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Suggested Citation:"TRANSPORTATION NETWORK COMPANIES." National Academies of Sciences, Engineering, and Medicine. 2020. Updated Survey of Laws and Regulations Applicable to Airport Commercial Ground Transportation. Washington, DC: The National Academies Press. doi: 10.17226/26003.
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Suggested Citation:"TRANSPORTATION NETWORK COMPANIES." National Academies of Sciences, Engineering, and Medicine. 2020. Updated Survey of Laws and Regulations Applicable to Airport Commercial Ground Transportation. Washington, DC: The National Academies Press. doi: 10.17226/26003.
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Page 9
Page 10
Suggested Citation:"TRANSPORTATION NETWORK COMPANIES." National Academies of Sciences, Engineering, and Medicine. 2020. Updated Survey of Laws and Regulations Applicable to Airport Commercial Ground Transportation. Washington, DC: The National Academies Press. doi: 10.17226/26003.
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Page 10

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8 ACRP LRD 39 transportation network companies (TNCs) and the associated technologies of mobile electronic devices (e.g., smart phones) and digital networks. TNC is also called “commercial rideshar- ing” by some agencies. Various regulatory agencies have adopt- ed different definitions of TNC. For instance, one of the earliest definitions was the one adopted by the California Public Utili- ties Commission: “an organization that provides transportation services for compensation using an online enabled application or platform to connect passengers with drivers who are using their personal vehicles.”20 Despite the chaotic and rapid initial expansion of TNCs, states have developed frameworks to regulate this new transportation mode. An American Association of Motor Vehicle Administra- tors conference presentation summarized the regulatory devel- opments across the United States.21 As of March 2020, 49 states, along with the District of Columbia, have passed some type of TNC legislation. The state-level agency that regulates TNCs dif- fers across the United States. The governing agency could be public utilities/service commissions (e.g., California), depart- ment of motor vehicles (e.g., Virginia), department of transpor- tation (e.g., Arizona), department of licensing and regulation (e.g., Michigan), and department of revenue (e.g., Missouri). A typical state legislation governing TNCs has the following elements:22 • Definitions of TNC and digital network—A definition of TNC typically distinguishes TNCs from taxicabs, limou- sines, motor carriers, and contract carriers. TNCs shall only provide prearranged service by connecting drivers and riders via a digital network. • Permitting requirement—TNCs and drivers required a valid permit to operate in the state. The issuance of a driver permit requires a criminal background check and a driving record check. • Employee conduct—TNC drivers are prohibited from the use of drug and alcohol, and from discriminating. Drivers shall be well groomed and clean, and behave in a courteous and non-offensive manner. • Vehicle requirement—A vehicle must be maintained in a safe, functional, and clean condition. A vehicle must display TNC trade-dress. • Insurance requirement—There shall be primary insurance that covers a driver logged onto the digital network and while engaged in servicing a ride. For the former, amounts are specified for death or injury per person, per incident, and for property damage (e.g., $50,000/$100,000/$25,000). 20 California Public Utilities Commission Transportation Network Companies Decision. CPUC, (Sept. 23, 2013). 21 Matthew Daus, M. (2017). Regulating Transportation Network Companies (TNCs) at American Association of Motor Vehicle Admin- istrators Annual International Conference, San Francisco, (Aug. 21-22, 2017). 22 For an example of a model law, see Model Act to Regulate Insur- ance Requirements for Transportation Network Companies and Trans- portation Network Drivers at National Conference of Insurance Legis- lators, (2015). closely with state departments of transportation, transit agen- cies, and local agencies to implement individual airport surface access projects.11 The National Highway Traffic Safety Administration is an agency under the USDOT that focuses on saving lives, prevent- ing injuries, and reducing vehicle-related crashes. To reduce traffic-related deaths and injuries, NHTSA prescribes motor vehicle safety and equipment standards,12 oversees motor ve- hicle and driver programs,13 and administers highway safety programs.14 See Appendix B for examples of relevant NHTSA laws and regulations. Federal Highway Administration The Federal Highway Administration administers the feder- al-aid highway program to support the construction and main- tenance of the National Highway System.15 FHWA publishes the Manual on Uniform Traffic Control Devices which provides a uniform set of standards for highway markings, signage, and signals.16 FHWA establishes federal size regulations for com- mercial motor vehicles, including buses.17 See Appendix B for examples of relevant FHWA laws and regulations. Federal Railroad Administration The Federal Railroad Administration is tasked with develop- ing a long-range national rail plan, assisting states in developing state rail plans, and promoting railroad safety.18 See Appendix B for examples of relevant FRA laws and regulations. Federal Transit Administration The Federal Transit Administration is authorized by Chapter 53 of Title 49 of the U.S. Code on public transportation. The FTA is charged with the development and revitalization of the public transportation system, to maximize safety, security, and efficiency, to minimize environmental impacts, and to improve sustainability.19 See Appendix B for examples of relevant FTA laws and regulations. TRANSPORTATION NETWORK COMPANIES One of the most significant changes in airport commercial ground transportation in the last decade was the emergence of 11 See, e.g., BULLETIN 1: BEST PRACTICES-SURFACE ACCESS TO AIR- PORTS, (Federal Aviation Administration, 2006) and COMMERCIAL GROUND TRANSPORTATION AT AIRPORTS: BEST PRACTICES, (Airport Coop- erative Research Program Report 146, 2015). 12 49 U.S.C. ch. 301. 13 49 U.S.C. chs. 321, 323, 325, 327, 329, 331. 14 23 U.S.C. ch. 4. 15 23 U.S.C. ch. 1 (2019). 16 23 C.F.R. pt. 655, subpart F (2019). 17 23 C.F.R. pt. 658 (2019). 18 49 U.S.C. § 103 (2019). 19 49 U.S.C. § 5301 (2019).

ACRP LRD 39 9 In regulating TNCs, there are several issues that are specific or especially critical to airports. Airport authorities, therefore, provide guidance and regulations in addition to the city, county, and state laws and regulations. One of these issues is regulat- ing the critical curbside areas of terminals for the loading and unloading of passengers. A wide range of ground transporta- tion providers utilize curbside areas, sometimes with slightly different needs. Taxicabs, for example, require a taxi stand area in which taxicabs can be queued in a first-in-first-out sequence. A taxicab starter assists with directing a passenger with the ap- propriate taxicab. Several off-site businesses or services utilize courtesy shuttles to transport passengers, including hotels, rent- al car companies, and parking. Such shuttle could carry a large number of passengers thus requiring an appropriate dwell time for loading/unloading. Certain prearranged service providers, such as limousines, might require drivers to enter the terminal to meet and greet the passenger. In the case of TNCs, a mobile app transmits a picture of the driver, the vehicle license number, the vehicle’s make and model, and the time until the vehicle ar- rives. Having this information, a passenger searches the curb- side for the right vehicle. The highly prized curbside areas are often subdivided into separate areas in order to meet the differing needs of the various ground transportation services. Figure 1 shows an example of a terminal curbside subdivided into nine separate curbside allot- ments, one of which is TNC (ride share). Similar to the issue of curbside areas, there are specific needs related to each ground transportation mode in terms the proce- dures for setup and pickup. Because airport ground transporta- tion demand is correlated with flight arrival patterns, ground transportation has to service such peaked demand patterns. Scheduled bus or light rail service follow a regular schedule. Similarly, courtesy vehicles could operate on a regular interval to circulate the terminals areas, or be called by passengers or dispatched. Prearranged service, such as limousines, livery, or TNC, should be timed so as to reduce congestion at the curb- side. Thus, staging areas are set up to accommodate such ve- hicles if they arrive early for pickup. Likewise, if a taxi stand area is full, then an appropriate staging area is required to prevent crowding beyond the stand area. An airport authority may need to develop rules governing how a vehicle acts once it enters the airport perimeter. An issue related to airport demand patterns is the issue of rates or pricing. Some cities and/or airports publicly regulate the fare structure of TNCs. There are potential airport-specific con- siderations in regulating TNC rates. Relatively speaking, TNCs do not exercise much control over drivers. For example, TNCs do not dictate when or how much a driver works. TNCs have opted for a business model that categorizes drivers as indepen- dent contractors over employees, thus reducing costs, such as workers compensation, as well as reducing potential liability. The issue of TNC driver classification (i.e., independent con- tractor versus employee) is fluid and is currently being litigated in cities like New York City. To ensure that there is ample sup- ply to match the airport passenger demand patterns, TNCs have For the latter, a single limit for death, injury, and property damage (e.g., $1,000,000). Personal vehicle insurance poli- cies may exclude coverage when a driver is conducting TNC business. Certain states regulate TNCs exclusively at the state level thus prohibiting local control. For example, see Idaho Stat. § 49-3715 (2019): No municipality or other local entity may impose a tax on, or require a license for, a TNC, a TNC driver, or a vehicle used by a TNC driver where such tax or licenses relates to providing TNC services, or sub- ject a TNC to the municipality or other local entity’s rate, entry, op- erational or other requirements. Another example is Mo. Rev. Stat. § 387.30 (2019): No municipality or other local or state entity may impose a tax on, or require a license for, a TNC, a TNC driver, or a vehicle used by a TNC driver where such tax or license relates to providing prear- ranged rides, or subject a TNC to the municipality or other local or state entity’s rate, entry, operational, or other requirements. Upon the enactment of this section, any municipality or other local entity’s or- dinance or policy that is inconsistent with sections 387.400 to 387.440 shall be void and shall have no force or effect. On the other end of the spectrum, some states regulate TNC extensively at the local level especially for large metropolitan areas. In New York, for instance, the state TNC statutes do not apply to cities with a population of equal or greater than one million.23 New York City (NYC) is an example of a city with one of the most elaborate regulatory schemes for TNCs. The prima- ry regulatory agency is the NYC Taxi and Limousine Commis- sion (TLC). The TNC industry in NYC is regulated as a for-hire vehicle (FHV) industry, including buses, vehicles, and drivers. Taxicabs in NYC are regulated separately from FHVs. TNCs generally fall under the Black Car designation of FHV, which involves the following characteristics: a central dispatch facility, servic- ing only prearranged rides, vehicles are owned by franchisees, and more than 90% of payment is non-cash.24 The large TNC companies, such as Uber and Lyft, fall under a separate FHV category, the High Volume For-Hire Services (HVFHS). High volume is defined as the dispatching of 10,000 or more trips in NYC per day.25 There are several unique aspects of NYC’s TNC regulatory scheme. One is the limit on the number of TNC vehicles al- lowed to operate in NYC. NYC Local Law 147 of 2018 imposed a one-year cap (since extended) on FHV licenses and delegated to the TLC the power to permanently limit the number of FHV licenses. Another is the establishment of a minimum payment rule and per trip calculation method that is applied to HVFHS operators. NYC Local Law 150 of 2018. The calculation method results in an estimated net income of $17.22 per hour for driv- ers, the independent contractor equivalent to a $15 an hour minimum wage. 23 N.Y. VEH. & TRAF. LAW § 1692(10). 24 35 R.C.N.Y. § 59B-03. 25 35 R.C.N.Y. § 59D-03.

10 ACRP LRD 39 Figure 2. Example of geofence surrounding airport terminal area.a a Phoenix Sky Harbor Ground Transportation Operating Require- ments. Exhibit B. Sky Harbor International Airport Geofence Map. advocated for the use of congestion pricing. Congestion pricing refers to the increase in TNC price during high demand periods in order to entice more drivers to participate. An airport could consider allowing the use of congestion pricing to increase TNC supply during times of high demand. An airport authority could also analyze the costs and fees associated with TNC airport op- erations in commenting on minimum wage requirements for TNC drivers in the city or the state. Another issue is the application of geofencing around the immediate airport. Current technology allows the automatic tracking and monitoring of the geofence via Global Positioning Systems and a mobile device. Geofencing aids the regulation of TNCs in several ways. TNC vehicles can be restricted from so- liciting for passengers via shared rides in the geofenced area. The elimination of cruising helps to improve traffic flow near termi- nals. The geofence provides notice to drivers that they are inside a restricted area. The geofence also allows airports to track and monitor permitted TNCs and to compute the appropriate fees, often a per trip airport access fee. Figure 2 provides a visual ex- ample of a geofence surrounding the airport terminal and rental car center. The geofence includes sub-perimeters around each terminal corresponding to allowable TNC loading areas. For examples of airport-specific TNC rules and regulations, see the state summaries section. To illustrate, the City of Chi- cago Transportation Network Providers Rules is summarized under the O’Hare International Airport section. The focus of this section is on the TNC regulatory framework. There are various complementary efforts advanced by ACRP in researching other aspects of TNCs at airports. ACRP Synthesis 84,26 Transportation Network Companies: Challenges and Op- portunities for Airport Operators, focuses on airport operations 26 Mandle, P. and Box, S., ACRP SYNTHESIS 84: TRANSPORTATION NETWORK COMPANIES: CHALLENGES AND OPPORTUNITIES FOR AIRPORT OPERATORS. ( 2017). and business aspects, such as revenue generation. ACRP project 01-35,27 Transportation Network Companies: Impacts to Airport Revenues and Operations, also focuses on the operational and business aspects of airports. 27 Leiner, C. and Adler, T. ACRP RESEARCH REPORT 215: TRANSPOR- TATION NETWORK COMPANIES (TNCS): IMPACTS TO AIRPORT REVENUE AND OPERATIONS—REFERENCE GUIDE (2020). Figure 1. Example of airport terminal curbside ground trans- portation allocations.a a Phoenix Sky Harbor Ground Transportation Operating Require- ments. Exhibit E. Airport Pickup Location Map. Terminal 4.

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Commercial ground transportation at U.S. airports includes public transit, door-to-door shuttle van service, charter buses, limousines, rental cars, taxicabs, hotel courtesy shuttles, wheel chair services, and courier operators. Technological developments, such as transportation network companies, car-sharing operations, and driverless cars, have added more options and challenges for airport ground transportation operations.

The TRB Airport Cooperative Research Program'sACRP Legal Research Digest 39: Updated Survey of Laws and Regulations Applicable to Airport Commercial Ground Transportation builds on ACRP LRD 3: Survey of Laws and Regulations of Airport Commercial Ground Transportation from 2008 and synthesizes available guidance, including regulations, statutes, policies, and case decisions (administrative or court) pertaining to commercial ground transportation.

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