WASHINGTON A long-awaited audit of the federal charter service rule has turned up a handful of areas that need improvement, but failed to deliver a definitive answer to a key question: What has been the impact of the regulation on customer costs?

The more-than-two-year study by the U.S. Department of Transportation Office of Inspector General offered five recommendations to the Federal Transit Administration that it said would enhance the continued implementation of the rule.

The FTA, which is responsible for enforcing the four-year-old rule that was developed to keep tax-supported public transit agencies from competing for charter work with private motorcoach operators, responded favorably to the audit recommendations and said steps already are being taken to put them in place.

The suggestions from the auditors included improving the electronic database of motorcoach companies, verifying charter registration data, adding safety information to the charter website, helping nonprofit and human-service agencies apply for charter rule exemptions, and tracking issues raised by public and private operators to determine if any rule changes may be needed or if operators need further help in understanding the rule.

The customer-cost issue was expected to be an important element of the audit because of concern early on by some event sponsors and other regular charter customers who worried their costs would increase when they stopped using public transit agencies and switched to private carriers.

Costs conundrum

Auditors said their study showed that customer costs increased in 6 of 13 events they examined. Examples they cited in the study included one case in which riders paid $10 more for a shuttle to a sports event in Baltimore and second in which a nonprofit group in Seattle paid $100,000 in additional costs for a charter.

Although the examples offered some evidence of higher costs, the auditors said they were unable to assess and compare full costs because some private operators would not fully disclose pricing data for competitive reasons, and because public and private operators use different criteria for establishing their costs.

They said private carriers have to include the $500,000 average price of a new motorcoach, while transit agencies may use a much smaller figure because they receive up to 80 percent of the cost of a bus from the federal government.

In addition, they noted that private carriers receive only a partial fuel tax exemption while transit agencies are given a full exemption.

Presleys view

The expense differences were highlighted in a response from Ken Presley, vice president and chief operating officer of the United Motorcoach Association, a strong and vocal supporter of the charter service rule.

"In the final analysis, when the private sector chooses to enter the charter market they purchase a bus. When the public transit chooses to enter the bus market they use equipment purchased by the taxpayer," he emphasized.

Although event sponsors and others told auditors they still worry some about the cost of charters, many of them acknowledged that motorcoaches provide a higher quality of service than transit buses.

"At three large urban areas we visited, stakeholders believed private charter operators were more effective in providing certain transportation services," the auditors wrote.

However, they also noted that transit buses may be better equipped for transporting people with mobility issues, mainly because they have wheelchair lifts or ramps, and they have two doors that can be used to get passengers on and off quickly.

FTA foot dragging

In other areas, auditors said they found that FTA was not meeting its requirement to respond to public and private operators within 10 days of their requesting an advisory opinion on a charter issue. Instead, they said, the agencys average response time has been 38 days.

"FTAs delayed posting of interpretation of the regulation and actions related to charter service creates the risk of event sponsors, private charter operators and public transit agencies misinterpreting the regulations requirements," the auditors said.

The FTA, which was given an opportunity to review and comment on the audit before it was released, said it would make every effort to post its decisions on a more-timely basis.

The auditors said they also found weaknesses in the FTA database of motorcoach operators that have signed up to be notified of charter opportunities in their areas.

They reported that of the 609 carriers in the database, there were inaccuracies on 39 of them, including 24 that had been placed out of service and should not have been on the list.

Additionally, they said the charter website did not have a link to the Federal Motor Carrier Safety Administration and its information on the safety records of individual carriers.

FTA responded that it will have a process in place to periodically verify the data by September, and have a link to the safety information on the FMCSA website by the end of this month. Not our job

The agency took issue with a complaint of auditors that some of the company information in the data base was not accurate, pointing out that the information is supplied by each operator and its accuracy is not the responsibility of the government.

"The responsibility for the accuracy of the information reported rests with those entities reporting and should not be shifted to the federal government, particularly as this data serves the interests of those entities and does not directly bear on inherently governmental functions such as safety," FTA said.

Auditors also said they had found evidence that nonprofit groups and human service organizations -- that may be exempt from the rule -- have had difficulty understanding their status. The FTA said it would develop an outreach program to help them better understand the rule and navigate the exemption process.

Auditors suggested, too, that FTA may not be doing enough to track and identify charter-rule issues and problems raised by event sponsors and public and private operators.

The FTA said it would continue its tracking of any potential problems and conduct education sessions on effectively interpreting the regulation for everyone impacted by the rule.

Presley view II

Presley said the complexity of the charter service rule is rooted in attempts to allow maximum flexibility to public transits, while protecting the marketplace. And if public transit agencies want it any simpler they should refrain from providing charter service and simply allow the marketplace to fill the needs of the public.

"Public transits best serve their respective communities when they first allow the marketplace to serve the needs of the citizens. Non-publicly-funded bus companies are no different than grocery and hardware stores, the plumber or the local newspaper.

"All deserve to compete and serve their community unhindered from government competition," he asserted.