IATR — IN FOCUS
by Matthew W. Daus, Esq. President, International Association of Transportation Regulators Distinguished Lecturer, University Transportation Research Center, Region 2 Contact: mwdaus@juno.com





Matthew W. Daus, Esq., left with one of his new clients, hockey legend Phil Esposito (right), at the offices of his law firm, Windels Marx in Manhattan. Phil Esposito, formerly #77 for the NY Rangers, was admitted to the Hockey Hall of Fame as Number 7 for the Boston Bruins. He was one of the founders of the Tampa Lightening and a commentator for the National Hockey League.

MATTHEW DAUS DELIVERS SPEECH IN CALIFORNIA ABOUT EXTENDING THE R.I.D.E. ACT TO CURB AIRPORT FEES FOR GROUND TRANSPORTATION OPERATORS

“P.U.F.A” – The Prevention of Unreasonable Fees Act

Last month, I flew to San Jose, California to deliver a speech to the Airport Ground Transportation Association on the history of the “R.I.D.E.” Act. R.I.D.E. stands for the Real Interstate Driver’s Equity Act which was signed into law on November 26, 2002 (H.R. 2546, and codified at 49 U.S.C. Sec. 14501(d)). But trouble is now afoot, and airport operators are disturbed by some recent bill amendments to the R.I.D.E. Act introduced in both the 111th and 112th Congress known as the “Prevention of Unreasonable Fees Act” or “PUFA” as I like to call it.

In response to various border wars in the late 1990s between New York and New Jersey concerning the interstate pick-up of passengers and the NYC Taxi and Limousine Commission’s (TLC’s) former Tier 2 permits, the R.I.D.E. Act was passed. I remember it like it was just yesterday, while I was NYC TLC General Counsel in the late 1990s, being sent to Congress by former Mayor Giuliani to lobby against the first version of the R.I.D.E. Act on behalf of New York City.

At a meeting with the General Counsel to the U.S. House Transportation Committee, I was literally one person against a phalanx of industry lobbyists, attorneys and trade group leaders who were openly hostile and argumentative during a very brutal meeting. However, the TLC - with some help from the International Association of Transportation Regulators (IATR) at the time – played a major role in stalling and killing the bill due to a lack of safety requirements.

The bill did not pass until I later became NYC TLC Commissioner and then I brokered a compromise which involved several important concessions made by the industry. At the time, Barry Lefkowitz was the primary lobbyist and leader of the effort to pass the R.I.D.E. Act on behalf of the Limousine Association of New Jersey and the National Limousine Association. In an ironic twist, Barry has not only become a good friend over the years, but he is now also the lobbyist for the IATR representing government regulators and my law firm - Windels, Marx, Lane & Mittendorf, LLP, has become LANJ’s General Counsel.

The issue before the R.I.D.E. Act passed was, primarily, New Jersey limousines picking up passengers in NYC for trips returning to NJ and, in many instances, pick-ups and drop-offs of the same or additional passengers wholly within NYC along the way.

The NY State Vehicle and Traffic law clearly authorized the TLC to issue a permit, which it did, charging a processing fee which the industry objected to on U.S. Constitutional grounds as an “unreasonable burden on interstate commerce.” After the dust settled, and after Mayor Bloomberg reappointed me as TLC Chair, I gave the go ahead and withdrew the prior objection to the bill as long as criminal background checks and/or drug tests were performed on drivers licensed to operate such out-of-state vehicles. So, since 2002, NJ or other out-of-state limousine operators have no longer been required to obtain a Tier 2 TLC vehicle permit from NYC’s TLC as long as:

1. the trip is pre-arranged;
   
   
   
2. the vehicle is licensed properly in its home state;
   
   
   
3. the driver has met any criminal background check or drug testing requirements that apply where pick-ups are made in any state or city where required along the interstate trip; and
   
   
   
4. the vehicle must be registered as a motor carrier with the U.S. Department of Transportation and carry $1.5 million of liability insurance for 9-15 passenger limousines.
   

Also, the R.I.D.E. Act allows the pick-up of additional passengers if there is an “intermediate stop”, that is, part of a continuous trip that returns to the state of origin.

The airport issue involves H.R. 1691, introduced by Congress Member Laura Richardson (D-CA) on May 3, 2011, and referred to the Committee on Transportation and Infrastructure. The bill is identical to S. 1764 that was introduced on October 8, 2009 by U.S. Senator Frank Lautenberg (D-NJ) and Senator David Vitter (R-LA), and to H.R. 6301 introduced by Congress Member Richardson previously. PUFA seeks to do the following:

• Prohibit airports from charging “any fees” to providers of pre-arranged ground transportation at any airport which receives federal funding whether they are conducting interstate or “intrastate” transportation;
  
  
  
• Prohibits transportation “terminal fees” to be charged to any licensed pre-arranged ground transportation provider (i.e, any special fees not charged the general public for access to its facilities are prohibited);
  
  
  
• Exempts “reasonable fees” to cover the costs of “ancillary services” such as curbside parking, information monitor access for arrivals/departures, restrooms, vending machines, etc…with a comprehensive list of ancillary facilities and suggested fees to be promulgated by the Secretary of Transportation; and
  
  
  
• Does not prohibit exclusive on-site concessions between terminals and ground transportation companies, or special lots for vehicles where the driver or company can pay a fee for access.
  

The general membership of AGTA, which is comprised mostly of airport authority managers and some private airport ground transportation operators, were intensely interested in the legislative developments. Airports over the last decade or so have increased the type and amount of fees charged to ground transportation companies, and this trend has become a significant revenue generator for airports. What is interesting about P.U.F.A., as compared to the R.I.D.E. Act, is that it is akin to what is known in transportation policy circles as a “crossover sanction” involving a more legally sound attempt by Congress to condition the receipt of federal funding on compliance.

The public policy argument made by the industry is that the overwhelming majority of limousine businesses are smaller companies struggling to make ends meet in this difficult economy, and they are being hurt by onerous airport fees. While airports and many “non-franchise” transportation providers may not see eye-to-eye on this legislation, it is uncertain whether P.U.F.A. will pass. But who knows? With a national election approaching next year Congress may be under some political pressure to help small businesses, and P.U.F.A. could be fast tracked and become a reality overnight.

Contact:
mdaus@windelsmarx.com
156 West 56th Street, New York, NY 10019
T. 212.237.1106 • F. 212.262.1215