
Trailways; and
United Motorcoach Association.
The CBNRAC met in Washington, DC on the following dates:
May 8-9
June 19-20
July 17-18
September 12-13
October 25-26
December 6-7
FTA hired Susan Podziba & Associates to facilitate the CBNRAC
meetings and prepare meeting summaries. All meeting summaries,
including materials distributed during the meetings, are contained in
the docket for this rulemaking (22657). During the first
meeting of the CBNRAC, the committee developed ground rules for the
negotiations, which are summarized briefly below:
[cir] The CBNRAC operates by consensus, meaning that agreements are
considered reached when there is no dissent by any member. Thus, no
member can be outvoted.
[cir] Work groups can be designated by the CBNRAC to address
specific issues or to develop proposals. Work groups are not authorized
to make decisions for the full CBNRAC.
[cir] All consensus agreements reached during the negotiations are
assumed to be tentative agreements contingent upon additional minor
revisions to the language until members of the CBNRAC
[[Page 7527]]
reach final agreement on regulatory language. Once final consensus is
achieved, the CBNRAC members may not thereafter withdraw from the
consensus.
[cir] Once the CBNRAC reaches consensus on specific provisions of a
proposed rule, FTA, consistent with its legal obligations, will
incorporate this consensus into its proposed rule and publish it in the
Federal Register. This provides the required public notice under the
Administrative Procedure Act (APA), 5 U.S.C. 551 et seq., and allows
for a public comment period. Under the APA, the public retains the
right to comment. FTA anticipates, however, that the pre-proposal
consensus agreed upon by this committee will effectively address
virtually all the major issues prior to publication of a proposed
rulemaking.
[cir] If consensus is reached on all issues, FTA will use the
consensus text as the basis of its NPRM, and the CBNRAC members will
refrain from providing formal negative comments on the NPRM.
[cir] If the CBNRAC reaches agreement by consensus on some, but not
all, issues, the CBNRAC may agree to consider those agreements as final
consensus. In such a case, FTA will include the consensus-based
language in its proposed regulation and decide all the outstanding
issues, taking into consideration the CBNRAC discussions regarding the
unresolved issues and reaching a compromise solution. The CBNRAC
members would refrain from providing formal negative comments on
sections of the rule based on consensus regulatory text, but would be
free to provide negative comments on the provisions decided by FTA.
[cir] In the event that CBNRAC fails to reach consensus on any of
the issues, FTA will rely on its judgment and expertise to decide all
issues of the charter regulation, and CBNRAC members may comment on all
components of the NPRM.
[cir] If FTA alters consensus-based language, it will identify such
changes in the preamble to the proposed rule, and the CBNRAC members
may provide formal written negative or positive comments on those
changes and on other parts of the proposed rule that might be connected
to that issue.
A complete description of the ground rules is contained in the
docket for this rulemaking.
Finally, the CBNRAC reached consensus on the issues the committee
would consider during its negotiations. The committee agreed to
consider the four issues included in the Conference Committee report:
1. Are there potential limited conditions under which public
transit agencies can provide community-based charter services directly
to local governments and private non-profit agencies that would not
otherwise be served in a cost-effective manner by private operators?
2. How can the administration and enforcement of charter bus
provisions be better communicated to the public, including the use of
Internet technology?
3. How can enforcement of violations of the charter bus regulations
be improved?
4. How can the charter complaint and administrative appeals process
be improved?
The CBNRAC also agreed to consider four additional issues:
1. A new process for determining if there are private charter bus
companies willing and able to provide service that would utilize
electronic notification and response within 72 hours.
2. A new exception for transportation of government employees,
elected officials, and members of the transit industry to examine local
transit operations, facilities, and public works.
3. Review and clarify, as necessary, the definitions of regulatory
terms.
4. FTA policies relative to the enforcement of charter rules and
the boundary between charter and mass transit services in specific
circumstances, such as university transportation and transportation to/
from special events.
III. Overview
The negotiated rulemaking process is fundamentally different from
the usual process for developing a proposed rule. Negotiation allows
interested and affected parties to discuss possible approaches to
various issues rather than simply being asked in a regular notice and
comment rulemaking proceeding to respond to details on a proposal
already developed and issued by an agency. The negotiation process
involves the mutual education of the parties on the practical concerns
about the impact of various regulatory approaches.
The negotiated rulemaking process for the charter service
regulation resulted in a complete overhaul of the regulation. This was
done in response to longstanding concerns that the existing regulation
is hard to understand because it is unclear about what activities
constitute ``charter service.'' In addition, members of the CBNRAC
agreed that the existing exceptions to the prohibition on charter
service should be clarified. Concerns were also raised about the
complaint process. Some members felt that complaints were filed in a
vindictive manner and without a substantive basis. Others felt that
once a complaint was filed, the standard contained in the existing
regulation made it nearly impossible to receive the relief requested.
All members of the CBNRAC felt that the complaint and appeal process
takes too long.
What follows is a description of the decisions reached on each of
the issues that the CBNRAC agreed to consider during negotiations. Each
issue raised sub-issues that the committee agreed were also worth
considering, and those sub-issues are also discussed. If consensus was
reached on an issue (or sub-issue), we explain the consensus. If
consensus was not reached, we explain the relative positions of the two
main groups: the public transit caucus and the private charter caucus,
and then offer a proposal by FTA. We encourage interested parties to
review the meeting summaries in the docket for a more complete
description of the positions of the caucuses and the negotiations of
the CBNRAC.
Furthermore, two major changes are worth noting at the outset.
First, the CBNRAC agreed to discard the concept of ``willing and
able,'' that had persisted for more than 20 years. As a result, private
charter operators interested in performing requests for charter service
received by recipients would now be ``registered charter providers.''
This term is appropriate because, as explained in further detail later
in this document, private charter operators would register on an
Internet site. This website, known as the FTA Charter Registration
Website, would store the names of private charter operators interested
in receiving notice from recipients. This new process would replace the
old ``willing and able'' process.
Second, the existing regulation contains very limited requirements
regarding complaints, hearings, and appeals. This proposal contains a
more robust complaint, hearings, and appeals process. This would ensure
that FTA has an appropriate mechanism for weeding out frivolous or
vindictive complaints while ensuring that substantive complaints
contain the necessary information to inform all parties involved.
Further, while the existing regulations contain an option for a
hearing, there are no procedures for a hearing. This NPRM contains
procedures for a hearing if a complaint merits one.
To summarize, the proposals contained in this NPRM represent
consensus language and informed decisions by FTA. The complete rewrite
[[Page 7528]]
of part 604 has been a long time in the making, and is necessary. It is
the hope of FTA that the clarifications made in this proposal will
assist public transit agencies in complying with charter service
regulations and ensure that all parties understand when compliance has
been achieved.
IV. Conference Committee Report Issues
Issue 1: Limited Exceptions for Providing Community-Based
Charter Services
Under the current regulations governing charter service, an FTA
recipient is generally prohibited from providing charter service unless
one of the exceptions applies. The existing exceptions are: (1) When
there is no ``willing and able'' private charter operator; (2) leasing
equipment; (3) rural hardship; (4) special events; (5) non-profit
organizations serving individuals with disabilities; (6) non-profit
social service agencies listed in Appendix A; (7) non-profit
organizations serving low-income or transit-dependent persons; (8)
rural non-profit organizations serving the elderly; and (9) formal
agreement with all willing and able private charter operators.
The CBNRAC agreed that the revised regulation should also contain
exceptions. The committee reached consensus on six exceptions: (1)
Government officials; (2) qualified human service organizations; (3)
leasing equipment; (4) events of regional or national significance; (5)
when no registered charter provider responds to notice from a
recipient; and (6) agreement with registered charter providers. We
discuss each of these exceptions below. We also discuss one exception
where the committee could not reach consensus, which was the
``hardship'' exception. We have added an exception that the committee
did not consider, but due to past and recent events, we believe should
be added; an exception for the Administrator. Finally, we discuss three
sub-issues for all exceptions: Reporting requirements, fully allocated
costs, and recipients with 1,000 or more buses in peak hour service.
(a) Government Officials
This is a new exception to the charter regulations and would allow
recipients to provide charter service to government officials for non-
transit related purposes as long as the recipient provides the service
in its geographic service area, does not generate revenue (except as
required by law), and records the trip. The CBNRAC also agreed that
there should be an hourly annual limit for this exception, but could
not reach consensus on the number of hours. The public transit caucus
proposed an annual limit of 125 charter service hours. The private
charter caucus proposed an annual limit of 80 charter service hours.
Neither caucus explained why one limit should prevail over the other.
Since this is a new exception to the charter regulations, FTA
proposes to accept the private charter caucus' annual limit of 80 hours
of charter service to government officials for non-transit related
purposes within the recipient's geographic service area. In accepting
this proposal, however, FTA believes that extenuating circumstances may
arise where additional hours may be necessary. As a result, FTA added a
provision to allow for additional charter service hours under this
exception, at the Administrator's discretion, in rare or unusual
circumstances, if the recipient submits a written request: (1)
Describing the event; (2) explaining why registered charter providers
in the geographic service area cannot perform the service (e.g.,
equipment, time constraints, or other extenuating circumstances); (3)
describing the number of charter service hours requested to perform the
service; and (4) presenting evidence that the recipient has sent the
request for additional hours to registered charter providers in its
geographic service area. FTA would review the request and respond to
the recipient. The recipient would then be responsible for emailing
FTA's response to the registered charter providers in its geographic
service area. As with all exceptions under the proposed regulation, the
recipient would be responsible for recording the service in an
electronic log.
(b) Qualified Human Service Organizations
This exception would essentially collapse three exceptions
contained in the existing regulation pertaining to the elderly,
individuals with disabilities, and low-income individuals into one
exception for ``qualified human service organization.'' Consistent with
the President's Executive Order on Human Service Transportation
Coordination (February 24, 2004), the CBNRAC reached consensus on
allowing recipients to provide charter service to ``persons with
mobility limitations related to advanced age, persons with
disabilities, and persons struggling for self-sufficiency * * *'' If an
organization serving the above individuals also receives funds from one
or more of the 65 Federal programs to be listed in Appendix A to the
regulation, then the recipient would only need to record the charter
service in order to provide it. If the organization does not receive
Federal funds from the programs listed in Appendix A, but serves
individuals described in this section, then the organization would need
to register on FTA's Charter Registration Web site and the recipient
would need to record the charter service. FTA will provide Appendix A
in the final rule and will update it from time to time as new Federal
programs are created to assist individuals and organizations covered by
this exception or when a party sends a petition to the Administrator
requesting an update to Appendix A.
(c) Leasing FTA-Funded Equipment and Drivers
The existing exception under the charter regulations allows for a
recipient to lease equipment to a private charter operator if the
private charter operator receives a request that exceeds its capacity,
or the private charter operator does not have equipment accessible to
the elderly or individuals with disabilities. The CBNRAC reached
consensus on maintaining this exception with a few minor changes.
First, the private charter operator would have to be registered on the
FTA Charter Registration Website. Second, the private charter operator
would have to own and operate a charter service business. Third, the
private charter operator would have to exhaust all available vehicles
from other private charter operators in the recipient's geographic
service area. Fourth, the recipient would have to record the vehicles
leased and retain the documentation provided by the private charter
operator that demonstrates compliance with the first three
requirements.
(d) Events of National or Regional Significance
This exception in the current regulation requires a petition to the
Administrator personally in order to provide charter service for a
special event. The only limitation is that the service can be provided
``to the extent that private charter operators are unable to provide
the service.'' The CBNRAC reached consensus on retaining this
exception, but with a more formal process for petitioning the
Administrator. The revised exception would require recipients to first
consult with private charter operators registered in the recipient's
geographic service area. After consultation, the recipient may petition
the Administrator only if the recipient (1) submits the petition at
[[Page 7529]]
least 90 days before the event; (2) describes the importance of the
event, the amount of charter service needed, and how private charter
operators will be utilized; and (3) files the petition in the special
events docket. The Administrator would review the petition, request any
additional information necessary to make a decision, and then post the
decision in the special events docket. The Administrator's approval of
a petition under this exception would be limited to the event described
in the petition.
(e) When No Registered Charter Provider Responds to Notice From a
Recipient
The existing regulation allows a recipient to provide any and all
charter service to the extent that there are no private charter
operators interested in providing the service. The CBNRAC reached
consensus on retaining this exception, but with a modification designed
to make the whole process more responsive. As noted earlier, the
implementation of an FTA Charter Registration Website would allow
recipients and registered charter providers to respond in real time
regarding charter service requests. Under this exception, a registered
charter provider would have 72 hours to respond to a request for
charter service to be provided in less than 30 days and 14 days to
respond to a request for charter service to be provided in more than 30
days. If a registered charter provider responds to the request, then
the recipient may not provide the service, even if the registered
charter provider and the customer are not able to agree upon a price.
Alternatively, if no registered charter provider responds to a request,
then the recipient may provide the service so long as it records the
proper information in an electronic log.
(f) Agreement With Registered Charter Providers
This exception in the current regulation allows a recipient to
enter into an agreement with all private charter operators in its
geographic service area to allow it to provide charter service directly
to a customer. The CBNRAC reached consensus on retaining this exception
with certain modifications to account for the use of the Charter
Registration Website instead of the annual willing and able process.
Under the revised exception, the recipient would have to ascertain
registered charter providers in its geographic service area from the
Charter Registration Website by January 30th of each year. The
recipient would have to enter into an agreement with those registered
charter providers by February 15th of each year.
1. Additional Exceptions
(i) ``Hardship''
The CBNRAC was unable to reach consensus regarding the ``hardship''
exception that currently exists in the charter regulation. This
exception is intended to allow non-urbanized (rural) areas to provide
charter service if a private charter operator's provision of this
service would create a hardship on the customer because the private
charter operator imposes a minimum duration that is longer than the
trip length or the private charter operator is located ``too far'' from
the origin of the charter service.
The CBNRAC could not reach consensus on what constitutes ``too
far.'' The private charter caucus proposed retaining the exception as
is. The public transit caucus offered to replace ``too far'' with
``deadhead time exceeding total trip time from initial pick-up to final
drop-off.''
FTA proposes to retain the hardship exception and replace ``too
far'' with the public transit caucus' proposal. We believe that this
proposal sufficiently clarifies what is meant by ``too far'' without
opening up the exception to abuse.
(ii) Administrator's Discretion
FTA proposes to add a new exception to address unique situations in
which it may not be practical or feasible to provide notice to
registered charter providers. Specifically, FTA proposes an
Administrator's discretion exception that would allow the Administrator
to personally approve a recipient's use of Federally-funded assets to
provide charter service for such events as funerals of local, regional,
or national significance. Such an event is unanticipated and requires
an immediate response. For example, the deaths of Presidents Ronald
Reagan and Gerald Ford underscore the need for flexibility when using
Federally-funded assets to assist in funeral preparation activities and
on the day of the funeral. Thus, FTA proposes an Administrator's
discretion exception to the charter regulations. A recipient would have
to submit a written request, by facsimile or e-mail, that describes the
event, describes the charter service requested, explains the time
constraints for providing the charter service, describes the
anticipated number of charter service hours needed for the event, the
type of equipment requested, approximate number of vehicles needed,
duration of the event, and explains how provision of the charter
service is in the public's interest. Recipients granted an exception
under this section would need to retain the record of approval from the
Administrator for three years and include the approval in its
electronic records for quarterly reporting on the Charter Registration
Web site.
(2) Reporting Requirements for All Exceptions
The CBNRAC agreed that for most of the exceptions a recipient must
record certain information about the charter service provided.
Specifically, the committee reached consensus on reporting that would
require recipients to record an organization's name, address, phone
number, e-mail address, date and time of service, number of passengers,
destination, trip length (miles and hours), fee collected, and vehicle
number. This would be required for charter service provided under the
exceptions for government officials, qualified human service
organizations, hardship, and when no registered charter provider
responds to a notice. For the leasing equipment exception, the
recipient would have to record the registered charter provider's name,
address, telephone number, number of vehicles leased, types of vehicles
leased, vehicle identification numbers, and documentation presented to
the recipient in support of the rule's requirements. A recipient would
have to retain this information in an electronic format and for at
least three years. The recipient would also identify in the record the
exception that the recipient relied upon when providing charter
service.
The CBNRAC could not reach consensus on whether or not the above
electronic records should be posted on the Charter Registration Web
site. The public transit caucus believes that posting their electronic
records to a public Web site may implicate privacy concerns. That
caucus instead favors the provision of records via e-mail upon request.
The private charter caucus insisted that electronic records should be
posted to the Web site in order to facilitate transparency. FTA agrees
with the private charter caucus, but also recognizes that there may be
some situations where certain information should not be posted on the
Web site. Thus, FTA proposes to include a provision in the regulation
that allows recipients to provide only generalized origin and
destination information when safety or security is an issue.
[[Page 7530]]
(3) Fully Allocated Costs
The CBNRAC was unable to reach consensus on whether the concept of
``fully allocated costs'' should apply to public transit agencies that
provide charter service. The public transit caucus felt as though the
requirement would be a barrier to providing community-based
transportation, but the private charter caucus argued that the
requirement is necessary to protect private charter operators.
In the past, FTA required public transit agencies to recover fully
allocated operating and capital costs and ensure that the charter
service did not interfere with the intended use of the asset. FTA
allowed this ``incidental use'' because it believed the charter service
provided supported the mission of FTA.
We propose to eliminate the concept of ``fully allocated costs.''
The exceptions included in the proposed regulation would allow
recipients to provide charter service that is in the public interest,
and is consistent with the overall mission of public transit operators
as mobility managers within their communities. Hence, the charter
service that would be allowed under the proposed rule would be an
incidental use of FTA-funded equipment and facilities, and the recovery
of fully allocated costs would not be required.
Further, in the case of service provided to ``qualified human
service organizations,'' the Federal Interagency Coordinating Council
on Access and Mobility is currently engaged, in cooperation with the
Office of Management and Budget, in developing cost allocation
principals to share fairly the costs of human service transportation.
To require FTA recipients to recover fully allocated costs from those
qualified human service organizations, including a share of capital
costs already subsidized by FTA, would impose unfair conditions on
those interagency deliberations.
That being said, FTA encourages and expects recipients that provide
charter services under the provisions of part 604 to develop fair
charges to recover as much as possible of the marginal operating cost
of the service, consistent with the public purpose of the charter
service, and the ability of the requesting entity to pay. As noted
earlier, under section 604.12, if a registered charter provider
responds to the request for charter service, the recipient may not
provide the service, even if the private charter operator's fee for the
service prevents the requester from purchasing the trip. This provision
protects the private charter industry from competition with transit
operators that receive subsidies from FTA.
(4) 1,000 or More Buses in Peak Hour Service
The CBNRAC reached consensus on limiting the application of two
exceptions--qualified human service organizations and government
officials--to recipients with 1,000 or more buses in peak hour service.
The public transit caucus requested this limitation, but the private
charter caucus wholly supported it because of the potentially negative
impact on private charter operators in urban areas where there are
higher concentrations of qualified human service organizations and
government officials. Both caucuses viewed the potential number of
requests as problematic and felt that it was in each caucuses' interest
to place a limitation on those two exceptions. FTA requests comments
from qualified human service organizations and governmental officials
on the practical impact of this limitation in the final regulation.
Issue 2: How Can We Better Communicate Charter Administration
and Enforcement to the Public?
The CBNRAC reached consensus on the use of Internet technology to
improve communications regarding the charter service regulations.
Members of the committee acknowledged that virtually all private
charter companies and public transit agencies have access to the
Internet and to email. The ability to maintain lists of private charter
companies, informing the public about allowable activities for public
transit under the charter service regulations, and posting FTA
decisions and complaints were all cited as valuable ways to use the
Internet.
To effectuate the Internet-based approach, FTA would develop a
Charter Registration Web site that would serve as a single point of
contact for private charter operators, recipients, and members of the
public to obtain information regarding charter service in their
geographic area. In addition, while FTA currently posts decisions
regarding charter complaints on its Web site, under the revised
regulation, we propose to make better use of the Department's Docket
Management System (DMS) by establishing an exemption docket, special
event docket, advisory opinion docket, complaint docket, and hearing
docket. These dockets would be available 24 hours a day and seven days
a week. Further, DMS has listserv capabilities so that the public can
receive notice each time the government places a document in the
docket. We believe this level of transparency would go a long way
toward informing the public as to which transit agencies do not provide
charter service (exemption docket); private charter operators as to
when a public transit agency requests a special event exception
(special event docket); when FTA provides formal advice to private
charter operators and recipients (advisory opinion docket); when a
complaint has been filed against a transit agency (complaint docket);
and when a complaint has been referred for a hearing (hearing docket).
The CBNRAC reached consensus on this issue.
Issue 3: How Can Enforcement of Violations of the Charter Bus
Regulations Be Improved?
The CBNRAC reached consensus on improved enforcement of charter
service regulations by focusing on deterrence of risky behavior.
Members of the committee noted that the seminal question regarding
enforcement is: ``What is charter service?'' For the public transit
caucus, it is important to protect the public transit agency's ability
to provide public transportation and serve its community. This includes
the ability to modify routes to address congestion or improve mobility
for the elderly, disabled or low-income populations. For the private
charter caucus, charter service by public transit agencies should not
be ``dressed up'' to look like public transportation. The private
charter caucus believed that service for special events of an irregular
nature constitutes charter service and the public transit agencies
should be prohibited from providing such service unless there is no
private charter operator interested in performing the service.
The proposed regulation would implement a new remedial scheme,
giving the decision-maker discretion to determine the type and amount
of the remedy based on a number of relevant factors, including, but not
limited to, the gravity of the violation, the revenue earned by
providing charter service, and the operating budget of the recipient.
The remedy could take the form of withholding a ``reasonable
percentage'' of available Federal financial assistance, a complete bar
on receiving future Federal funds, or a refund to the U.S. Treasury of
revenue collected in violation of the rule.
Besides flexibility in the assessment of a remedy, the CBNRAC
reached consensus on several other ways to improve the enforcement
process, specifically (1) issuing advisory opinions and (2) conducting
[[Page 7531]]
investigations. The CBNRAC could not reach consensus on whether the
following measures should be included in a new and improved charter
service enforcement regime: (1) Cease and desist orders, (2) using
neutral decision-makers, and (3) considering a pattern of violations as
an aggravating factor to any remedy assessed. We discuss each of these
issues below.
(a) Advisory Opinions
CBNRAC reached consensus that the new rule should incorporate a
provision enabling public transit agencies and registered charter
providers to obtain advisory opinions on a case-by-case basis regarding
whether or not a particular type of transportation would constitute
charter service. These advisory opinions would serve as a mechanism for
expedited review by FTA before the recipient performs the service.
Through this mechanism, recipients and registered charter providers
alike would receive formal advice about compliance with charter service
requirements. An advisory opinion would represent the formal position
of FTA on a matter and may be used in administrative or court
proceedings. The advisory opinion would be limited, however, to the
factual circumstances described in the request and would not be binding
upon a decision-maker adjudicating a charter complaint.
Advisory opinions represent a more formalized ``letter of
determination,'' which is currently issued when private charter
operators or recipients seek regulatory advice from FTA before
providing charter service. This more formal process would provide
transparency and consistency regarding FTA's advice. The CBNRAC reached
consensus on this issue.
(b) Investigations
Another way to improve enforcement is to ensure that a complaint
filed has a substantive basis. Members of the CBNRAC raised concerns
regarding the filing of incomplete complaints or frivolous complaints.
Thus, the proposed regulation includes a new provision allowing FTA
ninety days to conduct an investigation regarding a complaint. This
provision is consistent with the statutory requirement: ``On receiving
a complaint about a violation of an agreement, the Secretary of
Transportation shall investigate and decide whether a violation has
occurred.'' 49 U.S.C. 5323(d) (2). Thus, the CBNRAC reached consensus
on revised regulatory language that would allow FTA to conduct an
investigation after a registered charter provider files a complaint.
The proposed revision would also allow FTA to investigate on its own
initiative. After an investigation is complete, FTA may dismiss the
complaint, issue an initial decision based on the pleadings to date, or
refer the matter to a neutral decision-maker for a hearing.
(c) Cease and Desist Orders
The CBNRAC was unable to reach consensus on whether advisory
opinions should also offer an opportunity to request a cease and desist
order. The public transit caucus worried that such an order could be
issued wrongfully, thus preventing public transit agencies from
providing public transportation. The private charter caucus encouraged
the inclusion of a cease and desist provision as a way to prevent
financial harm to private charter operators without going through a
full-blown complaint and hearing process.
This NPRM does not include a cease and desist provision. While FTA
believes that a properly worded cease and desist provision would
protect against ``wrongfully'' issued cease and desist orders, we are
reluctant to implement a cease and desist process because FTA does not
have the human resources to administer a cease and desist provision.
FTA is concerned that interested parties would inundate the agency with
cease and desist requests. Furthermore, we believe that revisions to
the charter service definition, coupled with clear exceptions and
strong remedies for violations of the regulation provide sufficient
protection of a private charter operator's financial interest.
(d) Neutral Decision-Maker
During the CBNRAC negotiations, members of the committee expressed
the deeply held belief that FTA decisions regarding charter service
complaints are inconsistent. Both caucuses described experiences of
receiving inconsistent decisions from FTA regarding whether a
particular service is prohibited charter service. The private charter
caucus also stated that FTA was biased in favor of public transit
agencies by advising agencies on how to tailor the charter service so
as to look like public transportation. As a consequence, members of the
committee agreed that decision-making regarding charter service
complaints should be removed from the regional offices and sent to FTA
headquarters. The caucuses differed, however, on who should render a
determination once a complaint is sent to FTA headquarters. The public
transit caucus favored having FTA headquarters make the initial
decision regarding the complaint. The private charter caucus contended
that FTA headquarters is biased in favor of public transit agencies
regarding charter service complaints. Thus, the private charter caucus
favors the use of an Administrative Law Judge (ALJ) to make the initial
decision regarding a complaint.
After careful consideration of the above positions, and considering
FTA's limited resources, we propose to include a new provision in the
proposed regulation that would allow a headquarters office to make an
initial decision regarding a charter service complaint or to refer the
matter to a neutral decision-maker (Presiding Official) for a hearing.
The Presiding Official might be an Arbitrator or other hearing officer
and the parties to the proceeding would be the public transit agency
and the complaining party. The Presiding Official would then issue a
recommended decision to an appropriate headquarters office that would
reject, ratify, or adopt with modifications the recommended decision.
Any initial decision may be appealed to the Administrator. This
proposed process allows FTA to make a determination that a hearing is
unnecessary and issue an immediate decision based on the pleadings to
date or to refer the matter for a hearing. We believe that this
approach is less resource intensive but still provides a neutral
decision-maker for more serious cases that require a hearing.
(e) Pattern of Violations
As part of the revised rule's more rigorous enforcement scheme, the
proposed regulation contains language that would increase any remedy
ordered if the decision-maker determines that there is a ``pattern of
violations.'' The CBNRAC could not reach consensus on this issue. The
private charter caucus believed that more than one violation of the
charter service regulations should incur a severe penalty. The public
transit caucus believed that more than one violation of the same
requirement should be treated more severely. The public transit caucus
argued that more than one violation of different charter service
requirements should not constitute a pattern of violations, because the
public transit agency is unlikely to know what constitutes a violation
of the charter service regulations until FTA informs the public transit
agency of the violation.
As will be discussed later in the definitions section of this NPRM,
we propose to define a pattern of violations as: ``more than one
finding of non-
[[Page 7532]]
compliance of this Part by FTA beginning with the most recent finding
of noncompliance and looking back over a period of 72 months.'' We
intend to apply this definition in the ``remedies'' section of the
rule. Under that section, if the decision-maker determines there is a
pattern of violations, then the decision-maker ``shall bar a recipient
from receiving Federal transit assistance in an amount * * * considered
appropriate.'' This means that a public transit agency violating the
charter service regulation for the first time would be treated
differently, and less severely, than a public transit agency that has
violated the charter service regulations more than once over the past
six years. Further, we determined that looking at a six year period
would be sufficient to determine whether the public transit agency has
a history of non-compliance with the charter service regulations. FTA
believes that the new provision on ``pattern of violations'' would
deter conduct that leads to complaints, would reduce the number of
complaints, and would promote consultation with FTA.
Issue 4: How Can the Charter Complaint and Administrative
Appeals Process Be Improved?
All CBNRAC members agreed that the complaint process should be
designed so as to produce consistent decisions on charter bus
complaints. The perceived inconsistency in past charter decisions by
FTA was attributed in part to region-based adjudication under the
current rule. The committee expressed concern over the diverse
approaches for addressing charter violations taken by different
regions. To this end, the committee recommended that regional offices
should no longer handle charter complaints. Instead, complaining
parties would bypass the regional offices and file their complaints
directly with the FTA Office of the Chief Counsel. FTA headquarters
would receive complaints, post complaints in a complaint docket, and
investigate alleged violations.
Furthermore, the committee reached consensus on a more detailed
complaint process. The existing rule only requires the filing of a
complaint that ``is not without obvious merit and that * * * states
grounds on which relief may be granted.'' This generalized pleading
process has led to frivolous filings or complaints that do not contain
enough information to determine the violation of the charter service
regulations. The revised regulations would require a complainant to
identify the specific provisions of the charter service regulation
allegedly violated, provide a complete and concise statement of the
facts relied upon in filing the complaint, and submit all documents
offered in support of the complaint.
Additionally, the CBNRAC reached consensus on new filing and
service provisions. In the past, there were instances where the
complainant failed to notify the public transit agency. Instead, the
FTA regional office sent the complaint. The revised regulation would
require a complainant to file the complaint with the public transit
agency and send proof of service to FTA headquarters. Furthermore, the
committee agreed that associations may file a complaint as a duly
authorized representative of a registered charter provider. The private
charter caucus advocated for this position so that registered charter
providers who work with public transit agencies would not have to file
a complaint directly. Even so, the association would have to identify
on whose behalf the complaint is filed.
Moreover, we would appreciate comments on how to address State
involvement in the complaint process. For instance, in the case of a
complaint against a rural transit operator funded as a subrecipient of
a State under section 5311, we propose that the private charter
provider should submit a complaint with the State Department of
Transportation (FTA's direct recipient) first. If the State Department
of Transportation cannot resolve the complaint, then the private
charter operator would proceed under subpart F. This option was not
presented to the CBNRAC and we have not revised regulatory text to
reflect this proposal. We would, however, appreciate comment on the
topic.
In addition to a more detailed complaint process, the CBNRAC agreed
that the appeals process should have more flexibility, the conciliation
period should be eliminated, parties should be able to complain about a
private charter operator or qualifed human service organization's
registration on the FTA Charter Registration Web site, and it should be
easier for FTA to dismiss incomplete or non-substantive complaints.
Each of these points is discussed below.
(a) Appeals
The CBNRAC reached consensus on an improved appeals process that
gives the Administrator discretion to take an appeal or modify an
initial decision. Previously, the Administrator could only consider an
appeal if ``the appellant presents evidence that there are new matters
of fact or points of law that were not available or not known during
the investigation of the complaint.'' 49 CFR 604.20(b). Members of the
committee viewed that provision as too limiting, and advocated for
broader discretion. Thus, the new provision would allow an appeal so
long as the appellant meets the relevant deadlines. Further, even if
the appellant has not filed an appeal, the Administrator, on his or her
own motion, may review an initial decision. As noted earlier, the
initial decision would be made either by a headquarters office or by an
Arbitrator after a hearing and ratification by a headquarters office.
Additionally, the new regulation would set out specific timeframes for
FTA to make decisions regarding the complaint and appeal. Specifically,
the initial decision would have to be issued 110 days after the
investigation is complete. A decision on an appeal would have to be
made within 30 days.
(b) Conciliation Period
The committee also determined that the mandatory conciliation
period in the existing rule was almost never used and had no effect
other than delaying the adjudicatory process. The committee recommended
that FTA remove this requirement from the new rule and instead include
a statement that encourages the parties to resolve their dispute
informally before filing a complaint. Thus, we proposed not to include
a conciliation period in the revised regulation.
(c) Removal From Charter Registration Web Site
The CBNRAC reached consensus on providing a new provision that
allows registered charter providers or recipients to file a complaint
challenging the registration of a private charter operator or qualified
human service organization on the Charter Registration Web site.
Members of the committee approved of this provision because it would
allow the removal of private charter operators that act vindictively
when responding to requests for charter service. In other words, a
private charter operator that responds affirmatively to a notice from a
recipient requesting charter service but then does not contact the
customer or negotiates in bad faith with the customer could be removed
from the Web site and not receive future requests for charter services.
The proposed regulation sets out specific reasons why FTA could remove
a registered charter provider from the registration list. In addition,
we plan to develop an Appendix B that would set out examples of each
basis for removal.
[[Page 7533]]
On the other hand, a registered charter provider could file a
complaint to remove a qualified human service organization from the
registration list. FTA may remove a qualified human service
organization for the same reasons a registered charter provider may be
removed from the registration list (e.g., bad faith and lack of
documentation).
Thus, under this new process, a complaint would be filed
electronically in the complaint docket and a response would be required
in seven days. FTA would then consider the complaint and response and
issue a decision in ten business days. FTA's decision would be posted
in the complaint docket and would identify the reasons for removing or
allowing the private charter operator or qualified human service
organization on FTA's Charter Registration Web site. If removal is
ordered, the decision would identify the length of time for removal and
when the party may reapply for registration.
(d) Dismissals
Furthermore, to ensure the integrity of the complaints filed, the
CBNRAC reached consensus on new provisions that would allow FTA to
dismiss a complaint, without prejudice, if it is incomplete. FTA may
also dismiss a complaint, with prejudice, if the complaint, on its
face, is outside the jurisdiction of FTA, fails to state a claim that
warrants further investigation, or if the complainant lacks standing to
file the complaint.
V. Additional Issues Considered by the CBNRAC
Issue 5: A New Process for Determining If There Are Private
Charter Bus Companies Willing and Able To Provide Service That Would
Utilize Electronic Notification and Response
The CBNRAC discussed this issue because the private charter caucus
and public transit caucus were close to an agreement on this issue
during previous negotiations before the formation of the CBNRAC.
Essentially, the committee viewed the current ``willing and able''
process as protection for private charter operators from unsuccessful
negotiations with customers who might expect lower prices from public
transit agencies. The current process also allows public transit
agencies to provide charter service when there is no private charter
operator interested in performing the service. Even so, the committee
recognized that the existing willing and able process is outdated and
agreed to eliminate it in favor of a web-based registration process.
The Charter Registration Web site would serve as a database of
private charter operators who are interested in receiving notice from
recipients regarding requests for charter service. In order to
register, private charter operators would have to answer several
questions about their business and the geographic areas they serve.
Recipients, upon receiving a request for charter service that a
recipient is interested in providing, would be required to send an
email to registered charter providers listed on FTA's Charter
Registration Web site in the recipient's geographic service area. The
notification would have to be sent by close of business on the day the
recipient receives the request, unless the recipient received the
request after 2 p.m., in which case the recipient would have to send
the notice by the close of business the next business day. The
recipient may then provide charter service if no registered charter
provider responds to the notice within 72 hours for charter service
requested to be provided in less than 30 days; or within 14 calendar
days for charter service requested to be provided in 30 days or more.
The recipient would have to retain an electronic copy of the notice and
the list of registered charter providers notified of the requested
charter service for a period of at least three years from the date the
notice was sent. The recipient would also record certain information
about the charter service for purposes of quarterly reporting. Members
of the CBNRAC expressed approval of this real-time process over the
existing annual notification process.
The CBNRAC could not reach consensus on whether a private charter
operator should be required to answer whether it would provide free or
reduced rate services to qualified human service organizations. The
public transit caucus argued in favor of such a requirement while the
private charter caucus argued against a requirement and advocated
instead that it be optional.
The proposed regulation includes language that would make it
optional for a private charter operator to indicate whether they would
provide free or reduced rate charter services to qualified human
service organizations. We believe that private charter operators wish
to support their communities in the same way that many recipients
support their communities and that they would likely take advantage of
this option because qualified human service organizations can conduct a
search on the Charter Registration Web site to look only for those
private charter operators with free or reduced rates. We do not
believe, however, that private charter operators should be required to
provide such information.
(a) Registration of Qualified Human Service Organizations
In addition to registering private charter operators, the Charter
Registration Web site would also serve as a database for qualified
human service organizations that do not receive funding from the
Federal programs listed in Appendix A to the regulation. In order to
register, qualified human service organizations would have to answer
several questions about their organization, its funding, and its
mission.
After registering, these qualified human service organizations
would be eligible to receive free or reduced rate charter services from
either recipients or registered charter providers. The committee
reached consensus on this issue.
FTA requests comment from qualified human service organizations,
not receiving funding from the Federal programs listed in Appendix A,
on the practical impact of these registration requirements.
Issue 6: A New Exception for Transportation of Government
Employees, Elected Officials, and Members of the Transit Industry To
Examine Local Transit Operations, Facilities, and Public Works
The CBNRAC reached consensus on a new applicability provision for
the charter service regulations. Under the new provision, the charter
service regulations should not apply to a recipient transporting its
own employees, other transit system employees, management officials,
contractors and bidders, government officials and their contractors and
official guests to or from transit facilities or projects within their
geographic service area for the purpose of conducting oversight
functions such as inspection, evaluation, or review.
During the discussions on this issue, members of the CBNRAC noted
that movement of transit employees or officials for transit purposes is
simply not charter service. Further, as discussed in greater detail in
the next section, under the new definition of charter, movement of
transit employees from one work station to another is also not charter
service. The CBNRAC also reached consensus on the following
applicability provisions:
(a) The charter service regulations would not apply to a recipient
that transports its employees, or other transit system employees or
officials for
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emergency preparedness planning and operations.
(b) The charter service regulations would not apply to recipients
of 49 U.S.C. 5310, 5316, or 5317 funds, when used for program purposes.
(c) The charter service regulations would not apply in the case of
local, regional, or national emergencies lasting fewer than three days.
Otherwise, the recipient would have to follow the provisions of 49 CFR
part 601 subpart D.
(d) The charter service regulations would not apply to a non-
urbanized area transporting its employees outside of its geographic
service area for training purposes.
The CBNRAC could not reach consensus on whether the charter service
regulations apply to private charter operators receiving funds,
directly or indirectly, from programs under 49 U.S.C. 5307, 5309, 5310,
5311, 5316, 5317 or section 3038 of the Transportation Equity Act for
the 21st Century. The private charter caucus requested this provision
because it believes that the receipt of Federal funds should not hinder
the private charter operator's ability to conduct its business. The
public transit caucus asserted that private charter operators receiving
Federal funds should be subject to the same limitations as public
transit agencies.
We propose to include this provision because the receipt of funds
from the Federal government should not interfere with a private charter
operator's business. This regulation has its genesis in the protection
of the private charter operators from unfair competition by public
transit agencies. To subject private charter operators to the charter
service regulations undermines the very purpose of these regulations.
Issue 7: Review and Clarify, as Necessary the Definitions of
Regulatory Terms
One of the main points of contention for the CBNRAC was the
definition of ``charter service'' and ``pattern of violations.'' For
all other definitions, the CBNRAC was able to reach consensus.
Additionally, since the conclusion of the negotiations, we decided that
definitions of ``qualified human service organization'' and ``charter
service hours'' are necessary. Thus, what follows is a discussion of
the negotiations regarding the definitions of charter service and
pattern of violations. We also offer our proposed definitions of
qualified human service organization, charter service hours, and
special transportation.
(a) Definition of Charter Service
CBNRAC was unable to come to an agreement on the definition of the
term ``charter service.'' The controversy centered on a particular
category of transportation service provided on an irregular basis for
occasional local events such as golf tournaments, festivals, state
fairs, July 4th celebrations, flower shows, home shows, and sporting
events. The public transit caucus considers open-door bus service to
these types of events to be public transportation that serves the
community at large (by providing traffic mitigation and other public
benefits) even though the transit agency may need to create new or
modified routes on a temporary basis for the duration of the event in
order to provide the service. The private charter caucus believes that
such services constitute ``charter service'' because a third party
event sponsor is usually involved through some type of contractual
arrangement; a new, temporary route has to be created to transport
people to and from the event (as opposed to published, regular transit
routes); and because the service is not continuous, and lasts only for
the duration of the event. Despite lengthy discussions and an exchange
of various proposals between the two sides, these differences could not
be resolved by the committee. We recommend that interested parties
review the docket for the exact proposals offered by each caucus.
In response to the discussions held by the CBNRAC, we propose a
definition of charter service that recognizes concerns raised by each
caucus and provides examples of what would be considered charter
service. In providing this definition of charter service, we note that
the term ``buses'' includes rubber-tire replica trolleys.
First, the caucuses were able to agree, although they did not reach
consensus, on the proposition that charter service has three
components: The transportation of a group of persons pursuant to a
single contract with a third party; a fixed charge; and an itinerary
determined by someone other than the public transit agency. The CBNRAC
agreed that these three elements would have to be present in order for
a particular service to be considered charter service.
Second, members of the CBNRAC felt it was important to provide
examples of what is and is not charter service. Thus, we propose a
definition that includes three examples of charter service: (1) Use of
buses or vans to transport school students, school personnel or school
equipment; (2) shuttle service to events that occur on an irregular
basis or for limited duration; or (3) shuttle services limited to a
group of individuals pursuant to a contract with an institution,
university, corporation or government.
We also include in the definition examples of what is not charter
service. Specifically, we propose that the following do not constitute
charter service: (1) Adding equipment or days to an existing route; (2)
extending service hours on an existing route; (3) demand-responsive
service that is part of coordinated public transit human service
transportation; and (4) new or modified service that is open to the
public, where the recipient establishes and controls the route and the
service continues from year to year.
In an effort to provide further clarification of what service would
be considered charter service or public transportation, FTA will
publish an Appendix C with the final rule that contains more examples
and frequently asked questions. We would appreciate comments with
questions that should be included in Appendix C.
(b) Definition of Pattern of Violations
The CBNRAC did not reach agreement on the definition of ``pattern
of violations.'' Some participants advocated that the term should mean
``more than on