New York Codes, Rules and Regulations
Chapter VI - Transportation Regulations
Subchapter G - Mass Transportation Operating Assistance
Part 975 - Statewide Mass Transportation Operating Assistance Program
Section 975.17 - Determination of maximum operating assistance for private bus operators

Current through Register Vol. 44, No. 51, December 21, 2022

In accordance with legislation, the commissioner will annually establish a maximum service payment limit for each private bus operator that reflects a reasonable return on equity or operating expenses and revenues. In establishing, the maximum service payment limit, consideration may be given to prior years as well as the current fiscal year's return on equity or operating revenues and expenses. Additional criteria are also specified below regarding the profit provided to private operators that are part of a system where the local government provides local government funds in excess of mandated levels to further improve the utility, effectiveness, and/or coordination of its system of services.

All private transit operator financial records must conform to the uniform system of accounts, and their Annual Report to the Commissioner must be consistent with the uniform system of accounts as identified in section 975.5. Annually, the Department will evaluate the financial position of each private operator and establish a maximum service payment limit (cap) pursuant to the guidelines established by the Department's Carrier Certification and Compliance Bureau by regulatory process (profit cap case). Financial data not conforming to these regulatory case guidelines will be adjusted by the Department and may result in a lower payment limit.

The annual limit established for one year may be used in the following year until a new limit is established based on the previous year's actual data. The Department may amend an established annual maximum service payment limit when circumstances that will substantially change estimated expenses and revenues (such as a fare increase) warrant such an updating.

Any public transportation system that proposes to distribute, or has been found to have distributed, to any individual private bus operator (or for all operators in the system where the requirements of section 975.15(3) regarding profit cap on a system level have been met) a total amount of operating assistance that would exceed, or has exceeded, its individual maximum operating assistance allowance, as determined by the current regulatory case issued by the Department, and which seeks to allow such profits to be retained by the operator and not result in reduced State transit operating assistance payments to the public transportation system, shall comply with the following requirements:

(a) Submit a report that describes the methodology employed by the sponsor to allocate operating expenses for STOA eligible services, and includes an explanation of the rationale for making an adjustment to any category of expense that is inconsistent with any determination made by the Department in the final profit cap case for those operators that they propose to provide a profit in excess of the established statewide standard. Such report shall also include an explanation and reconciliation of any differences in expenses, revenues, and subsidies shown on any other financial report submitted to the Department by the sponsor to fulfill STOA program reporting requirements (ex. the annual estimates and projections prepared pursuant to section 17-a of the Transportation Law and annual appropriation language).

(b) Demonstrate that the amount of local voluntary aid is at least equal to the profit paid to private bus operators that is in excess of the operator's maximum operating assistance allowance as calculated by the Department.

(c) Demonstrate that the individual private bus operator(s) is more economic than provision of service of comparable quality and quantity by a comparable public authority or public municipal system. Operator cost per revenue vehicle hour is an acceptable comparable measure. The Department will assist in providing data on comparable public systems, if requested.

(d) Certify that the profit level being provided has been reviewed and is reasonable, consistent with maintaining adequate service to the public.

The certification must be made by the chief executive officer of the public transportation system. The public transportation system must indicate its intent in writing to make a submission under this provision not later than 45 days after the issuance of the final profit cap case in order to avoid recovery of state aid equal to the amount of profits in excess of the profit standard established by the Department.

The deadline for submission of the documentation specified above shall be 60 days from the date of issuance of the final profit cap case by the Department.

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