[Federal Register Volume 73, Number 223 (Tuesday, November 18, 2008)]
[Proposed Rules]
[Pages 68375-68390]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-26683]
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DEPARTMENT OF TRANSPORTATION
Federal Transit Administration
49 CFR Part 605
[Docket No. FTA-2008-0044]
RIN 2132-AB00
School Bus Operations
AGENCY: Federal Transit Administration (FTA), DOT.
ACTION: Notice of proposed rulemaking.
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SUMMARY: Through this notice, the Federal Transit Administration (FTA)
proposes to amend its school bus operations regulations. Most notably,
FTA proposes to clarify several definitions, amend the school bus
operations complaint procedures, and implement Section 3023(f) of the
Safe, Accountable, Flexible, Efficient Transportation Equity Act: A
Legacy for Users (SAFETEA-LU). FTA seeks comment on this notice from
interested parties.
DATES: Comments must be received by February 17, 2009. FTA will
consider late filed comments to the extent practicable.
ADDRESSES: You may submit comments by one of the following methods.
Federal e-Rulemaking Portal: http://www.regulations.gov.
Follow the online instructions for submitting comments.
Fax: 1-202-493-2251.
U.S. Post or Express Mail: U.S. Department of
Transportation, Docket Operations, West Building Ground Floor, Room
W12-140, 1200 New Jersey Avenue, SE., Washington, DC 20590.
Hand Delivery: The West Building of the U.S. Department of
[[Page 68376]]
Transportation, 1200 New Jersey Avenue, SE, Washington, DC 20590,
between 9 a.m. and 5 p.m., Monday through Friday, except Federal
holidays.
Instructions: You must include the agency name (Federal Transit
Administration) and the Docket number (FTA-2008-0044) or the Regulatory
Identification Number (RIN) (2132-AB00) for this notice at the
beginning of your comment. You should include two copies of your
comment if you submit it by mail. If you wish to receive confirmation
that FTA received your comment, you must include a self-addressed
stamped postcard. Note that FTA will post all comments that it
receives, including any personal information provided therein, without
change, to http://www.regulations.gov.
Due to security procedures in effect since October 2001 regarding
mail deliveries, mail received through the U.S. Postal Service may be
subject to delays. A party that submits a comment responsive to this
notice should consider using an express mail firm to ensure the prompt
filing of any submissions not filed electronically or by hand.
FOR FURTHER INFORMATION CONTACT: Michael L. Culotta, Attorney, Office
of Chief Counsel, Federal Transit Administration, U.S. Department of
Transportation, 1200 New Jersey Avenue, SE., East Building--5th Floor,
Washington, DC 20590. E-mail: [email protected]. Telephone: (202)
366-1936.
SUPPLEMENTARY INFORMATION:
I. Background
A. Introduction
FTA issues this Notice of Proposed Rulemaking regarding its school
bus operations regulations at 49 CFR part 605 pursuant to the changes
Congress requires in section 3023(f) of the Safe, Accountable,
Flexible, Efficient Transportation Equity Act: A Legacy for Users
(SAFETEA-LU),\1\ to provide clarification in the context of the U.S.
District Court for the Western District of New York's decision in
Rochester-Genesee Regional Transportation Authority v. Hynes-Cherin,\2\
and generally, to update the regulation. Through this Notice of
Proposed Rulemaking, FTA intends to provide its grantees with a
regulatory basis which will allow them to continue to provide the
service that FTA historically has allowed through administrative
adjudications, while simultaneously satisfying the statutory
requirements of 49 U.S.C. 5323(f). To the extent that FTA departs from
any previous guidance with respect to its school bus operations
regulations, FTA sets forth its reasons below.
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\1\ Safe, Accountable, Flexible, Efficient Transportation Equity
Act: A Legacy for Users (SAFETEA-LU) sec. 3023, 49 U.S.C. 5323(f)
(2006).
\2\ 531 F.Supp.2d 494 (W.D.N.Y. 2008).
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B. Statutory and Regulatory History
In 1973, Congress passed the Federal-Aid Highway Act, which
authorizes FTA to provide financial assistance to a grantee under 49
U.S.C. Chapter 53 only if the grantee agrees ``not to provide school
bus transportation that exclusively transports students and school
personnel in competition with a private school bus operator.'' \3\
Congress's intent in enacting this provision was to prevent unfair
competition between federally funded public transportation systems and
private school bus operators.\4\
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\3\ Federal Aid Highway Act of 1973, Public Law No. 93-87, sec.
164(b), 87 Stat. 250, 281-82 (1973) (codified as amended at 49
U.S.C. 5323(f) (2006)).
\4\ Chicago Transit Auth. v. Adams, 607 F.2d 1284, 1292-93 (7th
Cir. 1979) (citing H.R. REP. NO. 93-410, at 87 (1973) (Conf. Rep.);
S. REP. NO. 93-355, at 87 (1973) (Conf. Rep.)).
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In 1976, the Urban Mass Transportation Administration, now FTA,
codified regulations at 49 CFR part 605 which implemented the above
statutory provision.\5\ Under 49 CFR 605.14, FTA may not provide
financial assistance to a grantee ``unless the applicant and the
Administrator shall have first entered into a written agreement that
the applicant will not engage in school bus operations exclusively for
the transportation of students and school personnel in competition with
private school bus operators.'' \6\ FTA defines ``school bus
operations'' as ``transportation by bus exclusively for school
students, personnel and equipment. * * *'' \7\
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\5\ See Codification of Charter Bus Operations Regulations, 41
FR 14,122 (Apr. 1, 1976) (codified at 49 CFR part 605 (2007)).
\6\ 49 CFR 605.14 (2007).
\7\ 49 CFR 605.3(b).
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FTA exempts ``tripper service'' from the prohibition of school bus
operations.\8\ FTA defines ``tripper service'' as ``regularly scheduled
mass transportation service which is open to the public, and which is
designed or modified to accommodate the needs of school students and
personnel, using various fare collections or subsidy systems.'' \9\
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\8\ 49 CFR 605.13.
\9\ 49 CFR 605.3(b).
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On August 10, 2005, President George W. Bush signed SAFETEA-LU into
law. Section 3023(f)(3) of SAFETEA-LU provides, ``If the Secretary
finds that an applicant, governmental authority, or publicly owned
operator has violated the [school bus] agreement * * * the Secretary
shall bar a recipient or an operator from receiving Federal transit
assistance in an amount the Secretary considers appropriate.'' \10\
Prior to SAFETEA-LU, Congress required the Secretary of Transportation
to completely bar a violator of 49 CFR part 605 of all Federal transit
funds to which it was entitled.\11\
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\10\ SAFETEA-LU sec. 3023(f)(3).
\11\ See 49 CFR 605.33(b) (2004).
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C. Rochester-Genesee Regional Transportation Authority v. Hynes-Cherin
On January 24, 2008, the U.S. District Court for the Western
District of New York issued a decision in Rochester-Genesee Regional
Transportation Authority which set aside FTA's interpretation of its
school bus operations regulations at 49 CFR part 605.\12\ The Court
allowed the Rochester-Genesee Regional Transportation Authority (RGRTA)
to restructure its public transportation operation through the addition
of 240 new express school bus routes proposed to serve the Rochester
City School District (RCSD) and its students.\13\
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\12\ See Rochester-Genesee Reg'l Transp. Auth., 531 F.Supp.2d
521-22.
\13\ Id. at 507-17.
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In its decision, the Court narrowly interpreted the word
``exclusively'' in FTA's definition of ``school bus operations'' and
concluded that technically, because a member of the general public
hypothetically could board a bus along one of RGRTA's proposed 240
routes, RGRTA did not propose to ``exclusively'' transport students,
and therefore, RGRTA's proposed express school bus service did not
constitute an impermissible school bus operation.\14\ Additionally, the
Court broadly interpreted FTA's definition of ``tripper service''
citing United States ex rel. Lamers v. City of Green Bay for the
proposition that a grantee may ``completely redesign its transit system
to accommodate school children as long as all routes are accessible to
the public and the public is kept informed of route changes.'' \15\
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\14\ Id. at 507-09.
\15\ Id. at 512 (citing United States ex rel. Lamers v. City of
Green Bay, 168 F.3d 1013, 1019 (7th Cir. 1999)).
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D. School Bus Operations Policy Statement
On September 16, 2008, in the context of the Court's decision in
Rochester-Genesee Regional Transportation Authority, FTA issued a
``Final Policy Statement on FTA's School Bus
[[Page 68377]]
Operations Regulations.'' \16\ In the policy statement, FTA noted that
it respects the Court's decision in the Western District of New York;
however, FTA found the Court's decision problematic because, if applied
elsewhere in the United States, the decision could obstruct FTA's
ability to execute and implement Congress' school bus prohibition and
its express intent regarding that prohibition.\17\ FTA found that if it
permitted a grantee to provide school bus operations so long as the
service is technically open to the public, then Congress's purpose of
protecting private school bus operators would be nullified.\18\ Such an
interpretation would create a loophole in the statutory and regulatory
scheme which would permit FTA's grantees to displace private school bus
operators with ease.\19\ Clearly, Congress did not intend this result,
otherwise, Congress would not have passed the statutory provision at 49
U.S.C. 5323(f).\20\
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\16\ Final Policy Statement on FTA's School Bus Operations
Regulations, 73 FR 53,384 (Sept. 16, 2008).
\17\ 73 FR 53,390.
\18\ 73 FR 53,387.
\19\ 73 FR 53,387.
\20\ 73 FR 53,387.
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Thus, in the policy statement, FTA interpreted the term ``tripper
service'' as it historically has interpreted that definition to allow a
grantee to (1) utilize various fare collections or subsidy systems, (2)
modify the frequency of service, and (3) make de minimis route
alterations from route paths in the immediate vicinity of schools to
stops located at or in close proximity to the schools.\21\ FTA
interpreted the term ``exclusively'' as used in FTA's definition of
school bus operations at 49 CFR 605.3(b) to encompass any service that
a reasonable person would conclude was primarily designed to
accommodate students and school personnel, and only incidentally to
serve the non-student general public.\22\ In the policy statement, FTA
expressed its intention to issue a Notice of Proposed Rulemaking to
amend the regulatory text at 49 CFR part 605.\23\
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\21\ 73 FR 53,390.
\22\ 73 FR 53,390.
\23\ 73 FR 53,385.
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II. Notice of Proposed Rulemaking
A. Introduction
FTA issues this Notice of Proposed Rulemaking regarding its school
bus operations regulations at 49 CFR part 605 pursuant to the changes
Congress requires in section 3023(f) of the Safe, Accountable,
Flexible, Efficient Transportation Equity Act: A Legacy for Users
(SAFETEA-LU),\24\ to provide clarification in the context of the U.S.
District Court for the Western District of New York's decision in
Rochester-Genesee Regional Transportation Authority v. Hynes-
Cherin,\25\ and generally to update the regulation. Through this Notice
of Proposed Rulemaking, FTA intends to provide its grantees with a
regulatory basis which will allow them to continue to provide the
service that FTA historically has allowed through administrative
adjudications, while simultaneously satisfying its statutory
requirements under 49 U.S.C. 5323(f). To the extent that FTA departs
from any previous guidance with respect to its school bus operations
regulations, FTA sets forth its reasons below.
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\24\ SAFETEA-LU sec. 3023.
\25\ 531 F.Supp.2d 494.
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When drafting this Notice of Proposed Rulemaking, FTA sought
comment from interested parties on the existing school bus operations
regulation at 49 CFR part 605. On June 11, 2008, FTA met with
representatives from the National School Transportation Association to
discuss viewpoints from private school bus operators on the existing
school bus operations regulation. On July 29, 2008, FTA met with
representatives from the American Public Transportation Association,
the Washington Metropolitan Area Transit Authority, the Champaign-
Urbana Mass Transit District, the Greater Cleveland Regional Transit
Authority, the Alameda-Contra Costa Transit District, The Rapid, and
the Council of the Great City Schools to discuss viewpoints from
operators of public transportation systems and public school districts
on the existing school bus operations regulation. FTA intends to post
on docket number FTA-2008-0044 information from the meetings mentioned
above, such as attendance sheets and rulemaking proposals.
On September 16, 2008, FTA issued a ``Final Policy Statement on
FTA's School Bus Operations Regulations'' that clarifies FTA's
interpretation of its school bus operations regulations at 49 CFR part
605.\26\ The public provided FTA with over 600 comments at docket
number FTA-2008-0015 regarding FTA's proposed policy statement, and FTA
considered those comments in developing this Notice of Proposed
Rulemaking.
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\26\ 73 FR 53,384.
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B. Section-by-Section Analysis
In this section, FTA discusses the differences between the existing
regulation and the proposed regulation. In addition to seeking general
comments on the proposed regulation, FTA requests comments on the
specific issues indicated below.
1. Subpart A--General
a. Purpose (Sec. 605.1)
FTA proposes to amend 49 CFR 605.1 to update statutory citations.
Additionally, FTA proposes to amend 49 CFR 605.1 to include the
language of 49 U.S.C. 5323(f), specifically, ``Financial assistance
under this chapter may be used for a capital project, or to operate
public transportation equipment or a public transportation facility,
only if the applicant agrees not to provide schoolbus transportation
that exclusively transports students and school personnel in
competition with a private schoolbus operator.''
b. Scope (Sec. 605.2)
FTA proposes to amend 49 CFR 605.2 to update statutory citations.
c. Definitions (Sec. 605.3)
i. General
FTA proposes to amend 49 CFR 605.3 to update statutory citations.
FTA proposes to add a definition of the term ``Chief Counsel'' to
provide clarification with respect to FTA's proposed procedures under
Subpart B and Subpart C.
FTA proposes to delete the term ``grant contract'' because it is no
longer applicable under FTA's proposed agreement requirements at 49 CFR
605.11.
FTA proposes to update the term ``grantee'' to include
subrecipients of federal financial assistance under 49 U.S.C. Chapter
53 and 23 U.S.C. 133 and 142.
FTA proposes to delete the term ``incidental'' because it is no
longer applicable to 49 CFR part 605. FTA cautions grantees, however,
that FTA Circular 5010.1 defines ``incidental use'' as:
[T]he authorized use of real property and equipment acquired
with FTA funds for the purposes of transit service but which also
has limited non-transit use due to transit operating circumstances.
Such use must be compatible with the approved purposes of the
project and not interfere with intended public transportation uses
of project assets.
FTA proposes to delete the term ``tripper service.'' FTA discusses
this proposal in section (II)(B)(2)(d) below.
FTA proposes to delete the term ``urban area'' and replace it with
the term ``geographic service area'' which means ``the area in which a
recipient is authorized to provide public transportation service under
appropriate
[[Page 68378]]
local, state, and Federal law.'' FTA no longer uses the term ``urban
area,'' but instead, FTA uses the term ``geographic service area'' to
refer to the local area in which a grantee operates.
ii. ``School Bus Operations''
FTA proposes to amend the definition of the term ``school bus
operations.'' Under 49 U.S.C. 5323(f), FTA may provide financial
assistance to a grantee only if the grantee agrees ``not to provide
school bus transportation that exclusively transports students and
school personnel in competition with a private school bus operator.''
\27\ Congress's intent in enacting this provision was to prevent unfair
competition between federally funded public transportation systems and
private school bus operators.\28\
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\27\ 49 U.S.C. 5323(f).
\28\ Chicago Transit Auth., 607 F.2d at 1292-93.
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In its school bus operations regulations, FTA defines ``school bus
operations'' as ``transportation by bus exclusively for school
students, personnel and equipment * * *'' \29\ In Rochester-Genesee
Regional Transportation Authority, the Court narrowly interpreted the
word ``exclusively'' and concluded that, technically, because a member
of the general public hypothetically could board a bus along one of
RGRTA's proposed 240 routes, RGRTA did not propose to ``exclusively''
transport students, and therefore, RGRTA's proposed express school bus
service did not constitute an impermissible school bus operation.\30\
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\29\ 49 CFR 605.3.
\30\ Rochester-Genesee Reg'l Transp. Auth., 531 F.Supp.2d at
507-09.
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FTA finds the Court's decision in Rochester-Genesee Regional
Transportation Authority problematic. FTA believes that a grantee,
pursuant to the Court's interpretation of ``school bus operations,''
may believe that it could restructure substantially its public
transportation operation to accommodate the needs of a local school
district and its students, which might have the effect of displacing
private school bus operators and their employees, provided the system
keeps the service open to the public even though members of the public
unlikely will board these buses. This practice would produce unfair
competition for private school bus operators which is precisely the
result Congress sought to prevent when enacting 49 U.S.C. 5323(f).
FTA proposes to add a definition of the term ``exclusively'' as
used in 49 U.S.C. 5323(f) and the definition of ``school bus
operations'' at 49 CFR 605.3 to mean ``transportation that a reasonable
person would conclude was designed primarily to accommodate students
and school personnel, without regard to demand from the non-student
general public.'' FTA intends its proposed definition of
``exclusively'' to effectuate Congress's intent of protecting private
school bus operators from unfair competition with federally subsidized
grantees.
FTA relies, in part, on the subsequent qualifying language of 49
U.S.C. 5323(f)--``in competition with a private schoolbus operator''--
to justify this definition. To illustrate, if FTA permitted a grantee
to provide school bus operations so long as the service is advertised
as generally open to the public, then Congress's purpose of protecting
private school bus operators would be nullified. Such an interpretation
would create a loophole in the statutory and regulatory scheme which
would permit FTA's grantees to displace private school bus operators
with ease. As noted earlier, Congress did not intend this result;
otherwise, Congress would not have enacted this statutory provision.
Additionally, the relevant language of the regulation prohibits
service that is ``exclusively for'' students and school personnel, and
therefore, FTA concludes that it is reasonable and proper to consider
whether service is, in fact, ``for'' such riders.
With respect to the ``reasonable person'' standard, FTA points out
that this standard has nearly a two hundred year history in the common
law.\31\ Courts have held that the reasonable person standard is an
objective standard, and that a ``reasonable person'' is a person: (1)
Of ordinary prudence, (2) who has knowledge of the law and is aware of
its consequences, and (3) who exercises caution in similar
circumstances.\32\ Accordingly, FTA proposes to utilize this objective,
rather than subjective, standard when analyzing issues involving school
bus operations.
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\31\ See Vaughan v. Menlove, (1837) 132 Eng. Rep. 490, and its
progeny.
\32\ See William L. Prosser & W. Page Keeton, Prosser and Keeton
On Torts 173-93 (5th ed. 1984).
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FTA also uses the reasonable person standard in a similar
definition of ``exclusive'' in its charter service regulations at 49
CFR part 604. Under 49 CFR 604.3(h), `` `Exclusive' means service that
a reasonable person would conclude is intended to exclude members of
the public.'' \33\ Employing a similar reasonable person standard in
the school bus regulation would afford FTA and the public consistency
throughout its regulations.
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\33\ 49 CFR 604.3(h).
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In addition to utilizing a reasonable person standard, FTA proposes
to identify a non-exhaustive list of factors that it intends to
consider when evaluating a school bus operations issue. FTA discusses
these factors at section (II)(B)(4)(a)(v) below.
Finally, FTA does not intend to discourage grantees from creating
new routes to serve new demand, so long as a reasonable person would
conclude that the grantees designed the routes to serve some segment of
the non-student general public. Therefore, FTA proposes to define
``school bus operations'' to allow a grantee to create a new route to
serve school students and personnel if a reasonable person would
conclude that the grantee also designed the route to serve some segment
of the non-student general public.
d. Public Hearing Requirement (Sec. 605.4)
FTA proposes to delete the public hearing requirement for
applicants that engage or wish to engage in school bus operations at 49
CFR 605.4 and replace it with the proposed procedures in Subpart B as
discussed in section (II)(B)(2) below.
2. Subpart B--School Bus Agreements
a. Purpose (Sec. 605.10)
Under 49 CFR 605.10, FTA explains that the purpose of Subpart B is
``to formulate procedures for the development of an agreement
concerning school bus operations.'' \34\ FTA proposes to delete this
statement of purpose. FTA includes a statement of purpose regarding its
school bus operations regulations at 49 CFR 605.1.
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\34\ 49 CFR 605.10.
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Instead, FTA proposes to amend 49 CFR 605.10 to include an express
prohibition on school bus operations. Under FTA's current school bus
operations regulations, FTA does not have a separate, express provision
which prohibits school bus operations. Instead, FTA requires applicants
to enter into an agreement with FTA stating that they will not provide
school bus operations. With an express prohibition on school bus
operations at 49 CFR 605.10, FTA intends to clarify its regulatory
scheme.
Additionally, FTA proposes to prohibit grantees from contracting to
provide school bus operations. Under the current regulatory scheme, FTA
only may entertain a school bus operations case if a potential
violation has occurred, that is, if a grantee provided
[[Page 68379]]
service that was a potential school bus operation. Currently, if a
grantee contracted to provide service, but has not yet provided it,
then the case is not ripe for FTA's adjudication.\35\ FTA believes that
this scenario is problematic because, at the point when a case becomes
ripe, the academic year likely is in session, and FTA's decision on the
merits could potentially disrupt school transportation for that
academic year. By considering cases in which a grantee contracted to
provide service that potentially constitutes a school bus operation,
but has not yet provide the service, FTA proposes to mitigate the risk
of disrupting school transportation for the academic year by providing
the grantees, private operators, and school districts with time to
create a system that complies with FTA's school bus operations
regulations.
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\35\ See, e.g., Laidlaw Transit, Inc. v. Rochester-Genesee Reg'l
Transp. Auth., FTA School Bus Operations Docket Number 2007-01 1, 3
(2007).
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b. Exemptions (Sec. 605.11)
i. Existing Provisions
Pursuant to 49 U.S.C. 5323(f), FTA provides exemptions to its
prohibition on school bus operations where (1) a grantee or applicant
operates a school system and a separate and exclusive school bus
program for that school system; (2) private school bus operators in the
local area are unable to provide adequate transportation, at a
reasonable rate, and in conformance with applicable safety standards;
and (3) a grantee or applicant is a state or local public body or
agency that previously was engaged in school bus operations.\36\
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\36\ 49 CFR 605.11.
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In the existing regulation, a grantee or applicant that wishes to
provide school bus operations under an exemption must follow the
procedures set forth in 49 CFR 605.16-605.19. In sum, a grantee or
applicant must (1) provide notice to local private school bus operators
of its proposed or existing school bus operation,\37\ (2) publish in a
local newspaper a description of its proposed or existing school bus
operation,\38\ (3) hold public hearings regarding the proposed or
existing school bus operation,\39\ and (4) submit an application to FTA
setting forth reasons why FTA should allow the grantee or applicant to
provide school bus operations.\40\ If no private school bus operator
operates in the grantee's or applicant's local area, then the grantee
or applicant may so certify in lieu of providing the notice required
above.\41\ Private school bus operators have an opportunity to comment
on the grantee's or applicant's proposed or existing school bus
operations.\42\ The FTA Administrator subsequently issues a decision
regarding the grantee's or applicant's application for an
exemption.\43\ Since FTA promulgated its school bus operations
regulations in 1976, grantees and applicants rarely have applied for an
exemption under 49 CFR 605.11.
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\37\ 49 CFR 605.16(a)(1).
\38\ 49 CFR 605.16(a)(2).
\39\ 49 CFR 605.18.
\40\ 49 CFR 605.11.
\41\ 49 CFR 605.17.
\42\ 49 CFR 605.18.
\43\ 49 CFR 605.19.
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ii. Proposed Exemptions
FTA proposes to restructure its regulatory scheme with regard to
exemptions. First, FTA proposes to move its list of exemptions from 49
CFR 605.11 to 49 CFR 605.12.
Second, FTA proposes to delete from 49 CFR 605.3(b) its definition
of ``tripper service'' and its provision regarding tripper service at
49 CFR 605.13. FTA proposes to add exemptions to the school bus
operations prohibition for service that FTA historically has considered
to be tripper service. This amendment is discussed in detail in Section
(II)(B)(2)(d) below.
Third, FTA proposes to remove from its list of exemptions the
exemption located at 49 CFR 605.11(b) which allows a grantee or
applicant to provide school bus operations if the grantee or applicant
demonstrates to the satisfaction of the Administrator, ``That private
school bus operators in the urban area are unable to provide adequate
transportation, at a reasonable rate, and in conformance with
applicable safety standards.'' \44\ FTA proposes to make this
``exemption'' a new ``exception,'' and FTA discusses this proposal in
detail in Section (II)(B)(2)(b)(iii) below.
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\44\ 49 CFR 605.11.
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Fourth, FTA proposes to eliminate the procedural requirements that
a grantee or applicant must follow at 49 CFR 605.16-605.19 to provide
service pursuant to an exemption. FTA intends its proposed exemptions
to serve as defenses for grantees in the context of a school bus
operations complaint filed under proposed Subpart C.
iii. New Exceptions
As mentioned above, FTA proposes to amend 49 CFR 605.13 to provide
exceptions to the proposed prohibition on school bus operations at 49
CFR 605.10. Here, FTA borrows from, and modifies, the current
procedures corresponding to a petition for an exemption.
FTA proposes to allow an applicant or grantee to petition the Chief
Counsel for an exception to the school bus operations prohibition
``where private school bus operators in the applicant's or grantee's
geographic service area are unable to provide adequate transportation
at a reasonable rate and in conformance with applicable safety
standards.''
To provide service pursuant to this proposed exception, an
applicant or a grantee must follow a series of proposed procedural
requirements. FTA proposes to require an applicant or a grantee to
formally apply to FTA for a ``Petition for an Exception.'' First, the
applicant or grantee must provide notice to the Chief Counsel that it
intends to apply for a Petition for an Exception. This notice must
include a description of the proposed school bus operations, including
a description of (1) the geographic service area that the applicant or
grantee intends to serve; (2) the schools and school districts that the
applicant or grantee intends to serve; (3) the anticipated ridership
related to the school bus operation; (4) an estimation of the number
and types of buses that the applicant or grantee intends to utilize to
provide the school bus operation; (5) the duration of the school bus
operation; (6) the frequency of daily service related to the school bus
operation; (7) an analysis regarding the extent to which the proposed
school bus operation complies with local, state, and Federal safety
laws; (8) a summary of the fully allocated costs related to the school
bus operation; and (9) the rate that the applicant or grantee intends
to charge for the school bus operation. FTA believes that this
information will help it determine whether the proposed service is
adequate, safe, and at a reasonable rate. FTA invites the public to
comment on the components of a fully allocated cost analysis that it
should require from its applicants and grantees.
Second, FTA will open an electronic docket, entitled ``Petition for
an Exception Docket,'' at http://www.regulations.gov corresponding to
the Petition for an Exception. Instead of requiring applicants and
grantees to provide notices in local newspapers, FTA intends to utilize
current technology, particularly the electronic docket, to provide more
accessibility to the public regarding a Petition for an Exception. FTA
also believes that the utilization of this technology will make FTA
action more transparent.
Third, FTA will transmit a copy of the notice and its docket number
to the
[[Page 68380]]
applicant or grantee and to the National School Transportation
Association (NSTA). NSTA may circulate the notice to any appropriate
private school bus operators that provide school bus operations in a
particular geographic service area. Furthermore, persons interested in
monitoring petitions submitted to FTA for which a docket is opened may
sign up for the Regulations.gov list serv. Through this service,
Regulastions.gov will notify subscribers each time a party submits a
document to the docket.
Fourth, any private operator having a place of business in the
applicant's or grantee's geographic service area may, within thirty
days of the notice's docketing date, submit comments on the Petition
for an Exception Docket demonstrating the extent to which it can
provide school bus operations that constitute adequate transportation
at a reasonable rate and in conformance with applicable safety
standards. FTA invites the public to comment on whether it should allow
a private operator a different timeframe for commenting on a proposed
school bus operation.
Fifth, the applicant or grantee, after evaluating any comments from
private school bus operators, may petition the Chief Counsel for an
exception to the school bus operations prohibition at 49 CFR 605.10.
The applicant or grantee must demonstrate to the satisfaction of the
Chief Counsel that no private operator having a place of business in
the applicant's or grantee's geographic service area can provide school
bus operations that constitute adequate transportation at a reasonable
rate and in conformance with applicable safety standards. The Chief
Counsel subsequently will issue a decision that either grants or denies
the applicant's or grantee's Petition for an Exception.
c. Use of Project Equipment (Sec. 605.12)
FTA proposes to delete the regulatory provision at 49 CFR 605.12
regarding the use of project equipment. FTA recently amended its
charter service regulations at 49 CFR part 604, and FTA believes that
the current provision at 49 CFR 605.12 is no longer applicable.\45\
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\45\ See Charter Service Final Rule, 73 FR 2,326 (Jan. 14,
2008).
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d. Tripper Service (Sec. 605.13)
FTA proposes to delete the regulatory provision at 49 CFR 605.13
regarding tripper service. Although there is no statutory definition
for the term, FTA included the concept of ``tripper service'' in its
school bus operations regulations.\46\ FTA defines ``tripper service''
as:
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\46\ The Urban Mass Transportation Administration (UMTA), now
the Federal Transit Administration (FTA), did not include the term
``tripper service'' in its proposed school bus operations
regulation. See 40 FR 25,309-14 (June 13, 1975). UMTA introduced the
term ``tripper service'' into its final rule with no explanation as
to why it inserted that regulatory term. See 41 FR 128 (Apr. 1,
1976).
[R]egularly scheduled mass transportation service which is open
to the public, and which is designed or modified to accommodate the
needs of school students and personnel, using various fare
collections or subsidy systems. Buses used in tripper service must
be clearly marked as open to the public and may not carry
designations such as ``school bus'' or ``school special.'' These
buses may stop only at a grantee or operator's regular service stop.
All routes traveled by tripper buses must be within a grantee's or
operator's regular route service as indicated in their published
route schedules.\47\
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\47\ 49 CFR 605.3.
Under this definition of tripper service, FTA originally allowed
grantees to accommodate students only with respect to ``different fare
collections and subsidy systems.'' However, through administrative
decisions over the years, FTA broadened its interpretation of its
tripper service definition to allow grantees to make accommodations
beyond subsidies and fare collection systems. Specifically, FTA began
to allow its grantees to make minor modifications to its route paths
and frequency of service. As FTA stated in one matter concerning the
---------------------------------------------------------------------------
Erie Metropolitan Transit Authority:
Read narrowly, ``modification of regularly scheduled mass
transportation service to accommodate the needs of school students
and personnel'' means using different fare collections and subsidy
systems. In practice, ``modification of mass transportation
service'' has been broadened to include minor modifications in route
or frequency of scheduling to accommodate the extra passengers that
may be expected to use particular routes at particular times of
day.\48\
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\48\ See In re Erie Metropolitan Transit Authority 1, 4 (1989).
For example, in Travelways, Inc. v. Broome County Department of
Transportation, FTA stated that, ``A familiar type of modification
would be where the route deviates from its regular path and makes a
loop to a school returning back to the point of deviation to complete
the path unaltered.'' \49\ FTA reaffirmed this particular
interpretation of tripper service in its October 12, 2007 RGRTA
determination by permitting RGRTA to operate four loop-like route
extensions, each only several blocks in length, to accommodate the
needs of school students.\50\
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\49\ Travelways, Inc. v. Broome County Dep't of Transp. 1, 7
(1985) (allowing a grantee to run a bus to a point and express to a
school from that point if the grantee ran a second bus along the
regular route path from the point at which the first bus expressed
to the school).
\50\ Letter from Federal Transit Administration to Rochester-
Genesee Regional Transportation Authority at 6 (Oct. 12, 2007).
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FTA has not, however, allowed a grantee to restructure its public
transportation operation solely to accommodate the needs of school
students--such a modification would be a major modification. Thus, in
its October 12, 2007 letter to RGRTA, FTA rejected RGRTA's proposed
addition of 240 new routes because it would have constituted a major
overhaul of RGRTA's public transportation system solely to accommodate
the needs of school students.\51\
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\51\ Id. at 2-6.
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In addition to minor modifications to route paths, FTA previously
has allowed grantees to modify route schedules and the frequency of
service. For example, in Travelways, FTA stated, ``Other common
modifications include operating the service only during school months,
on school days, and during school and opening and closing periods.''
\52\
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\52\ Travelways at 7.
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Jurisprudence in United States courts has broadened the scope of
FTA's tripper service definition to include essentially any
modification. In United States ex rel. Lamers v. City of Green Bay, the
Seventh Circuit stated, arguably in dicta, ``[T]he City may completely
redesign its transit system to accommodate school children as long as
all routes are accessible to the public and the public is kept informed
of route changes.'' \53\ Citing Lamers, the Court in Rochester-Genesee
Regional Transportation Authority allowed RGRTA to restructure its
public transportation system by adding 240 new routes to accommodate
the needs of RCSD and its students.\54\
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\53\ United States ex rel. Lamers v. City of Green Bay, 168 F.3d
1013, 1019 (7th Cir. 1999).
\54\ Rochester-Genesee Reg'l Transp. Auth., 531 F.Supp.2d 494,
509.
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FTA finds the definition of tripper service and its subsequent
interpretations problematic. FTA believes that a grantee, pursuant to
the jurisprudence of the Courts in Lamers and Rochester-Genesee
Regional Transportation Authority, may believe that it could
substantially restructure its public transportation operation solely to
accommodate the needs of a local school district and its students while
displacing private school bus operators and their employees provided
the system keeps the service open to the public even though no member
of the public likely will ride those particular
[[Page 68381]]
routes. This practice would produce unfair competition for private
school bus operators which is precisely the result Congress sought to
prevent when enacting 49 U.S.C. 5323(f).
In this notice, FTA proposes to codify in regulatory text the type
of service that it historically has allowed through administrative
adjudications. FTA proposes to eliminate the term ``tripper service,''
and instead, create exemptions to FTA's proposed school bus operations
prohibition at 49 CFR 605.11. This regulatory scheme would allow a
grantee to continue to use various fare collection or subsidy systems,
modify the frequency of its service, and make de minimis route
alterations to accommodate the needs of school students and personnel.
To illustrate, FTA would allow a grantee to issue fare cards to
students and school personnel and it would allow a grantee to accept a
payment from a school or a school district in exchange for service. FTA
would allow a grantee to modify the frequency of its service, meaning,
FTA would allow a grantee to run more buses on routes in the morning
when school begins and more buses in the afternoon when school ends.
With respect to the de minimis route alterations, FTA would allow a
grantee to make one-half mile or less route alterations from routes
within a one-half mile or less radius of a school building to
accommodate the needs of students and school personnel.\55\ FTA invites
the public to comment on whether it should utilize a different
measurement, such as time traveled or route percentage. For example,
should FTA allow route deviations where a bus makes a five minute
deviation from a route? Should FTA allow route deviations that
constitute ten percent of the route? Alternatively, should FTA allow
route deviations that are greater than one-half mile? FTA also invites
public comment on whether it should allow grantees to make route
deviations at multiple portions of routes or only within the immediate
vicinity of school buildings.
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\55\ Historically, FTA has allowed grantees to make route
deviations that are several blocks in length within the immediate
vicinity of school buildings. See Travelways at 7; Letter from
Federal Transit Administration to Rochester-Genesee Regional
Transportation Authority at 6 (Oct. 12, 2007).
---------------------------------------------------------------------------
FTA notes that, through this proposed regulatory scheme, a grantee
may provide services pursuant to an exemption without a formal
application to FTA, similar to a grantee's existing opportunity to
provide ``tripper service'' without a formal application to FTA. FTA's
intent here is to clarify in regulatory text the type of service that
it will allow and to simplify the organization of its school bus
operations regulatory scheme--FTA's intent is not to overhaul the types
of service that it historically has allowed. FTA does not intend to
create additional regulatory burdens for grantees that wish to provide
this type of service.
e. Agreement (Sec. 605.14)
FTA proposes to consolidate the regulatory provisions at 49 CFR
605.14 and 49 CFR 605.15 regarding a school bus agreement and move
those provisions to a new 49 CFR 605.11. Through this proposed
provision, FTA intends to simplify the requirements regarding school
bus agreements.
Under the current regulatory scheme, FTA requires an applicant to
enter into an agreement with the Administrator whereby the applicant
agrees ``that the applicant will not engage in school bus operations
exclusively for the transportation of students and school personnel in
competition with private school bus operators.'' \56\ Under current
practice, FTA's grantees and applicants submit and certify to FTA an
``Annual List of Certifications and Assurances for Federal Transit
Administration Grants and Cooperative Agreements'' and grantees
subscribe to FTA's ``Master Agreement.'' Under the terms of these
documents, the applicants and grantees agree not to provide school bus
operations.
---------------------------------------------------------------------------
\56\ 49 CFR 605.14.
---------------------------------------------------------------------------
To simplify FTA's requirements regarding school bus agreements and
to codify current practice, FTA proposes to allow applicants to satisfy
the requirements regarding school bus agreements by submitting and
certifying to FTA an ``Annual List of Certifications and Assurances for
Federal Transit Administration Grants and Cooperative Agreements'' and
by subscribing to FTA's ``Master Agreement.'' No separate school bus
agreement is necessary under this proposal.
f. Content of Agreement (Sec. 605.15)
For the reasons discussed above, FTA proposes to consolidate the
regulatory provisions at 49 CFR 605.14 and 49 CFR 605.15 regarding a
school bus agreement and move those provisions to a new 49 CFR 605.11.
FTA intends to simplify the requirements regarding school bus
agreements and proposes to provide financial assistance to an applicant
or a grantee only if ``the applicant or grantee agrees not to provide
school bus operations exclusively for students and school personnel in
competition with a private school bus operator.''
g. Notice (Sec. 605.16)
FTA proposes to delete 49 CFR 605.16 regarding the notice
requirements for an exemption to FTA's school bus operations
prohibition in light of FTA's proposed procedures in Subpart B
explained above.
h. Certification in Lieu of Notice (Sec. 605.17)
FTA proposes to delete 49 CFR 605.17 regarding the opportunity for
a certification in lieu of notice corresponding to an exemption to
FTA's school bus operations prohibition in light of FTA's proposed
procedures in Subpart B explained above.
i. Comments by Private School Bus Operators (Sec. 605.18)
FTA proposes to delete 49 CFR 605.18 regarding comments from
private school bus operators on an applicant's petition for an
exemption in light of FTA's proposed procedures in Subpart B explained
above.
j. Approval of School Bus Operations (Sec. 605.19)
FTA proposes to delete 49 CFR 605.19 regarding FTA's approval of an
applicant's school bus operations in light of FTA's proposed procedures
in Subpart B explained above.
3. Subpart C--Modification of Prior Agreements and Amendment of
Application for Assistance
a. Modification of Prior Agreements (Sec. 605.20)
FTA proposes to delete the regulatory provision at 49 CFR 605.20
regarding the modification of prior school bus agreements in light of
FTA's proposed school bus agreement requirements in Subpart B explained
above. FTA proposes to replace this provision with amended complaint
procedures as explained in Subpart D below.
b. Amendment of Applications for Assistance (Sec. 605.21)
FTA proposes to delete the regulatory provision at 49 CFR 605.21
regarding the amendment of applications for assistance in light of
FTA's proposed school bus agreement requirements in Subpart B explained
above. FTA proposes to replace this provision with amended complaint
procedures as explained in Subpart D below.
4. Subpart D--Complaint Procedures and Remedies
Generally, FTA proposes to reorganize its complaint procedures and
remedies under a proposed ``Subpart C--Complaint Procedures and
Remedies'' at 49 CFR 605.20-605.31.
[[Page 68382]]
a. Filing a Complaint (Sec. 605.30)
i. Centralized Decision-Making Through the Chief Counsel
Under FTA's existing school bus operations regulations, any
interested party may file a written complaint with the Administrator
alleging a violation of 49 CFR part 605.\57\ FTA requires the
complainant to write its complaint, to specify in detail the potential
violation, and to provide evidence substantiating the allegation.\58\
---------------------------------------------------------------------------
\57\ 49 CFR 605.30.
\58\ 49 CFR 605.30.
---------------------------------------------------------------------------
FTA proposes to restructure and modify this section. Under the
existing regulation, the Administrator issues school bus operations
decisions. In practice, the Administrator delegates this authority to
each of FTA's ten Regional Administrators. FTA finds that this practice
may breed inconsistencies in decision-making and school bus operations
guidance. Different regions, under different administrations, may issue
conflicting decisions.
To remedy this potential conflict, FTA proposes to issue decisions
centrally through the Chief Counsel. This system will ensure
consistency in decision-making and school bus operations guidance.
ii. Time Limit for Filing a Complaint
Under the current regulatory scheme, FTA does not impose a time
limit on parties that wish to file a complaint alleging a violation of
49 CFR part 605. FTA finds this regulatory scheme problematic because a
party may believe that it may file a complaint alleging a school bus
operations violation years after the potential violation occurred. At
that point, valuable evidence may be lost or destroyed. Under FTA's
proposal, the complainant must file its complaint with the Chief
Counsel within ninety days after the alleged event giving rise to the
complaint occurred. FTA invites the public to comment on whether it
should impose a different time limit on parties wishing to file a
complaint under 49 CFR part 605.
iii. Burden of Persuasion
Under the current regulatory scheme, FTA does not identify which
party carries the burden of persuasion in a school bus operations
adjudication. In this notice, FTA proposes to impose on the complainant
the burden of persuasion, that is, the complainant loses if the
evidence is equally balanced. FTA notes that this is the default rule
in an administrative adjudication,\59\ and FTA invites the public to
comment on whether it should utilize some other standard.
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\59\ See, e.g., Schaffer ex rel Schaffer v. Weast, 546 U.S. 49,
56 (2005).
---------------------------------------------------------------------------
iv. Standard of Proof
Under the current regulatory scheme, FTA does not identify a
standard of proof in a school bus operations administrative
adjudication. In this notice, FTA proposes to utilize a preponderance
of the evidence standard. FTA notes that the preponderance of the
evidence standard is the default standard in administrative
adjudications,\60\ and to hold something by a preponderance of the
evidence means that something is more likely so than not so. FTA
invites the public to comment on whether it should utilize some other
standard of proof.
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\60\ See, e.g., Yzaguirre v. Barnhart, 58 F.App'x 460, 462 (10th
Cir. 2003) (quoting Jones ex rel Jones v. Chater, 101 F.3d 509, 512
(7th Cir. 1996)).
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v. School Bus Operations Factors
In practice, when evaluating a school bus operations issue under 49
CFR part 605, FTA weighs and considers a series of factors when
determining whether a grantee provided school bus operations. In this
notice, FTA presents factors that should provide clearer guidance in
its school bus operations regulations. FTA's intent is to codify an
objective standard for evaluating a potential school bus operations
violation. The non-exhaustive list of factors is as follows.
(1) Whether and to what extent a grantee designed and intended
to design its service to meet the demands of a school or school
district. If a grantee designed and intended its service to meet the
demands of a school or school district, then the service is more
likely to be a school bus operation.
(2) Whether and to what extent the grantee controls its routes
and schedules. If the grantee does not control its routes and
schedules, but instead, a school or school district controls the
routes and schedules at issue, then the service is more likely to be
a school bus operation.
(3) Whether and to what extent students' residences and schools
serve as the starting or ending points of a route. If students'
residences and schools serve as the starting or ending points of a
route, then the service is more likely to be a school bus operation.
(4) Whether and to what extent the grantee publicizes the
service at issue. If the grantee does not publicize the service at
issue, for example by not publicizing the service in its regularly
published route schedules and maps, then the service is more likely
to be a school bus operation.
(5) Whether and to what extent the grantee's service displaces
private school bus operators. If the grantee's service displaces
private school bus operators, then the service is more likely to be
a school bus operation.
(6) Whether and to what extent the grantee's service is open to
the public. If the grantee's service is open to the public, then the
service is less likely to be a school bus operation.
(7) The extent to which non-students use the grantee's service.
If a significant portion of non-students use the grantee's service
at issue, then the service is less likely to be a school bus
operation.
(8) Whether and to what extent the grantee operates its service
during times when school is not in session. If the grantee operates
the service at issue during times when school is not in session,
then the service is less likely to be a school bus operation.
(9) The frequency of the grantee's service during times when
school is in session. If the grantee frequently operates the service
at issue during times when school is in session, then the service is
less likely to be a school bus operation.
(10) Whether and the extent to which buses stop at clearly
marked regular route stops. If buses stop at clearly marked regular
route stops, then the service is less likely to be a school bus
operation.
FTA invites the public to comment on whether it should utilize these
factors or some of these factors in its analysis of a school bus
operations issue.
vi. Previous Oversight Findings
Under 49 U.S.C. 5307(h)(2), Congress mandates FTA to conduct
periodic, triennial reviews of its grantees to ensure that the grantees
are in compliance with the conditions imposed on them as recipients of
Federal funds.\61\ As a practical matter, however, a triennial review
is a constrained means of monitoring compliance.
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\61\ 49 U.S.C. 5307(h)(2).
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In a triennial review, if FTA finds that a grantee has complied
with its school bus operations regulations, then that finding should
not preclude FTA from later finding, pursuant to a complaint filed
under 49 CFR part 605, that a grantee has violated the school bus
operations prohibition. At the time of a triennial review, FTA may not
have all the pertinent facts when it makes a school bus operations
finding. FTA may find new facts in a complaint proceeding. Therefore,
FTA proposes to add a provision in its school bus operations
regulations that, ``Any previous oversight findings of compliance with
the Federal Transit Administration's school bus operations regulations
will not preclude the Chief Counsel from finding a violation of this
part.''
vii. Independent Investigation
Under the current regulatory scheme, the Administrator may
investigate a grantee if the Administrator believes
[[Page 68383]]
that it has violated 49 CFR part 605.\62\ FTA proposes to amend this
section to allow the Chief Counsel to initiate and conduct an
investigation if it has reasonable suspicion to believe that a grantee
violated 49 CFR part 605.
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\62\ 49 CFR 605.31.
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b. Notification to the Respondent (Sec. 605.31)
Pursuant to 49 CFR 605.31, when a complainant files a complaint, or
if the Administrator has reason to believe that grantee violated FTA's
school bus operations regulations, the Administrator notifies the
grantee that it may have violated this 49 CFR part 605.\63\ FTA
proposes to overhaul this provision and insert new complaint procedures
at 49 CFR 605.21.
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\63\ 49 CFR 605.31.
---------------------------------------------------------------------------
i. Complaint Procedures
Under the current regulatory scheme, FTA imposes few requirements
on parties with respect to the format and content of their submissions
in a school bus operations proceeding. FTA finds that this system is
problematic because parties often do not provide FTA with the facts
that it needs to make well-informed decisions. Furthermore, the parties
often do not apply the facts of their cases to applicable laws.
Therefore, FTA proposes to update its school bus operations regulations
to require parties to provide clarity in their submissions.
Under FTA's proposal, FTA would require a complainant to identify a
potential violator of 49 CFR part 605, the specific provisions of 49
CFR part 605 that were violated, any relevant documentation, a brief
statement of the relevant facts, and the harm suffered by the
complainant. Additionally, FTA would require parties, in their
responses, replies, and rebuttals, to provide FTA with a brief
statement of the relevant facts, admissions or denials where
appropriate, affirmative defenses where appropriate, and any supporting
documentation. FTA also proposes to allow parties to request extensions
of time, not to exceed thirty days for good cause, to file a submission
under this section.
Furthermore, under the current regulatory scheme, a respondent has
only one opportunity--in its response--to make its case to FTA. A
respondent is unable to rebut a complainant's reply which may include
additional facts or arguments that may merit an additional opportunity
for the respondent to file a submission. In FTA's proposal, FTA would
allow a respondent to file a rebuttal to a complainant's reply within
ten days of the date of service of the reply.
Additionally, under the current regulatory scheme, FTA allows a
respondent thirty (30) days to respond to a complaint.\64\ FTA allows
the complainant a ``like time'' to reply to the response. FTA finds
that this timeframe is ambiguous because FTA does not specify the
duration of the ``like time.'' In this notice, to provide clarity, FTA
proposes to allow a complainant to reply to a response within twenty
(20) days from the date of service of the respondent's response.
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\64\ 49 CFR 605.32.
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ii. Third Party Intervention
Under the current regulatory scheme, FTA has no explicit authority
to allow third parties to intervene in a school bus operations
proceeding. In some instances, a third party may be integral to a
proceeding because the existing parties may not adequately represent
the third party's interests and the third party consequently may suffer
harm. Therefore, FTA proposes to add 49 CFR 605.22 to explicitly allow
a third party to intervene in a school bus operations proceeding if it
demonstrates to the satisfaction of the Chief Counsel that the parties
to the proceeding do not adequately represent the third party's
interests and that it will suffer harm if the Chief Counsel does not
grant its motion to intervene.
iii. Dismissal of a Complaint
FTA proposes to add 49 CFR 605.23 to provide the Chief Counsel with
authority to dismiss a complaint or any claim in a complaint, with
prejudice, if the complaint or claim is outside FTA's jurisdiction, the
complainant does not state a claim, or the complainant lacks standing.
iv. Incomplete Complaint
FTA proposes to add 49 CFR 605.24 to provide the Chief Counsel with
authority to dismiss a complaint without prejudice if the complaint is
deficient as to one or more of the requirements set forth in FTA's
proposed 49 CFR 605.21.
v. Filing of a Complaint
Under the current regulatory scheme, FTA requires parties to submit
to FTA paper submissions in a school bus operations proceeding. Since
1976, the year that FTA promulgated its school bus operations
regulations, technology has undergone huge advancements. For example,
electronic dockets available through Regulations.gov provide
opportunities for Federal agencies to conduct adjudicative proceedings
electronically. FTA believes that electronic dockets promote
transparency in the Federal government, preserve public documents in an
easily accessible public forum, and provide parties with a simple and
efficient method of filing submissions in administrative adjudications.
For these reasons, FTA proposes to add 49 CFR 605.25 to create an
electronic filing system for its complaint process through
Regulations.gov.
vi. Service
Under the current regulatory scheme, FTA does not require parties
to serve copies of their submissions to opposing parties. FTA finds
this system problematic because parties may not be aware of complaints
and other submissions filed with FTA on a timely basis. In this notice,
FTA proposes to require parties to serve copies of all submissions that
they file with FTA on all other opposing parties.
vii. Appeal From Chief Counsel's Decision
Under the current regulatory scheme, a party adversely affected by
a decision may not file an appeal with FTA before filing an action in
United States District Court. FTA finds that this system has prevented
FTA from remedying issues administratively so that parties need not
seek relief in expensive and protracted litigation before United States
courts. In this notice, FTA proposes to add 49 CFR 605.29 to allow
parties adversely affected by a decision of the Chief Counsel to file
an appeal with the Administrator. On appeal, the Administrator shall
review the entire administrative record within the context of any issue
on appeal, and the Administrator shall issue a final decision. FTA also
proposes to amend 49 CFR 605.30 to authorize the Administrator to
review the Chief Counsel's decision at his or her own motion. FTA
invites the public to comment on whether it should utilize a different
standard of review on appeal.
c. Accumulation of Evidentiary Material (Sec. 605.32)
Under the current regulatory scheme, the Administrator allows the
respondent to respond to a complaint within thirty days of receipt of
the complaint.\65\ The Administrator allows the complainant to reply to
the respondent's response within ``a like period.'' \66\ The
Administrator may undertake such
[[Page 68384]]
further investigation as the Administrator deems necessary.\67\
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\65\ 49 CFR 605.32.
\66\ 49 CFR 605.32.
\67\ 49 CFR 605.32.
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FTA proposes to amend its procedures for accumulating evidentiary
material with its provisions at 49 CFR 605.20-605.26 as discussed
above.
d. Adjudication (Sec. 605.33)
Under the current regulatory scheme, the Administrator issues a
written decision at the conclusion of a school bus operations
proceeding.\68\ If the Administrator determines that a grantee violated
49 CFR part 605, then the Administrator shall order such remedial
measures as the Administrator deems appropriate.\69\ FTA proposes to
reorganize this section by moving the provision regarding the
Administrator's remedial measures to 49 CFR 605.28--the proposed
section that outlines the remedies available to FTA.
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\68\ 49 CFR 605.33(a).
\69\ 49 CFR 605.33(b).
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e. Remedy Where There Has Been a Violation of the Agreement (Sec.
605.34)
FTA proposes to amend the provisions at 49 CFR 605.34 regarding
remedies for a violation of the school bus agreement. Under the
Federal-Aid Highway Act of 1973, Congress instructed the Urban Mass
Transportation Administration (UMTA), now FTA, that if it found a
violation of the school bus operations prohibition, then it ``shall bar
such applicant from receiving any other federal financial assistance. *
* *'' \70\ FTA subsequently implemented this statutory provision at 49
CFR 605.34 which states, ``If the Administrator determines * * * that
there has been a violation of the terms of the agreement, he may bar a
grantee or operator from the receipt of further financial assistance
for mass transportation facilities and equipment.'' \71\
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\70\ Federal-Aid Highway Act sec. 164(b).
\71\ 49 CFR 605.34.
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Under this framework, the Administrator did not exercise the remedy
provision at 49 CFR 605.34 because such an action would completely bar
a grantee or operator from the receipt of financial assistance and
significantly obstruct their ability to provide public transportation.
That changed when Congress enacted the Safe, Accountable, Flexible,
Efficient Transportation Equity Act: A Legacy for Users, and amended 49
U.S.C. 5323(f) as follows, ``If the Secretary finds that an applicant,
governmental authority, or publicly owned operator has violated the
agreement * * * the Secretary shall bar a recipient or an operator from
receiving Federal transit assistance in an amount the Secretary
considers appropriate.'' \72\
---------------------------------------------------------------------------
\72\ SAFETEA-LU sec. 3023.
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FTA intends to implement the amended statutory provision at 49
U.S.C. 5323(f). Using the language of 49 U.S.C. 5323(f), FTA proposes
the following remedies provision at 49 CFR 605.28, ``If the Chief
Counsel determines, pursuant to this subpart, that a grantee has
violated this part or the terms of the agreement, then the Chief
Counsel shall bar the grantee from the receipt of further financial
assistance for public transportation in an amount that the Chief
Counsel considers appropriate.''
Additionally, FTA proposes to authorize the Chief Counsel to issue
cease and desist orders where appropriate. FTA believes that this
remedy will allow the Chief Counsel some additional flexibility when
issuing remedies and tailoring those remedies to the severity of the
violation.
Finally, FTA proposes to authorize the Chief Counsel to issue any
other such remedies that the Chief Counsel believes are appropriate.
FTA currently authorizes the Administrator to issue such remedies at 49
CFR 605.33(b). To illustrate, FTA may require a violator of 49 CFR part
605 to submit a remediation plan to FTA whereby it would outline a plan
to restructure its service so that it complies with FTA's school bus
operations regulations. FTA believes that this remedy will allow the
Chief Counsel some additional flexibility when issuing remedies and
tailoring those remedies to the severity of the violation.
f. Judicial Review (Sec. 605.35)
FTA proposes to restructure its regulatory scheme by moving the
judicial review provisions at 49 CFR 605.35 to a proposed 49 CFR
605.31.
5. Subpart E--Reporting and Records
a. Reports and Information (Sec. 605.40)
Under the current regulatory scheme, ``The Administrator may order
any grantee or operator for the grantee, to file special or separate
reports setting forth information relating to any transportation
service rendered by such grantee or operator, in addition to any other
reports required by this part.'' \73\ FTA does not propose to amend
this section.
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\73\ 49 CFR 605.40.
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b. Proposed Subpart E--Grandfathering of Existing School Bus Operations
FTA proposes to add 49 CFR 605.50 to include grandfathering
provisions in its amended regulatory framework. FTA recognizes that
some grantees may need significant time to modify their school bus
operations to comply with FTA's amended 49 CFR part 605. Therefore, FTA
proposes to allow these grantees to modify their school bus operations
to comply with FTA's amended 49 CFR part 605 by June 30, 2010. With
this timeframe, FTA proposes to give these grantees until the end of
the next academic year to comply with this part.
FTA also proposes to allow grantees to provide school bus
operations to schools or school districts if the grantee provided the
school bus operations without payment from the schools or school
districts prior to August 1, 2008. If a grantee receives payment from a
school or school district for school bus operations on or after August
1, 2008, then this grandfathering provision no longer would apply.
6. Appendix A to Part 605
Under the current regulatory scheme, FTA attaches Appendix A to 49
CFR part 605 which is an opinion of the Comptroller General of the
United States dated December 7, 1966. The Comptroller General discusses
the definition of the term ``incidental.'' FTA used this discussion to
clarify its definition of the term ``incidental'' as used in its
charter service regulations at 49 CFR part 604 and its school bus
operations regulations at 49 CFR part 605. FTA recently promulgated
amended charter service regulations at 49 CFR part 604, and FTA
proposes to delete Appendix A to 49 CFR part 605 because it is no
longer applicable in light of FTA's amended charter service
regulations.
III. Rulemaking Analyses and Notices
A. Executive Order 12866: Regulatory Planning and Review/DOT Regulatory
Policies and Procedures
Under Executive Order 12866, the U.S. Department of Transportation
(DOT) must examine whether this proposed rule is a ``significant
regulatory action.'' A significant regulatory action is subject to the
Office of Management and Budget (OMB) review and the requirements of
the Executive Order. Executive Order 12866 defines ``significant
regulatory action'' as one that is likely to result in a rule that may:
(1) Have an annual effect on the economy of $120 million or more or
adversely affect in a material way the economy; a sector of the
economy; productivity; competition; jobs; the environment; public
health or safety; or state, local, or tribal governments or
communities; (2) Create a serious
[[Page 68385]]
inconsistency or otherwise interfere with an action taken or planned by
another agency; (3) Materially alter the budgetary impact of
entitlements, grants, user fees, or loan programs or the rights and
obligations of recipients thereof; or (4) Raise novel legal or policy
issues arising out of legal mandates, the President's priorities, or
the principles set forth in the Executive Order.
This rulemaking is not a significant regulatory action within the
meaning of Executive Order 12866, and, therefore, this rulemaking was
not reviewed by OMB. Further, this rule is not significant under DOT's
regulatory policies and procedures. This Notice of Proposed Rulemaking
contains revisions that are clarifying in nature.
FTA does not anticipate this rule to adversely affect, in a
material way, any sector of the economy. Through this rulemaking, FTA
proposes to effectuate the purpose of 49 U.S.C. 5323(f) and to clarify
provisions to protect private school bus operators from unfair
competition by federally subsidized public transit agencies; thus,
these changes should increase economic opportunities for private school
bus operators. Additionally, this proposed rule would not create a
serious inconsistency with another agency's action or materially alter
the budgetary impact of any entitlements, grants, user fees, or loan
programs. Consequently, a full regulatory evaluation is not required.
FTA also estimates the costs associated with this rule to be minimal
because the rule clarifies definitions and exemptions.
B. Executive Order 13132: Federalism
Executive Order 13132 requires agencies to assure meaningful and
timely input by state and local officials in the development of
regulatory policies that may have a substantial, direct effect on the
states, on the relationship between the national government and the
states, or on the distribution of power and responsibilities among the
various levels of government. FTA has analyzed this Notice of Proposed
Rulemaking in accordance with the principles and criteria contained in
Executive Order 13132, and FTA has determined that this Notice of
Proposed Rulemaking would not have sufficient federalism implications
to warrant the preparation of a federalism assessment. FTA has also
determined that this Notice of Proposed Rulemaking would not preempt
any state law or regulation or affect a state's ability to discharge
traditional state governmental functions.
C. Executive Order 13175: Consultation and Coordination With Indian
Tribal Governments
Executive Order 13175 requires agencies to assure meaningful and
timely input from Indian tribal government representatives in the
development of rules that ``significantly or uniquely affect'' Indian
communities and that impose ``substantial and direct compliance costs''
on such communities. FTA has analyzed this proposed rule under
Executive Order 13175 and FTA believes 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
impact statement is not required.
D. National Environmental Policy Act
As a rulemaking process, FTA concludes that this proposed action is
categorically excluded from the requirements of the National
Environmental Policy Act (NEPA) and FTA's NEPA regulation at 23 CFR
771.117(c)(20). Although FTA's NEPA regulation requires some level of
environmental review even for those activities that are categorically
excluded if they involve ``unusual circumstances,'' 23 CFR 771.117(b),
FTA finds that the proposed action, if finalized, would not result in
the unusual circumstances that would cause FTA to perform an
environmental review. Although commenters on FTA's Notice of Proposed
Policy Statement on FTA's School Bus Operations Regulations \74\ raised
concerns about the environmental effects of the operation of school
buses relative to the operation of transit buses, FTA lacks the
evidence and data on the numerous variables necessary to predict
differences between operating the various types of buses that are used
in both public and private school transportation. Furthermore, it is
impossible to predict the likely minor changes in the types of buses
used that would result from FTA's proposal.
---------------------------------------------------------------------------
\74\ 73 FR 28,790 (May 19, 2008).
---------------------------------------------------------------------------
E. Paperwork Reduction Act
Under the Paperwork Reduction Act of 1995 \75\ (PRA), a Federal
agency must obtain approval from OMB for each collection of information
it conducts, sponsors, or requires through regulations. This Notice of
Proposed Rulemaking does not impose any paperwork collection
requirements.
---------------------------------------------------------------------------
\75\ See 44 U.S.C. Chapter 35 (2006).
---------------------------------------------------------------------------
F. 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.'' \76\ Under section 605 of the RFA, Congress allows an
agency to certify a rule, in lieu of preparing an analysis, if the
agency does not expect the proposed rulemaking to have a significant
economic impact on a substantial number of small entities.
---------------------------------------------------------------------------
\76\ 5 U.S.C. 603(a) (2006).
---------------------------------------------------------------------------
The nature of this rulemaking is to effectuate the purpose of 49
U.S.C. 5323(f) and to prevent unfair competition by federally
subsidized public transit agencies with private school bus operators.
FTA invites comment on the economic impact of the proposed regulations
on small entities.
G. Unfunded Mandates Reform Act of 1995
In this notice, FTA does not propose to impose unfunded mandates as
defined by the Unfunded Mandates Reform Act of 1995.\77\ This Notice of
Proposed Rulemaking 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.\78\
---------------------------------------------------------------------------
\77\ Unfunded Mandates Reform Act of 1995, Public Law 104-4, 109
Stat. 48 (1995).
\78\ See 2 U.S.C. 1532 (2006).
---------------------------------------------------------------------------
List of Subjects in 49 CFR Part 605
School bus operations.
In consideration of the foregoing, FTA amends Chapter VI of Title
49 of the Code of Federal Regulations as set forth below.
Title 49--Transportation
1. Revise part 605 to read as follows:
PART 605--SCHOOL BUS OPERATIONS
Subpart A--General
Sec.
605.1 Purpose.
605.2 Scope.
605.3 Definitions.
Subpart B--School Bus Operations Prohibition and Agreement
605.10 Prohibition.
605.11 Agreement.
605.12 Exemptions.
605.13 Exceptions.
Subpart C--Complaint Procedures and Remedies
605.20 General.
605.21 Complaint Procedures.
[[Page 68386]]
605.22 Third Party Intervention.
605.23 Dismissal of a Complaint.605.24 Incomplete Complaint.
605.25 Filing of a Complaint.
605.26 Service.
605.27 Adjudication.
605.28 Remedies.
605.29 Appeal from the Chief Counsel's Decision.
605.30 Administrator's Discretionary Review of the Chief Counsel's
Decision.
605.31 Judicial Review of a Final Decision and Order.
Subpart D--Reporting and Records
605.40 Reports and Information.
Subpart E--Grandfathering of Existing School Bus Operations
605.50 Grandfathering Provisions.
Authority: 49 U.S.C. 5323(f); 49 CFR 1.51.
Subpart A--General
Sec. 605.1 Purpose.
(a) The purpose of this part is to prescribe policies and
procedures to implement 49 U.S.C. 5323(f).
(b) By the terms of 49 U.S.C. 5323(f), financial assistance under
this chapter may be used for a capital project, or to operate public
transportation equipment or a public transportation facility, only if
the applicant agrees not to provide schoolbus transportation that
exclusively transports students and school personnel in competition
with a private schoolbus operator.
Sec. 605.2 Scope.
These regulations apply to all recipients of financial assistance
for the construction or operation of facilities and equipment for use
in providing public transportation under 49 U.S.C. Chapter 53 and 23
U.S.C. 133 and 142.
Sec. 605.3 Definitions.
(a) Terms defined at 49 U.S.C. Chapter 53 shall have the same
meaning in this part.
(b) For purposes of this part:
The Acts means the Urban Mass Transportation Act of 1964, as
amended and codified at 49 U.S.C. Chapter 53, and 23 U.S.C. 133 and
142.
Administrator means the Federal Transit Administration
Administrator or his or her designee.
Adequate transportation means transportation for students and
school personnel which the Chief Counsel determines conforms to
applicable safety laws, is on time, poses a minimum of discipline
problems, is not subject to fluctuating rates, and is operated
efficiently and in harmony with state educational goals and programs.
Agreement means an agreement required under 49 U.S.C. 5323(f).
Applicant means applicant for assistance under the Acts.
Assistance means Federal financial assistance for the purchase,
financing, leasing, or operation of buses and equipment and the
construction, financing, leasing, or operation of facilities for use in
providing public transportation services under the Acts, but does not
include research, development, and demonstration projects funded under
the Acts.
Chief Counsel means the Federal Transit Administration Chief
Counsel or his or her designee.
Exclusively means transportation that a reasonable person would
conclude was designed primarily to accommodate school students,
personnel, or equipment, without regard to demand from the non-student
general public.
Geographic service area means the area in which a recipient is
authorized to provide public transportation service under appropriate
local, state, and Federal law.
Government means the Government of the United States of America.
Grantee means a recipient, including a subrecipient, of assistance
under the Acts.
Interested party means an individual, partnership, corporation,
association, public organization, private organization, or its duly
authorized representative, that has a financial interest which is
adversely affected by the act or acts of a grantee with respect to
school bus operations.
Reasonable rates means rates which are fair and equitable taking
into consideration the local conditions which surround the geographic
service area where the rate is in question, including the portion of
Federal assistance that a grantee uses or intends to use to provide
school bus operations.
School bus operations means transportation by bus exclusively for
school students, personnel, and equipment.
Subpart B--School Bus Operations Prohibition and Agreement
Sec. 605.10 Prohibition.
A grantee shall not provide, or contract to provide, school bus
operations, except as provided in Sec. 605.12 and Sec. 605.13.
Sec. 605.11 Agreement.
(a) The Federal Transit Administration shall not provide assistance
under the Acts unless the applicant or grantee agrees not to provide
school bus operations exclusively for students and school personnel in
competition with a private school bus operator, except as provided in
Sec. 605.12 and Sec. 605.13.
(b) A grantee shall satisfy Sec. 605.11(a) by submitting and
certifying to the Federal Transit Administration its ``Annual List of
Certifications and Assurances for Federal Transit Administration Grants
and Cooperative Agreements'' and by subscribing to the Federal Transit
Administration's ``Master Agreement.''
(c) The ``Annual List of Certifications and Assurances for Federal
Transit Administration Grants and Cooperative Agreements'' and the
Federal Transit Administration's ``Master Agreement'' shall state as
follows:
The [Grantee, Recipient, or Applicant] agrees that it will not
provide school bus operations exclusively for students and school
personnel in competition with a private school bus operator, except
as provided in 49 U.S.C. 5323(f), 49 CFR Part 605, and any relevant
Federal Transit Administration directives. The [Grantee, Recipient,
or Applicant] agrees that it will comply with all the provisions of
49 U.S.C. 5323(f), 49 CFR Part 605, and any relevant Federal Transit
Administration directives.
Sec. 605.12 Exemptions.
(a) The school bus operations prohibition at Sec. 605.10 shall not
apply where:
(1) The grantee uses various fare collection or subsidy systems for
students, the grantee modifies the frequency of service, and the
grantee makes a one-half mile or less route deviation from a route
within a one-half mile or less radius of a school building;
(2) The grantee operates a school system in a grantee's geographic
service area and also operates a separate and exclusive school bus
program for that school system; or
(3) The grantee is a state or local public body or agency thereof,
or a direct predecessor in interest which has acquired the function of
transporting school students and personnel along with facilities to be
used therefor, which provided school bus operations:
(i) In the case of a grant involving the purchase of buses--
anytime during the twelve (12) month period immediately prior to
August 13, 1973; or
(ii) In the case of a grant for construction or operating of
facilities and equipment made pursuant to 49 U.S.C. Chapter 53,
anytime during the twelve (12) month period immediately prior to
November 26, 1974.
Sec. 605.13 Exceptions.
(a) Exceptions. An applicant or grantee may petition the Chief
Counsel for an exception to the school bus operations prohibition at
Sec. 605.10 where private school bus operators in the applicant's or
grantee's geographic
[[Page 68387]]
service area are unable to provide adequate transportation at a
reasonable rate and in conformance with applicable safety standards.
(b) Procedures. An applicant or grantee shall provide notice to the
Chief Counsel that it intends to apply for a ``Petition for an
Exception,'' and the applicant or grantee shall complete the following:
(1) An applicant or grantee shall send the notice required under
Sec. 605.13(b)(1) by electronic mail to the Chief Counsel at
[email protected].
(2) An applicant or grantee shall include the following information
in its notice:
(i) A description of the geographic service area that the applicant
or grantee intends to serve;
(ii) A description of the schools and school districts that the
applicant or grantee intends to serve;
(iii) A description of the anticipated ridership related to the
school bus operation;
(iv) An estimation of the number and types of buses that the
applicant or grantee intends to utilize for the school bus operation;
(v) A description of the duration of the school bus operation;
(vi) A description of the frequency of daily service related to the
school bus operation;
(vii) An analysis regarding the extent to which the proposed school
bus operation complies with local, state, and Federal safety laws;
(vii) A summary of the fully allocated costs related to the school
bus operation; and
(viii) The rate that the applicant or grantee intends to charge for
the school bus operation.
(c) The Federal Transit Administration shall open an electronic
Petition for an Exception Docket and file the notice at http://www.regulations.gov.
(d) The Federal Transit Administration shall transmit a copy of the
notice and its docket number to the applicant or grantee and the
National School Transportation Association.
(e) Any private operator having a place of business in the
applicant's or grantee's geographic service area may, within thirty
(30) days of the notice's docketing date, submit comments on the
Petition for an Exception Docket demonstrating the extent to which it
can provide school bus operations that constitute adequate
transportation at a reasonable rate and in conformance with applicable
safety standards.
(f) Petition for an Exception. After the thirty (30) day comment
period closes, an applicant or grantee may petition the Chief Counsel
for an exception to the school bus operations prohibition at Sec.
605.10 after completing the following steps:
(1) The applicant or grantee shall title the petition ``Petition
for an Exception'';
(2) The applicant or grantee shall file the Petition for an
Exception electronically in the appropriate Petition for an Exception
Docket at http://www.regulations.gov or mail it to the Docket Office at
1200 New Jersey Avenue, SE., West Building Ground Floor, Room W12-140,
Washington, DC 20590;
(3) The applicant or grantee shall send an executed original copy
of the Petition for an Exception by U.S. mail to the Chief Counsel at
1200 New Jersey Avenue, SE., East Building--5th Floor, Washington, DC
20590; and
(4) The applicant or grantee shall include in its Petition for an
Exception the applicant's or grantee's response to any comments filed
in the docket before the close of the thirty (30) day comment period.
(g) To qualify for an exception under this section, the applicant
or grantee shall demonstrate to the satisfaction of the Chief Counsel
that no private operator having a place of business in the applicant's
or grantee's geographic service area can provide school bus operations
that constitute adequate transportation at a reasonable rate and in
conformance with applicable safety standards.
(h) The Chief Counsel shall issue a written decision that either
grants or denies the applicant's or grantee's Petition for an
Exception.
(i) If the applicant or grantee fails to satisfy any of the
requirements in this section, then the Chief Counsel may dismiss the
Petition for an Exception with or without prejudice.
Subpart C--Complaint Procedures and Remedies
Sec. 605.20 General.
(a) Standing. Any interested party affected by an alleged
noncompliance of this part may file a complaint with the Chief Counsel
alleging a violation or violations of this part.
(b) Time Limit for Filing a Complaint. The complainant shall file
its complaint with the Chief Counsel within ninety (90) days after the
alleged event giving rise to the complaint occurred.
(c) Burden of Persuasion. The complainant bears the burden of
persuasion in a proceeding under this subpart, that is, the complainant
loses if the evidence is equally balanced.
(d) Standard of Proof. The standard of proof in a proceeding under
this subpart is a preponderance of the evidence standard. To hold
something by a preponderance of the evidence means that something is
more likely so than not so.
(e) School Bus Operations Factors. The Chief Counsel may weigh and
consider a variety of factors in determining whether a grantee
provided, or contracted to provide, school bus operations, including,
but not limited to, the following:
(1) Whether and to what extent the grantee designed and intended to
design its service to meet the demands of a school or school district;
(2) Whether and to what extent the grantee controls its routes and
schedules;
(3) Whether and to what extent students' residences and schools
serve as the starting or ending points of a route;
(4) Whether and to what extent the grantee publicizes the service
at issue;
(5) Whether and to what extent the grantee's service displaces
private school bus operators;
(6) Whether and to what extent the grantee's service is open to the
public;
(7) The extent to which students and non-students utilize the
grantee's service;
(8) Whether and to what extent the grantee operates its service
during times when school is not in session;
(9) The frequency of the grantee's service during times when school
is in session; and
(10) Whether and the extent to which buses stop at clearly marked
regular route stops.
(f) Previous Oversight Findings. Any previous oversight findings of
compliance with the Federal Transit Administration's school bus
operations regulations will not preclude the Chief Counsel from finding
a violation of this part, particularly when the Chief Counsel finds new
facts during the course of a proceeding under this subpart which were
not known or available during a triennial review.
(g) Independent Investigation. If the Chief Counsel, at any time,
has reasonable suspicion to believe that a grantee violated this part,
then the Chief Counsel may initiate and conduct an investigation and
take appropriate action pursuant to this part.
Sec. 605.21 Complaint Procedures.
(a) Complaint. In its complaint, the complainant shall:
(1) Title its complaint ``School Bus Operations Complaint'';
(2) State the name and address of each grantee that is the subject
of the complaint, and, with respect to each
[[Page 68388]]
grantee, state the specific provision(s) of this part that the
complainant believes were violated;
(3) Serve the complaint in accordance with Sec. 605.26, along with
all documents then available in the exercise of reasonable diligence
that are offered in support of the complaint, upon each grantee named
in the complaint as being responsible for the alleged actions(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; and
(5) Describe how the complainant was directly and substantially
affected by the action(s) or omission(s) of the grantee(s).
(b) Withdrawal of Complaint. The complainant may withdraw a
complaint at any time by serving a ''Notification of Withdrawal'' on
the Chief Counsel and the respondent.
(c) Docketing of Complaint. Unless the Chief Counsel dismisses the
complaint pursuant to this subpart, the Chief Counsel shall notify the
complainant and respondent that the Chief Counsel received the
complaint and that the complaint has been docketed.
(d) Response. (1) The respondent shall have thirty (30) days from
the date of service of the Chief Counsel's notification under Sec.
605.21(a)(3) to file a response.
(2) In its response, the respondent shall provide a concise but
complete statement of the facts upon which the respondent relies to
substantiate its answers, admissions, denials, or averments.
(3) In its response, the respondent shall provide supporting
documentation upon which the respondent relies.
(4) In its response, the respondent shall admit or deny each
allegation made in the complaint or state that it is without sufficient
knowledge or information to admit or deny an allegation.
(5) In its response, the respondent shall assert any affirmative
defense.
(6) In its response, the respondent may make a motion to dismiss
the complaint, or any portion thereof, with a supporting memorandum of
points and authorities.
(e) Reply. (1) The complainant may file a reply within twenty (20)
days of the date of service of the respondent's response.
(2) In its reply, the complainant shall provide a concise but
complete statement of the facts upon which the complainant relies to
substantiate its answers, admissions, denials, or averments.
(3) In its reply, the complainant shall provide supporting
documentation upon which the complainant relies.
(f) Rebuttal. (1) The respondent may file a rebuttal within ten
(10) days of the date of service of the reply.
(2) In its rebuttal, the respondent shall provide a concise but
complete statement of the facts upon which the respondent relies to
substantiate its answers, admissions, denials, or averments.
(3) In its rebuttal, the respondent shall provide supporting
documentation upon which the respondent relies.
(g) Extensions of Time. A party may request from the Chief Counsel
an extension of time, not to exceed thirty (30) days, for good cause,
to file a submission with the Chief Counsel under this section. The
Chief Counsel may grant an extension of time to a party as he or she
deems appropriate.
(h) Evidentiary Hearing. The Chief Counsel, as he or she deems
appropriate, may hold an evidentiary hearing to allow each party to
submit evidence under this part.
Sec. 605.22 Third Party Intervention.
(a) Any interested party may submit a motion to the Chief Counsel
requesting intervention in a proceeding under this subpart.
(b) The party requesting intervention shall demonstrate to the
satisfaction of the Chief Counsel that the parties to the proceeding do
not adequately represent the third party's interests and that it will
suffer harm if the Chief Counsel does not grant its motion to
intervene.
(c) The Chief Counsel may grant or deny the motion to intervene.
Sec. 605.23 Dismissal of a Complaint.
(a) The Chief Counsel may dismiss a complaint or any claim in a
complaint, with prejudice, if:
(1) On its face, it appears to be outside the jurisdiction of the
Federal Transit Administration under the Acts;
(2) On its face, it does not state a claim that warrants an
investigation or further action by the Federal Transit Administration;
or
(3) The complainant lacks standing to file a complaint under this
part.
(b) The Chief Counsel shall provide reasons for dismissing a
complaint or any claim in the complaint.
Sec. 605.24 Incomplete Complaint.
(a) If the Chief Counsel does not dismiss a complaint under Sec.
602.23, but the complaint is deficient as to one or more of the
requirements set forth in Sec. 605.21, then the Chief Counsel may
dismiss the complaint.
(b) If the Chief Counsel dismisses a complaint under this section,
then the Chief Counsel shall dismiss the complaint without prejudice
and the complainant may re-file a complaint after amendment to correct
the deficiency.
(c) The Chief Counsel shall include in the dismissal under this
section the reasons for the dismissal without prejudice.
Sec. 605.25 Filing of a Complaint.
(a) Filing Address and Method of Filing. (1) The complainant shall
file the complaint electronically in the School Bus Operations
Complaint docket at http://www.regulations.gov or mail it to the Docket
Office at 1200 New Jersey Avenue SE., West Building Ground Floor, Room
W12-140, Washington, DC 20590.
(2) Parties shall file responses, replies, rebuttals, appeals, and
responses to appeals electronically in the School Bus Operations
Complaint docket at http://www.regulations.gov or mail it to the Docket
Office at 1200 New Jersey Avenue SE., West Building Ground Floor, Room
W12-140, Washington, DC 20590.
(b) Date. Unless the date is shown to be inaccurate, documents
filed with the Federal Transit Administration shall be deemed filed, on
the earliest of:
(1) The date that the party filed the document electronically in
the School Bus Operations Complaint docket at http://www.regulations.gov;
(2) The date of personal delivery;
(3) The mailing date shown on the certificate of service;
(4) The date shown on the postmark if there is no certificate of
service; or
(5) The mailing date shown by other evidence if there is no
certificate of service and no postmark.
(c) Electronic Mail or Facsimile. A document sent by electronic
mail or facsimile shall not constitute service as described in this
subpart.
(d) Number of Copies. Each party shall send to the Chief Counsel by
personal delivery or by U.S. mail return receipt requested an executed
original copy of each document that it electronically files on the
School Bus Operations Complaint docket. Each party shall send the
executed original copy to the Chief Counsel at 1200 New Jersey Avenue
SE., East Building--5th Floor, Washington, DC 20590.
(e) Form. Each party shall type or legibly print each document that
it files with the Office of Chief Counsel. In the case of docketed
proceedings, the document shall include a title and the docket number,
as established by the Chief Counsel, of the proceeding on the front
page.
(f) Signing of Documents and Other Papers. Either the complainant
or a duly
[[Page 68389]]
authorized representative of the complainant shall sign the original
copy of each document that it files with the Office of Chief Counsel.
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, that 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.
Sec. 605.26 Service.
(a) Designation of Person to Receive Service. (1) In its complaint,
the complainant shall:
(i) State the complainant's name, post office address, and
telephone number;
(ii) State the complainant's facsimile number, if any, and e-mail
addresses, if any; and
(iii) Designate a person to receive service on behalf of the
complainant.
(2) If any of the items in paragraph (a) of this section change
during the proceeding, then the complainant promptly shall file notice
of the change with the Chief Counsel and shall serve the notice on each
party to the proceeding.
(b) Who Must be Served. Each party shall serve a copy of each
document that it files with the Chief Counsel to each other party to
the proceeding. Each party shall include a certificate of service on
each document when the party tenders it for filing and shall certify
concurrent service on each other party. 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 by
[specify method of service]:
[list persons and addresses]
Dated this ----day of ------, 20--.
[signature], for [party]
(c) Method of Service. Unless otherwise agreed by the parties, as
appropriate, the method of service is personal delivery or U.S. mail.
(d) Presumption of Service. There shall be a presumption of lawful
service:
(1) When a person who customarily or in the ordinary course of
business receives mail at the address of the party or the person
designated under this section acknowledges receipt; or
(2) When a properly addressed envelope, sent to the last known
address, has been returned as undeliverable, unclaimed, or refused.
Sec. 605.27 Adjudication.
(a) Upon the conclusion of a proceeding under this subpart, the
Chief Counsel shall issue a written determination as to whether a
grantee has committed a violation of this part.
(b) The Chief Counsel shall include an analysis and explanation of
his or her findings in the determination.
Sec. 605.28 Remedies.
(a) If the Chief Counsel determines that a grantee has violated
this part or the terms of the agreement, then the Chief Counsel shall
bar the grantee from the receipt of financial assistance for public
transportation in an amount that the Chief Counsel considers
appropriate.
(b) If the Chief Counsel determines that a grantee has violated
this part or the terms of the agreement, then the Chief Counsel may
issue a cease and desist order requiring the grantee to cease and
desist from the provision of the service at issue.
(c) If the Chief Counsel determines, pursuant to this subpart, that
a grantee has violated this part or the terms of the agreement, then
the Chief Counsel may issue other remedies as the Chief Counsel
determines are appropriate.
Sec. 605.29 Appeal from the Chief Counsel's Decision.
(a) Each party adversely affected by a decision of the Chief
Counsel may file an appeal with the Administrator within thirty (30)
days of the date of the Chief Counsel's decision.
(b) Procedures. (1) The appellant shall file the appeal
electronically and consistently with Sec. 605.25.
(2) The appellant shall serve a copy of the appeal on each appellee
by either personal delivery or U.S. mail consistent with Sec. 605.26.
(3) Each appellee may file a response to an appeal within twenty
(20) days after the appellant serves the appeal on the appellee.
(c) If a party files an appeal, then the Administrator shall review
the entire administrative record and issue a final agency decision
based on the administrative record that either accepts, rejects, or
modifies the Chief Counsel's decision. If a party does not file an
appeal, then the Administrator may review the Chief Counsel's decision
on his or her own motion. If the Administrator finds that a party is
not in compliance with this part, then the final agency order shall
include a statement of corrective action, if appropriate, and identify
remedies.
(d) If a party does not file an appeal, and the Administrator does
not review the Chief Counsel's decision on the Administrator's own
motion, then the Chief Counsel's decision shall take effect as the
final agency decision and order on the thirtieth day after the date
that the Chief Counsel issued the decision.
(e) The failure to file an appeal is deemed a waiver of any right
to seek judicial review of the Chief Counsel's decision that becomes a
final agency decision by operation of paragraph (c) of this section.
Sec. 605.30 Administrator's Discretionary Review of the Chief
Counsel's Decision.
(a) If the Administrator reviews the Chief Counsel's decision on
the Administrator's own motion, then the Administrator shall issue a
notice of review to each party by the thirtieth day after the date that
the Chief Counsel issued the decision.
(1) In the notice of review, the Administrator shall set forth the
specific findings of fact and conclusions of law in the Chief Counsel's
decision subject to review.
(2) Each party may file one brief on review to the Administrator or
rely on its post-hearing briefs to the Chief Counsel. Each party shall
file a brief on review no later than ten (10) days after the
Administrator serves notice of the review. Each party shall file and
serve its brief on review by personal delivery or U.S. mail consistent
with Sec. 605.26.
(3) The Administrator shall issue a final agency decision and order
within thirty (30) days after the due date of the briefs on review. If
the Administrator finds that a party is not in compliance with this
part, then the final agency order shall include a statement of
corrective action, if appropriate, and identify remedies.
(b) If the Administrator reviews a decision of the Chief Counsel on
the Administrator's own motion, then the Administrator shall stay the
Chief Counsel's decision pending a final decision by the Administrator.
Sec. 605.31 Judicial Review of a Final Decision and Order.
(a) A party may seek judicial review in an appropriate United
States District Court of a final decision and order as provided in 5
U.S.C. 701-706.
(b) The Chief Counsel's decision to dismiss a complaint under Sec.
605.24 does not constitute a final decision and order subject to
judicial review.
[[Page 68390]]
Subpart D--Reporting and Records
Sec. 605.40 Reports and Information.
The Administrator may order any grantee or operator for the grantee
to file special or separate reports setting forth information relating
to any transportation service rendered by such grantee or operator, in
addition to any other reports required by this part.
Subpart E--Grandfathering of Existing School Bus Operations
Sec. 605.50 Grandfathering Provisions.
(a) Each grantee shall have until June 30, 2010, to modify its
school bus operations to comply with this part.
(b) If a grantee provided school bus operations for a school or
school district and received no payment from that school or school
district for the school bus operations prior to August 1, 2008, then
that grantee may continue to provide the school bus operations for that
particular school or school district. If a grantee receives payment
from a school or school district for school bus operations on or after
August 1, 2008, then this grandfathering provision does not apply.
Issued in Washington, DC, on this 3rd day of November, 2008.
James S. Simpson,
Administrator.
[FR Doc. E8-26683 Filed 11-17-08; 8:45 am]
BILLING CODE 4910-57-P