SAN ANTONIO – While deregulation fever has gripped Washington, state and local efforts to regulate motorcoach operations continue to threaten federal preemptions that have allowed interstate travel to flourish.
Examples of efforts to raise revenue or stifle outside competition through regulations were discussed during the annual State Association Summit at Motorcoach Expo 2018.
“I think we are going to see more of these. They need the money,” said Ken Presley, vice president of legislative and regulatory affairs and industry relations/COO of the United Motorcoach Association. “We have to think about the potential for every city and county and political subdivision to create regulations. It could get pretty scary.
“It is important that we start pushing back,” Presley said. “The federal preemptions are sacred. If we don’t take care of them they are going to go away.”
Operators visiting Chicago are facing not a revenue grab but rather a clumsy effort to regulate party buses. Motorcoach tourism in Chicago has been stifled since last fall, reported Cherie Hime, executive director of the Midwest Bus and Motorcoach Association.
“A Chicago ordinance affects any trip involving a passenger vehicle of 15 or more passengers regardless of licensing jurisdiction,” Hime said. “The ordinance requires a licensed security guard and installed security cameras for any trip with stops at locations in the city where alcohol is served or when passengers are consuming alcohol on the vehicle during the trip.
“Chicago police and inspectors used this ordinance to stop buses. Operators have cancelled planned trips to the city due to the increased costs and inability to be compliant with the ordinance.”
Fortunately, tourism officials have joined the Midwest association in resolving the problems created by the ordinance.
“We have had some very successful meetings with the city and were able to educate them on how the ordinance affects the convention and leisure tourism markets in Chicago,” Hime said. “They know they are discouraging visitors. The issue hopefully will be resolved this spring.”
The California Bus Association is battling a permit and inspection protocol imposed on carriers picking up passengers at San Francisco International Airport.
“SFO, probably for the last 40 years, maybe longer, had a requirement that carriers coming into the airport had to file for a permit,” said Michael R. Waters of Pacific Coast Sightseeing and Coach USA in Moss Beach, Calif.
“It was applied to pick-ups primarily — they don’t enforce drop-offs. In addition to the permit process, which has a fee, there is a mandatory inspection of every bus. We have to install a decal on each side of the bus and install a transponder. The fee (for an airport trip) is rather minimal — I think it is $6,” said Waters, a member of the board of directors of California Bus Association.
While bus and coach operators believed the inspection process violated federal preemptions from such local regulation it was tolerated until the past year, when airport inspectors began to write “idiotic failures” on motorcoaches, he said.
“They failed a new bus because the inspector felt the seat recline was outside of specifications. There was no mention of what the specification was, but the bus failed. We were told it was the inspector’s opinion.
“It went from those types of things to too many candy wrappers on the floor. You are allowed to have four newspapers on board — the fifth one is a failure. There are absolutely ludicrous inspection criteria,” Waters said.
If a motorcoach fails inspection or is late for an appointment, the airport imposes a $250 re-inspection fee, he said. “This has been a sleeping bear for years. Everybody paid the fees and went through the moronic inspections until all these nitpicking failures came up.”
The California Bus Association has presented its federal preemption arguments to airport officials. They have decided that permit decals can become voluntary but they have not budged from demands for vehicle inspections, Waters said. The state operators are intent on pursuing the airport’s compliance with federal preemptions.
“The association has spent a lot of money and we may spend a lot more,” he said. “When you see this wave starting to form you have to cut the legs out from under it. If your airport starts talking about permits and fees at all, get into the first meeting and bring the arguments that ‘You are not allowed to preempt federal laws.’”
Presley updated the state associations on the results of UMA’s lawsuit attempting to overturn local permitting requirements imposed by Austin, Texas.
“This is very relevant to a lot of the state preemption stuff we were talking about,” he said. “Austin decided that they were going to dust off an old ordinance and reinstate it and start requiring charter buses that travel through their city to purchase a permit. It would require an inspection and displaying a decal.
“The ordinance had a lot of things that went with it. You couldn’t have more than five newspapers on the bus. All of your buses had to be painted alike.”
Two U.S. Supreme Court cases have shaped challenges to such local regulations, he said. The first, decided in 1998, was Greyhound Lines v. City of New Orleans.
“It was the only case dealing with this, prior to us suing Austin, for passenger carriers,” Presley said. “New Orleans was requiring permits to travel in that city by bus. Greyhound sued and the courts found that when Congress deregulated charter services it displaced local regulations.”
Many federal court cases have addressed local regulation of tow trucks, particularly City of Columbus v. Ours Garage, decided by the U.S. Supreme Court in 2002.
In that case, Presley said, “The Supreme Court said the states and their political subdivisions, basically cities and towns, can enforce motor vehicle safety, highway route controls or limitations based on the size or weight of the motor vehicle, and minimum insurance. Referred to as the ‘saving clause’ by the legal community, it extends to local jurisdictions a little bit of wiggle room thought to originally be reserved exclusively for states.”
The narrow claim of safety can save some degree of local permitting as pursued by Austin, he said.
“Greyhound prevailed because there was no safety associated with the New Orleans permit. But Austin made this play of safety — if they say they are trying to regulate safety there is a good chance that they can require a permit,” he said.
What constitutes a legitimate intent to promote safety? That is not certain, Presley said.
“Everything that is called safety is not necessarily safety. The courts have allowed a lot of latitude, but you can challenge them. They must be consistent with Federal Motor Carrier Safety Regulations. It can’t be about candy wrappers. Theoretically the regulations are supposed to be approved by the Secretary of Transportation. If a permit is just associated with funding, you have an argument. If they say it is related to safety, your battle is a little bit tougher.”
The federal courts have upheld the position that state and local governments cannot require interstate carriers to display permit decals, Presley said.
“That is clear cut now. This is where you can start pushing back on all these city permits. If they know they cannot require decals, we can win because this shifts the burden back on them. The people who are out there enforcing these permits are going to throw their hands up and say ‘We can’t enforce this.’ Eventually we will kill these permits across the country.”
Another battle facing motorcoach operators is competition from public transit agencies in violation of federal charter service rules that restrict public systems from competing with private carriers for charter work. Presley described the conversion of chartered shuttle service at the University of Southern Maine into an extension of the transit agencies scheduled service.
Presley presented this portion of the program when winter storms delayed the flights of scheduled panelists Gregg Isherwood of Custom Coach and Limousine in Portland, Maine, and Scott Riccio of Northeast Charter and Tour in Lewiston, Maine.
“Greg Isherwood said he has a charter that runs from the University of Southern Maine into the city of Portland a few times a day. It is a $400,000-a-year contract. He said he has gotten a notice that the university is not going to renew the contract,” Presley said.
“The public transit agency decides they are going to take that service over. The university is going to pay the $400,000 to the transit authority. Greg perceived that as a violation of the charter service rule. We dived into it and found that what the transit authority decided to do was expand their service out to the University of Southern Maine. In reality, there is no rule that keeps them from taking your charter and turning it into mass transit,” he said.
While a legal challenge may not succeed, a public relations campaign might help, Presley said.
“The only thing you can do is appeal to the good citizens of Portland. They are going to pay for this. Every one of those fares will be subsidized and they are going to need a capital grant to purchase the $6 million worth of buses to run this route.”