U.S. GOVERNMENT PRINTING OFFICE

WASHINGTON : 

1

99–010

" SENATE ! 107TH CONGRESS

2d Session 

REPORT

2002

107–237

Calendar No. 546

REAL INTERSTATE DRIVER EQUITY ACT 

OF 2001

REPORT

OF THE

COMMITTEE ON COMMERCE, SCIENCE, AND 

TRANSPORTATION

ON

H.R. 2546

AUGUST 1, 2002.—Ordered to be printed 


E:\Seals\Congress.#13
(II)

SENATE COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION 

ONE HUNDRED SEVENTH CONGRESS

SECOND SESSION

ERNEST F. HOLLINGS, South Carolina, Chairman 

DANIEL K. INOUYE, Hawaii 

JOHN D. ROCKEFELLER IV, West Virginia 

JOHN F. KERRY, Massachusetts 

JOHN B. BREAUX, Louisiana 

BYRON L. DORGAN, North Dakota 

RON WYDEN, Oregon 

MAX CLELAND, Georgia 

BARBARA BOXER, California 

JOHN EDWARDS, North Carolina 

JEAN CARNAHAN, Missouri 

BILL NELSON, Florida 

JOHN MCCAIN, Arizona 

TED STEVENS, Alaska 

CONRAD BURNS, Montana 

TRENT LOTT, Mississippi 

KAY BAILEY HUTCHISON, Texas 

OLYMPIA J. SNOWE, Maine 

SAM BROWNBACK, Kansas 

GORDON SMITH, Oregon 

PETER G. FITZGERALD, Illinois 

JOHN ENSIGN, Nevada 

GEORGE ALLEN, Virginia 

KEVIN D. KAYES, Staff Director 

MOSES BOYD, Chief Counsel 

GREGG ELIAS, General Counsel 

JEANNE BUMPUS, Republican Staff Director and General Counsel 

ANN BEGEMAN, Republican Deputy Staff Director 

Calendar No. 546

107TH CONGRESS REPORT " SENATE ! 2d Session 107–237

REAL INTERSTATE DRIVER EQUITY ACT OF 2001

AUGUST 1, 2002.—Ordered to be printed 

Mr. HOLLINGS, from the Committee on Commerce, Science, and 

Transportation, submitted the following 

R E P O R T 

[To accompany H.R. 2546] 

[Including cost estimate of the Congressional Budget Office]

The Committee on Commerce, Science, and Transportation, to 

which was referred the bill (H.R. 2546) to amend title 49, United 

States Code, to prohibit States from requiring a license or fee on 

account of the fact that a motor vehicle is providing interstate prearranged ground transportation service, and for other purposes, 

having considered the same, reports favorably thereon with amendments and recommends that the bill as amended do pass. 

PURPOSE OF THE BILL

The purpose of this bill, as reported, is to prohibit a State, a political subdivision of a State, or an interstate agency of two or more 

States, other than the home licensing State, from enacting or enforcing any law, rule, or regulation requiring a license or fee on a 

motor vehicle that is providing prearranged interstate ground 

transportation service. 

BACKGROUND AND NEEDS

Limousines, airport shuttles, executive sedans, black cars, and 

some taxicabs provide pre-arranged ground transportation services. 

Often in many metropolitan regions, not all points along a trip’s 

route, including the origin, intermediate stops, and destination, are 

located in the same State. Currently, if a taxicab or limousine provides pre-arranged interstate service, a State or municipality in 

which the service operator is not licensed may require registration 

or licensing fees and may enforce these requirements through fines 

and vehicle impoundment. In short, these for-hire vehicles are subVerDate Aug 1, 2002 02:10 Aug 07, 2002 Jkt 099010 PO 00000 Frm 00003 Fmt 6659 Sfmt 6602 E:\HR\OC\SR237.XXX pfrm15 PsN: SR237
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ject not only to the laws and regulations of the State in which they 

are licensed or domiciled, but also to certain requirements that 

may be imposed by other States or municipalities in which fares 

originate or intermediate stops are made. 

The Taxicab, Limousine, and Paratransit Association (TLPA) 

estimates that there are 18,600 companies in the United States 

that provide local, for-hire passenger transportation services using 

taxicabs, black cars, airport shuttles, executive sedans, or limousines. Limousines and taxicabs make up the largest portion of 

the for-hire passenger vehicle industry. According to TLPA, the 

companies that provide for-hire passenger transportation services 

operate a total of 293,000 vehicles and transport over 2 billion passengers each year. Of these, 10,000 limousine companies operate 

some 83,000 vehicles and transport over 400 million passengers per 

year, and 6,300 taxicab companies operate approximately 171,000 

taxicabs and transport 1.4 billion passengers per year. 

Limousine companies serve metropolitan areas nationwide 

with a heavy concentration of service in the northeast. According 

to TLPA, New York City alone has 5,700 limousines. Most limousine companies operate a small number of limousine vehicles, 

and the 50 largest limousine companies in the country have a combined fleet of only 6,500 vehicles. Typically, limousine services that 

are licensed by a State as a ‘‘limousine’’ operate relatively new luxury model vehicles and charge the customer based on time. These 

vehicles include limousines, luxury vans, luxury buses, and executive sedans. TLPA refers to the limousine industry as a $4 billiona-year business. 

Taxicabs, which are typically licensed by a municipality as a ‘‘taxicab,’’ charge the customer primarily based on distance traveled, and are generally brightly colored vehicles with the company 

name prominently displayed on the exterior. The average fleet size 

for these companies is just under 27 taxicab vehicles per company. 

The annual gross revenue of the United States taxicab industry is 

estimated to be approximately $10 billion. 

The Constitution grants the Federal government the authority 

to regulate interstate commerce, including interstate passenger 

transportation by motor carrier. As such, an operator performing 

interstate passenger transportation by motor carrier must obtain 

interstate operating authority from the United States Department 

of Transportation. Licensing of businesses providing intrastate 

transportation by limousines or taxicabs is performed largely by individual States. Limousines are typically licensed and regulated by 

State agencies; taxicabs are usually licensed and regulated at the 

municipal level. This has led to situations where a taxicab or limousine service operating intrastate as part of an interstate movement is required to comply with licensing requirements of the various States in and through which it operates. For example, some 

cities require that the pick up of any passenger within city limits 

for pre-arranged ground transportation service to a point in another State occur only by a for-hire vehicle licensed in the city. Another such restriction may be a requirement for the driver to be licensed in the State in which the trip originates. 

H.R. 2546 would amend Federal transportation law to clarify 

that no State or political subdivision of a State, other than the 

home licensing State, may require a license or fee of a motor carVerDate Aug 1, 2002 02:10 Aug 07, 2002 Jkt 099010 PO 00000 Frm 00004 Fmt 6659 Sfmt 6602 E:\HR\OC\SR237.XXX pfrm15 PsN: SR237
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rier or driver providing pre-arranged ground transportation service 

beginning in one State and ending in another, or beginning and 

ending in the same State with intermediate stops in or routing 

through another State. This limited exercise of Federal preemption 

authority is intended to allow operators of ground transportation 

services to provide interstate service under certain conditions without having to comply with licensing requirements of each State on 

the interstate trip. These conditions are: (1) the trip must be prearranged; and (2) the driver must comply with permissible criminal 

background check or drug testing requirements of any jurisdiction 

where pickups are made along the interstate trip which would otherwise require such measures as a prerequisite to obtaining a license in that State or municipality.

LEGISLATIVE HISTORY

H.R. 2546, introduced by Rep. Roy Blunt (R–MO) on July 18, 

2001, with 21 co-sponsors, passed the House of Representatives by 

voice vote under suspension of the rules on November 13, 2001. It 

was referred to the Senate on November 14, 2001, and, upon receipt in the Senate, was read twice and referred to the Committee 

on Commerce, Science, and Transportation. 

On April 18, 2002, the Committee on Commerce, Science, and 

Transportation ordered H.R. 2546 to be reported favorably with 

amendments. The amendments were offered by Senators Ernest F. 

Hollings and John McCain, and provided three changes: (1) to add 

a definition of ‘‘intermediate stop’’; (2) to clarify the definition of 

transportation by motor carrier to distinguish it from part of certain combined air/ground intermodal movements; and (3) to clarify 

that this legislation does not prevent a State from enforcing in a 

non-discriminatory manner drug and alcohol testing requirements 

on drivers of motor carriers operating in pre-arranged interstate 

commerce.

ESTIMATED COSTS

In accordance with paragraph 11(a) of rule XXVI of the Standing 

Rules of the Senate and section 403 of the Congressional Budget 

Act of 1974, the Committee provides the following cost estimate, 

prepared by the Congressional Budget Office:

U.S. CONGRESS, CONGRESSIONAL BUDGET OFFICE, Washington, DC, May 1, 2002.

Hon. ERNEST F. HOLLINGS, 

Chairman, Committee on Commerce, Science, and Transportation, 

U.S. Senate, Washington, DC. 

DEAR MR. CHAIRMAN: The Congressional Budget Office has prepared the enclosed cost estimate for H.R. 2546, the Real Interstate 

Driver Equity Act of 2001. 

If you wish further details on this estimate, we will be pleased 

to provide them. The CBO staff contacts are Rachel Milberg (for 

federal costs), and Susan Sieg Tompkins (for state and local costs). Sincerely, 

BARRY B. ANDERSON

(For Dan L. Crippen, Director.) 

Enclosure.

4

CONGRESSIONAL BUDGET OFFICE COST ESTIMATE

H.R. 2546—Real Interstate Driver Equity Act of 2001

H.R. 2546 would prohibit states from requiring limousine or 

shuttle operators to obtain a license or pay a fee to provide interstate service. CBO estimates that H.R. 2546 would not have a significant effect on the federal budget because the act would not expand the regulatory or enforcement authorities of federal agencies. 

The legislation would not affect direct spending or receipts; therefore, pay-as-you-go procedures would not apply. 

Prohibiting state and local governments from requiring certain licenses and fees would be an intergovernmental mandate as defined 

in the Unfunded Mandates Reform Act (UMRA). CBO estimates 

that the cost of this mandate, primarily lost revenues from fees and 

penalties, would be well below the threshold established in UMRA 

($58 million in 2002, adjusted annually for inflation). This act contains no new private-sector mandates as defined in UMRA. 

On November 9, 2001, CBO transmitted a cost estimate for H.R. 

2546 as ordered reported by the House Committee on Transportation and Infrastructure on November 7, 2002. CBO estimates 

that neither version of the legislation would have a significant effect on the federal budget, and that both versions contain an intergovernmental mandate with costs below the UMRA threshold. 

The CBO staff contacts for this estimate are Rachel Milberg (for 

federal costs), and Susan Sieg Tompkins (for the state and local 

costs). This estimate was approved by Peter H. Fontaine, Deputy 

Assistant Director for Budget Analysis. 

REGULATORY IMPACT STATEMENT

In accordance with paragraph 11(b) of rule XXVI of the Standing 

Rules of the Senate, the Committee provides the following evaluation of the regulatory impact of the legislation, as reported: 

The legislation would have no further effect on the number or 

types of individuals and businesses regulated, the economic impact 

of such regulation, the personal privacy of affected individuals, or 

the paperwork required from such individuals and businesses. 

SUMMARY OF MAJOR PROVISIONS

The bill, as amended, would relieve certain motor carriers providing pre-arranged interstate transportation service from complying with licensing requirements imposed by States other than 

its home licensing State. The legislation also would clarify that it 

does not: (1) subject taxicab service to regulation under chapter 135 

or section 31138; (2) prohibit or restrict an airport, train, or bus 

terminal operator from contracting to provide preferential access or 

facilities to one or more providers of pre-arranged ground transportation; or (3) restrict the right of a State to require pre-licensing 

drug testing or background investigations of individuals operating 

vehicles providing prearranged ground transportation service originating in that State. 

The Committee envisions that, in order to minimize administrative burdens, drivers will have in their possession official copies of 

their criminal background check before providing pre-arranged 

interstate transportation in a jurisdiction which requires such 

5

criminal background checks as a prerequisite to obtaining a license. 

This would allow local law enforcement authorities to be provided 

with immediate documentation upon request. The Committee also 

envisions the same approach would be followed with respect to jurisdictions which require drug testing of drivers. The driver would 

be expected to have in his or her possession documentation of passage of a drug test prior to providing pre-arranged interstate service within that jurisdiction. 

SECTION-BY-SECTION ANALYSIS

Section 1. Short title. 

This Act may be cited as the ‘‘Real Interstate Driver Equity Act 

of 2001.’’

Section 2. Regulation of interstate pre-arranged ground transportation service. 

This section would clarify that a State or local government or an 

interstate agency may not regulate pre-arranged interstate ground 

transportation provided by a motor carrier of passengers that 

meets all applicable Federal registration requirements for the 

interstate transportation of passengers and all applicable vehicle 

and intrastate passenger transportation licensing requirements of 

the carrier’s home State under State law. 

The bill would not prohibit airport, train, or bus terminal operators from providing preferential access or facilities to one or more 

transportation providers. In addition, a State or local government 

would not be restricted from requiring, in a non-discriminatory 

manner, a drug test or criminal background investigation as a condition of picking up passengers in their jurisdiction for an interstate trip. 

Interstate ground transportation includes any trip in which one 

or more passengers are picked up in one State and transported to 

an intermediate or final stop in another State. The bill prohibits 

a jurisdiction in a State different than the State in which the carrier is licensed from requiring other licenses or permits for pre-arranged interstate ground transportation. 

A stop is an intermediate stop only if the driver does not perform 

any service for any other person while waiting to resume transport 

of the first passenger or passengers. In addition, an airport shuttle 

is providing interstate ground transportation when it transports 

unrelated passengers at multiple locations while traveling to or 

from an airport so long as at least one stop is in a State other than 

the one in which the airport is located. 

Section 3. Definitions. 

Pre-arranged ground transportation service is defined as transportation of passengers, arranged in advance, and provided in a 

motor vehicle with a seating capacity not exceeding 15 passengers, 

including the driver. This section would clarify the extent of the 

taxicab service exemption from regulation by the United States Department of Transportation. Taxicab service is defined by reference 

to local law and functional characteristics. The bill would amend 

existing law to increase the vehicle size from six passengers to 

eight passengers (including the driver), to conform to the commerVerDate Aug 1, 2002 02:10 Aug 07, 2002 Jkt 099010 PO 00000 Frm 00007 Fmt 6659 Sfmt 6602 E:\HR\OC\SR237.XXX pfrm15 PsN: SR237
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cial motor vehicle safety provisions of the Transportation Equity 

Act for the 21st Century (P.L. 105–178). 

CHANGES IN EXISTING LAW

In compliance with paragraph 12 of rule XXVI of the Standing 

Rules of the Senate, changes in existing law made by the bill, as 

reported, are shown as follows (existing law proposed to be omitted 

is enclosed in black brackets, new material is printed in italic, existing law in which no change is proposed is shown in roman):

TITLE 49. TRANSPORTATION

SUBTITLE IV. INTERSTATE TRANSPORTATION

PART B. MOTOR CARRIERS, WATER CARRIERS, BROKERS, AND FREIGHT

FORWARDERS

CHAPTER 131. GENERAL PROVISIONS

§ 13102. Definitions In this part, the following definitions 

shall apply: 

(1) BOARD.—The term ‘‘Board’’ means the Surface Transportation Board. 

(2) BROKER.—The term ‘‘broker’’ means a person, other than 

a motor carrier or an employee or agent of a motor carrier, 

that as a principal or agent sells, offers for sale, negotiates for, 

or holds itself out by solicitation, advertisement, or otherwise 

as selling, providing, or arranging for, transportation by motor 

carrier for compensation. 

(3) CARRIER.—The term ‘‘carrier’’ means a motor carrier, a 

water carrier, and a freight forwarder. 

(4) CONTRACT CARRIAGE.—The term ‘‘contract carriage’’

means—

(A) for transportation provided before January 1, 1996, 

service provided pursuant to a permit issued under section 

10923, as in effect on December 31, 1995; and 

(B) for transportation provided after December 31, 1995, 

service provided under an agreement entered into under 

section 14101(b). 

(5) CONTROL.—The term ‘‘control’’, when referring to a relationship between persons, includes actual control, legal control, 

and the power to exercise control, through or by—

(A) common directors, officers, stockholders, a voting 

trust, or a holding or investment company, or 

(B) any other means. 

(6) FOREIGN MOTOR CARRIER.—The term ‘‘foreign motor carrier’’ means a person (including a motor carrier of property but 

excluding a motor private carrier)—

(A)(i) that is domiciled in a contiguous foreign country; 

or 

(ii) that is owned or controlled by persons of a contiguous foreign country; and 

(B) in the case of a person that is not a motor carrier 

of property, that provides interstate transportation of property by motor vehicle under an agreement or contract entered into with a motor carrier of property (other than a 

7

motor private carrier or a motor carrier of property described in subparagraph (A)). 

(7) FOREIGN MOTOR PRIVATE CARRIER.—The term ‘‘foreign 

motor private carrier’’ means a person (including a motor private carrier but excluding a motor carrier of property)— (A)(i) that is domiciled in a contiguous foreign country; 

or 

(ii) that is owned or controlled by persons of a contiguous foreign country; and 

(B) in the case of a person that is not a motor private 

carrier, that provides interstate transportation of property 

by motor vehicle under an agreement or contract entered 

into with a person (other than a motor carrier of property 

or a motor private carrier described in subparagraph (A)). 

(8) FREIGHT FORWARDER.—The term ‘‘freight forwarder’’ means a person holding itself out to the general public (other 

than as a pipeline, rail, motor, or water carrier) to provide 

transportation of property for compensation and in the ordinary course of its business— (A) assembles and consolidates, or provides for assembling and consolidating, shipments and performs or provides for break-bulk and distribution operations of the 

shipments; 

(B) assumes responsibility for the transportation from 

the place of receipt to the place of destination; and 

(C) uses for any part of the transportation a carrier subject to jurisdiction under this subtitle. The term does not 

include a person using transportation of an air carrier subject to part A of subtitle VII. 

(9) HIGHWAY.—The term ‘‘highway’’ means a road, highway, 

street, and way in a State. 

(10) HOUSEHOLD GOODS.—The term ‘‘household goods’’, as 

used in connection with transportation, means personal effects 

and property used or to be used in a dwelling, when a part of 

the equipment or supply of such dwelling, and similar property 

if the transportation of such effects or property is— (A) arranged and paid for by the householder, except 

such term does not include property moving from a factory 

or store, other than property that the householder has purchased with the intent to use in his or her dwelling and 

is transported at the request of, and the transportation 

charges are paid to the carrier by, the householder; or 

(B) arranged and paid for by another party. 

(11) HOUSEHOLD GOODS FREIGHT FORWARDER.—The term 

‘‘household goods freight forwarder’’ means a freight forwarder 

of one or more of the following items: household goods, unaccompanied baggage, or used automobiles. 

(12) MOTOR CARRIER.—The term ‘‘motor carrier’’ means a 

person providing motor vehicle transportation for compensation. 

(13) MOTOR PRIVATE CARRIER.—The term ‘‘motor private carrier’’ means a person, other than a motor carrier, transporting 

property by motor vehicle when—

(A) the transportation is as provided in section 13501 of 

this title; 

8

(B) the person is the owner, lessee, or bailee of the property being transported; and 

(C) the property is being transported for sale, lease, rent, 

or bailment or to further a commercial enterprise. 

(14) MOTOR VEHICLE.—The term ‘‘motor vehicle’’ means a vehicle, machine, tractor, trailer, or semitrailer propelled or 

drawn by mechanical power and used on a highway in transportation, or a combination determined by the Secretary, but 

does not include a vehicle, locomotive, or car operated only on 

a rail, or a trolley bus operated by electric power from a fixed 

overhead wire, and providing local passenger transportation 

similar to street-railway service. 

(15) NONCONTIGUOUS DOMESTIC TRADE.—The term ‘‘noncontiguous domestic trade’’ means transportation subject to jurisdiction under chapter 135 involving traffic originating in or 

destined to Alaska, Hawaii, or a territory or possession of the 

United States. 

(16) PERSON.—The term ‘‘person’’, in addition to its meaning 

under section 1 of title 1, includes a trustee, receiver, assignee, 

or personal representative of a person.

(17) PRE-ARRANGED GROUND TRANSPORTATION SERVICE.—The 

term ‘‘pre-arranged ground transportation service’’ means transportation for a passenger (or a group of passengers) that is arranged in advance (or is operated on a regular route or between 

specified points) and is provided in a motor vehicle with a seating capacity not exceeding 15 passengers (including the driver).

ø(17)¿ (18) SECRETARY.—The term ‘‘Secretary’’ means the 

Secretary of Transportation. 

ø(18)¿ (19) STATE.—The term ‘‘State’’ means the 50 States of 

the United States and the District of Columbia.

(20) TAXICAB SERVICE.—The term ‘‘taxicab service’’ means 

passenger transportation in a motor vehicle having a capacity 

of not more than 8 passengers (including the driver), not operated on a regular route or between specified places, and that—

(A) is licensed as a taxicab by a State or a local jurisdiction; or 

(B) is offered by a person that—

(i) provides local transportation for a fare determined (except with respect to transportation to or from 

airports) primarily on the basis of the distance traveled; and 

(ii) does not primarily provide transportation to or 

from airports.

ø(19)¿ (21) TRANSPORTATION.—The term ‘‘transportation’’ includes—

(A) a motor vehicle, vessel, warehouse, wharf, pier, dock, 

yard, property, facility, instrumentality, or equipment of 

any kind related to the movement of passengers or property, or both, regardless of ownership or an agreement concerning use; and 

(B) services related to that movement, including arranging for, receipt, delivery, elevation, transfer in transit, refrigeration, icing, ventilation, storage, handling, packing, 

unpacking, and interchange of passengers and property. 

9

ø(20)¿ (22) UNITED STATES.—The term ‘‘United States’’ means the States of the United States and the District of Columbia. 

ø(21)¿ (23) VESSEL.—The term ‘‘vessel’’ means a watercraft 

or other artificial contrivance that is used, is capable of being 

used, or is intended to be used, as a means of transportation 

by water. 

ø(22)¿ (24) WATER CARRIER.—The term ‘‘water carrier’’ means a person providing water transportation for compensation. 

* * * * * * *

CHAPTER 135. JURISDICTION

§ 13506. Miscellaneous motor carrier transportation exemptions 

(a) IN GENERAL.—Neither the Secretary nor the Board has jurisdiction under this part over— (1) a motor vehicle transporting only school children and 

teachers to or from school; 

ø(2) a motor vehicle providing taxicab service and having a 

capacity of not more than 6 passengers and not operated on a 

regular route or between specified places;¿

(2) a motor vehicle providing taxicab service;

(3) a motor vehicle owned or operated by or for a hotel and 

only transporting hotel patrons between the hotel and the local 

station of a carrier; 

(4) a motor vehicle controlled and operated by a farmer and 

transporting— (A) the farmer’s agricultural or horticultural commodities and products; or 

(B) supplies to the farm of the farmer; 

(5) a motor vehicle controlled and operated by a cooperative 

association (as defined by section 15(a) of the Agricultural Marketing Act (12 U.S.C. 1141j(a))) or by a federation of cooperative associations if the federation has no greater power or purposes than a cooperative association, except that if the cooperative association or federation provides transportation for compensation between a place in a State and a place in another 

State, or between a place in a State and another place in the 

same State through another State—

(A) for a nonmember that is not a farmer, cooperative 

association, federation, or the United States Government, 

the transportation (except for transportation otherwise exempt under this subchapter)—

(i) shall be limited to transportation incidental to 

the primary transportation operation of the cooperative association or federation and necessary for its effective performance; and 

(ii) may not exceed in each fiscal year 25 percent 

of the total transportation of the cooperative association or federation between those places, measured by 

tonnage; and 

(B) the transportation for all nonmembers may not exceed in each fiscal year, measured by tonnage, the total 

10

transportation between those places for the cooperative association or federation and its members during that fiscal 

year; 

(6) transportation by motor vehicle of— (A) ordinary livestock; 

(B) agricultural or horticultural commodities (other than 

manufactured products thereof); 

(C) commodities listed as exempt in the Commodity List 

incorporated in ruling numbered 107, March 19, 1958, Bureau of Motor Carriers, Interstate Commerce Commission, 

other than frozen fruits, frozen berries, frozen vegetables, 

cocoa beans, coffee beans, tea, bananas, or hemp, or wool 

imported from a foreign country, wool tops and noils, or 

wool waste (carded, spun, woven, or knitted); 

(D) cooked or uncooked fish, whether breaded or not, or 

frozen or fresh shellfish, or byproducts thereof not intended for human consumption, other than fish or shellfish 

that have been treated for preserving, such as canned, 

smoked, pickled, spiced, corned, or kippered products; and 

(E) livestock and poultry feed and agricultural seeds and 

plants, if such products (excluding products otherwise exempt under this paragraph) are transported to a site of agricultural production or to a business enterprise engaged 

in the sale to agricultural producers of goods used in agricultural production; 

(7) a motor vehicle used only to distribute newspapers; 

(8)(A) transportation of passengers by motor vehicle incidental to transportation by aircraft; 

(B) transportation of property (including baggage) by motor 

vehicle as part of a continuous movement which, prior or subsequent to such part of the continuous movement, has been or 

will be transported by an air carrier or (to the extent so agreed 

by the United States and approved by the Secretary) by a foreign air carrier; or 

(C) transportation of property by motor vehicle in lieu of 

transportation by aircraft because of adverse weather conditions or mechanical failure of the aircraft or other causes due 

to circumstances beyond the control of the carrier or shipper; 

(9) the operation of a motor vehicle in a national park or national monument; 

(10) a motor vehicle carrying not more than 15 individuals 

in a single, daily roundtrip to commute to and from work; 

(11) transportation of used pallets and used empty shipping 

containers (including intermodal cargo containers), and other 

used shipping devices (other than containers or devices used in 

the transportation of motor vehicles or parts of motor vehicles); 

(12) transportation of natural, crushed, vesicular rock to be 

used for decorative purposes; 

(13) transportation of wood chips; 

(14) brokers for motor carriers of passengers, except as provided in section 13904(d); or 

(15) transportation of broken, crushed, or powdered glass. 

(b) EXEMPT UNLESS OTHERWISE NECESSARY.—Except to the extent the Secretary or Board, as applicable, finds it necessary to exercise jurisdiction to carry out the transportation policy of section 

11

13101, neither the Secretary nor the Board has jurisdiction under 

this part over— (1) transportation provided entirely in a municipality, in contiguous municipalities, or in a zone that is adjacent to, and 

commercially a part of, the municipality or municipalities, except—(A) when the transportation is under common control, 

management, or arrangement for a continuous carriage or 

shipment to or from a place outside the municipality, municipalities, or zone; or 

(B) that in transporting passengers over a route between 

a place in a State and a place in another State, or between 

a place in a State and another place in the same State 

through another State, the transportation is exempt from 

jurisdiction under this part only if the motor carrier operating the motor vehicle also is lawfully providing intrastate transportation of passengers over the entire route 

under the laws of each State through which the route 

runs; 

(2) transportation by motor vehicle provided casually, occasionally, or reciprocally but not as a regular occupation or business, except when a broker or other person sells or offers for 

sale passenger transportation provided by a person authorized 

to transport passengers by motor vehicle under an application 

pending, or registration issued, under this part; or 

(3) the emergency towing of an accidentally wrecked or disabled motor vehicle.

* * * * * * *

CHAPTER 145. FEDERAL-STATE RELATIONS

§ 14501. Federal authority over intrastate transportation 

(a) MOTOR CARRIERS OF PASSENGERS.—

(1) LIMITATION ON STATE LAW.—No State or political subdivision thereof and no interstate agency or other political agency 

of 2 or more States shall enact or enforce any law, rule, regulation, standard, or other provision having the force and effect of 

law relating to—

(A) scheduling of interstate or intrastate transportation 

(including discontinuance or reduction in the level of service) provided by a motor carrier of passengers subject to jurisdiction under subchapter I of chapter 135 of this title on 

an interstate route; 

(B) the implementation of any change in the rates for 

such transportation or for any charter transportation except to the extent that notice, not in excess of 30 days, of 

changes in schedules may be required; or 

(C) the authority to provide intrastate or interstate charter bus transportation. 

This paragraph shall not apply to intrastate commuter bus 

operations, or to intrastate bus transportation of any nature in 

the State of Hawaii. 

(2) MATTERS NOT COVERED.—Paragraph (1) shall not restrict 

the safety regulatory authority of a State with respect to motor 

vehicles, the authority of a State to impose highway route conVerDate Aug 1, 2002 02:10 Aug 07, 2002 Jkt 099010 PO 00000 Frm 00013 Fmt 6659 Sfmt 6602 E:\HR\OC\SR237.XXX pfrm15 PsN: SR237
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trols or limitations based on the size or weight of the motor vehicle, or the authority of a State to regulate carriers with regard to minimum amounts of financial responsibility relating 

to insurance requirements and self-insurance authorization. 

(b) FREIGHT FORWARDERS AND BROKERS.— (1) GENERAL RULE.—Subject to paragraph (2) of this subsection, no State or political subdivision thereof and no intrastate agency or other political agency of 2 or more States shall 

enact or enforce any law, rule, regulation, standard, or other 

provision having the force and effect of law relating to intrastate rates, intrastate routes, or intrastate services of any 

freight forwarder or broker. 

(2) CONTINUATION OF HAWAII’S AUTHORITY.—Nothing in this 

subsection and the amendments made by the Surface Freight 

Forwarder Deregulation Act of 1986 shall be construed to affect the authority of the State of Hawaii to continue to regulate 

a motor carrier operating within the State of Hawaii. 

(c) MOTOR CARRIERS OF PROPERTY.— (1) GENERAL RULE.—Except as provided in paragraphs (2) 

and (3), a State, political subdivision of a State, or political authority of 2 or more States may not enact or enforce a law, regulation, or other provision having the force and effect of law related to a price, route, or service of any motor carrier (other 

than a carrier affiliated with a direct air carrier covered by section 41713(b)(4)) or any motor private carrier, broker, or 

freight forwarder with respect to the transportation of property. 

(2) MATTERS NOT COVERED.—Paragraph (1)— (A) shall not restrict the safety regulatory authority of a 

State with respect to motor vehicles, the authority of a 

State to impose highway route controls or limitations 

based on the size or weight of the motor vehicle or the hazardous nature of the cargo, or the authority of a State to 

regulate motor carriers with regard to minimum amounts 

of financial responsibility relating to insurance requirements and self-insurance authorization; 

(B) does not apply to the transportation of household 

goods; and 

(C) does not apply to the authority of a State or a political subdivision of a State to enact or enforce a law, regulation, or other provision relating to the price of for-hire 

motor vehicle transportation by a tow truck, if such transportation is performed without the prior consent or authorization of the owner or operator of the motor vehicle. 

(3) STATE STANDARD TRANSPORTATION PRACTICES.—

(A) CONTINUATION.—Paragraph (1) shall not affect any 

authority of a State, political subdivision of a State, or political authority of 2 or more States to enact or enforce a 

law, regulation, or other provision, with respect to the 

intrastate transportation of property by motor carriers, related to—

(i) uniform cargo liability rules, 

(ii) uniform bills of lading or receipts for property 

being transported, 

(iii) uniform cargo credit rules, 

13

(iv) antitrust immunity for joint line rates or routes, 

classifications, mileage guides, and pooling, or 

(v) antitrust immunity for agent-van line operations 

(as set forth in section 13907), if such law, regulation, 

or provision meets the requirements of subparagraph 

(B). 

(B) REQUIREMENTS.—A law, regulation, or provision of a 

State, political subdivision, or political authority meets the 

requirements of this subparagraph if— (i) the law, regulation, or provision covers the same 

subject matter as, and compliance with such law, regulation, or provision is no more burdensome than compliance with, a provision of this part or a regulation 

issued by the Secretary or the Board under this part; 

and 

(ii) the law, regulation, or provision only applies to 

a carrier upon request of such carrier. 

(C) ELECTION.—Notwithstanding any other provision of 

law, a carrier affiliated with a direct air carrier through 

common controlling ownership may elect to be subject to a 

law, regulation, or provision of a State, political subdivision, or political authority under this paragraph. 

(4) NONAPPLICABILITY TO HAWAII.—This subsection shall not 

apply with respect to the State of Hawaii. 

(d) PRE-ARRANGED GROUND TRANSPORTATION.— (1) IN GENERAL.—No State or political subdivision thereof 

and no interstate agency or other political agency of 2 or more 

States shall enact or enforce any law, rule, regulation, standard 

or other provision having the force and effect of law requiring 

a license or fee on account of the fact that a motor vehicle is 

providing pre-arranged ground transportation service if the 

motor carrier providing such service— (A) meets all applicable registration requirements under 

chapter 139 for the interstate transportation of passengers; 

(B) meets all applicable vehicle and intrastate passenger 

licensing requirements of the State or States in which the 

motor carrier is domiciled or registered to do business; and 

(C) is providing such service pursuant to a contract for—

(i) transportation by the motor carrier from one 

State, including intermediate stops, to a destination in 

another State; or 

(ii) transportation by the motor carrier from one 

State, including intermediate stops in another State, to 

a destination in the original State. 

(2) INTERMEDIATE STOP DEFINED.—In this section, the term 

‘‘intermediate stop’’, with respect to transportation by a motor 

carrier, means a pause in the transportation in order for one or 

more passengers to engage in personal or business activity, but 

only if the driver providing the transportation to such passenger 

or passengers does not, before resuming the transportation of 

such passenger (or at least 1 of such passengers), provide transportation to any other person not included among the passengers being transported when the pause began. 

(3) MATTERS NOT COVERED.—Nothing in this subsection shall 

be construed—

14

(A) as subjecting taxicab service to regulation under 

chapter 135 or section 31138; 

(B) as prohibiting or restricting an airport, train, or bus 

terminal operator from contracting to provide preferential 

access or facilities to one or more providers of pre-arranged 

ground transportation service; and 

(C) as restricting the right of any State or political subdivision of a State to require, in a nondiscriminatory manner, that any individual operating a vehicle providing prearranged ground transportation service originating in the 

State or political subdivision have submitted to pre-licensing drug testing or a criminal background investigation of 

the records of the State in which the operator is domiciled, 

by the State or political subdivision by which the operator 

is licensed to provide such service, or by the motor carrier 

providing such service, as a condition of providing such 

service.

* * * * * * *

SUBTITLE VI. MOTOR VEHICLE AND DRIVER PROGRAMS

PART B. COMMERCIAL

CHAPTER 311. COMMERCIAL MOTOR VEHICLE SAFETY

§ 31138. Minimum financial responsibility for transporting 

passengers 

(a) GENERAL REQUIREMENT.—The Secretary of Transportation 

shall prescribe regulations to require minimum levels of financial 

responsibility sufficient to satisfy liability amounts established by 

the Secretary covering public liability and property damage for the 

transportation of passengers for compensation by motor vehicle in 

the United States between a place in a State and— (1) a place in another State; 

(2) another place in the same State through a place outside 

of that State; or 

(3) a place outside the United States. 

(b) MINIMUM AMOUNTS.—The level of financial responsibility established under subsection (a) of this section for a motor vehicle 

with a seating capacity of—

(1) at least 16 passengers shall be at least $5,000,000; and 

(2) not more than 15 passengers shall be at least $1,500,000. 

(c) EVIDENCE OF FINANCIAL RESPONSIBILITY.—

(1) Subject to paragraph (2) of this subsection, financial responsibility may be established by evidence of one or a combination of the following if acceptable to the Secretary of 

Transportation: 

(A) insurance, including high self-retention. 

(B) a guarantee. 

(C) a surety bond issued by a bonding company authorized to do business in the United States. 

(2) A person domiciled in a country contiguous to the United 

States and providing transportation to which a minimum level 

of financial responsibility under this section applies shall have 

evidence of financial responsibility in the motor vehicle when 

the person is providing the transportation. If evidence of finanVerDate Aug 1, 2002 02:10 Aug 07, 2002 Jkt 099010 PO 00000 Frm 00016 Fmt 6659 Sfmt 6602 E:\HR\OC\SR237.XXX pfrm15 PsN: SR237
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cial responsibility is not in the vehicle, the Secretary of Transportation and the Secretary of the Treasury shall deny entry 

of the vehicle into the United States. 

(3) A motor carrier may obtain the required amount of financial responsibility from more than one source provided the cumulative amount is equal to the minimum requirements of this 

section. 

(d) CIVIL PENALTY.—

(1) If, after notice and an opportunity for a hearing, the Secretary of Transportation finds that a person (except an employee acting without knowledge) has knowingly violated this 

section or a regulation prescribed under this section, the person is liable to the United States Government for a civil penalty of not more than $10,000 for each violation. A separate 

violation occurs for each day the violation continues

(2) The Secretary of Transportation shall impose the penalty 

by written notice. In determining the amount of the penalty, 

the Secretary shall consider—

(A) the nature, circumstances, extent, and gravity of the 

violation; 

(B) with respect to the violator, the degree of culpability, 

any history of prior violations, the ability to pay, and any 

effect on the ability to continue doing business; and 

(C) other matters that justice requires. 

(3) The Secretary of Transportation may compromise the 

penalty before referring the matter to the Attorney General for 

collection. 

(4) The Attorney General shall bring a civil action in an appropriate district court of the United States to collect a penalty 

referred to the Attorney General for collection under this subsection. 

(5) The amount of the penalty may be deducted from 

amounts the Government owes the person. An amount collected under this section shall be deposited in the Treasury as 

miscellaneous receipts. 

(e) NONAPPLICATION.—This section does not apply to a motor vehicle—

(1) transporting only school children and teachers to or from 

school; 

ø(2) providing taxicab service, having a seating capacity of 

not more than 6 passengers, and not being operated on a regular route or between specified places;¿

(2) providing taxicab service (as defined in section 13102);

(3) carrying not more than 15 individuals in a single, daily 

round trip to and from work; or 

(4) providing transportation service within a transit service 

area under an agreement with a Federal, State, or local government funded, in whole or in part, with a grant under section 5307, 5310, or 5311, including transportation designed and 

carried out to meet the special needs of elderly individuals and 

individuals with disabilities; except that, in any case in which 

the transit service area is located in more than 1 State, the 

minimum level of financial responsibility for such motor vehiVerDate Aug 1, 2002 02:10 Aug 07, 2002 Jkt 099010 PO 00000 Frm 00017 Fmt 6659 Sfmt 6601 E:\HR\OC\SR237.XXX pfrm15 PsN: SR237
16

cle will be at least the highest level required for any of such 

States.

Æ