[Code of Federal Regulations]
[Title 49, Volume 7]
[Revised as of October 1, 2006]
From the U.S. Government Printing Office via GPO Access
[CITE: 49CFR604.9]

[Page 15-18]
 
                        TITLE 49--TRANSPORTATION
 
CHAPTER VI--FEDERAL TRANSIT ADMINISTRATION, DEPARTMENT OF TRANSPORTATION
 
PART 604_CHARTER SERVICE--Table of Contents
 
                            Subpart A_General
 
Sec.  604.9  Charter service.

    (a) If a recipient desires to provide any charter service using FTA 
equipment or facilities the recipient must first determine if there are 
any private charter operators willing and able to provide the charter 
service which the recipient desires to provide. To the extent that there 
is at least one such private operator, the recipient is prohibited from 
providing charter service with FTA funded equipment or facilities unless 
one or more of the exceptions in Sec.  604.9(b) applies.
    (b) Exceptions. (1) A recipient may provide any and all charter 
service with FTA funded equipment and facilities to the extent that 
there are no willing and able private charter operators.
    (2) A recipient may enter into a contract with a private charter 
operator

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to provide charter equipment to or service for the private charter 
operator if:
    (i) The private charter operator is requested to provide charter 
service that exceeds its capacity; or
    (ii) The private charter operator is unable to provide equipment 
accessible to elderly and handicapped persons itself.
    (3) A recipient in a non-urbanized area may petition FTA for an 
exception to provide charter service directly to the customer if the 
charter service provided by the willing and able private charter 
operator or operators would create a hardship on the customer because:
    (i) The willing and able private charter operator or operators 
impose minimum durations pursuant to State regulation and the desired 
trip length is shorter than the mandatory trip length; or
    (ii) The willing and able private operator or operators are located 
too far from the origin of the charter service.
    (4) Any recipient may petition the Administrator for an exception to 
provide charter service directly to the customer for special events to 
the extent that private charter operators are not capable of providing 
the service.
    (5) A recipient may execute a contract with a government entity or a 
private, non-profit organization exempt from taxation under subsection 
501(c)(1), 501(c)(3), 501(c)(4), or 501(c)(19) of the Internal Revenue 
Code to provide charter service upon obtaining a certification from that 
entity or organization which states that:
    (i) [the entity/organization] certifies that it is a government 
entity or an organization exempt from taxation under subsection 
501(c)(1), 501(c)(3), 501(c)(4), or 501(c)(19) of the Internal Revenue 
Code; there will be a significant number of handicapped persons as 
passengers on this charter trip; the requested charter trip is 
consistent with the function and purpose of [the entity/organization]; 
and the charter trip will be organized and operated in compliance with 
Title VI of the Civil Rights Act of 1964, as amended; and, section 19 of 
the Federal Mass Transit Act of 1964, as amended, and 49 CFR part 27; 
or, 45 CFR part 80; or,
    (ii) [the entity/organization] certifies that it is a government 
entity or an organization exempt from taxation under subsection 
501(c)(1), 501(c)(3), 501(c)(4), or 501(c)(19) of the Internal Revenue 
Code; [the entity/organization] is a qualified social service agency 
under appendix A of 49 CFR part 604, as a recipient of funds, either 
directly or indirectly, under one or more of the Federal programs listed 
in appendix A; the requested charter trip is consistent with the 
function and purpose of [the entity/organization]; and the charter trip 
will be organized and operated in compliance with Title VI of the Civil 
Rights Act of 1964, as amended; and, Section 19 of the Federal Mass 
Transit Act of 1964, as amended, and 49 CFR part 27; or, 45 CFR part 80.
    (iii) [the entity/organization] certifies that it is a government 
entity or organization exempt from taxation under subsection 501(c)(1), 
501(c)(3), 501(c)(4), or 501(c)(19) of the Internal Revenue Code; [the 
entity/organization] either receives or is eligible to receive directly 
or indirectly, from a State or local governmental body public welfare 
assistance funds for purposes whose implementation may require the 
transportation of a group of transit-advantaged or transit-dependent 
persons; following a petition presented by the State in which the entity 
or organization resides, FTA has determined in writing that an FTA 
recipient may contract directly with the entity or organization for 
charter services; the requested charter trip is consistent with the 
functions and purposes of the entity or organization; and the charter 
trip will be organized and operated in compliance with Title VI of the 
Civil Rights Act of 1964, as amended; and section 19 of the Federal Mass 
Transit Act of 1964, as amended, and 49 CFR part 27; or, 45 CFR part 80.
    (6) A recipient in a non-urbanized area may execute a contract with 
a government entity or a private, non-profit organization exempt from 
taxation under subsection 501(c)(1), 501(c)(3), 501(c)(4), or 501(c)(19) 
of the Internal Revenue Code to provide charter service upon obtaining a 
certification from that entity or organization which states that:


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    [the entity/organization] certifies that it is a government entity 
or an organization exempt from taxation under subsection 501(c)(1), 
501(c)(3), 501(c)(4), or 501(c)(19) of the Internal Revenue Code; more 
than 50% of the passengers on this charter trip will be elderly; the 
requested charter trip is consistent with the function and purpose of 
[the entity/organization]; and the charter trip will be organized and 
operated in compliance with Title VI of the Civil Rights Act of 1964, as 
amended; and, Section 19 of the Federal Mass Transit Act of 1964, as 
amended, and 49 CFR part 27; or, 45 CFR part 80.

    (7) A recipient may provide charter service directly to the customer 
where a formal agreement has been executed between the recipient and all 
private charter operators it has determined to be willing and able in 
accordance with this part, provided that:
    (i) The agreement specifically allows the recipient to provide the 
particular type of charter trip;
    (ii) The recipient has provided for such an agreement in its annual 
public charter notice published pursuant to this part before undertaking 
any charter service pursuant to this exception; and
    (iii) If a recipient has received several responses to its annual 
public charter notice but ceased its review process after determining 
that one private operator was willing and able, it must, before 
concluding a formal charter agreement under this section, complete the 
review process to ensure that all the willing and able private operators 
are valid parties to the agreement.
    (8) During the demonstration period described in paragraph 
(b)(8)(iv) of this section, recipients in the FTA-selected sites may 
submit applications to provide charter service to an advisory panel 
equally representative of public transit providers or local business 
organizations and local private operators, and which has either been 
created for such purpose by the grantee, the State Department of 
Transportation (State DOT), or metropolitan planning organization (MPO), 
or which is part of the recipient's existing private sector consultation 
process.
    (i) The advisory panel will forward these applications to the State 
DOT or MPO, which will grant those recommended by unanimous vote of the 
advisory panel.
    (ii) If the advisory panel does not unanimously endorse an 
application, the State DOT or MPO will make a decision to grant or deny 
the application based on the following criteria:
    (A) Cost evaluation. A recipient may provide charter service when it 
can do so at a significantly lower cost than can private charter 
operators. Cost differences may be considered significant when there is 
approximately a twenty percent difference between the average charge for 
service by private operators and the recipient's fully allocated cost of 
providing the service, or when the advisory panel determines them to be 
significant.
    (B) Equipment uniqueness. A recipient may provide charter service 
using equipment that is not available from a private source, when such 
equipment is essential to the purpose of the charter trip.
    (C) Service nature. A recipient may provide unscheduled or demand 
responsive service that could not be provided by a private operator 
without advance notice or at a substantial surcharge to the customer.
    (D) Specific local factors. A recipient may provide service which 
responds to a clear need that cannot be met by the local private sector, 
and which is important to the economic or social health and vitality of 
the local area.
    (iii) The State DOT or MPO may not grant applications to provide 
service that would jeopardize the economic vitality of individual 
private charter operators or would seriously detract from private 
charter business.
    (iv) The service described in this subsection may be provided only 
during the demonstration program to be conducted through October 31, 
1995, in the following sites:
    (A) Monterey, California;
    (B) Oklahoma City, Oklahoma;
    (C) St. Louis, Missouri;
    (D) Yolo County, California;
    (E) Four sites within the State of Michigan.
    (c) The process for requesting and granting an exception under 49 
CFR 604.9(b)(3):
    (1) The recipient must provide the private charter operators that it 
has determined are willing and able in accordance with this part with a 
written

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notice explaining why it is seeking an exception and state that they 
have at least 30 days to submit written comments to the recipient on the 
request;
    (2) The recipient must send a copy of the notice, all comments 
received, and any further information it desires in support of its 
request to the Chief Counsel.
    (3) The Chief Counsel shall review the materials submitted and issue 
a written decision denying or granting in whole or in part the request. 
In making this decision, the Chief Counsel may seek such additional 
information as the Chief Counsel determines is needed.
    (4) Any exception that the Chief Counsel grants under 49 CFR 
604.9(b)(3) shall be effective for not longer than 12 months from the 
date that the Chief Counsel grants it.
    (d) The process for requesting and granting and exception under 49 
CFR 604.9(b)(4):
    (1) The recipient must submit its petition for an exception to the 
Administrator at least 90 days prior to the day or days on which it 
desires to provide charter service.
    (2) The petition must describe the event, explain how it is special, 
and explain the amount of charter service which private charter 
operators are not capable of providing.
    (3) The Administrator will review the materials and issue a written 
decision denying or granting in whole or in part the request. In making 
this decision, the Administrator may seek such additional information as 
the Administrator determines is needed.
    (4) Any exception granted by the Administrator under 49 CFR 
604.9(b)(4) shall be effective solely for the event for which the 
recipient requests an exception.
    (e) Any charter service that a recipient provides under any of the 
exceptions in this part must be incidental charter service.

[52 FR 11933, Apr. 13, 1987, as amended at 53 FR 53355, Dec. 30, 1988; 
58 FR 36899, July 9, 1993; 58 FR 52685, Oct. 12, 1993; 59 FR 51134, Oct. 
7, 1994]