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Review of the Hillsborough County Public Transportation Commission

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Title:
Review of the Hillsborough County Public Transportation Commission
Series Title:
Report ;
At head of title:
OPPAGA
OPPAGA policy analysis
Alternate title:
OPPAGA policy analysis
Portion of title:
Review of the Hillsborough County Public Transportation Commission
Physical Description:
vi, 35 p. : ; 28 cm.
Language:
English
Creator:
Florida -- Office of Program Policy Analysis and Government Accountability
Publisher:
The Office
Place of Publication:
Tallahassee, Fla.
Publication Date:

Subjects

Subjects / Keywords:
Transportation and state -- Florida -- Hillsborough County   ( lcsh )
Transportation, Automotive -- Government policy -- Florida   ( lcsh )
Genre:
government publication (state, provincial, terriorial, dependent)   ( marcgt )
non-fiction   ( marcgt )

Notes

Additional Physical Form:
Also available on the Internet in PDF format.
Additional Physical Form:
Online version available.
Additional Physical Form:
Also available on Worldwide Web.
Statement of Responsibility:
Florida Legislature, Office of Program Policy Analysis and Government Accountability.
General Note:
Cover title.
General Note:
"November 1999."
General Note:
Accompanied by executive summary.

Record Information

Source Institution:
University of South Florida Library
Holding Location:
University of South Florida
Rights Management:
All applicable rights reserved by the source institution and holding location.
Resource Identifier:
aleph - 021666443
oclc - 42937506
notis - AKM2619
usfldc doi - C01-00326
usfldc handle - c1.326
System ID:
SFS0032396:00001


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Full Text

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The Florida Legislature OFFICE OF PROGRAM POLICY ANALYSIS AND GOVERNMENT ACCOUNTABILITY Joho W Turtolle Oirwor November 1999 The President of the Senate, the Speaker of the House of Representatives, and th e Joint Legislative Auditing Committee At the request of the Joint Leg i slative Auditing Committee, I have directed that a policy review be made of the Hillsborough County Public Transportation Commission The results of this rev i ew are presented to you in this report This review was conducted by Nancy Dufoe and Steven Bimholz under the supervision of Julie Ferris We wish to express our appreciation to the staff of the Hillsborough County Public Transportat i on Commission for their assistance. Sincerely, ;: ' < John W. Turcotte Director 111 Wesc Madison Room 312 CJaude Pepper Building Tallahassee, Florida 32399 850/ 488.(1()21 SUNCOM 278-0021 FAX 850/487-3804

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Table of Contents Executive i Chap t er 1: Introdu c tion ... .. .. .. .... .. ... .. ..... .. ... ........ ... ............... ... .......... .... ... .. .... ........ .... .... 1 Pur pose ......... ................ ....... ... .... . ...... ........... ...................... . ...... ....... . ............ ....... ..... ....... .... 1 Background ... ... ... ..... ... ... ..... .... .... .... ............... .... .. ....... .... . . . . ...... .. .......... ................... ....... 1 Chapter 2: G o vernance Issues ..... ....... ... . .... ..... .. ...... ... .. .. .. ..... .. .. ......... .. .. ... ........ .. . ... ... 5 Introduction ......... ... .......... . ..... ........ . ........ ...... .... ....... ............ ........ . . .............. . . ... ... ...... ... . 5 Governance Structure ... .. ...... .... .. ...... ............ .... ............................... .... ... ... ..... ... ...... ............ 6 C hap ter 3: Regulatory Issues ......................... .. ...... ... ... .. . ........... ...... ... ....... ... ...... ......... . .. .. 16 Introduction ........... ...... ...................... ....... .............. ... ......... .... ............ ...... ............ ............ .... 16 Public Safety Regulation ........................... ......... .... ........... ....... ...... .................. ............. ....... 1 6 Market Entry Regulation ...... .. ..... ... .................... .... .......... ...... ... ............... ...... ... ..... .......... 18 Recommendat ions . ...... ............... ..... ........ ..... ..... ..... ... ........................... ...... ... . ... ............... 23 Appendix A : Vehicles Regulated b y the Public Transpo rtati o n Commiss i on .. .. ......... 25 Appendix B: Bibliogr aphy ..... .. ..... ..... ....... ..... .. ............................... ...... ........ ... ......... .. .... .. ... 2 6 Appendix C : Chapter 189.4 0 4, Fl o ri d a Statutes ........................................ ................ .... ...... 2 8 Appen d i x D : R espons e from the Hillsbotough County Public Transp ortation Conunission .............. ... ................. ............. ....... ............ 31

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Executive Summary Hillsborough County Public Transportation Commission Purpose The Joint Legislative Auditing Committee directed the Office of Program Policy Analysis and Government Accountability (OPPAGA) to conduct a limited review of the Hillsborough County Public Transportation Commission because of concerns regarding the commission s operations. This report examines the governance structure of the commission and how the commission performs its regulatory responsibilities. We a lso identified policy alternatives to the current governance structure. Background----------The HiUsborough County Public Transportation Commission regulates the operation of certain "for-hire" vehicles in Hillsborough County and its municipalities Vehicles regulated are taxicabs, limousines, vans, handicabs, basic life support ambulances, and wreckers used for government purposes As o f June 1999, the commission had i ssued 1,302 vehicle permits. The commission supervises and regulates vehicles and their operators to protect the traveling public. For this purpose, the commission establishes rules and regulations regarding company, vehicle, "and operator standards. Commission inspectors enforce these standards. For taxicabs, the commission is also responsible for approving zones, rates, fares, and charges. The commission is composed o f seven officials representing Hillsborough County and its included municipalities. The county and municipalities each appoint member(s) of their elected boards to serve on the commission for two-year terms. Three members of the commission are from the Hillsborough County Board of County Commissioners; two members represent the Tampa City Council; and one member from each of the Temple T errace and Plant City city councils serves on the commission. The commission has seven authorized positions: an I

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Executive Summary executive director, an administrative spedalist, a receptionist/secretary, and four inspectors. History of the Public Transportation Commission Regulatory duplication and junSdictionaf problems fed to the creation of the Public Transportation Commission The commission has its origins in the Taxicab Commission of the City of Tampa, created by special act in 1947 (Ch. 24921, Laws of Florida}. Until 1976, Hillsborough County and the municipalities of Tampa, Plant City and Temple T errace had their own separate taxicab ordinances, resulting i.n duplication and jurisdictional problems. To resolve these problems and create a more centralized system of taxicab regulation, in 1976 the Florida Legislature authorized the establishment of a countywide taxicab regulatory agency, the Hillsborough County Consolidated Taxicab Commission. In 1982, the Legislature added vans, handicabs, and limousines to the commission s regulatory scope. To reflect this change, the name of the commission was changed in 1983 to the Hillsborough County Public Transportation Commis sion (Ch 83-423, Laws of Florida). In 1987 88, the Legislature added basic life support ambulances and government wreckers to the commission's regulatory scope. In 1994, the Department of Community Affairs designa te d the commission as an independent special d istrict. Public Transportation Commission Resources The Public Transportation Commission is funded by tees and HillsbOrough County subsidies To meet its obligations, the commiss ion has two main sources of revenue fees and Hillsborough County subsidies. Most of the commission's operations are funded through fees charged to the transportation businesses it regulates. The other main revenue source is Hillsborough Coun ty. Chapter 83-423, Laws of Florida, requires that the county "provide for annual budget review of the Public Transportation Commission and ... furnish the Public Transportation Commission with a part-time attorney, inspector(s), and a secretary, along with office space and equipment, stationary and postage necessary to carry out (its) responsibilities . "1 The county also subsidizes the commission if it has a budget deficit at year-end. Over the past three fiscal years, an average of 15.7% of the commission's revenues have come from the Hillsborough County General Fund. 1 Maintain.ing lh3t the words "pro\ide" and furnish are ambiguoU$, HiU:1borough County neither furnishes nor p3ys for the Public Transportation Commission's inSpt."
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Executive Summary Governance Issues--------. : : .... . The Public Transpo rtation Commiss ion is a n i ndependent special d is t rict. It is unique i n that it is the only special district in F lorida that regulates for-hir e vehicles. Although the commission has been designate d t o be an i ndependent speci al district it is u nclea r whether the commission currently meets the sta t u tory d efinitio n of this type o f entity Furthermo re, the com mi ssi o n is not meeting special d is trict a c countability r e quirements, and its lac k of conting ency funds for extraordinary ex p e n ses could a d versely affect its service d e livery to the p ublic. We i dentified two options for improving the gove r nance structure under which for -hire vehicl e regulation is performed in Hillsborough County. 1 Amend Ch. 83-423 Laws of Florida, to clarify that the Publi c Transpo r tation Commission is an independent special district. However, if the Legi s lature elects thi s option, the amendment should require t h e commis sion to clarify its fiscal relationship wit h Hillsborough Count y, meet all special district accountability requirements and dev elop methods for dealing with e x traordinary expens e s that do not reduce its servi c e delivery or harm the public. Although this option would prevent the jurisdictional problems and duplica ti o n that Jed to the creation of the com m ission it would also likely result in a f e e increase t o the regulate d industry due to the increased cost to mee t accountability requ irements. 2. Disso l v e the Public.Transporta tion Comm ission as a special district and allow Hillsborough County to either recrea t e the commi ss ion by ordinance as a dependent specia l d istrict or a ssume the commission's respons i bilities. Under this option, f e w changes would h ave t o be made t o the com mis sion's current budgeting, accounting, and auditing proces s es However, j u risdictional problems could result if the county' s municipalities d eci de d t o opt out of the county's ordinanc e unles s this issue was carefu ll y negotiated between the county and the m u nicipalities Because the r egulati o n o f fo r hire veh i cles in Hillsborough C ounty is a loca l concern, we recommend that the Hill sborough County Legi sl ative Delegation work with county and c o mmission officials t o determ ine whether the c ommiss ion should be statuto ri l y designate d as an independent special distric t o r whether Ch. 83-423, Laws of Florida, should be repealed 1 Hillsborough Count)l$
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Executive Summary Regulatory Issues Our review focused on two aspects of the regulation of for-hire vehicles public safety regulation and market entry regulation. While public safety regulation establishes sa.fety requirements for vehicles and vehicle operators, market entry regulation places limits on the number of f or-hire vehicles that can operate in a jurisd.iction. Jurisdictions may use a variety of approaches to provide these types of regulation Public Safety Regulation Public safety fBUU/ation is beneficial and should be conUnued Holders of Public Transportation Commission permits and licenses must comply with commission rules and regulations, including vehicle standards, driver qualification s and insurance requirements. The commission is required to inspect all permitted vehicles annua.lly and may inspect any vehicle at any time Inspectors ensure that vehicles comply with commission standards and provide for the sa fety and com.fort of passengers. The commission also makes certain that vehicle drivers are q ualified, of good moral character, of sound health, and meet all requirements of law. Much of the literature we reviewed supports some level of safety regulation of for-hire vehicle industries. Without public safety regulation, unqualified operators and/or unsafe vehicles could put passengers at risk. Moreover, unsafe for-hire transportation car. tarnish a community's imag e for citizens and touri sts. Stakeholders we interviewed agreed that the regulation of public safety is beneficial and should be continued. Our review uncovered little evidence of a chronic, perva s ive problem w ith public safety regulation in Hillsborough County. Many stakeholders believe that the commission has been doing a good job of regulating public safety. Stakeholders also indicated that the public could benefit from safety regulation of other types of for-hire vehicles. Market Entry Regulation The Public Transportation Commission issues certificates of public convenience and necessity to regulated companies, permits the vehicles owned by those companies, and licenses vehicle operators. The Special Act establishing the commission (Ch. 83-423, Laws of Florida) prescribes a method for regulating market entry called public convenience and necessity." Under this method a person desiring to engage in the for-hire vehicle business in Hillsborough County must first apply to the commission for a certificate of public convenience and necessity. The iv

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No consensus exists as to which regulatory approach is best We found no compelling evidence that major changes are needed In Hillsborough County Executive Summary applicant must show whether public conv e nience and nec e ssity will be promoted by the additional proposed service . . : : .. : From a market entry persp e ctive, the commission has been criticized for its handling of a recent application to pro vide ambulance services in the county. As a result of this situation, the applicant file d suit against the commission, alleging that the commission unfairly kept him from starting a new business 3ln a related incident a form e r commissioner and his partne r, a former Tampa city attorney, were indicte d for misusing their official public positions of trust to wrongfully induce an ambulance company not to oppose their own c ompany' s application for ambulance permits. These civil and criminal proceedings have raised questions ab out the commission s entry regulation policies and permitting p rocedures A re lated issue, the public hearing component of the permitting process, has also been a concern. Protracted cross examinations can extend hearings for days, increasing the costs of the hearing process to both the applicant and intervenors. This is caused, in part, by cross-examinations that do not always directly address the core issues pertaining to public convenience and necessity. Our review o f relevant literature indicates that ther e is no clear best way to regulate for-hire vehicles Whether or not for-hire vehicle markets operate more effectively unde r restricted or open entry conditions is the subject of a long-running debate. There is no consensus among researchers as to which type, if any, is the most effective. Furthermore, the commission s regulatory method is not unique. Like Hillsborough County, 1 0 of the 18 Florida jurisdictions reviewed by the Center for Urban Transportation Research regulate for hire vehicles through the restricted entry appro ach. In fact, most cities in the U.S. that restrict entry use the same approach that is used in Hillsborough County, the public convenience and necessity standard Our review also indicated that there have been few problems with the commission's permitting process. According to the conunission s executive director, the commission rarely denie s an application for a certificate of public convenience and necessity 31n October 1999, a ft.-dt.-rill judge rul e d the QppliCllrtt dkt not havt 3 vaJi d legal claim a gainst t h e Public Transportatlon Commission. The commission W
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Executive Summary Regulatory Recommendations Our review of relevant literature clearly indicates that local jurisdictions are in the best position to determine which regulatory approach would be most effective for them. Although OPPAGA support s the least restrictive form of regulation, there is no clear advantage of one regulatory scheme over another. Furthermore, we found no compelling evidence t o indicate the need for major revisions to the regulatory approach used in Hillsborough County. We therefore recommend that local officials continue to monitor the effectiveness of the county s regulatory system. If systemic or chronic problems arise, officials should consider adopting an alternative method for providing market entry and/or public safety regulation. Stakeholders would want t o review the advantages and disadvantages of the v arious approaches described in this report to determine if a different regulation method would better serve the needs o f the county. Furthermore, stakeholders indicated that the public could benefit from safety regulation of other types of for-hire vehicles. We therefore recommend that local officials investigate the possibility of expanding the scope of safety regulation to other vehicle types, if deemed cost-effective to do so Finally, if loc al officials decide to retain the present regulatory approach, we recommend that the cross-examination feature of the hearing process be examined. If it is determined that cross-examination is protracted and negatively affects the hearing process, we recommend that the commission more s tri ctly enforce its rules regarding the introduction of "irre levant, immaterial, or unduly repetitious" evidence during hearings. This will help minimize the cost of the hearing process. Agency Response--------The Director of the Hillsborough County Public Transportation Commission provided a written response t o our report findings and recommendations. The response is contained in Appendix D of t his report. to Rule No. 24.7.4, Rules and Resui:Jh'OIISOI the Hillsborough County Publk Tr.Jnsp
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Chapter1 Introduction ,:, . . Purpose The Joint Legislative Auditing Committee d ire cted the Office of Program Policy Analysis and Government Accountability (OPPAGA) to conduct a limited review of the Hillsborough County Public Transportation Commission because of concerns regarding the commission s ope rations This report examines the governance structure of the commission and how the commission performs its regula tory respon sibili ties. We also identified policy alternatives to the current governance structure. Background---------The Hillsborough County Public Transportation Commission regulates the operation of certain "for-hire vehicl e s in HiUsborough County and its municipalities. Vehicles regulated are taxicabs, limousines, vans, handicabs, basic life support ambulances, and wreckers used for government purposes. As of June 1999, the commission had issued 1,302 vehicle permits. For descriptions and data regarding the regulated vehicles, see Appendix A The commission supervises and regulates vehicles and their operators to prot ect the traveling public. For this purpose, the commission establishes rules and regu l ations regarding company, vehicle, and operator standards. Commission inspec t ors enforce these standards. For taxicabs, the commission is also responsible for approving zones, rates, fares, and charges. The commission is composed of seven officials representing Hillsborough County and its included municipalities. The county and municipalities each a ppoint member(s) of their elected boards to serve on the commission for two-year terms Three members of the commission are from the Hillsborough County Board of County Commissioners; two members represent the Tampa City Council; and one member from each 1

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Introduction o f the Tem p le Terrace and Plant City city councils serves on the commission.7 History of the Public Transportation Commission The Public Tra nsportation C o mmis sio n has its origins in the Taxicab Comm i ss ion of the City of Tampa, created by s p ecial act in 1947 (Ch. 24921, Laws of Florida). Until1976, Hillsborough County and the municipalities of Tampa, Plant C ity and Temple Terrace had their own separate taxicab ordinances. Taxicab companies had to obtain operating permits from each of the separate governments in order to serve the entire county, which resulted in duplication and j uri sdictio nal problems To r esolve these problems and create a more c entralize d system o f taxicab regula tion in 19 76 the loca l legi sl ative delegation as ked the Florida Legislature to pass a special enabling act authorizing the e stab lishment of a countywide taxicab regu latory age n cy. This act ( Ch 76-3S3, Laws of Florida) established the H illsborough County Consolidated Taxic ab C ommission The commission initially had authority to regulate only taxi service in the county. In 198 2, the Legislature add ed vans, handicabs and limousines t o the commission s regulatory scope. To reflect this change, the name of the commission was changed in 198 3 to the Hillsborough County Public Transportation Commission (Ch. 83-42 3, Law s of Florida). In 1987-88, the Legis la ture added bas ic life support ambulances and government w rec kers to the commission s regulatory scope In 1994 the Department of Commun ity Aff airs designated the commission as an independent special district. (For further discussio n, see Chapter 2.) Public Transportation Commission Resources To meet its obligations, the Publ ic Transportation Commission has two main so u rces of revenuefees and Hillsbo r ough County s ub s idies. Most of t he commission's operations are funded through fees charged t o the transportation businesses it regulates. The other main revenue sour c e is Hillsbo rough County. Chapter 83-423, Laws of Florida, requires that the county provide for annual budget review of the Public Transportation Commission and ... furnish the Public Transpo r tation Commission wi t h a part-time a tt orney, inspector( s ), and a secretary, along with office spa c e and equipment, stationary and postage necessary to carry out ( it s) 1 Most stakeho-ld ers we interviewed suppor t the current Publk Transport a t ion Commission composition because of the oxcountabilit y and geograp hKal rep r ese n tativeness ofits ('lected member'$. Altho ugh some stakeholders raised t h e is sue of bringing i ndustry and/or cons umer infO the policy proctS$, thett w.u no consensus on how i t should bt don e. Stakeholders w e indudcd officials from the Public Transportatio n Commi ssio n Hill!iborough County? T ampa Templ e Terrace, and Plant City; Publk Transportation Co mmissio n sta;ff nwmbtt$. ; H illsborough C ounty $t:lf f mtmbel"$; ind u stry reprtstnbtive$.; industry expertS; <11nd private:' citizen$. 2

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Introduction responsibilities ... " The county also subsidizes the commission if it has a budget deficit at year end. Over the past three fiscal years, an average of 15.7% of the have come from the Hillsborough County General Fund. Commission funding for the last three fiscal years is shown in Exhibit 1-1. Exhibit 1-1 Public Transportation Commission Budgets for Fiscal Years 1996-97 Tllrough 1998-99 Fiscal Year 1996-97 Budget Revenues Permits, fees, and c harges $433,700 Interest earnings 5,403 Transfer from Hillsborough Countx General Fund 93,718 TO!lll Revenues $532,821 Exl)endllures Personal services $417,969 Operating expenses 97,852 Capital ounay 17,000 Total Elqlendl1llres $532,821 f iscal Year SurplUs (Deficit) 1 so Number of Positions 7 Fiscal Year Fiscal Year 1997-98 1998-99 Budget Budget $433,700 $472,000 5,000 3 ,000 105,000 52,919 $543,700 $527,919 $437,802 424,859 97,371 102,457 22,000 20,000 $557,173 $547,316 $( 13,473) $(19,397) 7 7 1 H istori
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Introduction f o r hire v ehicle s Although the commission has been designated to be an independent specia l district, it is unclear whether the commission currently meets the statutory definition of this type of entity. Furthennore, the commission is not meeting special district accountability requirements, and its lack of contingency funds for extraordinary expense s could adversely affect its service delivery to the public (See Chapter 2 } From a regul atory perspective, the commission has been criticized for its handling of a recent application to provide ambulance services in the county. As a resul t of this situation, the applicant filed suit against the commission, aUeging that the commission unfairly kept him from starting a new business. In a related incident, a former commissioner and his partner a fonnerTampa city attorney, were indicted for misusing their official public positions of trust to wrongfully induce an ambulance company not to oppose their own company s application for ambulance permits. These civil and criminal proceedings have raised questions about the commission's entry regu l ation policies and pennitting procedures (See C hapter 3 ) 11ln October 1999, a j udge r uled that the appljcant did not have a valid legal claim the PublkTr ansportation Commission. The commission was subsequently remo\'ed from I M laW$uit. 4

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Chapter2 Governance Issues Introduction----------The Public Transportation Commission is an independent special district. It is unique in that it is the onl y special district in Florida that regulates for-hire vehicles. Although the commission has been designated to be an independent special district, it is unclear whether the commission currently meets the statutory definition of this type of e ntity. Furthermore, the commission is not meeting special district accountability requirements, and its lack of contingency funds for extraordinary ex p enses cou ld adversely affect i ts service deli very to the public. We identified two option s for improving the governance s t ructure under which for-hire vehicle regulation is performed in Hillsborough County. 1. Amend Ch. 83-423, Laws of Florida, to clarify that the Public Transp_9rtation Commission is an independent special district. However, if the Legislature elects this option, the amendment should require the commission to clarify its fiscal relationship with Hillsborough County, meet all special district accountability requirements, and develop methods for dealing with extraordinary expenses that do not reduce its service delivery or harm the public 2. Dissolve the Public Transportation Commission as a special distric t and allow Hillsborough Count y to either recrea t e the commission by ordinance as a dependent special district or assume the commission's responsibilities. Because the regulation of for-hire vehicles in Hillsborough County is a local concern, we recommend that the Hillsborough County Legislative Delegation work with county and commission officials to determine whether the commission shoul d be statutorily d esigna ted as an independent special district or whether the Special Act should be repealed. 5

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Governance Issues Governance Structure The Public Transportation Commission has been designated an independent special district The Public Transportation Commission was created by a special act of the Legislature in 1983. Subsequent to its creation, both the commission and Hillsborough C ounty considered the commission to be an "independent regulatory agency."" A county review of the applicable laws and the relationship between the two entities confirmed that position However, in late 1993, the Hillsborough County Legislative Delegation asked the Department of Community Affairs for a legal opinion regarding the special district status of the commission. Based on its interpretation of applicable law and iniormati .on provided by the county attorney, the department designated the commission to be an independent special district in March 1994. Special districts are loca l special purpose governments that are authorized by state law to manage, own, operate, construct and finance capital infrastructure, facilities, and services. Special districts generally finance service costs through ad valorem taxes, special assessments, or fees Individuals who reside or own property within the districts' service boundaries and who benefit from the districts' services pay these costs. Special districts provide a variety of infrastructures and services, including health care, fire control, juvenile welfare, and water supply. There are two types of s pecial districts, dependent and independent. A dependent special district is basically an extension of the general purpose local government (municipality or county), where the governing board of local government has certain control over the district. Counties and municipalities have the prerogative to create dependent special districts and may do so by enacting an ordinance prescribing a charter for the district. Independent special districts are an alternative available to the public sector to manage, own, operate, construct, and finance basic capital infrastructure, facilities, and services While independent special districts should cooperate and coordinate with their general purpose local governments, they are autonomous and are not controlled by those local 1 Chapt('f 8J..42J, Laws of Florida. 11 As noted in correspol\dtnc-e betwn the Hil lsborough Count) Auomey and the Department of Community Affairs. February 18, 1994. 1 1Jn making their decision, auorneys lor the Department of Cof\\mun ity Af'hirs a 19941egal op1nion provided by the HiUsbotough County Auomey,a 1990 legal opinion rendered by the depa.rtm-..nt regarding the City of Miami's Department of Off-Sueet Parldng, and Ch. 189, f .S., wh.ich ntablishes general pro ... isions for sptci.-:.1 d istrict$. 6

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The Public TransportaUon Commission is unique Governance Issues } ... governments. As shown in Exhibit2-l, Ch. 189, F.S., establishes criteria for dis tinguishing between dependent and independent special districts. Independent special districts are also require d to submit an annual financial report to the Department of Banking and Finance and an annual financial audit report to the Auditor General. Exhibit 2 Definitions of Dependent and Independent Special District District Type Definition Dependent Independent Dependent special district means a special d istrict that meets at least one of the criteria below. The membership of its governing body i s identical to that of the governing body of a single county or a single municipality. All members of Its governing body are appointed by the governing body of a single county or a singl e municipality. During their unexpired tenns, members of the special d lstrlcrs governing body are subject to removal at will by the governing body of a s ingle county or a singl e municipality. The distrtct has a budget that requires approval through an affirmative vote or can be vetoed by the governing body of a single county or a single municipality. Independent special distrtct means a special district that Is not a dependent special district as defined above. A district that includes more than one county Is an Independent special d istrict unless the district lies wholly withi n the boundaries of a single municipality. Source: Chapter 189 .403, F.S. The Public Transportation Commission is the only special district in F lorida that regula tes for-hire vehicles. In other areas of the state, county or city governments have this responsibility One possible reason for the commission's uniqueness is Hillsborough County' s h istor y of jurisdictional conflict with regard to the taxicab industry. Until1976, Hillsborough County and the municipalities of Tampa, Plant City, and Temple Terrace had their own separa te taxicab ordinances. Taxicab companies had to obtain operating permits from each of the separate governments in order to serve the entire county, which resulted in duplication and juris dicti onal problems. The Public Transportation Commission's predecessor, the Hillsborough County Consolidated Taxicab C ommission, was established by the Legislature to resolve these problems and create a more centralized system of taxicab regulation (Ch. 76-383, Laws of Florida) 13 Sections 11.45 :and 21&32. F.S. 7

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Governance Issues Elements of the Public Transportation Commission's govemance structure are unclear The Public Tfilnsportafion Commission'S budget is emlJedded in the county'S budget Although the Public Transportation Commission has been designated to be an independent special district, it is unclear whether the commission currently meets the statutory defmition of this type of entity According to s. 189 403, F S., a special district is independent if it does not meet at least one of the four criteria for being a dependent special district (see Exhibit 2-1 ). In accordance with its designation as an independent special d i strict, the commission clearly does not m eet the first three dependent special district criteria regarding membership of its govern ing body." However, many stakeholders we interviewed questioned whether the commission meets the fourth criterion for being a dependent special district-having a budget that requires approva l through an affirmative vote or can be vetoed by the governing body of a single county or a single municipality. H the commission meets the fourth criterion, it should be a dependent rather than an independent district. Issues were raised about the commission's budget approval process and Hillsborough County's subsidy of the commission. Budget Approval Process Chapter 189 403, F S states that an independent special district cannot hav e a budget that requires approval through an affirmative vote by the governing body of a single county or a single municipality. However, the Public Transportation Commission's budget is embedded in the budget of Hillsborough County Therefore, the commission's budget is not adopted until the county's budget is approved The commission must also submit budget amendments to the county for approval. The commission s and county's budgets are integrated because the commission s trust fund is part of the county's account structure. The commission s funds are accounted for in the Publ ic Transportation Commission Trust Fund, a subfund of one of Hillsborough County's governmental type, special revenue funds. Because the Public Transportation Commission Trust Fund is a county subfund, it is controlled and maintained by the county 1 .. The mem.betS or the Public Transportation Commission are ff'()m th.:Jn one entity (tht HiUsborough County Board of County C ommiSSioneD and city council:s of iampa, Plant City and Temple Terrace) Md are not $ubject to removal at will by any one o f those-entitles. 1S According to Hillsborough County's Fiscal Year 1999-2000 budget. a governmental type fund 1$ U$ed to aocounr for rhe county's expendable financial resources and relared liab ilities. One $ubrype of a governmenlal fund is called a special revenue fund, which is used to 3COOunt for the pN)('eeds of spedfte revenue sources lhar are legally restricted to certain purpose$. 8

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Hi/!sboroug/1 County subsidizes /he Public Transportauon Commission Governance Issues County Subsidy of the Commission . . . Although Ch. 189, F.S., does not require independent special districts to be self-sufficient, an independent entity's reliance on subsidies from other governments raises questions about its independent status Over the past three fiscal years, Hillsborough County has provided an average of 15.7% of the Public Transportation Commission's revenues. The county subsidizes the commission in two ways. First, the county cove r s the commission's year-end deficits. Second, the county provides certain statutorily required services to the commission. The county supplements the Public Transportation Commission Trust Fund with unrestricted revenues from the .county's general fund when there is a shortfall in the commission's budget (see Exhibit 1-1). Although such a subsidy is not statutorily required, it has been the county's practice for at least 10 years. In addition, Ch. 83-423, Laws of Florida, r equires the county to "provide for annual budget review of the Public Transportation Commission and . furnish[es] the Public Transportation Commission with a part time attorney, inspector(s), and a secretary, along with office spaoe and equipment, stationary and postage necessary to carry out their responsibilities ... However, it is unclear which entity, the county or the commission, decides the form and amount of these services. For example, Ch. 83-423, Laws of Florida, does not state how many inspector(s)" the county must "furnish" to the commission or which entity should determine that number." The county also "furnish(es]" the commission with a part-time attorney, although that attorney works for both the county and the commission and must withdraw from situations if the interests of the two conflict. lb Chapter 83-423. Laws ofFiorida. 11 Cu.rrontfy, Hillsborough County dOt$ not the Public Tr.tnsportation Commis$;01\ with any inspectors or the funding to employ i.Tl$pectors. Althou..gh Attorney General r ecenl1y ruled that the SpOOal Act C'Ompels Hillsborough County to pay (oull &ttltutorily req-uJred servkes, pti'$OI'lneJ. and material (AGO 99-47), the forms and amounts of that payment wtre oot a
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Governance Issues The Public Transportation Commission is not meeting special district accountability requirements The Public Transportation Commission has never filed a statutorily required annual financial audit report Chapter 189, F.S., states that special districts exist to serve the public and that they can best do so by meeting certain minimum s tandards of accountability designed to inform the public of their status and activities One of these standards is a re quirement that independent special districts with annual revenues or expenditures in excess of $50,000 submit an annual financial audit report to the Auditor General. Th i s report includes the district's general purpose f inancial statements as well as the auditor's reports on those s tatements and the district's internal controls However, since being designated an independent special district in 1994, the Public Transportation Commission has never filed an annual financial audit report with the Auditor General. Rather than being audited as an independent special distric t separate from Hillsborough County, the commission has continued to be audited as a part of the county. This practice raises both compliance and accountability concerns Fro m a compliance standpoint, Auditor General rules onl y allow dependent specia l districts to be audited as part of the audit of the local general purpose government. The Department of Community Affairs' 1999 Special District Handbook also restricts this p rac tice to dependent special districts. From an accountability perspective, the commission's participation in the county s annual audit does not provide as comprehensive an evaluation of the commission's finances as having a separate audit would. Instead of focusing solely on the commission's finances, county auditors commingle the commission s and the county's transactions and then sample them for an overall anal ysis of the county. To auditors evaluating the county s $887 million of expenditures, the commission's $579,000 of expend.itures is immaterial'' The commission has s tated that it "does not appear to be re quired, or in a position to be required, to provide for a separate financial audit of its accounts" pursuant to statute.'' The commission claims that it does not have any accounts within its direct control on which an audit could be performed and that Hillsborough County contro ls and maintains the Public Transportation Commission Trust Fund. Although this rationale explains why the commission believes it cannot comply with statutory 111 More :spl"dfi.caUy, it i$ Qf t h(! that public tna.st be secured by requiring each independent spedal district in the state to register and report its financial and other activilie$. I \I Chap1er 10.555(2)(3), Rules of the Audita( :!II Data i s lor Fiscal Year 1998-99. 2 1 Public Transportation Commiss io n with the Auditor C4.-ncnal. April 20, 1999. 10

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Governance audit requirements, it does not alleviate its need to meet legislative intent with regard to special district accow\tability. Furthermore, the commission's rati on.ale .'!-d
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Governance Issues foreseeable that the commission will face other e xtraordinary expens e s in the future, including litigation and/or auditing costs Govemance options We identified two options for improving the governance structure under which for-hire vehicle regulation is performed in Hillsborough County. 1. Amend Ch. 83423, Laws of Florida, to clarify that the Public Transportation Commission is an independent special district. However, if the Legislature elects this o ption, the amendment should require the commission to clarify its fiscal relationship with Hillsborough County, meet all special district accountability requirements, and develop methods for dealing with extraordinary expenses that do not reduce its service delivery or harm the public. 2. Dissolve the Public Transportation Commiss ion as a special district and allow HiUsborough County to either recreate the commission by ordinance as a dependent special district or assume the com.russion's responsibilities. The advantages and disadvantages of these options are described below. Option 1: Amend Chapter 83-423, Laws of florida, to clarity that the Public Transportation Commission is an independent special district Description. Under this option, the Public Transportation Com mission would be operationally the same, but would have to function with genuine independence and accou ntability. Specifically, the amendment to Ch. 83-423, Laws of Florida, would direct the com.russion to adopt changes to clarify its fiscal relationship with Hillsborough County, meet all special district accountability requirements, and develop methods for dealing with extraordinary expenses without impeding its service del.ivery. To clarify its fiscal relationship with Hillsborough County, the commission would need to segregate its budgeting and accounting processes from those of Hillsborough County. Moreover, an economically self -suffi cient commission would leave no doubt as to the commission's statutory and fiscal independence. Economic self-sufficiency, however, would entail the commission financing its normal operations and deficits without fiscal dependence on Hillsborough County. l-4 For Ch. 99-476, Laws of Florida, requires the Public Transportation Commission to undergo 3 perlonna.noe audit by Apri13(), 2003 12

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Governance Issues To improve its accountability both to the c itizens of Hillsborough County and t o the state, the commission would need to fund an annual financial audit separate from !h .cOuntY's audit. Although county budget officials have indicated that a separate financial audit could be performed on the commission's fmances within the current account structure, it may be preferab l e to segregate the commission s fiscal processes from t hose of the county before conducting such an audit. To be able to fund extraordinary expenses without reducing service delivery, the commission would need to take two actions. First, the commission would need to research the cost-effectiveness of purchasing liability insurance as protection against future litigation (including both founded or unfounded litigation). The cost of this insura nce has potentially increase d as a result of recent litigation. Second, the commission would need to establish a contingency fund to provide for extraordinary expenses. Monies for thi s fund could be generated by increasing regulated companies fees (the main source of commission revenue). In the past, the commission has been concerned that a fee increase would ultimately be passed on t o co nsumers However the effects of any fee increase may be able to be mitigated by varying its amount and/or duration. Advanuges. Performing for-hire vehicle regulation as an independent special district p rev ents the jurisdictional infighting that was the impetus for creating the commission. As noted above, jurisdictional problems caused pre-co mmission taxicab regulation to be inefficient and ineffective. The same situation could occur if municipalities were to opt out of any l ocal ordinance establishing for-hire vehi cle regulation by the county." Disadvantages. There are two main disadvantages to the commission remaining an independent special district. First, the state would still be involved in the regulation of for-hire vehicles in Hillsborough County, an issue that is a local concem. Second, the commission would have to generate new revenue to cover the additional costs of segregating its budgeting and accounting processes from the county's, performing an annual financial audit separate from the county's, and establishing a contingency fund for extraordinary expenses. lS H.ilbborvugh Coun ty's cbarter statE'S, "In the even t of a oonftict between a county ordi.Mnce and a municipal ordinance, the m.urddpal ordinance shan prevail within the municipality rega.rdll"$.S of whether the munkipal ordinitnte adopted Of enacted before or after the county ordinance. 13

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Governance Issues Option 2: Dissolve the Public Transportation Commission as a special district and allow Hillsborough County to either recreate the commission by ordinance as a dependent special district or assume the commission'S responsibilities Description. Under this option, after the Legislature dissol ves the Public Transportation Commission by repealing Ch. 83-423, Laws of Florida, the county would pass an ordinance eilher recreating the commission as a dependent special district o r allowing the county t o assume the commission's responsibilities. If recreated as a dependent special district, the Public Transportation Commission would change little operationally. The commission's budgeting, accounting, reporting, and auditing processes are already consistent with county and dependent sp ecial district requirements. However, if the county assumes the commission s responsi bilities, regulatory services could be altered and perform ed by a variety of organizational entities, including a new or existing county department. Advantages. Under thls option, the state would no longer be involved in the regulation o f for-hire vehicles in Hillsborough County, an issue that is a local concern Furthermore, few changes would have to be made to the commission's current budgeting, accounting, and auditing processes since the commission s accounts are already folded into the county's account structure, and the commission's transaction s are already sampled as part of the county's annual audit. The county would also officially assume budgetary approval power and could provide for any extraordinary expenses of the commission. Disadviinlages. Because the commission would be re-created by county ordinance, Tampa, Plant City, and Temple Terrace could opt out and establish their own regulatory s ystems and policies. The result could be the same jurisdictional problems and regulatory duplication that led to the Legislature's creation of the commission's predecessor, the Hillsborough County Consolidated Taxicab Commission. In addition, should the commission assume a dependent relationship with the county, its policy-making independence could be affected. Recommendations Although designated as an independent special district, the Public Transportation Commission does not appear to meet the statutory definition of this type o f entity. Furthermore, the commission is not meeting special district accountability requirements, and its lack of contingency funds for extraordinary expenses could adversely affect its County require additional reportil\8 from its dependent special disttkl$ 14

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Governance Issues service delivery to the public. In addition, the commission is unique in that it is the only entity in Florida that regulates for-hire vehicles through a special act of the. !7/9s.lature In other areas of the state, county or city governments have this responsibility. In our opinion, the commission does not need to be designated as an independent special district to carry out its missi on. However, relevant literature indicates that local government officials are usually in the best position to determine the most effective means for regulating for-hire vehicles."' Thus, the decision on how to structure this function should be made at the loca l level. We therefore recommend that the Hillsborough County Legislative Delegation work with county and commission officials to determine whether the commission should be statutoril y designated as an independent special district, or whether the Special Act should be repealed and the commission be designated as a dependent special district or the commission be abolished and this function be assumed by the county government. If the Legislature and local officials determine that the best option is to amend Ch. 83-423, Laws of Florida, to statu torily designate the commission as an independent special district, the amendment should also requ i re the commission to meet the independent special district requirements of s. 189.404, F.S. 28 Although this option would prevent the jurisdictiona l problems and duplication that led to the creation of the commission, it would a ls o likely result in a fee increase to the regulated indus try due to the increased cos t to meet accountability requirements. If the Legislature and local officials determine the commission should not be an independent special district, the Legislature should repeal Ch. 83-423, Laws of Florida. In repealing the act, the Legislature should clea rly indicate the entity that wiU assume the commission's liabilities upon disso luti on. 19 The county should then pass an ordinance either recreating the commission as a dependent special district or allowing the county government to assume the commis sio n 's responsibilities. Under this option, few changes would have to be made t o the commission's current budgeting, accounting, and auditing processes. However, jurisdictional problems could result if the county's munic ipalities decided to opt out of U1e county's ordinance unless this issue was carefully negotiat ed between the county and the municipalities t1 m Appendix 6 for a bibUoyaphy Appendix C for the text of Section 189.404,. F.S. The provisions of this section were not applied in 1994 whm the Oep.\rtment of Co mmunity Affair'$ the c:ommi:\sion to be indeptndent special district 189.4045(2), P.S., states, unless othe rwise provided by la w or ordinance, the dissolution of a special district gov ernment shan transfer the title to all property owned by the preexisting special district government to the local general-purpose government, which shall also 8S$Ume all indebtedness of the preexisting spedal district." 15

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Chapter3 Regulatory Issues Introduction----------This chapter foc:uses on two aspects of the regulation of for-hire vehicles-public safety regulation and market entry regulati o n While public safety regulation establishes safety requirements for vehicles and vehicle operators, market entry reg ulation places limits on the number of for-hire vehicles that can operate in a jurisdiction Jurisdi ctions may use a v arie ty o f approaches t o prov id e these types of regulat ion. Our review of relevant literature clearly indicates that local jurisdictions are in the best position to determine which regulatory approach would be most effective for them. Although OPPAGA supports the least restrictive form of regulation, there is no dear advantage of one regulatory scheme over another. Furthermore w e found no compelling evidence to indicate the need for major revisions to the regulatory approach used in Hillsborough County. Public Safety Regulation----Regulatory melllod //Sed in HiUsbofOII{/h County In addition to issuing certificates of public convenience and necessity to regulated companies, the Public Transportation Commission permits the vehic les owned by those companies and licenses vehicle operators. Holders of permits and licenses must comply with commission rules and regulations, including vehicle standards, drive r qualifica tions, and insurance requirements. The co mmission i s required to inspect all permitted ve h icles annually and may inspect any vehicl e at any time Inspect ors ensure that vehicles comply with commiss ion standards and provide for the safety and comfort of passengers. The commission also make s certain that vehicle drivers are qualified, of good mor al characte r of sound health and meet all requirements of law. Certificates, permits, and licenses are subject to suspension or revocation by the commissio n if hold ers violate commissio n rules or regulations. Violations may also be crimin ally punishable Chapter 83-423, Laws of Florida, auth orizes the commission to issue a summons t o appear be fore it t o any violator of its rules and may obtai n from the state attorney a 16

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Public safety regulation is necessary There Is no compelling evidence fllat major changes are needed In Hillsborough County Regulatory Issues warrant or capias for rul e vio l ations. The commission may also secure enforcement of its rul es and regul ations by any l egal action, such as injunctive relief. .. , ., Much o f the lit erature we reviewed supports so m e level of safety regulation of for-hire vehicle industries. Without public safety regulation, unqualified operato r s and/or unsafe vehicles could put passengers at risk. Moreover, unsafe for-hire t r ansportatio n can tarnish a communi ty's image for citizens and tourists. Stakeholders we interviewe d agreed that the regu l ation of public safety i s beneficial and should be continued. Our review uncovered little evidence of a chronic, pervasive problem with public safety regulat ion in Hillsborough County Many stakehol ders b e lieve that the commission has been d oing a good job of regulating public safety. Over the past six years, the comm i ssion has received an average of 61 comp l aints per year. This represents an annual average o f one complain t for every 19 permitted vehicles. On a per vehicle basis, the number of complaints has declined since 1993 (see Exh i bit 3 -1). Stakeholders did indicate that the public could benefit from safety regu l ation of other types of for-hire vehicles Exhibit 3-1 Number of Complaints Per Vehicl e Has Declined Since 1993 0.10 0.09 .. 0.08 u :;: 0,07 .. > 0.06 .. Q, 0.05 !l c 0,04 ;; i5. 0.03 E 0 0.02 0 0.01 0 .00 ..... ./"\. \ / i \.. '\. .......... ............ 1993-94 1 994-95 199 5 1996 1997 1998 Fiscal Year 17

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Regulatory lssues Market Entry Regulation-----Regulatory method used in Hillsborough County The Special Act establishing the Public Transportation Co mmiss ion (Ch. 83-423, L aws of Florida) prescribes a method for regulating market entry called "publi c convenience and necessity." 30 Under this method, a person desiring to engage in the for-hire vehicle bus i ness in Hillsborough County must first appl y to the commission for a certificate of public convenience and necessity. The applicant must show whether public convenience and necessity will be promoted by the additional proposed service In determining whether or not public conven i ence and necessity will be promoted by the additional proposed servic e, the commission may conside r the following: the adequacy of existing services; the probable permanence and quality of the proposed service; the character of the proposed servi c e as demonstrated by the proposed use of any radio communications, the proposed use of terminals and hack stands the time of day and night when service is to be offered, and the proposed number and characte r of vehicles; the financial status, character, and responsibility of the applicant as demonstrated by the applicant s ability to provide, maintain, and operat e the number of vehicles proposed, the applicant's criminal and traffic record and the applicant's credit record if any; and the experience of the applicant in the operation of the type of service proposed. In addition to these statutory requirements, comm is sion rules require taxicab companies to have 24-hour centra l dispatch availability and vehicles that are five year's old or less. Commission rul es also lim i t the number of taxicab permit s that can be issued to one permit per 2,000 inhabi tants of HiUsborough County Pursuant to Ch. 83-423, Laws o f Florida the commission is required to investigate circumstances surrounding an application and designate a time and place for a public hearing regarding the application The commission is a l so required to notify each existing certificate holder to allow them the opportunity to intervene in the application process. The public hearing may be held by the commission as a whole or by a committee mad e up of m embe r s appointed by the comm i ssion for that purpose The committee woul d then report to the commission its finding and recommendations for approva l disapproval, or modifica t ion of the application The commission may then conduct further hearings or investigations before ruling on the application. 1 3ppfication!lal\!' $pedfica1Jy excluded from the public he3ring requi rement btAuS4: wrec k ers are not authori z ed to transport p;w.engers 18

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Regulatory Issues In 1993, the commission altered this hearing process by establishing, through rule, a quasi-judicial process led by a special master. This new process was intendec;l more expertise and consistency in the public hearing process and reduce the application-specific workload of the commissioners Under these new rules, any certificate holder who wants to present testimony or cross-examine witnesses at the special master hearing can do so by filing a notice with the commission Strict rules of evidence do not apply, but evidence must be relevant to the issues. The purpose of allowing cross-examinations is to help the special master assess whether an applicant has met the criteria for public convenience and necessity. The applicant and any intervenors are required to bear the costs of the special master public hearing. After the public hearing, the special master is required to submit the findings and recommendation to the commission which makes the final determination on the application. Current Issues The Public T ransportation Commission has been criticized for its handling of a recent application to provide ambulance services in the county In 1996, the commission denied an application by a local businessman to operate a basic life support ambulance service. The commission ruled that the applicant did not demonstrate that there was a need for the new service or that he had the financial means to sustain the proposed business. Then, in early 1997, the commission approved an application for a basic life support ambulance from a former commissioner, who had voted against the 1996 application. As a result of these events, the local businessman filed suit against the commission, alleging that the commission unfairly kept him from starting a new business. Moreover, the former commissioner and his partner a former Tampa city attorney, were indicted for misusing their official public positions of trust to wrongfully induce an ambulance company not to oppose their own company's application for ambulance permits. These civil and criminal proceedings have raised questions about the commission's entry regulation policies and permitting procedures. A related issue, the cross-examination portion of the public hearing process, has also been a concern Protracted cross-examinations can extend hearings for days, increasing the costs of the hearing process to both the applicant and intervenors. This is caused, in part, by cross examinations that do not always directly address the core issues pertaining to public convenience and necessity. 31 In October 1999,a fede-ral judge ruled that tlw applicant dJd not have a valid legal claim against the Public Tran:s.port;,tion ComO\ission The commission was &ubsequentty removed from the li\W'SUit. 19

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Regulatory Issues Approaches tor regulating market entry Restricted entry Numerous studies have been done regarding taxicab regulation in the United States and other countries. Although the Public Trans portation Commission regulates vehicles other than taxicabs, the regulatory principles described in these studies are still generally applicable. The literature identifies three main approaches to regulatory control: restricted entry, open entry, and open entry with minimum standards. Description. Restricted entry involves controlling or limiting the number of vehicles allowed to operate in an area. The most common methods of restricted entry are: requiring proof of public convenience and necessity, tying the maximum number of permits to population in a formula, or setting a flat ceiling on the number of Advanillges. Regulation proponents argue that regulation helps maintain a stable and economically healthy industry by avoiding destructive competition. The historic rationale for regulation of the taxicab industry is that taxicabs are common carriers, which are often held to service standards, and in return are accorded some protection from competition through restrictive licensing criteria. One of the major arguments for regulating for-hire vehicles is the existence of market imperfections peculiar to the for-hi r e vehicle industry. These market imperfections make typical supply and demand analysis inapplicable. Unlike in other industries, consumers buying for-hire vehicle services often have little comparative pricing or service information. Disadvanillges. The criteria for restricting entry can be very subject i ve and does not readily lend itself to a formulaic or criteria-based decision making format. Without well-defined criteria, the subjective nature of the process can pit an applicant, who has the burden of proving the need for additional services, against the existing certificate holders, who have a vested interest in keeping new businesses out of the market. Thus, restricting entry tends to limit competition. This type of regulatory control strongly favors existing businesses and can reduce incentives to innovate, develop new services and control costs. Moreover, in the absence of market forces, it is difficult to determine the optimum supply of vehicles needed. This can result in either under-supply and excess profits or over-supply and insufficient profits to maintain equipment at desired levels. nAt the request of the Legis1ature, the Center for Urban Tr-ansportation Rese-arch rec:enlly condu cted a study of taxicab regulations in Florida and the United States. For a bibliography listing thi-s report and other related re:s,e.arch, see Appendix B. 20

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Openent!Y Regulatory Issues Description. Open entry refers to the economic deregulation of the for hire vehicle industry Under open entry, competition and market forces are allowed to det ermine the quantity, and in part, the quality of services provided. Advantages. The argument in favor of open entry is based on the belief that competition will lead to lower fares, improved service, and innovation. Open entry can also create employment opportunities for displaced workers, recently arrived immigrants, and people on welfare to become economically self-sufficient in an easy-entry, low-cost.business. Through increased competition, open entry can prevent monopolies from forming and can lead to lower prices, which is important, as many users of for-hire vehicles are low-i ncome citizens. Disadvantages. Open entry can result in an over-supply of vehicles, which often results in reduced operator i ncomes and leads to deferred maintenance, high driver turnover, and deteriorating service. In fact, many cities that have tried deregulation have subsequently re-enacted regulations due to service quality problems. Several studies show the negative effects of deregulation of the taxicab industry that occurred in many U.S. cities during the 1970s and 1980s These studies cite evidence of increases in price, highway congestion, and pollution, and declines in operational efficiency and productivity, driver income, and service quality Open entry with minimum standards Description. Open entry with minimum standards is a hybrid of the restricted entry and open entry approaches. Under the minimum standards approach the regulatory body determines and enforces the quality of service offered and le aves the quantity to be determined by market forces. Minimum standards can be established for various aspects of vehicle opera tion, such as a minimum fleet size, type of dispatch, vehicle condition, driver qualifications, and insurance requirements. Advantages. The minimum standards approach provides benefits found in both restricted entry and open entry systems. A regulatory body can set minimum standards that will ensure service quality while allowing for market-enhancing competition. Moreover, if fleet-size minimum standards are established (e.g., a company must operate a minimum number of vehicles), regulation o f enforcement is much easier, and the regulated companies will be somewhat self-policing. Disadvantages. Proponents for both the restricted entry approach and the open entry approach have concerns about using minimum standards. Those favoring restricted entry a rgue that, by not limiting the number of vehicles in the market, the minimum sta ndards approach opens the door 21

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Regulatory issues for destructive competition that will erode service quality. Conversely, advocates for open entry fear that minimum standards will be set so high that market entry will be nearly impossible for small businesses. Method tor regulating entty is best determined at the local level No consensus exists as to which regulatoty approach is best Wetoundno compelling evidence that 1113jor changes are needed in Hillsborough County Our review of relevant literature indicates that there is no clear best way to regulate for hire v ehicles. Whether or not for-hire vehicle markets operate more effectively under restricted or open entry conditions is the subjec t of a long-running debate There is no consensus among researchers as to which type, if any, is the most effective. According to a 1998 article in Govemingabout taxi regulation, Over the past half-century, cities have experimented with just about every form of taxi oversight, from rigid supervision to virtuallaissez faire. All of these strategies have had one thing in common: They haven't worked very well. Hardly any city seems to be able to figure out how to provide its residents with uniformly dean, safe, reliable and courteous cab service. Given this lack of consensus, decisions regarding which regulatory method to use are best made at the lo cal level. According t o the Center for Urban Transportation Resea.rch, 'The challenge is to identify the most appropriate type s and levels o f regulation that produce a high quality service that meets local needs in a manner consistent with local conditions."" Furthermore, the commission s regulatory method is not unique. Ten of the 18 Florida jurisdictions reviewed by the Center for Urban Tran sportation Research regulate for-hire vehicles through the restricted entry approach. In fact, most cities in the U.S. that restrict entry use the same approach that is used in Hillsborough County, the public convenience and necessity standard. Our review also indicated that there have been few probl ems with the commission's permitting process. According to the commission's executive director, the commission rarely denies an application for a certificate of public convenience and necessity "' : iurmoU/' Cov<'ming Dl"Ccmber 1998, pp. lt Center (or Urban Transportation Research, A Review of the Method and Sltllcture ofT4Jti<'4b Regulations in Representative Communities in F/orid
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Regulatozy Issues Recommendations . ' . Our review of relevant literature clearly indicates that local jurisdictions are in the best position to determine which regulatory approach would be most effective for them. Although OPP AGA supports the least restrictive form of regulation, there is no clear advantage of one regulatory scheme over another. Furthermo re, we found no compelling evidence to indicate the need for major revisions to the regulatory approach used in Hillsborough County. We therefore recommend that local officials continue to monitor the effectiveness of the county's regulatory s ystem. H systemic or chronic problems arise, offida!s should consider adopting an alternative method for providing market entry and/or public safety regulation. Stakeholders would want to review the advantages ai:td disadvantages of the various approaches described in this report to determine if a different regulation method would better serve the needs of the county. Furthermore, stakeholders indicated that the public could benefit from safety regulation of other types of for -hire vehicles We therefore recommend that local officials investigate the possibility of expanding the scope of safety regulation to other vehicle types, if deemed cost-effective to do so Finally, if local officia ls decide to retain the present regulatory approach, we recommend that the cross-examination feature of the hearing process be examined. Hit is determined that cross-examination is protracted and negatively affects the hearing process, we recommend that the commission more strictly enforce its rules regarding the introduction of "inele van t, immaterial, or unduly repetitious" evidence during hearings. This will help minimize the cost of the hearing process 37 RuJe No. 2.4.7 A., Ruli!$ and Regula lions of the Hl/Jsborough Ccunty Public Transportation D>nomi#km. 23

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Appendix A Vehicles Regulated by the Public Transportation Commission Van limousine HandJcab Any mOIDr-ilriven vehicl e widl a capaciiY for not more dlan nine passengers, including the dr1Ver, for the transportation for hire of passengers, which operates wldlln Hillsborough County not including site-seeing cars or buses, slreetcars, or mOIDr buses operated under or pursutnt to franchise. Any motor-i!r1Ven vehicle with a capaciiY of at least 10 but not more than 15 passengers includlng the dr1Ver, f o r transportation for hira of passengers, which operares within Hllsborough Coun!y not indu
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AppendixB B i b liograph y Avants, Sandi, Gorman Gilbert, and Barbara Lupro. 1995. Peer Review of Seattle Taxicab Regulation. Boroski, John W. and Gerald C.S. Mildner. 1998. An Economic Analysis of Taxicab Regulation in Port18ntt Oregon. Cascade Policy Institute. Buckeye Institute for Public Policy Studies. 1996. TaxiCJJbRegulation in Ohio's Largest Oties. (October). Center for Urban Transportation Research University. 1999. A Review of the Method and Structure of Taxicab Regulations in Representative Communities in Florida and Other States. University of South Flori d a. (June). Consumer Policy Institute. 1997 Putting Consumers First Taxicab Refonn in the Greater Toronto Area Toronto, Canada (April). Dempsey, Paul Stephen. 1996. 'The Revolving Door: A Review ofTaxi Industry Regulation, Deregulation & Reregulation: The Paradox of Market Failure. Transportation Law ]oumal24, Transp L.J. 73-120. Ehrlich, Captain John. 1998. Public Convenience and Necessity Hearing Report for Taxicab Medallions to the Police Commission Oty and County of San Francisco Gentzogl a nis; Anastassios 1992. 'The Taxicab Industry: Theoretical and Empirical Evidence from (De)regulation." Proceedings of the lntemational Conference on Taxi Regulation.. Gilbert, Gorman. 1992. 'How to Make Regu lation Work. Proceedings of the lntemational Conference on Taxi Regulation. Gold s mith, Stephen 1997. "Regu lation and the Urban Marketplace," Regulation, Ca t o Institute Hara, Dan and David Lewis. 1992 'The Political Economy of Taxi Regulation Reconciling Pub lic Welfare With Political Process." Proceedings of the Intemational Conference on Taxi Regulation Institute for Transportation Research and Education. 1996. Study of TaxiCJJb and Wrecker licensing for the Metropolitan Government of NashviUe and Davidson County. North Carolina State University. (February). Kang, Choong-Ho 1998. Taxi Deregulation: Intema.tional Comparison. Institute for Transport Studies, The University of Leeds. (August). 26

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Regulatory Issues . . Marko, Thomas E. 1993. Metro-Dade jitney Experience. Mathesian, Charles. 1998. Taxicab Turmoil Governing. (December). pp. 26-7. Morris, Paul T. 1993. Recent Case Law Affecting Taxicab Regulation. Proceedings of the International Collference of North Ame.dcan Transpomtion Regulators (October). Patton, Robert. 19%. "'s Taxicab Deregulation Dead?" Proceedings from the Conference of Intemationa/ Transportation Regulators Price Waterhouse. 1993. Analy>is of Taxicab Dereguktion andRe Regulation (November). Romero, Miguel Tomas. 1996. "The Future of The Taxicab Industry: The Point of View of the Industry." Proceedings from the Conference of Jntemational TranspOrtation Regulators Schaller, Bruce and Gorman Gilbert. 1996. "Fixing New York City Taxi Service." Transportation Quarterly, Vol. 50, No .2, (Spring). Schaller Bruce. 1993. The New York City For-Hire Vehide Fact Book (February) . Smythe Terry. 1997. Taxicab Deregulation: Futility or Blessing (May). Smythe, Terry 1990. "Taxi Regulatory Fees." The Regulator. (November). Teal, Roger F and Mary Berglund. 1987. "The Impacts of Taxicab Deregulation in the USA." foumal of Transport Economics and Policy. (January) Teal, Roger F Ph. D 1992. "An Overview of the American Experience with Taxi Deregulation Proceedings of the International Conference on Taxi Regulation Toner, Jeremy P and. Peter J Mackie 1992. "The Economics of Taxicab Regulation: A Welfare Assessment Proceedings of the Intemational Conference on Taxi Regulation. Tru d el, Michel. 1995. "The Fundamentals of Taxi Regulation and the Quebec Experience." Presentation to the 7" Congress of the European Taxi Confederation. Trudel Michel. 19%. "The F uture ofTransportation by Taxi." Proceedings from the Conference of International Transportation Regulators. U.S. Department of Transportation. 1983. Taxicab Regulation in U.S. Cities_ Volume 2: Cas e Studies. (October). 27

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AppendixC Chapter 189.404, Florida Statutes If the Legislature and local officials determine that the best option is to amend Ch. 83-423, Laws of Florida, to statutorily designate the Public Transp ortation Commission as an independent special district, the amendment should also require the commission to meet the independent special district requirements of s. 189.404, F.S. 189.404 Legislative intent for the creaUon of independent special districts (1) LEGISLATIVE INTENT. It is the intent of the Legislature that, after September 30, 1989, at a minllnum, the requirements of subsection (3) must be satisfied when an independent special district is created. (2) SPECIAL ACTS PROHIBITED. Pursuant to s. 1l(a)(21), Art. ID of the State Constitution, the Legislature hereby prohibits special laws o r general laws of local application which: (a) Create independent special districts that do not, at a minllnum, conform to the minimum requirements in subsection (3); (b) Exempt independent special district elections from the appropriate requirements ins. 189.405; (c) Exempt an independent special district from the requirements for bond referenda ins. 189.408; (d) Exempt an independent special district from the reporting, notice, or public meetings requirements of s. 189.4085, s. 189.415, s. 189.417, or s. 189 .418; (e) Create an independent special district for which a statement has not been submitted t o the Legislature that documents the following: 1 The purpose of the proposed district; 2. The authority of the proposed district; 3. An explanation of why the district is the best alternative; and 4. A resolution or official statement of the governing body or an appropriate administrator of the local jurisdiction within which the proposed district is located staling that the creation of the proposed district is consistent with the approved local government plans of the local governing body and that the local government has no objection to the creation of the proposed district. 28

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AppendixC (3) MINIMUM REQUIREMENTS.:.:Ceneral Jaws or special acts that create or authorize the creation of independent special districts and are enacted after September 30, 1989, must address and require the following in their charters: (a) The purpose of the district. (b) The powers functions, and duties of the district regarding ad valorem t axation, bond iss uance, other revenue-raising capabilities budget preparation and a p proval, liens and foreclosure of liens, use of tax deeds and tax certificates as appropria t e for non-a d valorem assessments, and contractual agreements. (c) The methods for establishing the d istrict (d) The method for amending the charter of the district (e) The membership and orgartization of the governing board of the district If a district created afte r September 30 1989, uses a oneacre/one vote election principle, it shall provide for a governing board consisting of five members. Three members shall constitute a quorum . (f) The maximum compensation of a governing board member. (g) The administrative duties o f the governing boar d of the district. (h) The applicab l e financial disclosure, noticing, and reporting requirements. (i) If a district has authority to issue bonds, the procedures and r e quirements for issuing bonds. (j) The proce;dures for conducting any district elections or referenda required and the qualifications of an elector of the district. (k) The methods for financing the district Q) If an independent special district has the authority to levy ad valorem taxes, other than taxes levied for the payment of bonds and taxes levied for periods not longer than 2 years when authorized by vote of the electors of the district the millage rat e that is authorized. (m) The method or m ethod s for collecting non-ad valorem assessments, fees, or service charges. {n) Planning requirements. (o) Geographic b oundary limitations. (4) LOCAL GOVERNMENT/GOVERNOR AND CABINET CREATION AUI'HORIZATIONS EXcept as otherwise authorized by general law, onl y the Legislature may create independent special districts. (a) A municipality may create an independent special district which shall be established by ordinance in accordance with s. 190.005, or as otherwise authorized in general law. (b) A county may create an independent special district which shall be adopted by a charter in accordance with s 125.901 or s 154.331 or chapter 29

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AppendixC 155, or which shall be established by ordinance in accordance with s. 190.005, or as otherwise authorized by general Jaw. (c) The Governo r and Cabinet may create an independent special district which shall be established by rule in accordance with s. 190.005 or as otherwise authorized in general law. The Governor and Cabinet may also approve the establishment of a charter for the creation of an independent special district which shall be in accordance with s. 373.1962, or as otherwise authorized in general law. (d) 1. Any combination of two or more counties may create a regional special district which shall be established in accordance with s. 950.001, or as otherwise authorized in general l aw. 2. Any combination of two or more counties or municipalities may create a regional special district which shall be established in accordance with s. 373.1962, or as otherwise authorized by general law. 3. Any combination of two or more counties, municipalities, or other political subdivisions may create a regional special district in accordance with s 163.567, or as otherwise authorized in general law. (5) STATUS STATEMENT After October 1, 1997, the charter of any newly created special district shall contain and, as practical, the charter of a preexisting spe cial district shall be amended to contain, a reference to the status of the special district as dependent or independent. When necessary, the status statement shall be amended to conform with the department's determination or declaratory statement regarding the status of the district. lfutory. --s. 6, Ch. 89-169; s 106, Ch. 90-136; s. 6, Ch. 97255. 30

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AppendixD Response from the Hillsborough County PubHc Transportation Commission In accordance with the provi sions of s. 11 45(7)(d) F S., a drnft of our report was submitted to the Director of the Hillsborough County Public Transportation Commission for his review and response. The director's written response has been reproduced herein beginning on page 32. 31

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Appendix[) HILLSBOROUGH COUNTY PUBLIC TRANSPORTATION COMMISSION P.O. Bttx 1110. 1'amsu. Ftt>rt.da 33601 Mt. John W. Turcoae, Director Office: of Program Policy Analysis and Governmental Acc:ountabill'Y Post Ofti.ce Box J73S Tallahaute, Florid> 32305 Dear Mr. Turconc: Oco>ber 4, 1999 Enclosed f:s the requested response to your pre:limio.uy findiags and reoommeodatiortS of your review of the Hillsl>oro ugh Publie eo-luioa. 1b< pn>kmonali ..,.fill., 1M to ass'i.st with tbeir difficott deds:loos, b\d your staff d.id an admirable job. I hope that lh.is respoMe, coupled with your staffs wiU bclp pmeot an aceuraae and osetW report. My conuntnr:s will be form.ttcd so that dMy rapmd directly ro tho COli&DleDtS iDcluded m me report. J hope thai the$e commeots will clarify any issues or wiU provide add\tlooal infOf"l''Wioa. usoful to 1he-rea.ckn of your review. J respe:ctfuJiy request thai a c:opy of this respoo.se be provided to tbe Leg:lslalive DelegatK.n Pul) lic Ttan$portation Commissioo Ad Hoc Study Committee as it n:vicws the OPPAGA repon. Sinecrely, Gttgory"B. Cox Dirutor ": The Hononble Tom ko$$ln lhe Honorable Kennedl P. Pruitt The Hocorable James Ha.rgrett Com.rJ'Iiuioner Chris Han Commtssioocr R.ich Glorioso Commiuicmer Joe Affi"ontj Comrni.ssioncr Shawn Harrisoa Commis.sioncf' l'at FraNc Com.missionet' Charlie Miranda Cot:nutissioncr Ben Wac:ksman Mr. Daniel A. Kleman, COWley Adminlslm., l\1$. Amy Acton, Hillsborough Coun
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Appe.ndixD R.e5PQD$0 Comments to OPPAOA l'C'View of'HUisboroug.h CoUQty Public Tnuls:ponatjoo Commission. Pace I. Baskground: "As of !uoe 1999, !be oommission 1w1 bsued 1,302 vehicle permits." Septemb!r 30. I$99. mr 1364 permits hare lnwd by @e rommlssion. Page 2, .Public TraDsponation Commission '7o meet its Commission has two main SOlaCeS or and Page 4, Cwrenc Public Transportation Issues: criticized for its handling of a receot "From a regulatory perspective, the commission bas bten to provide ambula.JKi serviecs in the County n _!!!$ Page S, Govemat'le Issues: "The Public TranspoJtation Commission is an independent special district. It is unique in that it is the only di$trict ill Florida tbat regul-Mes fOl'bire vebietu... It is true tbat tbis is tllt pniY designated indepsndent special district that mplaw vehfc:les for hire in Fk)rida, but a couple othn somrotnts shoyld bt inctpdcd. Fiat, thls Copnry b: uwJqae In tb!t tbm ars three munic:ipalitlts wbich without tb i n dependf a tspecfar district status. would eaeh ltave to sort out. their various regp.latJops end epforcemcnt of yehkl$1 for bitt. along with tile Coynty Sesond!y. it should be mentioned that aearly everv County and municipality in florida has some desinattd office ar omnization that regulates nhiclta tor hirt., performing mug 9ftbe gme function tbat ths PTC pertonns for Hilltbotough Count.Y. 1'1ge 6, Govenwtee Scrw:ture: Tbe report illdlca!es lballio.m 1983 to late 1993, !be PTC was oonsidered by !be oommissiOI) and Hillobo
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AppendixD Response Comments to OPPAGA review of Hitlsborougb County Publtt: Transport::ation Commission. Process: '" .... However, tbe Public Tl"'llSppl'tati Commission's bud&et is of Hillsborougl> Cow!ry. 1bmfot<, the wmmi<$ion's bolder$ did indicate 1toat the public eould benefit fi'om safety regularion of othtr typeS of Dis sommrnt Jbo!ld be gRindrd yd brought to tbc kcis!atiYe De!mtlon's etugJ!oa. The Spesial Act spsc;ifies which vfhicles Cln c:umnlly be rnulaffd by tbs PTC Otbsr xebic:!ts for ltire shoukl bt iMiudsd Ia tbt Sptdal Ad to PI"'(t' the public. 19$b Is: c:oartev vans, daY pre ddiycry ngs IDd pMtt lt9fi;S9JIS$11SJIII W[tJser ODSratiMs. Tbe-publi$ woyld bt bt!ltr Kmd if the [Ok O(tbt nc WSB tlR!ndcd, Plge 20, CUmnt IS>UCS: '"Tb< Public Thmspo!lalioa Commimoo 1w been c:riliciud for its baodliDg of a toeeDt apptic:atioa co provide ambulaDc:e seMoes in me c.owtty. ID. 1996. tbe commission denied an applkatioa by a loeal busiDessmaD to opmte a besie ll!e support ambulaD
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AppendixD Response Comments to OPPAGA review ofHitlsborou.gh Councy Pubtie Transportation Commission. Page 20, Comnt Issues: ... "lbe ctQSS examillalion ponian oftbe public bearil>g process, bas also been a coac:em The a]M rg:udiDg thC Special Master proS!$! ud the cross ex.amloatloPs by the Jntervc.nors are bei M revised bv the PTC. ne iatent it to eljmlnate the c:roa examiQatioo and to stf'eamline the. proms but 091 recluse the efftctivtpes$ 3 35


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