FTA’s Charter Regulations: A Compliance Guide for Ohio’s Rural Public Transit Systems

The Ohio Department of Transportation Office of Transit

May 2004

An Equal Opportunity Employer

Table of Contents

Section 1.

INTRODUCTION AND PURPOSE ...... 1 Purpose...... 1 Who Should Read This Guidebook?...... 1 Are There Any Exceptions to the Applicability of the Charter Regulations? ...... 2 What is Charter Service? ...... 2 FTA’s Basic Requirements Pertaining to Charter Service ...... 3 ODOT Definition of Contract Services ...... 3 Organization of this Guide...... 3

Section 2.

GUIDANCE ON ELIGIBLE PUBLIC TRANSIT, CONTRACT, AND CHARTER SERVICES...... 6 What is Eligible Mass Transportation?...... 6 Contract Services: Eligible Mass Transportation or Charter Service? ...... 6 What is the Definition of a...... 7 Social Service Agency? ...... 7 Why is a Distinction Being Made Between Social Service Agencies and Other Entities that May Contract for Service?...... 8 Transit Service is Under the Control of the Recipient...... 9 Transit Service is Designed to Benefit the Public-At-Large ...... 10 Transit Service is Open to the Public...... 11 Are the Criteria for Providing Service Under Contract to Social Service Agencies Different from Providing Service Under Contract to Other Organizations?...... 11 Are Fixed Route Services Subject to Similar Requirements? ...... 13 Example of Fixed Route Service ...... 16 Does this Guidance Mean We Cannot Provided Service Under Contract?...... 18 What Approach Should be Taken to Achieve Compliance? ...... 18 What If the Services Provided Do Not Meet the Requirements Described in this Section? .... 18

Section 3.

COMPLIANCE RESPONSIBILITIES UNDER FTA CHARTER REGULATIONS (49 CFR PART 604)...... 20 Purpose of this Section...... 20 Scope of Coverage of 49 CFR part 604...... 20 General Regulatory Requirement ...... 21 Can a Grantee Provide Charter Using Vehicles that are Locally Funded?...... 21

Can Our Subcontractors and/or Management Company, As a Private Entity, Provide Charter Services? ...... 22 How Do We Determine If There Are Willing and Able Private Operators in Our Service Area?...... 22 What Does this Notice Have to Say?...... 23 Do We Have to Publish This Notice?...... 23 How Detailed Must Our Description of Planned Charter Service Be?...... 23 Are We Permitted to Discuss Details with Private Operators During the Notice Solicitation Period?...... 24 How Do We Determine That a Private Charter Operator Qualifies as a Willing and Able Operator?...... 24 How Often Do We Need to Conduct the Solicitation Process?...... 25 Can a Private Operator Retract its Willingness to Provide Charter Service? ...... 26 What Happens if A Willing and Able Operator Refuses to Provide Service in Our Service Area?...... 26 Are We Required to Make Referrals to the Public from Our Willing and able Operators List?...... 26 Are There Any Circumstances When the Transit System Can Provide Charter Services When There are Willing and Able Charter Operators? ...... 26 Are There Any Other Requirements Imposed on the Transit System When We Do Provide Charter Service?...... 31 What is Incidental Charter Service? ...... 31 Can We Provide Charter Service If the Chartering Party Requests Use of Our Trolley Vehicle?...... 32 If We Opt to Provide Service Free to the Chartering Party as a Gesture of Goodwill, Are We Still Subject to the Regulations? ...... 32 Can We Use System Vehicles to Respond to Request for Service from Our County Board of Commissioners?...... 32 What if We Are Ordered to Use Transit System Vehicle in a Court of Law?...... 32 What are the Consequences for Violations of the FTA Charter Regulations? ...... 32

Appendix A: List of Federal Funding Sources

Section 1.

Introduction and Purpose

Section 1.

Introduction and Purpose

Purpose ♦ the compliance requirements associated with 49 CFR part 604; ♦ specific examples of eligible mass As a condition of receipt of funds under 49 transportation (“public U.S.C. § 5307, 5309, or 5311 from the transportation”); Federal Transit Administration (FTA), ♦ ODOT requirements for the whether received directly from FTA or provision of public transportation through the Ohio Department of under contract; Transportation, all transit systems must ♦ differences between charter certify that they will comply with FTA’s transportation and eligible services charter regulations (49 CFR part 604). provided under contract; ♦ the concept of “incidental” charter These programs are: services and explain when such services may be provided; and ♦ Section 5307 – Urban Formula ♦ the procedures that must be followed Program if any allowable charter services are to be provided by a transit system. ♦ Section 5309 – Discretionary Capital Program

♦ Section 5311 – Rural Transit Who Should Read This Guidebook? Program (Nonurbanized Area Formula Program)

All Ohio public transit systems that are There is substantial confusion among Ohio recipients of FTA financial assistance, or transit systems with respect to FTA’s charter any coordination project that anticipates regulations. Moreover, ODOT has received receipt of Federal financial assistance in the complaints filed by private operators of future, should read this manual. charter services alleging violations of the policy. Subsequent investigation by ODOT Existing coordination projects that do not has indicated that transit systems are receive Federal financial assistance under potentially and unknowingly out of any of the three (3) programs listed above compliance with the charter regulations. should consult an ODOT white paper on this

topic for guidance on their current The purpose of this manual is to define: compliance responsibilities.

FTA’s Charter Regulations: A Compliance Guide for Ohio’s Public Transit Systems

Page 1

Are There Any Exceptions to the specified in advance or modified after Applicability of the Charter Regulations? having left the place of origin.”

This definition includes the incidental use of There is one exception to the applicability of FTA funded equipment for the exclusive FTA’s charter regulations to recipients of transportation of school students, personnel, Federal financial assistance. and equipment.

Ohio transit programs that only receive What Does This Definition Mean? funding under the Specialized Transit Program (49 U.S.C. § 5310 - Elderly and The definition specifies several Persons with Disabilities Program) are not characteristics of charter service. These subject to the charter regulations. components are:

However, recipients of Specialized Transit 1. The service is provided using vehicles Program (Section 5310) funds must adhere and facilities financed by FTA. to ODOT’s private sector participation policy. Recipients of Specialized 2. The service is provided to a group of Transportation Program funds (Section persons (two or more persons). 5310) in urbanized areas must adhere to the private sector participation policy adopted 3. The group travels pursuant to a common by the Metropolitan Planning Organization purpose. (MPO) in the area. 4. There is a contract, either written or oral, between the group and the provider.

What is Charter Service? 5. The agreement stipulates an agreed charge for the services rendered, consistent with the provider’s customary Definition and usual charges.

FTA defines charter service in 49 CFR part 6. The group has acquired the exclusive use 604.5(e). of the vehicle.

Charter Service means: 7. The group has specified the origin, destination, and any intermediate stops …transportation using buses or vans, or in the travel itinerary. facilities funded under the Acts of a group of persons who pursuant to a If these seven conditions exist, it is likely common purpose, under a single that the service being provided is charter contract, at a fixed charge (in service subject to the provisions of 49 CFR accordance with the carrier's tariff) for part 604. the vehicle or service, have acquired the exclusive use of the vehicle or service to travel together under an itinerary either

FTA’s Charter Regulations: A Compliance Guide for Ohio’s Public Transit Systems

Page 2

FTA’s Basic Requirements Pertaining to These similarities include: transportation Charter Service provided to a specified group, use a previously agreed upon charge for the service, transportation for a common If a recipient desires to provide any charter purpose, and elements of the trip itinerary service using FTA equipment or facilities, controlled by the group. the recipient must first determine if there are any willing and able private charter Public transportation systems are permitted operators to provide the charter service to provide service under contract. which the transit system desires to provide. Generally, contract services are not considered “charter” service if the service is To the extent that there is at least one such provided in accordance with FTA’s private operator, the transit system is definition of eligible mass transportation. prohibited from providing charter service ODOT’s Rural Transit Program Manual with FTA funded equipment or facilities goes on to specify certain guidelines unless one or more of the exceptions to necessary in the provision of contract the regulation can be identified. transportation necessary to meet the definition of mass transportation.1 One of the problem areas associated with compliance with the charter regulations, however, is that the distinction between prohibited charter and allowable services provided under contract is not always clear. Organization of this Guide Poorly planned contract services or improperly written service contracts may result in a determination that services This guidebook provides specific guidance provided under contract are prohibited to public transportation systems so that charter services. compliance may be assured in the provision of services under contract or to systems that otherwise provide permissible, incidental charter services ODOT Definition of Contract Services In Section 2, the guidebook provides

guidance on eligible public transit services, ODOT has promulgated a definition of allowable contract service, and those contract service in Chapter 3 of the Rural services that are considered charter services. Transit Program Manual:

…the transportation of a group of people for a specified cost scheduled and paid by a third party, e.g., Title XX group 1 Throughout this manual, use of the terms “mass transportation, Title III-B trips, etc. transportation” and “public transportation” are synonymous. Most of the regulatory language As can be seen, there are many similar developed in the 1980s employs the term mass transportation. Public transportation is considered elements between the definition of charter more appropriate usage when considering both rural service and service provided under contract. and urban environments.

FTA’s Charter Regulations: A Compliance Guide for Ohio’s Public Transit Systems

Page 3 In Section 3, the guidebook provides a In Section 4, guidance is provided on detailed review of the requirements of 49 soliciting the interest of willing and able CFR part 604. private charter companies.

FTA’s Charter Regulations: A Compliance Guide for Ohio’s Public Transit Systems

Page 4

Section 2.

Guidance on Eligible Public Transit, Contract, and Charter Services

Section 2.

Guidance on Eligible Public Transit, Contract, and Charter Services

What is Eligible Mass Transportation? public and is not closed door. Thus, anyone who wishes to ride on the service must be permitted to so. Federal mass transit law defines what is “eligible mass transportation,” or public transportation. 49 U.S.C. § 5302(a)(7) states that "mass transportation" means: Contract Services: Eligible Mass Transportation or Charter Service? …transportation by a conveyance that provides regular and continuing general or special transportation to the public, but does not include school bus, charter, Many Ohio public transit systems, or sightseeing transportation. particularly those in rural areas, depend heavily on the revenues derived from the FTA has elaborated on this definition in provision of services under contract. Based various opinions rendered in response to on experience, transit agencies contract with charter complaints. FTA recognizes three social service agencies, units of local (3) key components of eligible mass transit. governments, local charitable organizations, The service must be: civic clubs, and other organizations to provide requested transportation. ♦ under the control of the recipient; Revenues derived from the provision of ♦ designed to benefit the public at service under contract are an important, if large; and not critical, element in the budgets of many ♦ open to the public and not closed Ohio public transit systems. Some rural door. systems would not exist if it were not for

these revenues. ODOT emphasizes that FTA states: FTA’s charter regulations are not designed

to limit a transit system’s generation of First, mass transportation is under the revenue from the provision of contract control of the recipient. Generally the services. Indeed, revenues derived from recipient is responsible for setting the such some contracts are referenced in the route, rate, and schedule and deciding enabling legislation for the Rural Transit what equipment is used. Second, 2 Program (Section 5311) program. service, is designed to benefit the public

at large and not some special organization such as a private club. Third, mass transportation is open to the 2 49 U.S.C. § 5311(g)(1).

FTA’s Charter Regulations: A Compliance Guide for Ohio’s Public Transit Systems

Page 6 Congress intended that rural transit systems clients. The regulation should not could use revenues received under service discourage Section 5311 subrecipients agreements with a state, local or nonprofit from using FTA funded equipment in social service agency as the local matching coordinated systems, or from providing share of Rural Transit Program (Section service under contract to social service 5311) operating grants. agencies (emphasis added).

Congress anticipated that such revenues Thus, there is substantial evidence that would be earned due to local coordination service under contract to social service arrangements. Specific authority to make agencies is clearly an activity that was grants under the Rural Transit Program planned and anticipated as a component of (Section 5311) requires that the Secretary of Rural Transit Program and is clearly USDOT must find that the project provides distinguished from services provided under for the maximum feasible coordination of contract to other organizations. mass transportation service assisted under this section with transportation service assisted by other United States Government 3 sources. What is the Definition of a Social Service Agency? ODOT believes that coordination is achieved at a maximum feasible level when an organization, supported by Federal FTA Circular 9040.1E does not provide a financial assistance from sources other than definition of what constitutes a “social the U.S. Department of Transportation, service agency.” enters into a purchase of service agreement with a rural public transit system funded FTA’s charter regulations (49 CFR part under the Rural Transit Program. 604.9(b)(5)(ii)) make reference to a “qualified social service agency.” In this FTA Circular 9040.1E, “Nonurbanized Area context, a qualified social service agency is Formula Program Guidance and Grant one that receives funding from any of the Application Instructions,” directly addresses sources of funds listed in an appendix to the the issue of contract services and the fact regulation. The list is a compendium of 38 that such services are not generally different Federal assistance programs considered as charter service. Chapter X, administered under the United States “Other Provisions,” paragraph 4, “Charter Department of Health and Human Services Service,” reads, in part: (HHS). The financial assistance under each of these HHS programs includes funding for Service provided under contract to a the transportation needs of the program social service agency will usually be beneficiaries. The list is wide ranging and mass transportation, not charter service, appears to be an effort to capture all if the service is under the control of the potential funding sources that may be used subrecipient, is open door, and the to fund client transportation. The list is also subrecipient can put any rider on the substantially out-of-date. vehicle in addition to the agency's In defining social service transportation, ODOT has adopted the basic premise 3 49 U.S.C. § 5311(b).

FTA’s Charter Regulations: A Compliance Guide for Ohio’s Public Transit Systems

Page 7 employed by FTA in 49 CFR part 604, but recent GAO study will be included in the list has updated and expanded the list of funding of funding sources that define a social sources consistent with recent Federal service organization. The definition of a research. social service agency is as follows:

Thus, in the ODOT definition, programs from any Federal agency identified in a

What is a Social Service Agency:

A social service agency is an organization that:

…is a government entity or a nonprofit organization exempt from taxation under subsection 501(c)(1), 501(c)(3), 501(c)(4), or 501(c)(19) of the Internal Revenue Code; and

…is a recipient of Federal funds, either directly or indirectly, from one or more of the funding programs administered by the U.S. Departments of Health and Human Services, Labor, and Education listed in Appendix A to this guide.

It is not necessary for the social service agency to provide an accounting of the specific funding that may be used to render payment to the transit system for particular clients, for a particular invoice, etc. This would place an undue and unnecessary accounting burden on the both the provider and purchaser of transit services. The agency merely would certify, in executing the purchase of service agreement, that it is a recipient of these funds.

transit systems do not receive this attention Why is a Distinction Being Made Between in either legislation or regulatory treatment. Social Service Agencies and Other Entities that May Contract for Service? This distinction is critical when FTA’s own interpretation of the difference between mass transportation and charter services is ODOT draws the distinction between social considered. In California Bus Association v. service agencies and other potential SunLine Transit Agency, FTA states: organizations because of the unique attention directly focused on social services …a balancing test must be applied to agencies in the legislative, regulatory, and determine the nature of the service policy positions of FTA with respect to the involved in any complaint filed with FTA Rural Transit Program (Section 5311). With because, as the preamble to the charter some limitations, it is clear that FTA did not regulation points out at pages 11919-20, intend to classify such contracts as charter there is no fixed definition of charter services. Other types of organizations tha services, and the characteristics cited by may enter into service agreements with rural

FTA’s Charter Regulations: A Compliance Guide for Ohio’s Public Transit Systems

Page 8 FTA are not exhaustive, but merely illustrative. Transit Service is Under the Control of the Recipient The balancing test referenced above relates to FTA’s assessment of the three (3) key factors associated with eligible mass transit. ODOT has formulated the following It is also recognized that the majority of guidance that will assist transit systems in FTA experience in the application of this making determinations if the service is “balancing test” is in the context of eligible mass transportation or charter urbanized area fixed route service. service. The first criterion used to indicate that service is under the control of the While insightful, an examination of how recipient is that the service is provided on a FTA applied this balancing test on previous regular or continuing basis. charter complaints against fixed route public transportation system reveals that issues will Most social service agency transportation surface if a similar approach is used for that is provided under contract is performed demand response transportation system. on a daily basis. However, for some funding programs, transit service is required only on For example, the very first criterion is that an intermittent basis. the service is “under the control of the recipient.” Demand response transportation, In order to accommodate a wide range of by definition, requires some interaction circumstances while continuing to foster between the customer and the transit system coordination between rural public in order to access the service.4 In a demand transportation providers and recipients of response system, the customer will typically social service agency funding, ODOT will specify the pick-up location, the drop-off consider the following services as regular location, and the desired time of pick-up. and continuing: Thus, the customer, not the transit system, has substantial control of the service. Yet, ♦ The recipient has a signed contract demand response or specialized with the social service agency that transportation is, despite the apparent calls for the provision of service over contradictions to the FTA definition of the course of the agency’s fiscal public transportation, are, in fact, mass year;5 and transportation, not charter service. ♦ The service under contract is In the following section, ODOT provides provided on a regular basis, with the guidance on the application of the three transit system providing service on service criteria for mass transportation trip intervals not less than once per service that is operated as specialized month for the duration of the services or in demand response mode. contract.

5 In the case of new contracts that arise after the start 4 See 49 CFR part 37, Appendix D, regarding FTA’s of the fiscal year, any contract that runs from the discussion of the definition of a demand response initial date of the period of performance through the transportation service. end of the agency’s fiscal year.

FTA’s Charter Regulations: A Compliance Guide for Ohio’s Public Transit Systems

Page 9 Second, to be under the control of the Finally, demand response service is under recipient, the public transit system, not the the control of the recipient if the project contracting social service agency, must have maintains full responsibility for: control over the scheduling of individual rides under the contract. This means: ♦ vehicle assignment to the runs used to meet the services provided under ♦ The contract may not specify use of contract. a dedicated vehicle to provide the service; This provision does not preclude a ♦ The transit system is responsible for contracting social service agency from the scheduling of all rider pick-up specifying that only accessible vehicles be and drop-off times, consistent with used in contract service delivery. system policies regarding “appointment” time (e.g., the time the agency requires clients to be dropped off at the destination); and Transit Service is Designed to Benefit the Public-At-Large ♦ The transit system, if using automated scheduling software, does not program agency client rides as The second primary “balancing test” used to group subscription trips that would determine that service is eligible mass have the affect of the software not transportation is that the service is designed scheduling other customers on that to benefit the public-at-large. vehicle run. ODOT, in evaluating adherence to this Third, a contract service is under the control criterion, will use the following factors to of the recipient if the social service agency determine if the demand response service is charged the usual and customary contract benefits the public-at-large: rate employed by the system. This means, consistent with existing ODOT guidance, ♦ The rural transit system must operate that: demand response transportation as part of its regular services, not solely ♦ the rates charged by the recipient as a mode to respond to the needs of represent the fully allocated costs of the contracting social service agency. transit operations, maintenance, and administration. If other subsidies are ♦ At the time of contract execution used to defray the fully allocated with the social service agency, the costs of service provision, the rural scope of services provided under transit system should indicate to contract to be performed will be ODOT that the combination of local done so during the span of regular subsidies and contract charges business hours operated by the represents the fully allocated cost of recipient as stated in the most recent service. grant application and/or service brochure.

FTA’s Charter Regulations: A Compliance Guide for Ohio’s Public Transit Systems

Page 10 ♦ The recipient advertises the ♦ imposes no policy restrictions on the availability of services to the public. assignment of general public passengers on the runs; and This last requirement means that the demand response services provided to the social ♦ has not executed a contract that calls service agency must be included in the for the provision of social service descriptions of all demand response services transportation in exclusive “client- advertised by the transit system in their only” mode service brochures, print media, website, etc. …then the system will be determined to be opened to the general public.

Transit Service is Open to the Public In examining a rural transit system’s compliance with this last criterion, ODOT will consider the extent to which the system The third primary criterion specifies that the transports members of the general public on service must be open to the public and not runs used primarily for social service agency operated on a “closed door” basis. Closed transportation. ODOT will not prescribe door service means that the vehicle is not any minimum standard for individual available for boarding by any other demand response runs, as this may individual during the period when the unnecessarily impact a system’s ability to vehicle is in revenue service to perform the operate in an efficient manner. contract. In all cases, ODOT’s service area definition In a demand response setting, this criterion applies to services provided under contract is problematic. At any given hour of the to social service agencies. day, a demand response run may be operating in exclusive mode, transporting only clients of the social service agency. The fact that no other member of the general Are the Criteria for Providing Service public requests a ride appropriate for Under Contract to Social Service scheduling on that vehicle at that particular Agencies Different from Providing time of day does not by itself make the Service Under Contract to Other service “closed door.” Organizations?

ODOT will use the following factors to determine if the rural public transit system, The criteria for provision of contract operating in demand response mode is open transportation to organizations other than to the general public. If the system: social service agencies are very similar to those identified above for social service ♦ has the capacity in the system during agency transportation. Yet, because they that particular day and time to lack the specific regulatory or legal authority transport other, general public to be presumptively assumed as eligible passengers; mass transportation by definition, such contracts must more closely adhere to FTA’s definition of eligible mass transportation.

FTA’s Charter Regulations: A Compliance Guide for Ohio’s Public Transit Systems

Page 11 The key differences between a contract with Service is Under the Control of the a qualified social service agency and another Recipient – Regular and Continuing organization are: Service

♦ Service must be provided on a more Service provided under contract to frequent basis in order to be organizations other than qualified social considered eligible mass service agencies as defined earlier in this transportation. chapter will be subject to a more stringent standard with respect to regular and ♦ Service must be to a destination continuing service when provided in the within the service area that is demand response mode. Whereas ODOT routinely accessed by members of will only require service to be provided on a the general public. monthly interval when under contract to a social service agency, more frequent service Service must be open to the general public will be required in order for ODOT to as evidenced by regular and consistent determine that a contract service is not assignment of general public passengers to prohibited charter operation (see explanation the contract run. below).

Regular and Continuing Service – Demand Response Examples

ODOT requires that for service to be provided on a regular and continuing basis, service must be provided throughout the fiscal year as evidenced by a service contract that extends throughout the year.

Service must be provided on regular intervals. In the case of a social service agency, ODOT requires only that the service be provided at intervals no less frequent than monthly. For example, the transit system may enter into a contract with a local health department to provide service to clients participating a pre-natal care program. The health department requires clients to participate in a monthly screening program and contracts with the transportation to bring clients to their clinic facilities. The department uses Federal funds provided by the U.S. Department of Health and Human Services (DHHS), in part, to pay for the service. This service meets the ODOT definition for regular and continuing service and is consistent with FTA’s coordination efforts wherein social service programs are encouraged to purchase client transportation from a public transportation service provider. The service interval, specified as one trip per month, is consistent with the program needs of the Health Department. Special consideration is given in this regard because of the entity’s status as a social service agency.

If the contracting organization is not a social service agency, ODOT, in applying the “balancing test” to determine if the service is eligible mass transit or charter service, will require a more stringent standard. Service must be provided on a regular basis, as evidenced by service provide at a frequency no less than bi-weekly.

FTA’s Charter Regulations: A Compliance Guide for Ohio’s Public Transit Systems

Page 12 While each case will be examined individually, ODOT recommends that the Are Fixed Route Services Subject to frequency of service under contracts with Similar Requirements? other organizations be provided no less frequently than bi-weekly. Yes, fixed route transit service is subject to Service is Designed to Benefit the Public- the same requirements. However, in fixed At-Large route systems, the three primary requirements for eligible mass transportation For other than social service agencies, the are evaluated in a different manner, key factors ODOT will examine is whether reflecting the modal differences between the provision of service under contract is fixed route and demand response services. performed on regular demand response runs operated by the transit system and that the Service is Under the Control of the destination(s) served are facilities and/or Recipient – Regular and Continuing locations that are places of public Service accommodation (e.g., shopping centers, medical facilities, etc.). In short, the In fixed route service, this means that the contract service must be provided in an transit system must operate on a regular operational manner that is consistent with daily schedule, the system controls the the transit system’s regular demand response number of vehicles used in revenue service, service. and the customer is primarily responsible for paying the fare. Open to the General Public and Not Closed Door ODOT will use the following criteria in making determinations that fixed route In addition to all the criteria identified above service is under the control of the transit for social service agency transportation (e.g., system: capacity and scheduling practices), a transit system must ensure that demand response ♦ The route path and the route service provided under contract to other than headways are determined by the social service agencies is open to the public, transit system, not a third party. generates general public ridership on all runs, and that the service is marketed in a ♦ The route operates on a daily basis manner consistent with all other demand on headways appropriate to demand. response services. ODOT will specifically examine the level of general public ridership ♦ The transit system establishes the on runs used to meet the contract demand to fare for the service. make determinations as to whether the service is open to the public. ♦ The individual passenger pays the fare, not a third party organization. Exhibit 2.1 provides a side-by-side comparison of the service criterion for contract services provided in demand response mode for social service and other organizations.

FTA’s Charter Regulations: A Compliance Guide for Ohio’s Public Transit Systems

Page 13 Exhibit 2.1 Comparative Analysis of Contract Service Requirements - Social Service Agencies and Other Organizations Demand Response Transportation

FTA Primary Criteria for Contracts with Social Service Agencies: Contracts with Other Organizations: Eligible Mass Transportation Requirement Grantee Action to be Considered Eligible Mass Transportation Grantee Action to be Considered Eligible Mass Transportation

A. Service is Under the 1.Service is Operated on a Regular and a.The recipient has a signed contract with the social service agency that Same Control of the Recipient Continuing Basis calls for the provision of service over the course of the agency's fiscal year

b. The service is provided on a regular basis, with the trip being provided The service is provided on a regular basis, with the trip being provided on intervals not less than once per month for the duration of the on intervals not less than once bi-weekly for the duration of the contract. contract.

2. Control Over Trip Scheduling a.The contract may not specify use of a dedicated vehicle to provide the Same service;

b.The recipient is responsible for the scheduling of all rider pick-up and Same drop-off times, consistent with system policies regarding "appointment" time (e.g ., the time the agency requires clients to be dropped off at the destination);

c.The recipient, if using automated scheduling software, does not Same program agency client rides as group subscription trips that would have the affect of the software not scheduling other customers on that vehicle run.

3. a.The rates charged by the recipient represent the fully allocated costs of Same Use of Fully Allocated Contract Pricing transit operations, maintenance, and administration.

4. Vehicle Assignment a.The recipient maintains full control over vehicle assignment to runs. Same

B. Service is Designed to 1. Demand Response Mode a.The recipient must already operate demand response services as part of Same Benefit the Public-At- its regular scope of service delivery.

2. Span of Service a.The scope of services provided under contract will be performed during Same the span of regular business hours operated by the recipient as stated in the most recent grant application and/or service brochure.

3. Marketing a.The recipient must advertise the contract services as being available to Same the general public in the same manner, using the same techniques, as used in other marketing campaigns.

4. Transit Trip Destinations a. Destinations of travel may include facilities and/or locations that serve a particular group provided it is consistent with the social service Destinations of travel must be to locations within the service area that agency's purpose and mission. are places of public accommodation for the general public. Exhibit 2.1 Comparative Analysis of Contract Service Requirements - Social Service Agencies and Other Organizations Demand Response Transportation

FTA Primary Criteria for Contracts with Social Service Agencies: Contracts with Other Organizations: Eligible Mass Transportation Requirement Grantee Action to be Considered Eligible Mass Transportation Grantee Action to be Considered Eligible Mass Transportation

3. Open to the General Public 1. Capacity a. Same and Not Closed Door The recipient has the capacity in the system during that particular day and time to transport other, general public passengers.

2. Trip Assignment Restrictions a. The recipient imposes no policy restrictions on the assignment of general public passengers on contract runs. Same, except that ODOT will impose a higher standard/level of public ridership when assessing other than social service agency contracts.

3. Contract Terms & Conditions a.The recipient, in executing a contract with the agency, does not agree to Same any provision that pledges the exclusive use of a vehicle to the entity. Generally, control of fares and schedules are good fixed route design and would be critical elements in determining eligible indicative of service being available to serve mass transportation in this regard. the public-at-large. Routes designed to serve only a single origin and destination, Service is Designed to Benefit the Public- with no intervening stops, will generally not At-Large be considered fixed route mass transportation. Service must meet the needs of the public at large, not a single group of users. This Additional factors under this criterion that criterion is best accomplished when the will indicate the recipient is operating route serves a multiple set of trip service available to the public at large: destinations that typically represent transit trip generators (e.g., office complexes, ♦ The number of other bus stops along hospitals, medical offices, shopping, grocery the line. stores, etc.) ♦ Availability of connections to other Additionally, marketing efforts should be elements (routes/services) of the consistent with other fixed route services transit system. operated by the transit system. If system publishes route brochures for its other ♦ Vehicle destination signs that clearly routes, publication of a route brochure for communicate the nature of the the route under question would be evidence service and that service is available of a service designed to benefit the public at to the general public. large. In short, the system’s marketing efforts for all its fixed route services will be FTA evaluates the level of marketing efforts examined for consistency if questions arise employed by the transit system to make the as to whether the service is eligible mass service known to the public as indicative of transportation. intent to provide service that is open to the public. ODOT will utilize this same Open to the General Public and Not criterion and will consider marketing efforts Closed Door of a particular service in light of similar efforts for all other transit services operated The two key elements under this criterion by the system. are the level of general public ridership and the intent of the recipient in providing the service (California Bus Association v. Sunline Transit Agency, 1997). Example of Fixed Route Service

While fixed route service bus stop placements are clearly designed to serve a In the following exhibit, ODOT presents a specific location, benefiting customers, graphic that reflect two different fixed route shoppers, employees, or residents of a services. particular business, commercial center, or neighborhood, a sufficient number of such strategically placed stops would represent

FTA’s Charter Regulations: A Compliance Guide for Ohio’s Public Transit Systems

Page 16 Exhibit 2.2 Illustrative Fixed Route Services: Eligible Mass Transit and Prohibited Charter Services

Example “A”

In this example, an Ohio fixed route system is approached by a local medical complex to operate an employee shuttle between the main hospital facility and an overflow, remote parking lot. The transit system arranges to operate a fixed route, on frequent intervals, directly connecting the remote lot and the hospital. As the hospital Hospital Remote pays for the shuttle, employees may ride for Parking Lot free.

This service is not eligible mass transportation. The service is operated exclusively for a single group (hospital employees), the route is not designed to serve the public-at-large, and customers do not pay a fare for the service.

00.51

Example “B”

The transit system has expanded the route to incorporate other transit trip generators and has established bus stops at various other points along the route. The route is now integrated with the system’s other fixed Transfer route services and transfers to these other Center routes are now possible. Finally, the hospital now longer directly underwrites the cost of the route on a fee per hour basis, but Hospital Remote County Parking Lot rather purchases a guaranteed amount of Bldg. bus tokens for distribution to its employees.

In this example, the service is eligible mass Social transportation. Security

Bus Stop 00.51

FTA’s Charter Regulations: A Compliance Guide for Ohio’s Public Transit Systems

Page 17 In the first case, a nonurbanized area transit system revenues. In providing contract system operating fixed route service is services, ODOT has always required that the approached by a local medical complex to services are open to the public. This operate an employee shuttle between the guidance provides specific direction to main hospital facility and an overflow, transit systems in providing such service in a remote parking lot. The transit system compliant manner. arranges to operate a fixed route, on frequent intervals, directly connecting the remote lot In entering into an agreement with a third and the hospital. As the hospital pays for party organization to provide transit services the shuttle, employees may ride for free. under contract, transit management should use good, sound planning principles in In the second case, the transit system designing the service. Service design should entertains the same request. In this scenario, not be based solely on the requirements of however, the system plans how the services the contract; in virtually all instances, if the can meet the needs of the general public in transit system applies sound public addition to hospital employees and devises a transportation design principles, the service route that circulates in the downtown area as will meet ODOT and FTA requirements for well as serving the hospital and the remote eligible mass transportation. parking lot. The strategy adds several key transit trip generators to the route. The service is no longer oriented towards a single group and the system collects fares What If the Services Provided Do Not from all passengers. The system publishes a Meet the Requirements Described in this separate route brochure for the route and Section? includes the route on its system map and in its website pages. If the services provided under contract do not meet the requirements stipulated in this section, it is likely the service provided is Does this Guidance Mean We Cannot charter service. If this is the case, the transit Provided Service Under Contract? system must:

♦ Re-design the service to be eligible No. This guidance is designed to facilitate mass transportation; the provision of service under contract consistent with FTA and ODOT ♦ Operate the service as designated guidelines. charter service, provided it meets the requirements of 49 CFR part 604; or

♦ Cease to operate the service. What Approach Should be Taken to Achieve Compliance? In the next section, ODOT reviews the requirements for compliance with FTA’s charter regulations. ODOT encourages recipients of rural transit funding to seek contracts and maximize

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Page 18

Section 3.

Compliance Responsibilities Under FTA Charter Regulations (49 CFR part 604)

Section 3.

Compliance Responsibilities Under FTA Charter Regulations (49 CFR part 604)

Purpose of this Section Scope of Coverage of 49 CFR part 604

The purpose of this section is to provide Scope of Coverage guidance to Ohio’s rural transit systems that have determined that transportation services As noted in Section 1, FTA charter provided or desired to be provided may fall regulations apply to recipients of financial into the category of charter services. This assistance under the following programs: section provides a detailed description of FTA’s requirements along with explanation ♦ Section 5307 – Urban Formula and guidance on special situations that are Program likely to be encountered by rural public ♦ Section 5309 – Discretionary Capital transit projects. Program ♦ Section 5311 – Rural Transit In this section, ODOT will review: Program (Nonurbanized Area Formula Program) ♦ Limitations in the use of equipment and facilities funded with FTA Additionally, if flexible funds from the monies; Highway Trust funds are used to support ♦ Procedures for soliciting the interest capital acquisitions by a public transit of willing and able private operators; system (Sections 103(e)(4), 142(a), or ♦ Requirements for determining 142(c) of Title 23 United States Code which whether a private operator is permit the use of Federal-Aid Highway “willing” and “able;” funds to purchase buses), the charter ♦ Procedures for handling requests regulations will also apply. from the public after the system determines that there is at least one The charter regulations are not applicable to willing and able private operator; the Specialized Transportation Program ♦ The seven (7) exceptions to FTA’s (Section 5310 program). charter rules wherein a system can provide incidental charter service even when there are willing and able Annual Certification private operators; and ♦ The definition of “incidental” All applicants who apply directly to FTA for charter. grants subject to the charter regulations must

FTA’s Charter Regulations: A Compliance Guide for Ohio’s Public Transit Systems

Page 20 submit two copies of the charter certification One-Time Certification for Nonurbanized that reads: Area Projects

… I, (name), (title), agree that (name of For nonurbanized area projects that receive applicant) and all recipients through (name Rural Transit Program (Section 5311) funds of applicant) will provide charter service through ODOT, a one-time certification is that uses equipment or facilities provided required. The certification reads as follows: under the Federal Mass Transit Act of 1964, as amended (49 U.S.C. 1601 et seq.) or …(Name of subrecipient) certifies that it under 23 U.S.C. 103(e)(4), 142(a) or 142(c) shall comply with 49 CFR part 604 in the (the Acts) only to the extent that there are no provision of any charter service provided private charter service operators willing with FTA funded equipment or facilities. and able to provide the charter service that

(name of applicant) and all recipients through (name of applicant) desire to provide unless one or more of the exceptions in 49 CFR 604.9 applies. General Regulatory Requirement

I further agree that (name of applicant) and all recipients through (name of applicant) As noted in Section 1, transit systems that will comply with the provisions in 49 CFR receive FTA financial assistance under the part 604 before they provide any charter subject programs are prohibited from service using equipment or facilities using FTA funded equipment and provided under the Acts, that the facilities to provide charter service if it is requirements of 49 CFR part 604 will apply determined there is one or more willing to any such charter service that is provided, and that the definitions in 49 CFR part 604 and able charter operators in the service apply to this agreement. area.

Applicant

Name Can a Grantee Provide Charter Using Vehicles that are Locally Funded? Title

Date The preamble to FTA’s charter regulations states that they apply only to charter service Federal Transit Administration performed by transit systems using FTA funded facilities and equipment. If a transit Name system:

Title (1) sets up a separate company that has only locally funded equipment and Date facilities; and (2) operates these facilities and equipment with only local funds; or (3) is able to maintain separate accounts for its charter operators to show that

FTA’s Charter Regulations: A Compliance Guide for Ohio’s Public Transit Systems

Page 21 the charter service is truly a separate requires that all entities, public or private, division that receives no benefits that operate transit services on behalf of a from the mass transportation transit system are covered by the charter division… rule. Consequently, all operators, whether public or private, under contract or receiving …then the charter rule would not apply. assistance through the transit system, are ODOT cautions that these conditions will be subject to the charter rule but only to the strictly enforced. extent that the operator uses FTA funded equipment or facilities to provide charter Further caution is urged with respect to use service. In short, the rule treats all operators of FTA funded facilities. In a recent opinion and/or management companies of a transit involving charter operations, FTA has stated system as standing in the shoes of the transit that if there is a willing and able private system for purposes of compliance. provider, a transit system may not allow its separate charter entity to use, even on an incidental basis, the FTA-funded garage in connection with its charter operations. This How Do We Determine If There Are interpretation also applies if the separate Willing and Able Private Operators in charter service were to pay the transit Our Service Area? authority rent and fees for such incidental use. The regulations specify the procedures that It should be noted that the term "facilities" must be used to determine if there are applies to offices and other administrative willing and able charter operators. A public locales. This rule, however, applies only to participation process is used. The steps a the use of facilities by public transit transit system must do are as follows: authorities and their charter entities. Thus, if a grantee has excess space in its FTA- ♦ At least 60 days prior to the funded garage, it may lease that space to a provision of charter service, the private operator on an incidental basis. transit system must place a notice in a newspaper, or newspapers, having general circulation within the proposed geographic charter service Can Our Subcontractors and/or area; Management Company, As a Private ♦ Send a copy of the notice to all Entity, Provide Charter Services? private charter service operators in the proposed geographic charter service area and to any private Section 3(f) of the FTA Act states that the charter service operator that requests charter restrictions apply to the transit notice; and system "or any operator of mass ♦ Send a copy of the notice to the transportation equipment" acting on behalf United Bus Owners of America and of the grant recipient. the American Bus Association (in 1996, the United Bus Owners of It is FTA’s opinion that this language America become the United provides little room for discretion and Motorcoach Association).

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Page 22

How Do We Send a Notice to the Two Trade Associations?

When publishing a notice to solicit the interest of willing and able private charter operators, 49 CFR 604.11(b)(3) requires the transit system also send a copy to two trade associations, the United Bus Owners of America (UBOA) and the American Bus Association (ABA). UBOA is now known as the United Motor Coach Association. Direct correspondence to:

United Motorcoach Association American Bus Association th 113 S. West Street 700 13 Street, NW Alexandria, VA 22314 Suite 575 Washington, DC 20005-5923

What Does this Notice Have to Say? ♦ A statement that the transit system will not provide any charter service using equipment or facilities funded The following elements must be included in under the Acts to the extent that the notice. They are: there is at least one willing and able private charter operator unless the ♦ Transit system name; recipient qualifies for one or more of ♦ Description of the charter service the exceptions in 49 CFR 604.9(b). that the transit system proposes to provide; ♦ Notice that the transit system will provide at least 30 days from the Do We Have to Publish This Notice? date of publication to allow private operators to submit statements of interest; No. If a transit system will not provide ♦ The transit system’s mailing address charter service during the course of the where statements of interest should year, it need not publish this notice. be mailed; However, if the system anticipates providing ♦ A statement that specifically charter service, or is unable to categorically identifies the evidence that must be indicate it will not provide charter service, submitted to the transit system to then the notice must be published. demonstrate the operator is willing and able; ♦ A statement that the transit system will only review submissions How Detailed Must Our Description of submitted by the stated deadline and Planned Charter Service Be? that the determination process will

be completed review within 60 days It is not necessary for the transit system to of the deadline; and detail specific details of every single charter

FTA’s Charter Regulations: A Compliance Guide for Ohio’s Public Transit Systems

Page 23 trip that it intends to provide during the that private operators may call the system to course of a year. FTA intends to provide obtain further information. Through flexibility in the level of detail that must be cooperation, it should be possible to ensure provided in the notice. 49 CFR part that critical consumer needs for charter 604.11(c)(2) indicates that the notice service will be met. include:

♦ estimated number of days charter services will be provided; How Do We Determine That a Private ♦ the approximate times of day; Charter Operator Qualifies as a Willing ♦ the geographic area; and and Able Operator? ♦ category of revenue vehicle that would be used in charter service. Willing Operators This description may be generalized (e.g., description of trip purposes, groups When a transit system receives a response transported, and typical destinations). from its notice to solicit the interest of private charter companies, it must determine The notice must not be worded in a way that that the respondent is “willing” and “able.” would discourage a response from any person who meets the minimum criteria for A charter operator need only express, in a “willing and able” operator. Regardless of writing, its desire to perform charter service how the transit system describes its own in the service area specified by the transit service, the system must make it clear in the agency to be considered a willing operator. notice that private operators are not required The operator is not subject to any test to respond in similar detail. Private regarding whether it has or has not provided operators are required to show only that service previously in the service area. they have the requisite legal authority and the desire to perform the service. Able Operators

To be considered an “able,” the charter operator must demonstrate two things: Are We Permitted to Discuss Details with Private Operators During the Notice ♦ It has the physical capability of Solicitation Period? providing the categories of revenue vehicles specified in the notice; and This is not a procurement; merely a solicitation of interest. As such, transit ♦ It has the required legal authority to systems are permitted to discuss charter operate charter service in the area issues, either individually or collectively, where it desires to provide such with prospective private charter operators service. during the solicitation period. In order to prove that it is "able" to provide A transit system may provide the system the service, the charter operator does not telephone number in their notices indicating have to demonstrate that it has any particular

FTA’s Charter Regulations: A Compliance Guide for Ohio’s Public Transit Systems

Page 24 capacity level; in other words, a charter Finally, the "willing and able" concept is not operator is as willing and able if it has one intended to include any duration limitations; bus as it would be if it had one hundred in other words, the fact that a private buses. operator may be required by state regulation to charge for a minimum five hour trip does Also, there are only two categories of not mean that it is not "able" to provide for revenue vehicles that the transit agency can charter of lesser duration. In some states, designate in its notice – buses and vans. such minimums are imposed as a mater of This means a private operator does not have regulation. PUCO, however, imposes no to demonstrate that it has any particular type such state mandated minimum duration on of bus in order to be considered "able." charter trips; therefore, this condition is generally not applicable in Ohio. A state agency, the Public Utilities Commission of Ohio (PUCO), has responsibility for establishing whether or not a provider possesses the legal authority to How Often Do We Need to Conduct the operate charter transportation in the state. Solicitation Process?

In order to operate legally, the provider must have either registered as an interstate or Transit systems need only conduct the intrastate carrier of passengers. At a solicitation once a year. ODOT minimum, such carriers must: recommends that the system conduct the solicitation in concert with the preparation ♦ demonstrate financial responsibility of the annual grant application. (by carrying $350,000 minimum liability insurance); If the transit system determines that ♦ file PUC Form 3341; and significant changes have occurred in the ♦ follow Ohio specific safety rules. marketplace, there is no prohibition from conducting the process again in mid-year. PUCO’s Office of Motor Carrier Examples of changes in the marketplace Registration should be consulted, if include, but are not limited, to: necessary, to verify the evidence submitted to the transit system that the operator ♦ An operator previously determined possesses the requisite authority to operate found to be willing and able loses its in the state. PUCO authority; ♦ The transit system becomes aware of other interested private operators Special Circumstances early in the fiscal year (after the close of the solicitation period). A transit system may exclude tour/charter “brokers” from the definition of willing and Again, in either example, the transit system able private operators because they do not is not obligated to conduct the solicitation own equipment. Brokers typically do not process; if it chooses to so, it must follow own their own equipment and therefore do the same procedures and timeframes not meet the tests defined above for willing outlined earlier in this section. and able.

FTA’s Charter Regulations: A Compliance Guide for Ohio’s Public Transit Systems

Page 25

Can a Private Operator Retract its Are We Required to Make Referrals to Willingness to Provide Charter Service? the Public from Our Willing and able Operators List?

Yes, a charter operator, previously found to be willing and able, may use its own There is no obligation imposed on the transit business judgment during the year and elect system to refer inquiries about charter not to provide charter service in the service services to companies on the system’s list of area operated by the transit system. willing and able operators.

If this retraction occurs in mid-year, and no ODOT recommends that transit systems use other private operators in the service area either an “all or nothing” approach. When have been determined "willing and able," an inquiry is received, the transit system the transit system may resume charter may provide a list of all willing and able service without re-publishing a notice for charter operators. Alternatively, a transit the rest of that year only. system may simply indicate it is not permitted to provide that type of service and If, at the end of this period, the transit refer the individual to the Yellow Pages. system wishes to continue providing charter service, it must repeat the public Transit systems should not make referrals of participation notice process to determine if selected companies on the list or should not there are any other willing and able use a rotation scheme to select a single operators in the area. company for a referral. A transit system may not “steer” charter referrals to favored companies.

What Happens if A Willing and Able Operator Refuses to Provide Service in Our Service Area? Are There Any Circumstances When the Transit System Can Provide Charter Services When There are Willing and If a private charter operator is found to be Able Charter Operators? willing and able (thereby preventing the transit system from engaging in charters) but then refuses to provide charter service in the If, after the solicitation process, a transit service area, the regulations provide no system determines that there is at least one recourse to the transit system. The system willing and able charter operator, the system may only provide charter service to the is prohibited from providing charter services extent the charter trip meets one or more of unless the trip meets one or more of the the exceptions outlined later in this section. special exceptions to the regulations In this circumstance, it is recommended that detailed in 49 CFR part 604.9. the transit system communicate with the operator and determine if the company There are seven special exceptions. Five wishes to retract its previously provided exceptions apply to all recipients of FTA statement of willingness to provide service. assistance. Two exceptions apply only to the Rural Transit Program (Section 5311).

FTA’s Charter Regulations: A Compliance Guide for Ohio’s Public Transit Systems

Page 26 If one or more of these exceptions exists, accessible to elderly and disabled the transit system may provide charter persons. service regardless of whether or not there are willing and able private charter This exception enables a public transit operators in the area. system to serve as a subcontractor to a private charter company in three Exception No. 1: No Willing and Able circumstances: Operators (1) A charter operator needs A transit system may provide any and all supplemental capacity to augment its charter services using FTA funded own fleet in the provision of a equipment and facilities to the extent that charter service. In this case, the there are no willing and able private charter charter operator would lease rolling operators. stock from the public transit system.

If, after going through a notice process, the (2) A charter operator has neither the transit system receives no response, charter rolling stock nor staff to operate a service may be provided without further requested charter. In this case, the restriction or concern. The period extends operator contracts for supplemental for one year; thereafter, the system must service to be provided by the public repeat the solicitation process. transit system.

Systems should note, however, that deficits (3) A charter operator does not have generated from charter operation are not an sufficient accessible vehicles to eligible operating expense. Therefore, when accommodate a charter party that entering into charter agreements, the transit includes persons with disabilities. In system must be certain that the price quoted this case, the charter company would will fully recover the costs of charter service lease accessible vehicles from the provision. public transit system to fulfill its obligations under the ADA. Exception No. 2: Equipment Leases for Elderly and Disabled Charter Service or The charter regulations do not require a to Supplement Capacity transit system to fulfill such requests from private operators. A transit system may enter into a contract with a private charter operator to provide Exception No. 3: Special Events charter equipment or to provide charter service on behalf of the private charter A transit system may petition the FTA operator if: Administrator for an exception to provide charter service directly for "special events" ♦ The private charter operator is when the private operators do not have the requested to provide charter service capacity to provide all necessary service. that exceeds its capacity; or FTA does not define a special event, however, in subsequent guidance, these ♦ The private charter operator is events are described as events of national unable to provide equipment scope and singular in nature. Examples

FTA’s Charter Regulations: A Compliance Guide for Ohio’s Public Transit Systems

Page 27 given include a visit by the Pope or the Pan transportation of a group of American Games. transit-disadvantaged or transit- dependent persons; and Regularly scheduled yearly or periodic events, such as an Independence Day ♦ The requested charter trip is fireworks display, county fairs, etc. do not consistent with the function and qualify as events subject to this exception. purpose of chartering entity; and

Exception No. 4: Social Service Agency ♦ The charter trip will be organized Trips and operated in compliance with Title VI of the Civil Rights Act of A transit system may provide charter to a 1964, as amended; and, section 19 of “social service agency” provided certain the Federal Mass Transit Act of conditions are present. These conditions 1964, as amended, and 49 CFR parts are: 27 and 37 or, 45 CFR part 80; and,

♦ The organization requesting the ♦ The transit system obtains a charter trip is a government entity or certification from the chartering a private, non-profit organization entity (see text box, next page) exempt from taxation under attesting compliance with the three subsection 501(c)(1), 501(c)(3), conditions listed in the second bullet 501(c)(4), or 501(c)(19) of the item. Internal Revenue Code; and It should be noted that in the third condition ♦ One or more of the following of the second bullet, ODOT must present a circumstances are associated with the petition to FTA to permit the charter service. trip: Exception No. 5: Charter Operators o There will be a significant Permits Trip number of persons with disabilities as passengers on this A transit system may provide charter service charter trip; or directly to the customer where a formal o The chartering entity receives agreement has been executed between the funding, or is eligible to receive transit system and all private charter funding, either directly or operators it has determined to be willing and indirectly, from agencies listed in able in the service area. Appendix A to 49 CFR part 604 (updated in Appendix A of this Once again, there are special circumstances guidebook; or that must be adhered to under this exception: o The chartering entity either receives, or is eligible to receive, ♦ The agreement must specifically either directly or indirectly, from allow the transit system to provide a State or local governmental the particular type of charter trip; body public, welfare assistance and funds for purposes whose implementation may require the

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Page 28

Required Certifications Under Exception No. 4

The social service agency exception requires that the transit system obtain a written certification from the chartering party. There are three (3) separate circumstances where charter services can be provided; each circumstance has its own certification language, as follows:

Significant Number of Persons with Disabilities

[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 parts 27 and 37; or, 45 CFR part 80.

Eligible Social Service Agency

[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 ODOT’s “FTA’s Charter Regulations: A Compliance Guide for Ohio’s Public Transit Systems and Coordination Projects,” 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 parts 27and 37; or, 45 CFR part 80.

Welfare to Work

[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-disadvantaged 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 parts 27 and 37; or, 45 CFR part 80.

FTA’s Charter Regulations: A Compliance Guide for Ohio’s Public Transit Systems

Page 29 ♦ The transit system has provided for Exception No. 7: Nonurbanized Area such an agreement in its annual Elderly Passengers public charter notice published pursuant to this part before The second rural exception is a charter trip undertaking any charter service where the chartering entity is a social pursuant to this exception. service agency and more than fifty percent of the passengers are elderly. The following Exception No 6: Nonurbanized Area conditions must be present: Economic Hardship ♦ The organization requesting the There are two special exceptions available charter trip is a government entity or only to the Rural Transit Program (recipients a private, non-profit organization of Section 5311 financial assistance). The exempt from taxation under first is an economic hardship exception. subsection 501(c)(1), 501(c)(3), 501(c)(4), or 501(c)(19) of the This exception is applicable under limited Internal Revenue Code; and circumstances. A transit system must specifically seek ODOT’s permission ♦ More than fifty percent of the prior to providing charter service under passengers on the trip will be this exception. elderly; and

ODOT’s evaluation of such request will be ♦ The charter trip will be organized based on a finding of economic hardship and operated in compliance with created by one of the following two Title VI of the Civil Rights Act of circumstances: 1964, as amended; and, section 19 of the Federal Mass Transit Act of ♦ The willing and able private charter 1964, as amended, and 49 CFR parts operator or operators impose 27 and 37 or, 45 CFR part 80; and minimum duration requirements pursuant to state regulation and the ♦ The transit system obtains a desired trip length is shorter than the certification from the chartering mandatory trip length; or entity attesting compliance with the these conditions. ♦ The willing and able private operator or operators are located too far from The certification of this exception reads as the origin of the charter service follows: resulting in excessively high rates due to the long deadhead involved. [the entity/organization] certifies that it is a government entity or an PUCO imposes no minimum duration organization exempt from taxation under requirements. Therefore, only the second subsection 501(c)(1), 501(c)(3), condition will be relevant in Ohio. 501(c)(4), or 501(c)(19) of the Internal Revenue Code; more than 50% of the ODOT will evaluate such requests on a passengers on this charter trip will be case-by-case basis. elderly; the requested charter trip is consistent with the function and purpose

FTA’s Charter Regulations: A Compliance Guide for Ohio’s Public Transit Systems

Page 30 of [the entity/organization]; and the charter service means charter service that charter trip will be organized and does not: operated in compliance with Title VI of the Civil Rights Act of 1964, as ♦ interfere with or detract from the amended; and, Section 19 of the Federal provision of the mass transportation Mass Transit Act of 1964, as amended, service for which the equipment or and 49 CFR parts 27 and 37; or, 45 facilities were funded under the CFR part 80. Acts; or ♦ does not shorten the mass FTA does not define “elderly.” If the transit transportation life of the equipment system receives Elderly and Disabled or facilities Transit Fare Assistance funds from ODOT, elderly will be defined consistent the transit Examples of what would not be “incidental“ system’s definition used in this program. may include:

If a transit system anticipates provision of ♦ service performed during peak hours; charter trips under this exception, the system ♦ service which does not meet its fully should publish in its annual notice soliciting allocated cost; willing and able operators its definition of ♦ service being used to count toward “elderly.” In no case shall this definition meeting the useful life of any include persons less than 60 years of age. facilities or equipment; or ♦ service provided in equipment that is in excess of an ODOT approved spare ratio. Are There Any Other Requirements Imposed on the Transit System When We Note that this list is merely guidance; peak Do Provide Charter Service? hour service may not be indicative of non- incidental charter. Again, ODOT will

evaluate such situations on a case-by-case If the transit system publishes the notice and basis. finds that it can meet one of the seven exceptions, the system may provide charter This guidance also does not impose upon services. However, there is one final transit systems a requirement to track charter element in 49 CFR part 604. usage by specific system vehicles to comply

with the useful life criterion above. The rule Any allowable charter service that is permits any reasonable computation. The provided is permitted only to the extent the system may apply an average of charter charter trip is “incidental” to the provision usage to all system vehicles, for example. of eligible mass transportation. The key element is that the system may not

replace vehicles in advance of their useful

life plus accumulated charter usage. Records of specific charter usage should be What is Incidental Charter Service? maintained to document this requirement.

Any charter service provided by the transit system must be “incidental.” Incidental

FTA’s Charter Regulations: A Compliance Guide for Ohio’s Public Transit Systems

Page 31 tour of that department's facilities or Can We Provide Charter Service If the projects, or some other trip in connection Chartering Party Requests Use of Our with the department's operations. Trolley Vehicle? FTA has determined that such trips described above share most of the Many public transit systems operate characteristics of charter service. Since the specialty vehicles (e.g., replica trolleys, regulations do not include an exception for a double decker buses, etc.) that may not be particular category of customers (local operated by willing and able private charter elected officials), a transit system that companies in your service area. wishes to provide service of this type would be obliged to comply with the requirements However, as FTA recognizes only two types of the charter regulations. of equipment in its charter regulations (buses and vans), requests to use a system’s specialty vehicles is not an allowable charter opportunity under the exceptions listed What if We Are Ordered to Use Transit above. System Vehicle in a Court of Law?

ODOT is aware that in some cases a court If We Opt to Provide Service Free to the order has been issued to transport juries or Chartering Party as a Gesture of other related parties to legal proceedings and Goodwill, Are We Still Subject to the that the local transit system was designated Regulations? to provide the vehicles. Such trips are charter services and are not permitted under the regulation. Cost is not relevant in determining whether or not a service is a charter. If other If a transit system finds itself subject to such elements of the service indicate the service an order, ODOT recommends that the is charter, the transit system is subject to system’s legal counsel advise the court of these regulations. this Federally imposed limitation to provide such service. This may result in the order being withdrawn or rescinded.

Can We Use System Vehicles to Respond to Request for Service from Our County Board of Commissioners? What are the Consequences for Violations of the FTA Charter Regulations? Many rural transit systems are departments of city or local government rather than ODOT will monitor transit system separate authorities or commissions. As compliance through a combination of such, they are occasionally requested by techniques, including a review of the another city or county department to make a proposed scope of transit services contained bus available for some use, typically to take in the annual grant application, periodic site members of the city council and staff on a visits, and the management performance

FTA’s Charter Regulations: A Compliance Guide for Ohio’s Public Transit Systems

Page 32 review process. Further, ODOT will service, or operate the service as an eligible conduct formal inquiries in response to charter service consistent with these complaints raised by private charter guidelines. Failure to adhere to one of these operators. remedies may result in a withholding of the system’s transit operating subsidy payments If violations are found to exist, ODOT may or other such remedies as deemed order the transit system to cease operating appropriate by ODOT. the service, order the system to re-design the

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Page 33

Appendix A.

List of Federal Funds

Appendix II: Inventory of Federal Programs Providing Transportation Services to the Appendix II: InventoryTransportation-Disadvantaged of Federal Programs Providing Transportation Services to the Transportation-Disadvantaged

U.S. Code Target provisions Typical uses as Types of trips population as Fiscal year Popular title of authorizing reported by as reported defined by 2001 federal authorizing funds for program by program program spending on Program legislation transportation officials officials officialsa transportationb Department of Agriculture, Food and Nutrition Service Food Stamp Food Stamp Act 7 U.S.C. § Reimbursement To access Low-income $12,952,956c Employment and of 1977, as 2015(d)(4)(I)(i) or advanced education, persons Training Program amended (I) payment for training, between the gasoline employment ages of 16 and expenses or bus services, and 59 fare employment placements Department of Education, Office of Elementary and Secondary Education 21st-Century No Child Left 20 U.S.C. § Contract for To access Students from $84,600,000 Community Learning Behind Act of 7173(a)(10) service educational low-income (estimate)d Centers 2001 services families Department of Education, Office of Innovation and Improvement Voluntary Public No Child Left 20 U.S.C. § Contract for To access Students from New program, no School Choice Behind Act of 7225a(a) services, educational under- actual data or 2001 purchase and services and performing estimate operate vehicles, programs schools who available from hire bus drivers choose to the federal and transfer to agency transportation higher directors, performing purchase bus schools passes, redesign transportation plans including new routing systems, offer professional development for bus drivers Department of Education, Office of Special Education and Rehabilitative Services Assistance for Individuals with 20 U.S.C. §§ Purchase and To access Children with No actual data or Education of All Disabilities 1401(a)(22), operate vehicles, educational disabilities estimate Children with Education Act 1411(a)(1) contract for services available from Disabilities service the federal agency Centers for Workforce 29 U.S.C. §§ Referral, To access Persons with a No actual data or Independent Living Investment Act of 796f-4(b)(3) assistance, and program significant estimate 1998 and 705(18)(xi) training in the services disability available from use of public the federal transportation agency

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U.S. Code Target provisions Typical uses as Types of trips population as Fiscal year Popular title of authorizing reported by as reported defined by 2001 federal authorizing funds for program by program program spending on Program legislation transportation officials officials officialsa transportationb Independent Living Workforce 29 U.S.C. § Referral, To access Persons aged No actual data or Services for Older Investment Act of 796k(e)(5) assistance, and program 55 or older estimate Individuals Who Are 1998 training in the services, for who have available from Blind use of public general trips significant the federal transportation visual agency impairment Independent Living Workforce 29 U.S.C. §§ Referral, To access Persons with a No actual data or State Grants Investment Act of 796e-2(1) and assistance, and program significant estimate 1998 705(18)(xi) training in the services, disability available from use of public employment the federal transportation opportunities agency Supported Employment Workforce 29 U.S.C. §§ Transit subsidies To access Persons with No actual data or Services for Individuals Investment Act of 795g and for public and employment most estimate with Most Significant 1998 705(36) private placements, significant available from Disabilities transportation employment disabilities the federal (e.g. bus, taxi, services, and agencye and paratransit), vocational training in the rehabilitation use of public services transportation Vocational Rehabilitation 29 U.S.C. § Transit subsidies To access Persons with $50,700,000 Rehabilitation Grants Act of 1973, as 723(a)(8) for public and employment physical or (estimate)e amended private placements, mental transportation employment impairments (e.g. bus, taxi, services, and and paratransit), vocational training in the rehabilitation use of public services transportation Department of Health and Human Services, Administration for Children and Families Child Care and Child Care and 42 U.S.C. § States rarely use To access Children from $0 (estimate)f Development Fund Development 9858c CCDF funds for child care low-income Block Grant Act transportation services families of 1990, as and only under amended very restricted circumstances Community Services Community 42 U.S.C. § Taxi vouchers, General trips Low-income No actual data or Block Grant Programs Opportunities, 9904 bus tokens persons estimate Accountability, available from Training, and the federal Educational agency Services Act of 1998

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U.S. Code Target provisions Typical uses as Types of trips population as Fiscal year Popular title of authorizing reported by as reported defined by 2001 federal authorizing funds for program by program program spending on Program legislation transportation officials officials officialsa transportationb Developmental Developmental 42 U.S.C. §§ Transportation General trips Persons with No actual data or Disabilities Projects of Disabilities 15002, information, developmental estimate National Significance Assistance and 15081(2)(D) feasibility disabilities available from Bill of Rights Act studies, planning the federal of 2000 agencyg Head Start Augustus F. 42 USCA § Purchase and To access Children from $514,500,000 Hawkins Human 9835(a)(3)(C) operate vehicles, educational low-income (estimate)h Services (ii) contract with services families Reauthorization transportation Act of 1990 providers, coordinate with local education agencies Refugee and Entrant Refugee Act of 8 U.S.C. §§ Bus passes To access Refugees No actual data or Assistance 1980, as 1522(b)(7)(D), employment estimate Discretionary Grants amended 1522(c) and available from educational the federal services agency Refugee and Entrant Refugee Act of 8 U.S.C. §§ Bus passes To access Refugees No actual data or Assistance State 1980, as 1522(b)(7)(D), employment estimate Administered Programs amended 1522(c) and available from educational the federal services agency Refugee and Entrant Refugee Act of 8 U.S.C. §§ Bus passes To access Refugees No actual data or Assistance Targeted 1980, as 1522(b)(7)(D), employment estimate Assistance amended 1522(c) and available from educational the federal services agency Refugee and Entrant Refugee Act of 8 U.S.C. §§ Bus passes To access Refugees No actual data or Assistance Voluntary 1980, as 1522(b)(7)(D), employment estimate Agency Programs amended 1522(c) and available from educational the federal services agency Social Services Block Social Security 42 U.S.C. § Any To access States $18,459,393 Grants Act, as amended 1397a(a)(2)(A) transportation- medical or determine related use social services what categories of families and children

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U.S. Code Target provisions Typical uses as Types of trips population as Fiscal year Popular title of authorizing reported by as reported defined by 2001 federal authorizing funds for program by program program spending on Program legislation transportation officials officials officialsa transportationb State Councils on Developmental 42 U.S.C. §§ State Councils All or general Persons with $786,605 (partial Developmental Disabilities 15002, 15025 provide small trips developmental outlay)i Disabilities and Assistance and grants and disabilities and Protection and Bill of Rights Act contracts to local family Advocacy Systems of 2000 organizations to members establish transportation projects or collaborate in improving transportation for people with disabilities; Protection and Advocacy Systems ensure that people with disabilities have access to public transportation as required by law Temporary Assistance Personal 42 U.S.C. §§ Any use that is General trips No assistance $160,462,214 for Needy Families Responsibility 604(a), (k) reasonably is provided to (partial outlay)j and Work calculated to families Opportunity accomplish a without a minor Reconciliation purpose of the child, but Act of 1996, as TANF program states amended and the determine allowable specific matching portion eligibility of JARC grants Department of Health and Human Services, Administration on Aging Grants for Supportive Older Americans 42 U.S.C. § Contract for To access Program is $72,496,003 Services and Senior Act of 1965, as 3030d (a)(2) services program targeted to Centers amended services, persons aged medical, and 60 or over for general trips Program for American Older Americans 42 U.S.C. §§ Purchase and To access Program is for No actual data or Indian, Alaskan Native, Act of 1965, as 3057, operate vehicles program American estimate and Native Hawaiian amended 3030d(a)(2) services, Indian, available from Elders medical, and Alaskan the federal for general Native, and agency trips Native Hawaiian elders

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U.S. Code Target provisions Typical uses as Types of trips population as Fiscal year Popular title of authorizing reported by as reported defined by 2001 federal authorizing funds for program by program program spending on Program legislation transportation officials officials officialsa transportationb Department of Health and Human Services, Centers for Medicare & Medicaid Services Medicaid Social Security 42 U.S.C. §§ Bus tokens, To access Recipients are $976,200,000 Act, as amended 1396a, subway passes, health care generally low- (estimate)k 1396n(e)(1)(A) brokerage services income services persons, but states determine specific eligibility State Children’s Health Medicare, 42 U.S.C. §§ Any To access Beneficiaries $4,398,089 Insurance Program Medicaid, and 1397jj(a)(26), transportation- health care are primarily SCHIP Benefits (27) related use services children from Improvement low-income and Protection families, but Act of 2000 states determine eligibility Department of Health and Human Services, Health Resources and Services Administration Community Health Public Health 42 U.S.C. § Bus tokens, To access Medically $4,200,000 Centers Service Act, as 254b(b)(1)(A) vouchers, health care underserved (estimate)l amended (iv) transportation services populations coordinators, and drivers Healthy Communities Public Health 42 U.S.C. § Improve To access Uninsured or No actual data or Access Program Service Act, as 256(e)(1)(B)(iii) coordination of health care underinsured estimate amended transportation services populations available from the federal agency Healthy Start Initiative Public Health 42 U.S.C. § Bus tokens, taxi To access Residents of No actual data or Service Act, as 254c-8(e)(1) vouchers, health care areas with estimate amended reimbursement services significant available from for use of own perinatal the federal vehicle health agency disparities HIV Care Formula Ryan White 42 U.S.C. §§ Bus passes, To access Persons with $19,500,000 Grants Comprehensive 300ff-21(a), tokens, taxis, health care HIV or AIDS (estimate)m AIDS Resources 23(a)(2)(B) vanpools, vehicle services Emergency Act purchase by of 1990 providers, mileage reimbursement Maternal and Child Social Security 42 U.S.C. § Any To access Mothers, No actual data or Services Grants Act, as amended 701(a)(1)(A) transportation- health care infants and estimate related use services children, available from particularly the federal from low- agency income families

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U.S. Code Target provisions Typical uses as Types of trips population as Fiscal year Popular title of authorizing reported by as reported defined by 2001 federal authorizing funds for program by program program spending on Program legislation transportation officials officials officialsa transportationb Rural Health Care, Health Centers 42 U.S.C. § Purchase To access Medically No actual data or Rural Health Network, Consolidation 254c vehicles, bus health care underserved estimate and Small Health Care Act of 1996 passes services populations in available from Provider Programs rural areas the federal agency Department of Health and Human Services, Substance Abuse and Mental Health Services Administration Community Mental ADAMHA 42 U.S.C. § Any To access Adults with No actual data or Health Services Block Reorganization 300x-1(b)(1) transportation- program mental illness estimate Grant Act, as amended related use services and children available from with emotional the federal disturbance agency Substance Abuse ADAMHA 42 U.S.C. § Any To access Persons with a No actual data or Prevention and Reorganization 300x-32(b) transportation- program substance estimate Treatment Block Grant Act, as amended related use services related available from disorder and/or the federal recovering agency from substance related disorder Department of Housing and Urban Development, Office of Community Planning and Development Community Housing and 42 U.S.C. § Purchase and General trips Program must $6,761,486 Development Block Community 5305(a)(8) operate vehicles serve a (partial outlay)n Grant Development Act majority of low- of 1974 income persons Housing Opportunities AIDS Housing 42 U.S.C. § Contract for To access Low-income $190,252 for Persons with AIDS Opportunity Act 12907(a)(3) services health care persons with (partial outlay)o and other HIV or AIDS services and their families Supportive Housing McKinney-Vento 42 U.S.C. § Bus tokens, taxi To access Homeless $14,000,000 Program Homeless 11385 vouchers, supportive persons and (estimate)p Assistance Act of purchase and services families with 1987, as operate vehicles children amended Department of Housing and Urban Development, Office of Public and Indian Housing Revitalization of Housing and 42 U.S.C. § Bus tokens, taxi Trips related to Residents of $700,000 Severely Distressed Community 1437v(l)(3) vouchers, employment or the severely (estimate)q Public Housing Development Act contract for obtaining distressed of 1992, as services necessary housing and amended supportive residents of services the revitalized units

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U.S. Code Target provisions Typical uses as Types of trips population as Fiscal year Popular title of authorizing reported by as reported defined by 2001 federal authorizing funds for program by program program spending on Program legislation transportation officials officials officialsa transportationb Department of the Interior, Bureau of Indian Affairs Indian Employment Adult Indian 25 U.S.C. § Gas vouchers To access Native No actual data or Assistance Vocational 309 training American estimate Training Act, as persons available from amended between the the federal ages of 18 and agency 35 Indian Employment, Indian 25 U.S.C. § Gas vouchers Employment- Low-income No actual data or Training and Related Employment, 3401 related Native estimate Servicesr Training and American available from Related Services persons the federal Demonstration agency Act of 1992 Department of Labor, Employment and Training Administration Job Corps Workforce 29 U.S.C. §§ Bus tickets To access Job Low-income $21,612,000 Investment Act of 2888(a)(1), Corps sites youth 1998 2890 and employment services Migrant and Seasonal Workforce 29 U.S.C. §§ Mileage To access Low-income No actual data or Farmworkers Investment Act of 2801(46), reimbursement employment persons and estimate 1998 2912(d) placements or their available from intensive and dependents the federal training who are agency services primarily employed in agricultural labor that is seasonal or migratory Native American Workforce 29 U.S.C. § Bus tokens, To access Unemployed No actual data or Employment and Investment Act of 2911(d)(2) transit passes, employment American estimate Training 1998 use of tribal placements, Indians and available from vehicles and employment other persons the federal grantee staff services of Native agency vehicles, mileage American reimbursement descent for participants operating “car pool” services Senior Community Older Americans 42 U.S.C. § Mileage To access Low-income $4,400,000 Service Employment Act of 1965 3056(c)(6)(A) reimbursement, employment persons aged (estimate)s Program (iv) reimbursement placements 55 or over for travel costs, and payment for cost of transportation

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U.S. Code Target provisions Typical uses as Types of trips population as Fiscal year Popular title of authorizing reported by as reported defined by 2001 federal authorizing funds for program by program program spending on Program legislation transportation officials officials officialsa transportationb Trade Adjustment Trade Act of 19 U.S.C. § Mileage To access Persons found No actual data or Assistance - Workers 1974, as 2296(b) reimbursement, training to be impacted estimate amended transit fares by foreign available from trade, the federal increased agency imports, or shift in production Welfare-to-Work Personal 42 U.S.C. § Any To access American No actual data or Grants to Federally Responsibility 612(a)(3)(C) transportation- employment Indians and estimate Recognized Tribes and and Work related use, placements, other persons available from Alaska Nativest Opportunity though employment of Native the federal Reconciliation purchasing services American agency Act of 1996 vehicles for descent who individuals is not are long-term allowable welfare recipients or are low-income Welfare-to-Work Personal 42 U.S.C. § Any To access Long-term No actual data or Grants to States and Responsibility 603(a)(5)(C) transportation- employment welfare estimate Localitiest and Work related use, placements, recipients or available from Opportunity though employment low-income the federal Reconciliation purchasing services individuals agency Act of 1996 vehicles for individuals is not allowable Work Incentive Grants Workforce 29 U.S.C. §§ Encourage To access Persons with No actual data or Investment Act of 2801(46), collaboration with one-stop disabilities who estimate 1998, as 2864(d)(2) transportation services are eligible for available from amended providers employment the federal and training agency services Workforce Investment Workforce 29 U.S.C. §§ Mileage To access Priority must No actual data or Act Adult Services Investment Act of 2801(46), reimbursement, training be given to estimate Program 1998, as 2864(e)(2) bus tokens, people on available from amended vouchers assistance and the federal low-income agency individuals Workforce Investment Workforce 29 U.S.C. §§ Transportation To access Includes No actual data or Act Dislocated Worker Investment Act of 2801(46), allowance or transition workers who estimate Program 1998, as 2864(e)(2) reimbursement, assistance in have been laid available from amended bus/subway order to find or off, or have the federal tokens qualify for new received an agency employment individual notice of termination, or notice that a facility will close

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U.S. Code Target provisions Typical uses as Types of trips population as Fiscal year Popular title of authorizing reported by as reported defined by 2001 federal authorizing funds for program by program program spending on Program legislation transportation officials officials officialsa transportationb Workforce Investment Workforce 29 U.S.C. §§ Public To access Youth with low No actual data or Act Youth Activities Investment Act of 2801(46), transportation training and individual or estimate 1998, as 2854(a)(4) other support family income available from amended services the federal agency Youth Opportunity Workforce 29 U.S.C. §§ Bus tokens To access Youth from $415,000 Grants Investment Act of 2801(46), program high poverty (estimate)u 1998, as 2914(b) services areas, amended empowerment zones, or enterprise communities Department of Labor, Employment Standards Administration Black Lung Benefits Black Lung 30 U.S.C. § Mileage To access Disabled coal No actual data or Program Benefits Reform 923 reimbursement, health services miners estimate Act of 1977 transit fares, taxi available from vouchers the federal agencyv Department of Labor, Veterans Employment and Training Service Homeless Veterans’ Homeless 38 USCA §§ Bus tokens To access Homeless No actual data or Reintegration Project Veterans 2011, 2021 employment veterans estimate Comprehensive services available from Assistance Act of the federal 2001 agency Veterans’ Employment Workforce 29 U.S.C. §§ Bus tokens, To access Veterans No actual data or Program Investment Act of 2801(46), 2913 minor repairs to employment estimate 1998, as vehicles services available from amended the federal agency Department of Transportation, Federal Transit Administration Capital and Training Title 49 49 U.S.C. § To make General trips Persons with $2,877,818 Assistance Program for Recodification, 5310 vehicles disabilities Over-the-Road Bus P.L. 103-272 wheelchair Accessibility accessible and training required by ADA Capital Assistance Title 49 49 U.S.C. § Assistance in To serve the Elderly $174,982,628 Program for Elderly Recodification, 5310 purchasing needs of the persons and Persons and Persons P.L. 103-272 vehicles, contract elderly and persons with with Disabilities for services persons with disabilities disabilities

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U.S. Code Target provisions Typical uses as Types of trips population as Fiscal year Popular title of authorizing reported by as reported defined by 2001 federal authorizing funds for program by program program spending on Program legislation transportation officials officials officialsa transportationb Capital Investment Transportation 49 U.S.C. § Assistance for General trips General public, $17,500,000 Grants Equity Act for the 5309 bus and bus- although some (estimate)w 21st Century related capital projects are for projects the special needs of elderly persons and persons with disabilities Job Access and Transportation 49 U.S.C. § Expand existing To access Low income $85,009,627 Reverse Commute Equity Act for the 5309 note public employment persons, 21st Century transportation or and related including initiate new services persons with service disabilities Nonurbanized Area Title 49 49 U.S.C. § Capital and General trips General public, $0 Formula Program Recodification, 5311 operating although (partial P.L. 103-272 assistance for paratransit obligation)x public services are transportation for the special service, including needs of paratransit persons with services, in disabilities nonurbanized areas

Urbanized Area Title 49 49 U.S.C. § Capital General trips General public, $36,949,680 Formula Program Recodification, 5307 assistance, and although (partial P.L. 103-272, as some operating paratransit obligation)y amended assistance for services are public transit, for the special including needs of paratransit persons with services, in disabilities urbanized areas Department of Veterans Affairs, Veterans Benefits Administration Automobiles and Disabled 38 U.S.C. § Purchase of General trips Veterans and $33,639,000 Adaptive Equipment for Veterans and 3902 personal service Certain Disabled Servicemen’s vehicles, members with Veterans and Members Automobile modifications of disabilities of the Armed Forces Assistance Act of vehicles 1970 Department of Veterans Affairs, Veterans Health Administration VA Homeless Homeless 38 U.S.C. § 20 vans were General trips Homeless $565,797 Providers Grant and Veterans 7721 note purchased under veterans Per Diem Program Comprehensive this program Service Programs Act of 1992

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U.S. Code Target provisions Typical uses as Types of trips population as Fiscal year Popular title of authorizing reported by as reported defined by 2001 federal authorizing funds for program by program program spending on Program legislation transportation officials officials officialsa transportationb Veterans Medical Care Veterans’ 38 U.S.C. § Mileage To access Veterans with $126,594,591 Benefits Benefits 111 reimbursement, health care disabilities or Improvements contract for services low incomes Act of 1994 service Total (reported or $2,445,453,139 estimated spending on transportation services for the transportation- disadvantaged)

Sources: GAO analysis of information from the Departments of Agriculture, Education, Health and Human Services, Housing and Urban Development, the Interior, Labor, Transportation, and Veterans Affairs; the Coordinating Council on Access and Mobility; the Catalog of Federal Domestic Assistance; the U.S. Code; the Code of Federal Regulations; and the Community Transportation Association of America.

aA supplemental source for the target populations was the Catalog of Federal Domestic Assistance.

bActual outlays or obligations on transportation are given for programs that track this information. All data are outlays, except for the following programs, which are obligations: Capital Investment Grants, Urbanized Area Formula Program, Nonurbanized Area Formula Program, Job Access and Reverse Commute, Capital and Training Assistance for Over-the-Road Bus Accessibility, Capital Assistance Program for Elderly Persons and Persons with Disabilities, Automobiles and Adaptive Equipment for Certain Disabled Veterans and Members of the Armed Forces, and Veterans Medical Care Benefits. Actual data and estimates are the total for the program, unless otherwise noted as partial outlays or obligations in the table. When actual information was not available, estimates are given based on information provided by program officials or the officials agreed with an estimate made by another source.

cAccording to a program official, outlays for the Food Stamp Employment and Training Program have increased due to changes in the program from the 2002 Farm Bill. The 2002 Farm Bill eliminates the $25 per month cap that the Department of Agriculture will reimburse the states for transportation and other work costs incurred by participants. In fiscal year 2002, federal outlays for transportation were $18,523,535.

dA program official said that 10 percent of total program outlays would be a conservative estimate of transportation outlays.

eGrantees report total expenditures and unliquidated obligations made by the state Vocational Rehabilitation (VR) Agency for transportation services provided to individuals served under the State VR Services Program for a fiscal year. Total obligations include both federal and nonfederal funds under the State VR Services Program, the supplemental federal funds awarded to the State VR Agency for the cost of supported employment services under the Supported Employment Program, and funds from other rehabilitation sources. The Department of Education does not collect data on the specific sources of funds used for transportation obligations under the program. However, based on information available from total annual obligations on a national aggregate basis, a program official estimated that of the total amount reported for transportation, about 96 percent would be from the State VR Services Program, and of that amount approximately 76 percent would be federal funds. Similar estimates could not be made for the Supported Employment Program.

fA program official said that, while transportation is an allowable use of funds, using funds for transportation is not encouraged. Program officials estimate that transportation expenditures are zero or close to zero for this program.

gFiscal year 2001 data are not available because transportation was not an area of emphasis until fiscal year 2002. The preliminary fiscal year 2002 outlays for transportation projects totaled $1,084,798.

hA program official estimated that transportation outlays were 8.3 percent of total outlays.

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iThis is a partial outlay based on voluntary reporting by grantees. Full outlays are not available because, according to a program official, grantees were not required to report transportation outlays prior to fiscal year 2002. Fiscal year 2002 data are incomplete, however preliminary data on transportation outlays from 46 of the 51 grantees totaled $2,215,498. jThis is a partial outlay based on the amount grantees reported as non-assistance outlays in a category exclusively for transportation. States reported an additional $356.5 million as outlays on assistance in a category that includes transportation and supportive services, however program officials were unable to determine what percentage of the outlays on assistance were spent on transportation. kProgram officials indicate that federal data on nonemergency medical transportation are not available. Estimate assumes that transportation outlays are 0.73 percent of total program outlays, based on previous research, including a survey of state Medicaid programs. lAccording to a program official, grantees report total outlays for transportation and it is not possible to distinguish between federal and nonfederal funds. The official said 22 percent of total transportation outlays would be a good estimate of the federal portion of fiscal year 2001 transportation outlays. mEstimate of transportation outlays is based on data from grantee’s budget allocations, as suggested by an agency official. nThis is a partial outlay for transportation through the Community Development Block Grant program. This figure includes transportation outlays for the Entitlement program, but excludes the State Administered program. oThis is a partial estimate because, according to a program official, data on transportation outlays are not available from all grantees. The program official could not provide an estimate of outlays for transportation for all grantees. pHUD provided data for transportation spending by 3,187 grantees in fiscal year 2001 that totaled $7,221,569. According to HUD program officials, there are a total of 6,323 grantees, about twice as many as reported data. The officials therefore estimated that about $14,000,000 would have been spent on transportation from all grantees in fiscal year 2001. qEstimate of outlays for transportation is based on a program official’s review of the budgets from 15 grantees who renewed their grants in fiscal year 2001. The official projected total transportation outlays for the program based on these 15 grantees. rPublic Law 102-477 is applied to allow tribal governments to consolidate funding from several federal programs. These include: the Department of Health and Human Services’s Temporary Assistance for Needy Families, and Child Care and Development Fund programs; the Department of Labor’s Native American Employment and Training, and Welfare-to-Work Grants for Federally Recognized Tribes programs; and the Bureau of Indian Affairs’ Employment Assistance, Indian Social Service and Welfare Assistance, Adult Basic Education, and Higher Education programs. The Indian Social Services and Welfare Assistance Program is not used for transportation outside 102-477. The Adult Basic Education and Higher Education programs do not target transportation-disadvantaged populations as defined in this study outside of 102-477. The Employment Assistance program and the HHS and DOL programs provide transportation assistance separately from 102-477. sA program official estimated that transportation outlays were approximately 1 percent of total program outlays. tProgram funding from fiscal year 1998 and 1999 may still be spent, but the program no longer receives funding. uEstimate of transportation outlays is based on a program official’s review of grantee obligations. vAccording to a program official, fiscal year 2001 data are not available due to changes in the program’s reporting system. The official reported that transportation outlays for fiscal year 2002 totaled $478,408.

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wAccording to a program official, there are three distinct allocations of funds under the Capital Investment Grants: the New Starts allocation, which funds new rail projects; the fixed-guideway modernization allocation, which provides funding to maintain and update aging rail systems; and the bus allocation, which provides funding for the purchase of buses, bus-related equipment and paratransit vehicles, and for the construction of bus-related facilities. Because the Capital Investment Grants fund projects that provide services for the general public, the transportation-disadvantaged likely benefit from many projects funded through each of the three allocations, but information was not available to estimate what portion of these funds for the general public benefit the transportation- disadvantaged. However, the program official said that the bus allocation would likely provide the most direct benefit for the transportation-disadvantaged and the obligation level could be estimated by totaling allocations to purchase vans, buses for the elderly or disabled, or paratransit vehicles and equipment. xThe Nonurbanized Area Formula Program funds projects that provide services for the general public, however grantees can use up to 10 percent of their funds to provide complementary ADA paratransit services. Although grantees did not report obligations for complementary ADA paratransit, a program official said that transportation-disadvantaged populations might benefit from other services provided through this grant, such as demand-responsive services. However, the program official could not identify the amount of spending that directly benefits the transportation-disadvantaged. yAccording to a program official, the Urbanized Area Formula Program funds projects that provide services for the general public, however grantees can use up to 10 percent of their funds to provide complementary ADA paratransit services. The figure listed in the table is the total obligations that grantees reported for providing complementary ADA paratransit services. Although grantees may benefit from other services provided through this grant, such as demand-responsive services, the amount spent on complementary ADA paratransit is the only portion that program officials could identify as directly benefiting the transportation-disadvantaged.

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