School Bus Contractors

FTA issues policy statement aimed at stopping unfair competition

Posted on November 1, 2008

WASHINGTON — The Federal Transit Administration (FTA) in September issued a final policy statement to clarify its school bus regulations for federally funded transit agencies in light of recent cases that debated exactly what kind of service these agencies can provide for students.

FTA’s proposal to revise its policy was issued in May after a federal judge struck down an earlier FTA decision, paving the way for the Rochester-Genesee (N.Y.) Regional Transportation Authority to create new bus routes for the purpose of transporting students.

At issue in that decision was the judge’s interpretation of FTA’s definitions of “school bus operations” and “tripper service,” with the FTA arguing that the court’s interpretation could lead a transit agency to “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.”

In the policy statement, FTA interprets the definition of “tripper service,” which is permissible, as it has interpreted it historically: “to allow a grantee to utilize various fare collections or subsidy systems, modify the frequency of service, and 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.”

The agency also stated that it will interpret exclusive “school bus operations,” which are not permissible, as encompassing “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 this clarification would allow the agency to implement the express intent of Congress to prevent unfair competition between federally funded grantees and private school bus operators.

In the statement, FTA also responded to comments that it solicited from the public earlier this year, which addressed safety, environmental, regional and other concerns.

“There were probably two-to-one comments supporting FTA’s attempt to clarify the understanding of the regulation,” said Robin Leeds, industry expert for the National School Transportation Association (NSTA). “If the comments had been uniformly negative, then FTA might have been reluctant to go ahead with the statement. I think the outpouring of comments in favor was helpful.

“Everybody in the school bus industry believes that children are best served by school buses and not by transit buses,” Leeds said. “I think there will be continued contention between the school bus industry and the transit industry.”

Leeds said that because transit systems receive substantial revenue from providing service to schools, they are not likely to let the issue go without a fight. “They’ve got a lot invested in this and are not likely to just fold up their tents and walk away,” she said.

“We at NSTA are prepared for a battle, not just within the agency, but within Congress as well,” Leeds said. “It’s important to us to protect the private school bus industry against unfair competition from federally subsidized transit agencies, but it’s also important for the entire school bus industry to protect the right of children to be transported in school buses and not in transit buses.”

The FTA plans to issue a Notice of Proposed Rulemaking (NPRM) providing clearer definitions of “tripper service” and “school bus operations,” and to generally update its existing school bus regulations. The agency said it is working “expeditiously” to complete the NPRM.

“I expect that we’ll see it before the end of the year,” Leeds said.

To read the full statement, go to


Related Topics: FTA, transit/tripper service

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