53384 Federal Register / Vol. 73, No. 180 / Tuesday, September 16, 2008 / Rules and Regulations 

1 73 FR 28,790 (May 19, 2008). 

2 531 F.Supp.2d 494, 507 (W.D.N.Y. 2008) (setting 

aside FTA’s interpretation of its school bus 

operations regulations under 49 CFR part 605). 

occurred, and avoided it by taking steps 

within his/her control which would not have 

risked causing another kind of mishap, the 

accident was preventable.’’ (Emphasis 

added.) 

The intent of the safety permit 

program is to hold motor carriers that 

transport permitted materials to a higher 

safety standard due to the potential risks 

associated with transportation of these 

high-risk hazardous materials. In 

applying this standard to the safety 

fitness rating process, FMCSA 

recognizes that crashes in which the 

motor carrier’s driver was not at fault 

and could not have reasonably avoided 

without further risk, should not 

adversely reflect on the safety fitness of 

the motor carrier. Similarly, denial of a 

safety permit based upon crashes which 

were not preventable, does not have a 

reasonable correlation to the safety 

standard required under the safety 

permit program. 

In the safety rating context, FMCSA 

considers preventability when the 

carrier contests the evaluation of the 

accident factor by presenting 

compelling evidence that the recordable 

rate is not a fair means of evaluating the 

carrier’s fitness under the accident 

factor. Similarly, FMCSA will consider 

preventability of crashes under the 

safety permit program. When a carrier 

contests the denial of its safety permit 

application based upon a crash rate that 

falls into the top thirty percent of the 

national average and submits 

compelling evidence that a crash or 

crashes listed in the MCMIS were not 

preventable, it should not be included 

in the crash rate calculation. The 

preventability standard that will be 

applied is the same standard that is 

used in the safety rating context. 

Preventability Policy Procedures 

Accordingly, FMCSA is implementing 

the following policy procedures: If a 

motor carrier’s safety permit application 

is denied based upon a crash rate greater 

that the safety permit program crash rate 

threshold, the carrier may submit 

evidence to show that one or more 

crashes were not preventable. In order 

to preserve the right to seek 

administrative review of FMCSA’s 

determination on the preventability of 

one or more crashes, the carrier should 

submit such evidence as part of a 

request for administrative review 

pursuant to § 385.423(c). The carrier 

should submit the request to FMCSA’s 

Chief Safety Officer (CSO) and the 

Office of Chief Counsel, and must 

include adequate proof that the crash or 

crashes in question were not 

preventable. The standard for 

determining preventability is the same 

as the standard found in Appendix A to 

Part 385: 

If a driver who exercises normal judgment 

and foresight could have foreseen the 

possibility of the accident that in fact 

occurred, and avoided it by taking steps 

within his/her control which would not have 

risked causing another kind of mishap, the 

accident was preventable. 

It is incumbent upon the carrier to 

provide reliable and objective evidence 

that the accident was not preventable. 

Such evidence may include but is not 

limited to police reports and other 

verifiable government reports or law 

enforcement and witness statements. 

The issue of whether a crash was or was 

not preventable under the above-stated 

standard will be initially addressed by 

the FMCSA Office of Enforcement and 

Compliance, Hazardous Materials 

Division in consultation with the Office 

of Chief Counsel, Enforcement and 

Litigation Division. If the initial 

determination results in a finding that 

one or more crashes were not 

preventable, the safety permit 

application will be reprocessed with the 

relevant crash or crashes removed from 

consideration in the crash rate 

calculation. If removal of the crash(es) 

results in a crash rate calculation that 

falls below the crash rate cut-off for the 

top 30 percent of the national average 

and no other disqualifying factors exist, 

FMCSA will issue a safety permit to the 

carrier. If the Office of Enforcement and 

the Office of Chief Counsel determine 

that the evidence submitted does not 

support a finding that the crash or 

crashes were preventable, the motor 

carrier may pursue its request for 

administrative review by the Chief 

Safety Officer of the denial of its safety 

permit application based upon its crash 

rate. The request for administrative 

review must have been timely filed and 

served in accordance with the 

requirements of 49 CFR 385.423. 

Issued on: September 10, 2008. 

John H. Hill, 

Administrator. 

[FR Doc. E8–21563 Filed 9–15–08; 8:45 am] 

BILLING CODE 4910–EX–P 

DEPARTMENT OF TRANSPORTATION 

Federal Transit Administration 

49 CFR Part 605 

[Docket No. FTA–2008–0015] 

Final Policy Statement on FTA’s 

School Bus Operations Regulations 

AGENCY: Federal Transit Administration 

(FTA), DOT. 

ACTION: Final policy statement. 

SUMMARY: Through this notice, the 

Federal Transit Administration (FTA) 

clarifies its policy with respect to its 

interpretation of ‘‘tripper service’’ and 

‘‘school bus operations’’ under 49 CFR 

part 605. 

DATE: Effective Date: The effective date 

of this final policy statement is 

September 16, 2008. 

ADDRESSES: Availability of the Final 

Policy Statement and Comments: One 

may access this final policy statement, 

the proposed policy statement, and 

public comments on the proposed 

policy statement at docket number 

FTA–2008–0015. For access to the 

docket, please visit http:// 

www.regulations.gov or the Docket 

Operations office located in the West 

Building of the U.S. Department of 

Transportation, Room W12–140, 1200 

New Jersey Avenue, SE., Washington, 

DC 20590, between 9 a.m. and 5 p.m., 

Monday through Friday, except Federal 

holidays. 

FOR FURTHER INFORMATION CONTACT: 

Michael L. Culotta, Attorney, Office of 

Chief Counsel, Federal Transit 

Administration, U.S. Department of 

Transportation, 1200 New Jersey 

Avenue, SE., 5th Floor—East Building, 

Washington, DC 20590. E-mail: 

Michael.Culotta@dot.gov. Telephone: 

(202) 366–1936. 

SUPPLEMENTARY INFORMATION: 

I. Background 

A. Introduction 

On May 19, 2008, FTA issued a 

Notice of Proposed Policy Statement on 

FTA’s School Bus Operations 

Regulations 1 to provide guidance in the 

context of the recent decision of the 

United States District Court for the 

Western District of New York in 

Rochester-Genesee Regional 

Transportation Authority v. HynesCherin.2 As of August 6, 2008, FTA 

received approximately 510 comments 

on its proposed policy statement. 

In the final policy set forth below, 

FTA clarifies its guidance regarding 

FTA’s interpretation of its school bus 

operations regulations. FTA shall 

construe the term ‘‘tripper service,’’ as 

it has historically, to include 

modifications to fare collection or 

subsidy systems, modifications to the 

frequency of service, and de minimus 

route alterations from route paths in the 

immediate vicinity of schools to stops 


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3Federal Aid Highway Act of 1973, Pub. L. No. 

93–87, 164(b), 87 Stat. 250, 281–82 (1973) (codified 

as amended at 49 U.S.C. 5323(f) (2006)). 

4Chicago Transit Auth. v. Adams, 607 F.2d 1284, 

1292–93 (7th Cir. 1979) (citing H.R. Rep. No. 93– 

410, at 87 (1973) (Conf. Rep.); S. Rep. No. 93–355, 

at 87 (1973) (Conf. Rep.)). 

5See Codification of Charter Bus Operations 

Regulations, 41 FR 14,122 (Apr. 1, 1976). 

6 49 CFR 605.14 (2007). 

7 49 CFR 605.3(b). 

8 49 CFR 605.13. 

9 49 CFR 605.3(b). 

10Rochester-Genesee Reg’l Transp. Auth., 531 

F.Supp.2d at 507. 

11 Id. at 507–16. 

12 Id. at 507–09. 

13 Id. 

14 Id. at 512. 

15 Id. at 512 (citing United States ex rel. Lamers 

v. City of Green Bay, 168 F.3d 1013, 1019 (7th Cir. 

1999)). 

16 Id. at 509–16. 

17See In re Erie Metropolitan Transit Authority 

1, 4 (1989). 

18Travelways, Inc. v. Broome County Dep’t of 

Transp. 1, 7 (1985) (allowing a grantee to run a bus 

Continued 

located at or in close proximity to the 

schools. Consistent with that 

construction, FTA shall interpret the 

definition of ‘‘school bus operations’’ to 

include service that a reasonable person 

would conclude was primarily designed 

to accommodate students and school 

personnel and only incidentally to serve 

the nonstudent general public. 

FTA stresses that its intent with this 

final policy is not to overhaul its school 

bus operations regulatory scheme. 

Rather, in the context of RochesterGenesee Regional Transportation 

Authority, FTA intends to provide its 

grantees a basis which will allow them 

to continue to provide the service that 

FTA historically has allowed through 

administrative adjudications, while 

simultaneously satisfying the statutory 

requirements. 

FTA acknowledges that the 2008– 

2009 academic year has commenced. 

However, because FTA is not 

overhauling its regulatory scheme and is 

continuing to allow the type of tripper 

service that it historically has allowed, 

this final policy will not negatively 

impact transportation for the 2008–2009 

academic year if grantees have been 

complying with FTA’s historical 

interpretation of its school bus 

operations regulations. 

FTA expects to issue expeditiously a 

notice of proposed rulemaking to 

provide clearer definitions of ‘‘tripper 

service’’ and ‘‘school bus operations,’’ as 

well as generally to update the existing 

school bus regulation. 

B. Statutory and Regulatory Framework 

In 1973, Congress passed the FederalAid Highway Act, which requires FTA 

to provide financial assistance to a 

grantee under 49 U.S.C. Chapter 53 only 

if the grantee agrees ‘‘not to provide 

school bus transportation that 

exclusively transports students and 

school personnel in competition with a 

private school bus operator.’’ 3 Congress’ 

intent in enacting this provision was to 

prevent unfair competition between 

Federally funded public transportation 

systems and private school bus 

operators.4

In 1976, the Urban Mass 

Transportation Administration, now 

FTA, codified regulations under 49 CFR 

part 605 which implemented the above 

statutory provision.5 Under 49 CFR 

605.14, FTA may not provide financial 

assistance to a grantee ‘‘unless the 

applicant and the Administrator shall 

have first entered into a written 

agreement that the applicant will not 

engage in school bus operations 

exclusively for the transportation of 

students and school personnel in 

competition with private school bus 

operators.’’ 6 The regulation defines 

‘‘school bus operations’’ as 

‘‘transportation by bus exclusively for 

school students, personnel and 

equipment * * * .’’ 7

The regulation exempts ‘‘tripper 

service’’ from the prohibition against 

school bus operations.8 ‘‘Tripper 

service’’ is ‘‘regularly scheduled mass 

transportation service which is open to 

the public, and which is designed or 

modified to accommodate the needs of 

school students and personnel, using 

various fare collections or subsidy 

systems.’’ 9

II. Rochester-Genesee Regional 

Transportation Authority v. HynesCherin 

On January 24, 2008, the United 

States District Court for the Western 

District of New York issued a decision 

in Rochester-Genesee Regional 

Transportation Authority which set 

aside FTA’s interpretation of its school 

bus operations regulations under 49 

CFR part 605.10 The Court allowed the 

Rochester-Genesee Regional 

Transportation Authority (RGRTA) to 

restructure its public transportation 

operation through the addition of 240 

new express school bus routes proposed 

to serve the Rochester City School 

District (RCSD) and its students.11

In its decision, the Court narrowly 

interpreted the word ‘‘exclusively’’ in 

FTA’s definition of ‘‘school bus 

operations’’ and found that, because a 

member of the general public could, 

hypothetically, board a bus along one of 

RGRTA’s proposed new 240 express 

routes, RGRTA’s service technically 

would not ‘‘exclusively’’ transport 

students.12 The Court therefore 

concluded that RGRTA’s proposed 

express bus service did not constitute 

impermissible school bus operations.13

Additionally, the Court broadly 

interpreted FTA’s definition of ‘‘tripper 

service.’’ 14 The Court cited United 

States ex rel. Lamers v. City of Green 

Bay for the proposition that a grantee 

may ‘‘completely redesign its transit 

system to accommodate school children 

as long as all routes are accessible to the 

public and the public is kept informed 

of route changes.’’ 15

FTA believes that, following the 

Court’s narrow interpretation of ‘‘school 

bus operations’’ and its broad 

interpretation of ‘‘tripper service,’’ a 

grantee could conclude that it would be 

permitted to restructure its public 

transportation operation dramatically to 

accommodate the needs of a local 

school district and its students, thereby 

displacing private school bus operators 

and their employees, provided the 

grantee keeps the service technically 

open to the public.16 FTA believes that 

such an interpretation would contradict 

FTA’s final policy as set forth herein. 

III. Previous FTA Policy 

A. Tripper Service 

Under its tripper service definition, 

FTA originally allowed grantees to 

accommodate students only with 

respect to ‘‘different fare collections and 

subsidy systems.’’ However, through 

administrative decisions over the years, 

FTA broadened its interpretation of its 

tripper service definition to allow 

grantees to make accommodations 

beyond subsidies and fare collection 

systems. Specifically, FTA has allowed 

its grantees to make minor 

modifications to its route paths and 

frequency of service. As FTA stated in 

one matter concerning the Erie 

Metropolitan Transit Authority: 

Read narrowly, ‘‘modification of regularly 

scheduled mass transportation service to 

accommodate the needs of school students 

and personnel’’ means using different fare 

collections and subsidy systems. In practice, 

‘‘modification of mass transportation service’’ 

has been broadened to include minor 

modifications in route or frequency of 

scheduling to accommodate the extra 

passengers that may be expected to use 

particular routes at particular times of day.17

For example, in Travelways, Inc. v. 

Broome County Department of 

Transportation, FTA stated that, ‘‘A 

familiar type of modification would be 

where the route deviates from its regular 

path and makes a loop to a school 

returning back to the point of deviation 

to complete the path unaltered.’’ 18 FTA 


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to a point and express to a school from that point 

if the grantee ran a second bus along the regular 

route path from the point at which the first bus 

expressed to the school). 

19Letter from Federal Transit Administration to 

Rochester-Genesee Regional Transportation 

Authority at 6 (Oct. 12, 2007). 

20 Id. at 2–6. 

21Travelways at 7. 

22United States ex rel. Lamers v. City of Green 

Bay, 168 F.3d 1013, 1019 (7th Cir. 1999). 

23Rochester-Genesee Reg’l Transp. Auth., 531 

F.Supp.2d at 512–13. 

24Advance Notice of Proposed Rulemaking, 47 

FR 44,795, 44,803–04 (Oct. 12, 1982). 

25Notice of Proposed Rulemaking: Withdrawal, 

55 FR 334 (Jan. 4, 1990). 

26FTA School Bus Docket Number 2006–02 1 

(2007). 

27S. Rep. No. 93–355, at 86 (1973) (emphasis 

added). 

28S. Rep. No. 93–355, at 87 (emphasis added). 

29 District Union Local One, FTA School Bus 

Docket Number 2006–02 at 10–11 (holding the 

Rochester-Genesee Regional Transportation 

Authority’s (RGRTA) school bus service was 

designed and modified ‘‘exclusively’’ for the 

Rochester City School District and its students 

because students constituted a significant 

proportion of passengers on the school bus routes 

and RGRTA designed the routes without regard to 

demand from the nonstudent public). 

30See Letter from Federal Transit Administration 

to Rochester-Genesee Regional Transportation 

Authority at 3–4 (Oct. 12, 2007). 

31See Laidlaw Transit, Inc. v. Rochester-Genesee 

Reg’l Transp. Auth., FTA School Bus Docket 

Number 2007–01 1, 4 (2007). 

32Rochester-Genesee Reg’l Transp. Auth., 531 

F.Supp.2d at 507–09. 

reaffirmed this particular interpretation 

of tripper service in its October 12, 

2007, RGRTA determination by 

permitting RGRTA to operate four looplike route extensions, each only several 

blocks in length, to accommodate the 

needs of school students.19

FTA has not, however, allowed a 

grantee such as RGRTA to restructure its 

public transportation operation solely to 

accommodate the needs of school 

students—such a modification would be 

a major modification. Thus, in its 

October 12, 2007 letter to RGRTA, FTA 

rejected RGRTA’s proposed addition of 

240 new routes because it would have 

constituted a major overhaul of 

RGRTA’s public transportation system 

exclusively for the purpose of 

accommodating the needs of school 

students.20

In addition to minor modifications to 

route paths, FTA has allowed grantees 

to modify route schedules and the 

frequency of service. For example, in 

Travelways, FTA stated, ‘‘Other 

common modifications include 

operating the service only during school 

months, on school days, and during 

school and opening and closing 

periods.’’ 21

Jurisprudence in United States courts 

has broadened the scope of FTA’s 

tripper service definition to include 

essentially any modification. In United 

States ex rel. Lamers v. City of Green 

Bay, the Seventh Circuit stated, arguably 

in dicta, ‘‘[T]he City may completely 

redesign its transit system to 

accommodate school children as long as 

all routes are accessible to the public 

and the public is kept informed of route 

changes.’’ 22 Citing Lamers, the Court in 

Rochester-Genesee Regional 

Transportation Authority allowed 

RGRTA to restructure its public 

transportation system by adding 240 

new routes to accommodate the needs of 

RCSD and its students.23

B. ‘‘Exclusive’’ School Bus Operations 

FTA has had little prior formal policy 

regarding ‘‘exclusive’’ school bus 

operations under 49 CFR part 605. In 

1982, FTA attempted to clarify the 

meaning of ‘‘exclusive’’ school bus 

service through a rulemaking.24

However, in 1990, FTA withdrew the 

rulemaking because it believed that the 

regulations were ‘‘functioning 

adequately.’’ 25

In school bus adjudications, parties 

did not directly address the issue of 

‘‘exclusive’’ school bus operations until 

United Food and Commercial Workers 

District Union Local One v. RochesterGenesee Regional Transportation 

Authority.26 In resolving that issue, FTA 

examined the Federal-Aid Highway Act 

of 1973, found the language of the Act’s 

school bus provision ambiguous, and 

looked to the legislative history of Act 

for some guidance. 

In an early version of the Federal-Aid 

Highway Act, Congress did not use the 

word ‘‘exclusively’’ in the school bus 

provision, but rather, focused the 

language of the Act on preventing unfair 

competition between Federally funded 

grantees and private school bus 

operators. That language is as follows: 

[N]o financial assistance is to be provided 

to an applicant which engages, directly or 

indirectly in transporting school children 

and personnel to and from school and school 

authorized functions or which proposes to 

expand present routes, schedules, or facilities 

for that purpose in competition with or 

supplementary to service criteria provided by 

a private transportation company or other 

person so engaged in so transporting such 

children and personnel.27

After the bill passed the House and 

the Senate, the conference modified the 

above provision in an effort to further 

protect private school bus operators 

from unfair competition with Federally 

funded grantees. The conferees used the 

following language: 

[N]o federal financial assistance is to be 

provided under those provisions of law for 

the purchase of buses to any applicant who 

has not first entered into an agreement with 

the Secretary of Transportation that the 

applicant will not engage in school bus 

operations in competition with private school 

bus operators.28

As evinced by the above language, 

Congress intended to prevent unfair 

competition between Federally funded 

grantees and private school bus 

operators. Therefore, in District Union 

Local One, FTA concluded that it would 

defeat the purpose of the Federal-Aid 

Highway Act and eviscerate 49 U.S.C. 

5323(f) if it accepted a grantee’s 

argument that its service was 

technically nonexclusive and open to 

the public, but where: (1) The grantee 

had designed the service specifically for 

students, without regard to demand 

from the nonstudent public; (2) the vast 

majority of passengers were students; 

and (3) as a result, the routes would 

displace the private school bus industry 

and its workers.29 In efforts to prevent 

the unfair competition which Congress 

sought to prevent, FTA rejected 

RGRTA’s arguments and prohibited 

RGRTA from providing its school bus 

service exclusively for school students. 

FTA utilized this same policy and 

analysis when it found non-compliant 

RGRTA’s proposed service in its 

October 12, 2007 letter 30 and again in 

Laidlaw Transit, Inc. v. RochesterGenesee Regional Transportation 

Authority.31

The Court in Rochester-Genesee 

Regional Transportation Authority, 

however, applied a narrower, more 

restrictive analysis when it interpreted 

the word ‘‘exclusively’’ in the context of 

‘‘school bus operations.’’ 

Notwithstanding the fact that RGRTA 

designed its 240 express school bus 

routes exclusively for the benefit of 

RCSD and its students, without regard 

for demand from the nonstudent public, 

the Court held that, because a member 

of the general public hypothetically 

could board a bus along one of RGRTA’s 

proposed 240 routes, RGRTA’s proposed 

service was not ‘‘exclusive’’ and 

therefore technically did not constitute 

impermissible ‘‘school bus 

operations.’’ 32

III. Response to Public Comments 

As of August 6, 2008, approximately 

510 parties commented on FTA’s Notice 

of Proposed Policy Statement on FTA’s 

School Bus Operations Regulations. At 

the closing date of the docket, June 18, 

2008, approximately 157 parties 

commented on FTA’s proposed policy 

statement. FTA subsequently 

considered all additional comments 

through August 6, 2008. The 


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33See Vaughan v. Menlove, (1837) 132 Eng. Rep. 

490, and its progeny. 

34See William L. Prosser & W. Page Keeton, 

Prosser and Keeton on Torts 173–93 (5th ed. 1984). 

35See, e.g., Travelways, Inc. at 7; Letter from 

Federal Transit Administration to RochesterGenesee Regional Transportation Authority, supra 

note 20, at 6. 

commenters represent a broad spectrum 

of stakeholders from geographic areas 

throughout the United States, and they 

provided comments on a wide variety of 

issues. Many commenters raised issues 

that are outside the scope of FTA’s 

proposed policy statement, and FTA 

does not address those concerns in this 

final policy statement. 

In this section, FTA responds to 

public comments by topic in the 

following order: (A) Policy Statement 

Generally; (B) ‘‘School Bus Operations’’; 

(C) ‘‘Tripper Service’’; (D) Unfair 

Competition; (E) Economic Issues; (F) 

Safety Issues; (G) Environmental Issues; 

(H) Congestion; (I) Rising Fuel Prices; (J) 

Local Issues; and (K) Alternative Policy 

Proposals and Amendments to 49 CFR 

part 605. 

A. Policy Statement Generally 

Some commenters questioned 

whether FTA has the legal authority to 

issue this Final Policy Statement on 

FTA’s School Bus Operations 

Regulations. These commenters 

questioned whether FTA should 

promulgate amended regulations rather 

than issue a policy statement. 

FTA Response: FTA concludes that it 

is not required to promulgate amended 

regulations to implement this final 

policy because FTA is not changing the 

language of the regulatory text at 49 CFR 

part 605. FTA merely is clarifying its 

interpretation of that regulatory 

language, and FTA lawfully may 

accomplish this clarification through a 

policy statement. Furthermore, FTA is 

not altering the substance of its 

regulatory requirements under 49 CFR 

part 605; FTA merely is summarizing 

thirty-two years of its policy in one 

document, based on public comments 

and FTA’s historical interpretation and 

enforcement of its school bus operations 

regulations. Indeed, many commenters 

applauded FTA’s efforts to issue a 

policy statement to provide guidance in 

the context of Rochester-Genesee 

Regional Transportation Authority. 

B. ‘‘School Bus Operations’’ 

Some commenters asserted that the 

word ‘‘exclusively,’’ as used in 49 U.S.C. 

5323(f) and in FTA’s definition of 

‘‘school bus operations’’ at 49 CFR 

605.3, is not ambiguous and, therefore, 

FTA must implement a regulatory 

scheme that allows FTA’s grantees to 

transport students and school personnel 

so long as the service is technically 

open to the public. 

Additionally, some commenters 

asserted that FTA’s use of a ‘‘reasonable 

person’’ standard in its interpretation of 

‘‘school bus operations’’ is vague. 

Finally, at least one commenter 

expressed concern regarding whether 

and to what extent, under FTA’s 

proposed policy, a grantee may create a 

new route to serve a school— 

particularly in communities 

experiencing population growth and 

development. 

FTA Response: FTA rejects the notion 

that 49 U.S.C. 5323(f) is unambiguous. 

FTA believes that one may reasonably 

interpret the term ‘‘exclusively’’ in 49 

U.S.C. 5323(f) and 49 CFR 605.3 to 

prohibit service that essentially is 

exclusively for students and school 

personnel, even though the service 

technically may be open to the 

nonstudent public. The relevant 

language of the regulation prohibits 

service that is ‘‘exclusively for’’ students 

and school personnel. FTA 

consequently concludes that it is 

reasonable and proper to consider 

whether service is, in fact, ‘‘for’’ such 

riders. FTA also relies heavily on the 

subsequent qualifying language of 49 

U.S.C. 5323(f)—‘‘in competition with a 

private schoolbus operator’’—to justify 

this interpretation. To illustrate, if FTA 

permitted a grantee to provide school 

bus operations so long as the service is 

technically open to the public, then 

Congress’s purpose of protecting private 

school bus operators would be nullified. 

Such an interpretation would create a 

loophole in the statutory and regulatory 

scheme which would permit FTA’s 

grantees to displace private school bus 

operators. Clearly, Congress did not 

intend this result, otherwise, Congress 

would not have passed this statutory 

provision. Accordingly, in this final 

policy statement, FTA relies on an 

interpretation of 49 U.S.C. 5323(f) 

which reasonably ensures that FTA’s 

grantees that transport school students 

are not providing school bus operations 

that are exclusive-in-fact. 

With respect to the ‘‘reasonable 

person’’ standard, FTA points out that 

the standard has nearly a two hundred 

year history in the common law, and 

therefore, the standard is an acceptable 

standard in FTA’s interpretation of its 

school bus operations regulations.33

Courts have held that the reasonable 

person standard is an objective 

standard, and that a ‘‘reasonable 

person’’ is a person: (1) Of ordinary 

prudence, (2) who has knowledge of the 

law and is aware of its consequences, 

and (3) who exercises caution in similar 

circumstances.34

Finally, FTA does not intend to 

discourage grantees from creating new 

routes to serve new demand, so long as 

a reasonable person would conclude 

that the grantees designed the routes to 

serve some segment of the nonstudent 

general public. Therefore, in the final 

policy set forth below, FTA will 

interpret its definition of ‘‘school bus 

operations’’ to allow a grantee to create 

a new route to serve school students and 

personnel if a reasonable person would 

conclude that the grantee designed the 

route to serve some segment of the 

nonstudent general public. 

C. ‘‘Tripper Service’’ 

With respect to FTA’s interpretation 

of its ‘‘tripper service’’ definition at 49 

CFR 605.3, some commenters requested 

clarification as to what constitutes a ‘‘de 

minimus’’ route deviation. Additionally, 

some commenters recommended that 

FTA should allow route deviations at 

multiple points along a route path—not 

just within the immediate vicinity of a 

school. 

FTA Response: FTA intends a ‘‘de 

minimus’’ route deviation, as FTA uses 

the term in this final policy statement, 

to mean a route alteration that is truly 

minor. For example, historically, FTA 

has allowed its grantees to provide 

tripper service that deviates from an 

existing route path by several blocks.35

FTA intends to identify definitively a 

specific threshold for determining 

whether an alteration is ‘‘de minimus’’ 

in its forthcoming notice of proposed 

rulemaking. 

With respect to the locations of the 

route alterations, FTA stresses that it 

does not intend to significantly alter the 

type of service that it historically has 

allowed. In the past, FTA has allowed 

route alterations only within the 

immediate vicinities of schools, and 

FTA does not intend to break from that 

precedent in this final policy statement. 

D. Unfair Competition 

Many commenters representing the 

interests of private school bus operators 

expressed support for FTA’s proposed 

policy because the policy effectuates 

Congress’s intent that Federally 

subsidized grantees do not displace 

private school bus operators. However, 

many commenters expressed concern 

that FTA’s proposed policy would 

interfere with local transit agencies that 

transport students to school out of 

necessity, either because there are no 

private operators that provide the 

service in the local area or that private 


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36 49 CFR 605.11(b). 

37 49 U.S.C. 5323(f). 

38See Comment Number FTA–2008–0015–0184.1 

(June 19, 2008). 

39 Id. (noting that the useful life of a transit bus 

is approximately 12 to 15 years, while the useful 

life of a private school bus is comparable— 

approximately 12 years). 

40 Id. 

41 49 U.S.C. 5323(f). 

42See, e.g., Federal Motor Vehicle Safety 

Standards, 49 CFR Part 571 (2007). 

43 49 CFR Part 571. 

operators charge an unreasonably high 

rate in exchange for its service. 

FTA Response: In localities where no 

private operator exists or where a 

private operator charges an 

unreasonably high rate in exchange for 

service, FTA highlights an existing 

exemption for its school bus operations 

prohibition at 49 CFR 605.11(b). Under 

this provision, FTA allows its grantees 

to provide school bus operations if, in 

the local area, a private school bus 

operator is ‘‘unable to provide adequate 

transportation, at a reasonable rate, and 

in conformance with applicable safety 

standards.’’ 36 FTA’s final policy does 

not affect this exemption, and FTA 

suggests that interested parties apply to 

FTA for this exemption, if appropriate. 

E. Economic Issues 

Some commenters expressed 

economic concerns with respect to 

FTA’s proposed policy. These 

commenters questioned the propriety of 

FTA’s proposed policy, considering that 

many school districts have limited 

financial resources and a variety of 

educational needs. Additionally, some 

commenters proffered that private 

school bus operators are more expensive 

than Federally subsidized public 

transportation. 

FTA Response: Congress, by passing 

the statutory provision now codified at 

49 U.S.C. 5323(f), already has spoken to 

this issue and has decided that it is 

concerned with preventing unfair 

competition between Federally 

subsidized grantees and private school 

bus operators. Under 49 U.S.C. 5323(f), 

FTA may provide financial assistance to 

a grantee only if the grantee agrees ‘‘not 

to provide schoolbus transportation that 

exclusively transports students and 

school personnel in competition with a 

private schoolbus operator.’’ 37 In its 

regulations, guidance, and this final 

policy statement, FTA intends to 

implement this statutory provision to 

effectuate Congress’s intent to prevent 

unfair competition between Federally 

subsidized grantees and private school 

bus operators. 

Moreover, some commenters 

suggested that taxpayers ultimately 

spend much more in tax dollars on 

public transit service for students rather 

than on private school bus operators.38

For example, they estimate that the base 

cost of a transit bus is between $300,000 

and $500,000, while they estimate that 

the base cost of a private school bus is 

between $46,000 and $68,000.39 These 

commenters also claim that the 

maintenance cost per mile for a transit 

bus is approximately $0.80 to $1.00, 

while they claim that the maintenance 

cost per mile for a private school bus is 

$0.34.40 They therefore argue that, while 

a school district’s direct payments to a 

federally subsidized public transit 

authority may be lower than payments 

to a private school bus operator, the 

total cost to the taxpayer may be much 

higher for federally subsidized transit 

service than for private school bus 

service. FTA lacks sufficient 

information to analyze this argument 

fully, but it will seek additional 

information and comment in connection 

with FTA’s forthcoming notice of 

proposed rulemaking. 

F. Safety Issues 

Many commenters expressed concern 

that FTA, through its proposed policy, 

would create a more hazardous 

environment for school students 

commuting to school. Specifically, these 

commenters, with the notion that FTA 

intends to limit allowable service under 

its ‘‘tripper service’’ definition, suggest 

that FTA’s proposed policy would result 

in more students walking, biking, and 

driving across busy roads while 

traveling to school. Some commenters 

raised a similar safety concern and 

believe that, with limitations on 

‘‘tripper service,’’ FTA’s proposed 

policy will result in less direct routes 

and increased transfers for students 

traveling to school. Consequently, these 

commenters write, FTA’s proposed 

policy will cause school students to 

congregate at transfer points, which will 

lead to increased crime around these 

transfer points. 

Many commenters also expressed 

concerns regarding the safety of private 

school buses. These commenters 

asserted that public buses are safer than 

private buses. Alternatively, many 

commenters asserted that private buses, 

which are subject to stringent safety 

standards imposed by the National 

Highway Traffic Safety Administration 

(NHTSA), are safer than public buses. 

For example, these commenters noted 

that NHTSA requires school buses to be 

equipped with warning lights, 

additional mirrors for drivers, ‘‘stop 

arms,’’ and rollover protection. 

Additionally, these commenters assert, 

that on public buses, school students 

may be exposed to any number of 

unknown influences, such as 

pedophiles and child molesters. 

FTA Response: Congress, by passing 

the statutory provision now codified at 

49 U.S.C. 5323(f), already has spoken to 

this issue and has decided that it is 

concerned with preventing unfair 

competition between Federally 

subsidized grantees and private school 

bus operators. Under 49 U.S.C. 5323(f), 

FTA may provide financial assistance to 

a grantee only if the grantee agrees ‘‘not 

to provide schoolbus transportation that 

exclusively transports students and 

school personnel in competition with a 

private schoolbus operator.’’ 41 In its 

regulations, guidance, and this final 

policy statement, FTA intends to 

implement this statutory provision to 

effectuate Congress’s intent to prevent 

unfair competition between Federally 

subsidized grantees and private school 

bus operators. 

Moreover, some commenters 

misconstrued FTA’s intent. FTA did not 

propose to eliminate transit service that 

historically has qualified as tripper 

service. Therefore, FTA believes that its 

final policy will not result in the abovementioned increased safety hazards. 

With respect to the safety of public 

buses versus private buses, FTA 

recognizes that, most notably, private 

school buses are subject to stringent 

safety standards promulgated by 

NHTSA.42 For example, NHTSA 

imposes on school bus manufacturers 

restrictions regarding rear view mirrors, 

safety lights, ‘‘stop signal arms,’’ 

rollover protection, body joint strength, 

passenger seating, and crash 

protection.43 Accordingly, FTA does not 

believe that private school buses afford 

an inherently unsafe means of school 

transportation. 

G. Environmental Issues 

Many commenters asserted that FTA’s 

proposal would result in the elimination 

of numerous transit routes. These 

commenters asserted that, with fewer 

transit routes available to students, more 

students would drive vehicles to school. 

The affect, these commenters argued, 

would be greater harm to the 

environment. 

Some commenters also argued that 

public buses are more fuel-efficient than 

private buses. Alternatively, many 

commenters asserted that private buses 

are more fuel-efficient than public 

buses. One commenter provided 

evidence that the average fuel miles per 

gallon for transit buses is 4.5, while the 


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Federal Register / Vol. 73, No. 180 / Tuesday, September 16, 2008 / Rules and Regulations 53389 

44See Comment Number FTA–2008–0015–0184.1 

(June 19, 2008). 

45See, e.g., Comment Number FTA–2008–0015– 

0242.1 (July 25, 2008). 

46 49 U.S.C. 5323(f). 

47See 23 CFR 771.117(c)(20) (2008). 

48 49 U.S.C. 5323(f). 

49 49 U.S.C. 5323(f). 

average fuel miles per gallon for private 

school buses is 6.5.44 Scores of 

commenters asserted that private school 

bus service is approximately 40% more 

fuel-efficient than public bus service.45

FTA Response: Congress, by passing 

the statutory provision now codified at 

49 U.S.C. 5323(f), already has spoken to 

this issue and has decided that it is 

concerned with preventing unfair 

competition between Federally 

subsidized grantees and private school 

bus operators. Under 49 U.S.C. 5323(f), 

FTA may provide financial assistance to 

a grantee only if the grantee agrees ‘‘not 

to provide schoolbus transportation that 

exclusively transports students and 

school personnel in competition with a 

private schoolbus operator.’’ 46 In its 

regulations, guidance, and this final 

policy statement, FTA intends to 

implement this statutory provision to 

effectuate Congress’s intent to prevent 

unfair competition between Federally 

subsidized grantees and private school 

bus operators. Moreover, these concerns 

are based on the misperception that 

FTA’s proposed policy would prohibit 

tripper service that FTA historically has 

permitted. 

In response to specific concerns 

regarding environmental harm and fuelefficiency concerns, FTA concludes that 

there is no reliable method to determine 

the effect of its school bus operations 

policy on the environment. There are 

numerous factors that will vary from 

locality to locality, such as, (1) the 

number of additional vehicles utilized 

as a direct result of FTA’s school bus 

operations policy, (2) the fuel emissions 

of those vehicles, and (3) the 

manufacturing date of those vehicles. 

FTA notes that no commenter provided 

evidence that FTA’s proposed policy 

would result in greater harm to the 

environment. 

FTA does not anticipate that its 

school bus operations policy will have 

a significant environmental impact, and, 

thus, FTA does not believe that this 

final policy requires additional 

approvals under the National 

Environmental Policy Act.47

H. Congestion 

Many commenters asserted that FTA 

proposes to eliminate numerous transit 

routes. These commenters alleged that, 

with less transit routes available to 

students, more students would drive 

vehicles to school. The affect, these 

commenters argued, would be increased 

congestion. 

FTA Response: Congress, by passing 

the statutory provision now codified at 

49 U.S.C. 5323(f), already has spoken to 

this issue and has decided that it is 

concerned with preventing unfair 

competition between Federally 

subsidized grantees and private school 

bus operators. Under 49 U.S.C. 5323(f), 

FTA may provide financial assistance to 

a grantee only if the grantee agrees ‘‘not 

to provide schoolbus transportation that 

exclusively transports students and 

school personnel in competition with a 

private schoolbus operator.’’ 48 In its 

regulations, guidance, and this final 

policy statement, FTA intends to 

implement this statutory provision to 

effectuate Congress’s intent to prevent 

unfair competition between Federally 

subsidized grantees and private school 

bus operators. 

Moreover, these concerns are based 

on the misunderstanding that FTA’s 

proposed policy would prohibit tripper 

service that FTA historically has 

permitted. In this final policy statement, 

FTA does not propose to alter its 

historical interpretation of ‘‘tripper 

service’’ fundamentally, and therefore, 

FTA does not believe that its final 

policy will affect congestion. 

I. Rising Fuel Prices 

Some commenters expressed concern 

about rising fuel prices and the effect 

these prices will have on school 

transportation. 

FTA Response: Congress, by passing 

the statutory provision now codified at 

49 U.S.C. 5323(f), already has spoken to 

this issue and has decided that it is 

concerned with preventing unfair 

competition between Federally 

subsidized grantees and private school 

bus operators. Under 49 U.S.C. 5323(f), 

FTA may provide financial assistance to 

a grantee only if the grantee agrees ‘‘not 

to provide schoolbus transportation that 

exclusively transports students and 

school personnel in competition with a 

private schoolbus operator.’’ 49 In its 

regulations, guidance, and this final 

policy statement, FTA intends to 

implement this statutory provision to 

effectuate Congress’s intent to prevent 

unfair competition between Federally 

subsidized grantees and private school 

bus operators. 

Moreover, these commenters did not 

specify how rising fuel prices should 

affect FTA’s final policy. Notably, rising 

fuel prices affect both public transit 

authorities and private school bus 

operators in any given locality, 

therefore, FTA estimates that rising fuel 

prices should affect school districts in a 

similar manner, regardless of the type of 

service that they use to transport 

students. Without a more particularized 

concern from these commentators, it is 

difficult for FTA to speculate how rising 

fuel prices should impact and factor 

into FTA’s final policy. 

J. Local Issues 

Approximately 141 of the 510 

commenters represent the Oakland, 

California area, and these commenters 

expressed concerns that FTA proposed 

to eliminate transit service in that 

region. Approximately 27 commenters 

from Washington State expressed 

similar concerns. 

FTA Response: These comments are 

unfounded: FTA did not propose to 

eliminate any particular transit service 

through its proposed policy statement, 

and FTA does not propose to eliminate 

any particular transit service through 

this final policy statement. Moreover, 

FTA’s final policy does not prohibit 

transportation that historically has 

qualified as tripper service. Therefore, 

so long as public transit authorities in 

these areas are complying with FTA’s 

historical interpretation of its school bus 

operations regulations, FTA’s final 

policy should not interfere with the 

transportation that these public transit 

authorities provide. 

K. Alternative Policy Proposals and 

Amendments to 49 CFR Part 605 

Some commenters offered alternative 

policy proposals, including 

amendments to 49 CFR part 605, for 

FTA’s consideration. Specifically, some 

commenters proposed that FTA require 

an annual period of open bidding on 

school transportation, with bid 

submissions from interested parties 

received in April and FTA selections, 

based on quality and cost, in May. 

Some commenters also proposed 

additional exemptions under 49 CFR 

part 605, such as exemptions for: (1) 

Areas with populations of less than 

200,000 persons; (2) transit agencies that 

operate in communities without school 

district transportation subsidies; (3) 

grantees that provide service to school 

districts that operate some service with 

their own private fleets; and (4) routes 

serving secondary schools. 

Lastly, some commenters suggested 

that FTA utilize a negotiated rulemaking 

proceeding to formulate its forthcoming 

proposed rule. 

FTA Response: With respect to the 

open bidding proposal, FTA believes 

that such a proposal amounts to a new 

regulatory scheme, which FTA cannot 

appropriately adopt through a policy 


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53390 Federal Register / Vol. 73, No. 180 / Tuesday, September 16, 2008 / Rules and Regulations 

statement. The proposal would require 

an amendment to FTA’s school bus 

operations regulations, not its 

interpretation of those regulations, and 

FTA would have to adopt such a 

scheme through a rulemaking. 

With respect to the proposed 

exemptions, FTA believes that, if 

adopted, these proposals would 

constitute substantive changes to the 

text of FTA’s school bus operations 

regulations. FTA already lists a series of 

allowable exemptions at 49 CFR 605.11. 

Thus, FTA believes that it cannot 

appropriately consider these 

exemptions within the rubric of this 

final policy statement. 

Finally, FTA believes that the 

comments suggesting a negotiated 

rulemaking fall outside the scope of this 

policy statement. FTA will 

appropriately address any comments 

regarding a notice of proposed 

rulemaking in that forum. 

IV. Final FTA Policy 

A. Purpose of Final FTA Policy 

In the final policy set forth below, 

FTA clarifies its guidance regarding 

FTA’s interpretation of its school bus 

operations regulations under 49 CFR 

part 605 in light of the Court’s decision 

in Rochester-Genesee Regional 

Transportation Authority. FTA respects 

the Court’s decision in the Western 

District of New York. However, FTA 

finds that the Court’s decision is 

problematic because, if applied 

elsewhere in the United States, it could 

obstruct FTA’s ability to execute and 

implement Congress’s school bus 

prohibition and Congress’s express 

intent regarding that prohibition. 

Therefore, FTA issues this final policy 

statement to clarify the status of FTA’s 

guidance regarding its interpretation of 

its school bus operations regulations 

under 49 CFR part 605, and to resolve, 

for jurisdictions outside of the Western 

District of New York, conflicting issues 

between FTA’s school bus operations 

policy and the Court’s decision in 

Rochester-Genesee Regional 

Transportation Authority. 

Additionally, FTA intends to issue 

expeditiously a notice of proposed 

rulemaking to provide clearer 

definitions of ‘‘tripper service’’ and 

‘‘school bus operations,’’ as well as 

generally to update the existing school 

bus regulation. 

B. Tripper Service 

With respect to a grantee’s regularly 

scheduled public transportation service, 

FTA shall interpret the definition of 

‘‘tripper service’’ under 49 CFR 605.3(b), 

as it historically has interpreted that 

definition, to allow a grantee to (1) 

utilize ‘‘various fare collections or 

subsidy systems,’’ (2) modify the 

frequency of service, and (3) make de 

minimis route alterations from route 

paths in the immediate vicinity of 

schools to stops located at or in close 

proximity to the schools. For example, 

a grantee may provide more frequent 

service on an existing route to 

accommodate increased student 

ridership before and after school. 

Furthermore, a grantee may alter route 

paths to accommodate the needs of 

school students by making de minimis 

route alterations from route paths to 

drop off and pick up students at stops 

located on school grounds or in close 

proximity to the schools. 

FTA believes that this policy 

regarding its interpretation of the 

definition of ‘‘tripper service’’ is 

consistent with both the statutory 

language and the language of 49 CFR 

605.3(b). This policy permits only the 

type of design or modification 

accommodations that FTA historically 

has allowed and does not represent a 

departure from FTA’s prior guidance on 

this matter. 

C. ‘‘Exclusive’’ School Bus Operations 

To effectuate the intent of Congress 

when it enacted its school bus 

operations prohibition now codified at 

49 U.S.C. 5323(f), FTA shall interpret 

the term ‘‘exclusively’’ in the definition 

of ‘‘school bus operations’’ under 49 

CFR 605.3(b) to encompass any service 

that a reasonable person would 

conclude was primarily designed to 

accommodate students and school 

personnel, and only incidentally to 

serve the nonstudent general public. 

Additionally, grantees may create new 

routes to serve school students and 

personnel if a reasonable person would 

conclude that the grantees designed the 

routes to serve some segment of the 

nonstudent general public. 

FTA believes that maintaining this 

interpretation of ‘‘exclusively’’ is 

consistent with the legislative history on 

the issue and would allow FTA 

effectively to implement the express 

intent of Congress, which is to prevent 

unfair competition between Federally 

funded grantees and private school bus 

operators. This policy does not 

represent a departure from FTA’s prior 

guidance on this matter, and is merely 

intended to provide FTA with 

additional flexibility when interpreting 

49 U.S.C. 5323(f) and 49 CFR 605.3(b) 

and effectuating the intent of Congress. 

Issued in Washington, DC on this 11th day 

of September 2008. 

James S. Simpson, 

Administrator. 

[FR Doc. E8–21601 Filed 9–15–08; 8:45 am] 

BILLING CODE 4910–57–P 

DEPARTMENT OF COMMERCE 

National Oceanic and Atmospheric 

Administration 

50 CFR Part 679 

[Docket No. 080225265–81165–02] 

RIN 0648–AW28 

Fisheries of the Exclusive Economic 

Zone Off Alaska; Recordkeeping and 

Reporting 

AGENCY: National Marine Fisheries 

Service (NMFS), National Oceanic and 

Atmospheric Administration (NOAA), 

Commerce. 

ACTION: Final rule. 

SUMMARY: NMFS issues regulations to 

exempt groundfish catcher/processors 

and motherships equipped with an 

operational vessel monitoring system 

transmitter from check–in/check–out 

requirements. This action reduces 

paperwork requirements for certain 

catcher/processors and motherships and 

changes the definitions for ‘‘active’’ 

period for motherships and trawl, 

longline, and pot gear catcher/ 

processors. This action reduces 

administrative costs for both the fishing 

industry and NMFS. 

DATES: Effective October 16, 2008. 

ADDRESSES: Written comments 

regarding the burden-hour estimates or 

other aspects of the collection–of– 

information requirements contained in 

this final rule may be submitted to 

NMFS Alaska Region, P. O. Box 21668, 

Juneau, AK 99802 or the Alaska Region 

NMFS website at http:// 

alaskafisheries.noaa.gov and by email to 

DavidlRostker@omb.eop.gov, or fax to 

202–395–7285. 

FOR FURTHER INFORMATION CONTACT: 

Patsy A. Bearden, 907–586–7008. 

SUPPLEMENTARY INFORMATION: 

Background 

NMFS manages the U.S. groundfish 

fisheries of the exclusive economic zone 

(EEZ) off Alaska under the Fishery 

Management Plan for Groundfish of the 

Bering Sea and Aleutian Islands 

Management Area and the Fishery 

Management Plan for Groundfish of the 

Gulf of Alaska (FMPs). The North 

Pacific Fishery Management Council 


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