Justification for Administrative Rule Adoption
16 TAC Chapter 95, new rules §§95.1, 95.2, 95.10, 95.20 - 95.23, 95.30, 95.31, 95.40, 95.50, 95.51, 95.70 - 95.72, 95.80, 95.90, 95.91 and 95.100
The Texas Commission of Licensing and Regulation (Commission) adopts new rules at 16 Texas Administrative Code (TAC), Chapter 95, §§95.1, 95.2, 95.20 - 95.23, 95.30, 95.31, 95.40, 95.51, 95.70 - 95.72, 95.80 and 95.90, regarding the Transportation Network Companies program, without changes to the proposed text as published in the September 15, 2017, issue of the Texas Register (42 TexReg 4742). The rules will not be republished.
The Commission also adopts new rules at 16 TAC, Chapter 95, §§95.10, 95.50, 95.91 and 95.100, with changes to the proposed text as published in the September 15, 2017, issue of the Texas Register (42 TexReg 4742). The rules will be republished.
The Texas Legislature enacted House Bill 100 (H.B. 100), 85th Legislature, Regular Session (2017), which established Chapter 2402 of the Texas Occupations Code that requires statewide regulation of Transportation Network Companies by the Commission and the Texas Department of Licensing and Regulation (Department). The adopted new rules are necessary to implement H.B. 100.
The Department held stakeholder meetings on July 6, 2017, with the Texas Travel Industry Association and Texas Commercial Airports Association; July 13, 2017, with Coalition of Texas with Disabilities, ADAPT, Governor’s Committee on Disability, and Disability Rights Texas; July 14, 2017, with Coalition of Texas with Disabilities, ADAPT, Governor’s Committee on Disability, and Disability Rights Texas; and July 31, 2017, with Fasten, Uber, Lyft, Ride Austin, Get Me, Pronto Rides and GLT, in Austin, Texas to get initial input about the industry and their concerns.
The adopted new §95.1 provides the statutory authority for the Commission and the Department.
The adopted new §95.2 identifies the definitions to be used under this chapter.
The adopted new §95.10 clarifies the scope and construction of this chapter.
The adopted new §95.20 requires a transportation network company to obtain a permit to operate in this state.
The adopted new §95.21 explains the terms of the permit.
The adopted new §95.22 establishes the initial permit application for transportation network companies.
The adopted new §95.23 provides for the permit renewal notice and application for transportation network companies.
The adopted new §95.30 allows for the issuance of a permit when requirements are met.
The adopted new §95.31 allows for the department to deny a permit.
The adopted new §95.40 establishes the responsibilities of the Department.
The adopted new §95.50 establishes reporting requirements for transportation network companies.
The adopted new §95.51 requires transportation network companies to provide notification of operations at airports and cruise ship terminals.
The adopted new §95.70 requires a permit holder to maintain a current and valid email address.
The adopted new §95.71 establishes requirements for data integrity, name changes, address changes and address additions.
The adopted new §95.72 prohibits deceptive practices.
The adopted new §95.80 establishes the fees for the transportation network company program.
The adopted new §95.90 allows the Department authority to investigate.
The adopted new §95.91 provides for administrative sanctions when necessary.
The adopted new §95.100 requires transportation network company permit holders to comply with the program statute, Texas Occupations Code, Chapter 2402.
Rule Purpose
The purpose of these rules is to balance the interests of Transportation Network Companies (TNC), airports and cruise ship terminals, the disability community, and the public welfare by providing a regulatory framework with minimal governmental intervention allowing the market to function by reaching agreements wherever possible.
These rules do not govern or provide complete oversight of the airport TNC relationship. Rather, in keeping with legislative intent expressed in the Bill Analysis, these rules provide a “uniform, rationale statewide framework” and guidance to airports exercising local authority over a statewide industry. These rules provide flexibility for each airport to set reasonable fees and implement regulations based on circumstances unique to its locality while providing predictability to the industry. As acknowledged by certain airports during the October 5, 2017 public hearing, nothing in these rules prevents an airport from reaching agreement with a TNC regarding issues within the authority of the airport to regulate, including fees.
Consistent with Occupations Code 2402.003, these rules recognize that fee setting authority is “an exclusive power and function of this state” delegated to airports by Occupations Code 2402.003(b). Therefore, in the absence of an agreement, these rules provide a standard or methodology for an airport exercising the power of the state to meet existing regulatory obligations and prevent the exercise of unfettered “arbitrary and onerous” discretion by the airports. The exercise of unfettered “arbitrary and onerous” discretion by the airports has the potential to drive TNCs from the market, negatively affecting the “growth” and availability of “safe transportation options” for passengers traveling to and from airports.
As specifically stated in new §95.10, these rules “do not prohibit an airport or cruise ship terminal from imposing regulations including a reasonable fee to or from airport or cruise ship terminal; enforcing those regulations in a manner consistent with any compliance, assurances, and obligations under federal law, rules, regulations, and policies; or from requesting third-party auditable reports of the numbers of rides to and from an airport or cruise ship terminal”. As discussed below, these rules provide reasonable options for airports to exercise sound and reasoned discretion while meeting their regulatory and financial obligations.
Moreover, these rules do not “authorize an airport or cruise ship terminal to compel data sharing or to impose additional requirements on a personal vehicle or driver; including, tracking of the vehicle or driver when logged into the digital network.” Instead, these rules recognize and preserve the restrictions in Occupations Code 2402 related to personal vehicles and data sharing requirements; while acknowledging the ability of an airport to impose other requirements related to those matters, such as requiring auditable reports.
Public Comments
The Department drafted and distributed the proposed rules to persons internal and external to the agency. The proposed rules were published in the September 15, 2017, issue of the Texas Register (42 TexReg 4742). The deadline for public comments was October 16, 2017. The Department held a public hearing during the public comment period on October 5, 2017. During the public hearing, the Department received comments from ten interested parties including the Texas Commercial Airports Association.
During the 30-day public comment period and at the Commission meeting sixteen and eight interested parties, respectively, submitted comments including the Texas Commercial Airports Association.
The public comments received are summarized by issue below.
Impact on Local Governments
Comment--The Port of Galveston commented that they believe there is an economic cost to local government associated with: (1) the costs of a cost-of-service study; (2) enforcement; and (3) an adverse impact on revenue.
Department Response--The Department disagrees with each of the concerns raised by the Port of Galveston because the costs associated with a cost-of-service study and enforcement may be accounted for in the fee collected from transportation network companies which is a direct pass through to consumers. Since these costs are pass-throughs there will be no adverse impact on the revenue of local authorities. In addition, cost-of-service study leading to cost recovery with an market based return is only one option available to the owners or operators of cruise ship terminals.
Data Tracking and Monitoring Software (§95.10)
Comment--The Department received comment from; The Texas Commercial Airport Association, Houston Airport System, City of San Antonio, San Antonio Airport System, City of Houston, Dallas/Ft. Worth Airport, Houston Airport System, and City of Dallas - Dallas/Lovefield (hereinafter referred to as “the airports”).
The airports stated that without electronic tracking and monitoring software that they would be unable to monitor and regulate traffic flow, to properly assign non-aeronautical costs (such as parking) and that the airports would be unable to rely upon self-reporting from Transportation Network Companies (TNC) to remain in compliance with federal regulations. The airports also claimed that TNC drivers routinely circumvent data tracking and monitoring software by using multiple phones or by leaving phones outside of the airport grounds (ghost phones).
The City of Dallas – Dallas/Lovefield believes that tracking data and management allows airports to effectively manage curbside congestion related to the pick-up and drop-off of passengers.
In addition to the airports Representative Charlie Geren (Rep. Geren) submitted a comment supporting the airports’ position to allow the airports “to accurately track TNCs in a timely manner, which allows airport staff to monitor the entry and location of the TNC vehicles allows for the safe and efficient management of roadway, terminal and curbside spaces.” Rep. Geren also states that data tracking software, “is already being used at numerous other major airports across the nation.”
As an alternative to data tracking and monitoring software, the City of Houston believes that auditable monthly reporting to the airport would provide enough data to reasonably track TNC drivers entering and exiting the airport and provide an accurate account of fees owed to the airport.
Department Response--The Department understands and appreciates the comments related to data tracking and monitoring software. In response to those comments the Department believes the recommendation from the city of Houston is reasonable and will address concerns raised through the comments. The ability for the airports to obtain auditable reports from the transportation network companies allows the airport to meet Federal Aviation Administration (FAA) requirements for grant assurances to the FAA that each trip to and from the airport is accurately reported. The auditable reports also address concerns raised about the inaccuracies of self-reporting. Therefore, the Department believes these auditable reports may be superior to tracking and monitoring software that airports in public hearing argued could be easily defeated by drivers using multiple phones or by leaving the cell phone outside of airport grounds. The Department further understands that software tracking mechanisms can be defeated by the transportation network companies simply by changing the application’s algorithms for location of the drivers. Therefore, the Department concludes that auditable reports based on actual company data is a superior mechanism for the reporting of trip data. The Department further concludes that the best data is the auditable data used by the TNC to account for its revenue and maintain financial viability.
The issues related to curb-side congestion including the pick-up and drop-off of passengers and the traffic management leading to the terminals are within the authority of the airport or cruise ship terminal to regulate through rules and regulations as authorized by Occupations Code 2402.003(b). With respect to traffic congestion, the airports failed to show that TNC traffic is different or distinguishable from non-TNC traffic and thus the Department believes that current methods used by airports to monitor traffic congestion remain valid.
Reasonable Fees and Rule Construction (§95.10)
Comment--The airports state that the definition of “reasonable fees” is insufficient because it conflicts with Title 49 United States Code and the FAA Sponsors Assurances; which the airports claim requires fees be set at Fair Market Value (FMV). The airports state that fee setting based on costs of service is inconsistent with the responsibility to establish FMV jeopardizing federal financial assurances. Moreover, some commenters believe that the escalator option in §95.10(c) would result in a historical rate that does not reflect economic conditions specific to the airport’s geographic location.
The Port of Galveston states that they have no taxing authority and instead rely on an enterprise fund approach in which the cost of services is recovered through the fees charged to the users of such goods and services and that fees collected from entities entering the port’s cruise terminal complex is an important part of these revenues.
The Texas Commercial Airport Association believes that §95.10 (1) and §95.10(2) contradict each other and suggest that the Department delete §95.10(2).
Lyft expressed concern that airports would attempt to make rates retroactive and charge back-fees for the period that fees under this rule were not in effect.
The Texas Commercial Airport Association, Houston Airport System, and Valley International Airport state that §95.10 Rule Construction omits the words “to and from” regarding the assessment of fees for trips on airport grounds.
Department Response--The Department acknowledges the need to include trips “to and from” airports and cruise ship terminals. The Department believes the omission of those terms was inadvertent and the rule has been changed to include the requested language.
The airport commenters claimed that the published rule prevents self-sustainability by preventing them from charging a FMV rate which jeopardizes their federal financial assurances. The Department believes the published rule is consistent with the airports ability to establish fees based upon FMV. Consistent with FAA guidelines, the Department further believes that FMV fees should be transparent and nondiscriminatory. The Department found that the definition of “FMV” set by the FAA has no set methodology and is therefore ambiguous. The airport commenters failed to provide or even suggest a methodology for the determination of FMV. The Department further finds that without a methodology for determining FMV fees, the airports obligation to set a reasonable fee under Occupations Code 2402.003(c) would not be met and would instead result in the exercise of unfettered arbitrary and onerous discretion by the airports. These possible arbitrary or discriminatory fees would be a direct pass-through unreasonable burden on the citizens of the state contrary to the reasonable fee requirement in the statute.
Therefore, while the Department removed rule language related to “surplus revenue”, the rule as adopted provides four options for standards or methodologies that may be used to determine reasonable fees required by Occupations Code 2401.003(b) that are consistent with FMV fees requested by the airports.
The first option recognizes that existing fees comply with the airports regulatory obligations to meet federal obligations and assurances. During the public hearing, certain airports acknowledged that existing rates in fact comply with and meet regulatory obligations and assurances.
The second fee setting option allows airports to impose a cost recovery approach with market based returns as acknowledged by the cities of San Antonio and Houston during public comments. Both cities acknowledged before the Commission that current FMV fees are based on and contain a cost recovery approach.
A third fee setting option provides that an airport may adopt market based fees that are in effect at airports with similar characteristics. The decision of which airport to use for comparison purposes is within the sound discretion of each individual airport electing to exercise this option.
Finally, in recognition that FMV may also be established when an unpressured buyer and an unpressured seller reach agreement, the rules provide that an airport and TNC may enter into agreement to determine reasonable market based fees.
In response to the specific comments from the airports regarding a FMV fee the Department recognizes the need to separate the airport’s reasonable fee requirements from the obligations of cruise ship terminals. Therefore, the Department established a fee setting methodology for airports which is now located in §95.10(b) and moved the requirements for cruise ship terminals to §95.10(c). The requirements for airports and cruise ships were separated to avoid confusion between the two methodologies. However, each methodology to the extent possible mirror each other.
In response to the airport’s concerns about FMV and self-sustainability the Department changed §95.10(b)(1) to address those concerns by clarifying the fee setting methodology based upon the FAA guidelines. Specifically, the fee setting methodology found in §95.10(b)(1)(a) for airports addresses FMV and the airports obligations under FAA financial assurance requirements and provides airports the flexibility to meet their self-sustaining financial obligations. Additionally, §95.10(b)(1) acknowledges that existing fees set by the airports with no requirements from the Department or the state on May 29, 2017 comply with these standards.
Moreover, the Department clarifies in §95.10(b)(1)(B) a FMV fee should be transparent and non-discriminatory based on FAA guidelines for non-aeronautical services. This clarification was also carried into §95.10(b)(1)(C).
Furthermore, the Department added §95.10(b)(1)(D) to allow the airports and TNC to establish a fee through mutual-agreement that satisfies both the reasonable fee under the Occupations Code and FMV requirements in the FAA’s guidelines.
While the airports commented that the adjustment escalator found in §95.10(c) would result in a historical rate not reflective of current economic conditions specific to the airport’s geographic location, the Department disagrees that the adjustment escalator results in a historic fee because the adjustment escalator is forward looking. With respect to the geographic differences between airports the Department has changed §95.10(c) to provide the flexibility for an airport to select an index specific to their location which reflects economic conditions unique to that airport.
The Texas Commercial Airports Association believes that §95.10(1) and §95.10(2) contradict each other. The Department does not believe options for a fee methodology are contradictory because an airport may select one of the options best suited for its needs of the circumstances of their geographic location. The election between the four options would not result in contradictions because the rules provide that only one option is available. The rule has been changed to reflect that the four fee setting methodologies are options and only one methodology should be used.
In response to Lyft’s concerns about retroactive fees, the Department did not change the rule regarding these concerns. However, the Department notes that fees adopted under Occupations Code 2402.003 and these rules are prospective from the date of adoption and should not be applied retroactively. The prospective nature of fees in supported by House Bill 100 (H.B. 100), 85th Legislature, Regular Session (2017). H.B.100, Section 3 says that “any municipality’s or other local entity’s ordinance or policy related to transportation network companies…is void and has no effect.” Since existing fee ordinances are void by statute, under Occupations Code 2402.003 and §95.10 local fee setting authorities may re-adopt those fees or adopt new fees. In either case, the new fees or re-adopted fees are prospective.
The Port of Galveston included comments regarding their fees that make up their revenue stream. However, the Port of Galveston did not request a rule change and therefore rules were not amended due to their comments.
Application and Renewal Fees
Comment--One commenter believes that the initial application and renewal fees are too high and therefore represent a barrier to entry for small and micro companies. Another commenter believes that fees should be lower for micro and small businesses to allow an opportunity for those businesses to develop. One commenter believes that the fee structure should be based upon the company’s size.
Department Response--The Department appreciates the concerns raised by this comment. However, HB100 from the 85th Legislature requires that the Department implement fees necessary to cover the costs of administering this chapter. As stated in the proposed preamble, fees were established on projected program costs as well as the number of potential applicants. To lower the application fees would result in the Department failing to recover transportation network company program related costs and would shift those costs to unrelated programs.
The Department believes that the fees imposed upon micro and small businesses under these rules is less burdensome than regulations imposed by multiple jurisdictions. The state-wide application fee required under these rules result in substantial cost savings to those businesses because they are no longer subject to multiple application fees for each jurisdiction for which they operate and are no longer subject to ongoing fees based on a percentage of the total revenue the company received for rides based in each jurisdiction. Therefore, the rules have not been changed in response to this comment.
Reporting Requirements – Pilot Program (95.50)
Comment--The Department received comments from Uber, Lyft, and Texas Conservative Coalition Research stating that they believe the Department did not have authority to add additional requirements to the Pilot Program report to the legislature but that the Department did have authority to establish specific reporting requirements for the Disability Compliance Report to the Department.
Texas Taxi stated that pilot program “exhibit[s] a fundamental misunderstanding of the nature of the transportation network services provided by the [TNC’s] web application.” This commenter states that a TNC has “no control over how many transportation service providers enroll… nor have any control over how many transportation service providers have wheel-chair vehicles or only vehicles capable of only providing ambulatory services.” This commenter stated that they can “provide periodic reporting of the division between ambulatory service registrations and wheel-chair service registrations. However, they cannot “pre-determine the division and relative size of each type of service that may emanate from the transportation service providers who register to utilize the [TNC] Platform.”
Department Response--The Department finds that the rules do not exceed the Department’s authority to require additional requirements for the Pilot Program report because §2402.113(c) of the Occupations Code provides “minimum” criteria to be included in the report to the legislature. After further review, the Department concludes that the section should be modified to remove the requirement for reporting zip codes because the additional data is limited to the market area selected for the pilot project. In addition, the Department changed §95.50(c) to include additional data requirements in the Disability Compliance Report. These changes allow for the collection of data that demonstrates compliance with Occupations Code 2402.113(a).
Texas Taxi’s commented that transportation network companies do not control the number of transportation service providers with wheel chair accessible vehicles, or pre-determine the division and relative size of each the of services that may emanate from the service providers who register to use the transportation network company’s platform. The Department believes that a reasonably prudent transportation network company in the development of a pilot program would engage in discussions with alternative providers to determine the size of their fleets and ability to service fixed-frame wheelchair accessible requests and gather data related to the need for such services. Failure to do so would result in an unwillingness of a TNC to demonstrate compliance as required by Occupations Code 2402.113(a) including the unwillingness to track the referral of fixed-frame wheelchair accessible vehicle requests to another provider. Therefore, the Department did not make any changes to the proposed rules based on these comments.
Public Benefit
Comment--One commenter claims that there is no public benefit by regulating TNCs statewide and that uniform regulation does not improve the public safety, security or convenience. This commenter suggests that the rules be implemented on a one year trial basis.
Department Response--In response to the comment the Department concludes that the legislature has found that there are multiple benefits to public safety, security and convenience offered to the public through transportation network services. The Department further finds it inappropriate to question the validity of legislative findings supporting the adoption of House Bill 100 from the 85th legislative session. The Department continuously reviews its rules for relevancy and has the authority to adjust rules as the need arises.
Vehicle Requirements
Comment--The Coalition of Texans with Disabilities expressed concern about the four-door eligibility requirement in Occupations Code 2402.111(a)(2)(A). This commenter believes that the four-door requirement may have the unintended consequence of limiting the number of vehicles eligible to transport persons in fixed-frame wheelchairs.
Department Response--The Department believes this comment has merit because the statute requires transportation network companies to provide rides for persons using fixed-frame wheelchairs and to limit the availability of those vehicles would frustrate the statutory purpose related to the transport of persons with disabilities. Therefore, the Department harmonizes and interprets Occupations Code 2402.111(a)(2)(A) not to apply to vehicles capable of transporting fixed-frame wheelchairs and renumbered the §95.100 by adding a new §95.100(b) to reflect this interpretation.
95.91. Administrative Sanctions
To clarify the Department’s authority to impose administrative penalties and sanctions, the Department made non-substantive changes to §95.91 aligning the Commission’s authority with the authority set forth in Occupations Code Chapter 51.
Various Issues Outside the Scope of this Rulemaking
Comment--At least one commenter submitted comments addressing the following issues: (1) the transportation of minors; (2) background checks; (3) safety enhancements; (4) driver input; (5) surge pricing; (6) consumer ratings; (7) fares; (8) trade dress or the display or company insignia; (9) allowing drivers to unionize; (10) uncompensated wait times for drivers; (11) drivers being able to opt out of company requirements such as car pool programs; (12) the Department housing driver data and insurance information and making this information available for the public; (13) requirements for drivers to disclose to their insurance company that they are driving for a transportation network company; and (14) unfair practices of TNCs such as exclusive use of credit cards or certain technology requirements.
Department Response--The Department acknowledges the importance of each of the fourteen comments submitted by the industry and the concerns expressed on behalf of the public. However, the Department finds that the issues are outside of the statutory authority of the Commission and the Department.
At its meeting on October 20, 2017, the Commission adopted the proposed rules with changes as recommended by the Department which are incorporated in these rules.
The new rules are adopted under Texas Occupations Code, Chapters 51 and 2402, which authorize the Commission, the Department’s governing body, to adopt rules as necessary to implement these chapters and any other law establishing a program regulated by the Department.
The statutory provisions affected by the adoption are those set forth in Texas Occupations Code, Chapters 51 and 2402. No other statutes, articles, or codes are affected by the adoption.
95.1. Authority.
This chapter is promulgated under Texas Occupations Code, Chapters 51 and 2402.
95.2. Definitions.
Unless otherwise defined in this chapter, each term used in this chapter has the meaning assigned by Texas Occupations Code, Chapter 2402 and Texas Government Code, Chapter 2001.
(1) Airport– means an airport owner or operator.
(2) Cruise Ship Terminal – means a governing body of a governmental entity with jurisdiction over a cruise ship terminal.
95.10. Rule Construction.
(a) Nothing in these rules shall be construed to:
(1) prohibit an airport or cruise ship terminal from:
(A) imposing regulations including a reasonable fee to or from airport or cruise ship terminal;
(B) enforcing those regulations in a manner consistent with any compliance, assurances, and obligations under federal law, rules, regulations, and policies; or
(C) from requesting third-party auditable reports of the numbers of rides to and from an airport or cruise ship terminal; or
(2) authorize an airport or cruise ship terminal to compel data sharing or to impose additional requirements on a personal vehicle or driver; including, tracking of the vehicle or driver when logged into the digital network.
(3) prohibit transportation network companies and airports or cruise ship terminals from entering into mutual data sharing agreements.
(b) For purposes of this section, a reasonable fee means a fee:
(1) established using one of the following fee setting methodologies for airports which provides for a self-sustaining and market based fee consistent with guidelines published by the Federal Aviation Administration and:
(A) imposed on May 29, 2017 by an airport;
(B) calculated by the costs of airport facilities and services used for non-aeronautical services including a market-based return proportionate to the uses of the facility. The fee resulting from the fee setting methodology must be transparent, and not unjustly discriminatory.
(C) for an airport that did not have a fee imposed on the date referenced in paragraph (1)(A), and that adopts the fees imposed on the date in paragraph (1)(A) by an airport with a similar number of passengers boarding annually, or uses the fee setting methodology in paragraph (1)(B); or
(D) mutually agreed upon by the transport network company and the airport.
(E) A reasonable fee established under this section may include an adjustment escalator option based on an appropriate index selected by the airport which incorporates geographic economic conditions.
(2) the fee setting methodology for cruise ship terminals using one of the following fee setting methodologies including fees:
(A) imposed on May 29, 2017 by a cruise ship terminal;
(B) calculated by the costs of cruise ship terminal facilities and services including a market-based return proportionate to the uses of the facility. The fee resulting from the fee setting methodology must be transparent and not unjustly discriminatory;
(C) of a cruise ship terminal that did not have a fee imposed on the date referenced in paragraph (2)(A), and that adopts the fee imposed on the date in paragraph (2)(A) by a cruise ship terminal with a similar number of passengers boarding annually, or performs a cost-of-service study under paragraph (2)(B); or
(D) mutually agreed upon by the transportation network company and the cruise ship terminal.
(E) A reasonable fee established under this section may include an adjustment escalator option based on an appropriate index selected by the cruise ship terminal which incorporates geographic economic conditions.
95.20. Permit Required.
A person may not operate a transportation network company in this state without first obtaining and maintaining a transportation network company permit.
95.21. Permit Terms.
A transportation network company permit issued under this chapter is:
(1) valid for one year from the date of issuance;
(2) valid throughout the state; and
(3) nontransferable.
95.22. Transportation Network Company Permit Initial Application.
To be eligible for a transportation network company permit, an applicant must:
(1) submit a completed application on a form and in the manner prescribed by the department;
(2) provide electronic proof of insurance with the policy coverage required by Texas Occupations Code, Chapter 2402;
(3) certify that the applicant meets the requirements of Texas Occupations Code, Chapter 2402; and
(4) pay the fee set out under §95.80.
95.23. Transportation Network Company Permit Renewal Notice and Application.
(a) The department will send written notice to permit holders at least thirty (30) days before the permit expires. The notice will be emailed to the permit holder's last known email address in the department’s licensing records.
(b) To be eligible to renew a permit, a permit holder must:
(1) submit a completed application on a form and in the manner prescribed by the department;
(2) provide electronic proof of insurance with the coverage required by Texas Occupations Code, Chapter 2402;
(3) certify that the applicant continues to meet the requirements of Texas Occupations Code, Chapter 2402; and
(4) pay the fee set out under §95.80.
(c) Late Renewal.
(1) To maintain continuous licensure, the renewal requirements under this section must be completed prior to the expiration of the permit.
(2) A late renewal means the permit holder will have an unlicensed period from the expiration date of the expired permit to the issuance date of the renewed permit. During the unlicensed period, a transportation network company must block drivers access to the digital network.
(3) Non-receipt of a permit renewal notice from the department does not exempt a permit holder from the requirements of this chapter.
95.30. Permit Issuance.
The department will issue a permit under this chapter to an applicant who meets the eligibility requirements for a permit.
95.31. Permit Denial.
The department may deny an application or revoke a permit if the applicant, a partner, principal, officer, or general manager of the applicant has:
(1) violated an order of the commission or executive director, including an order for sanctions or administrative penalties; or
(2) submitted false or incomplete information on the application.
95.40. Responsibilities of the Department.
(a) Unless otherwise provided by statute or this chapter, the department may send notice of department proposed actions and decisions through email sent to the last email address designated by the permit holder in the department’s licensing records.
(b) At licensure, the department will provide the permit holder with the requirements for the accessibility pilot program report required by Texas Occupation Code, Chapter 2402.
95.5. Reporting Requirements.
(a) For purposes of this section “Market” means the legal boundaries of a municipality as defined in Section 1.005 of the Local Government Code or the metropolitan statistical area as defined by the Office of Management and Budget.
(b) A permit holder must electronically file with the department reports required by subsections (c)(1) and (d).
(c) For purposes of the required Disability Compliance Report, the transportation network company is required to submit the information in subsection (c)(1) and (c)(2) within the 100th day after the transportation network company begins a pilot program.
(1) Disability Compliance Report. A report under this paragraph must include:
(A) Criteria for determining the four largest markets that the transportation company operates in this state;
(i) Identify the market(s) the transportation network company implemented the Accessibility Pilot Program; and
(ii) Explain the reason(s) for selecting the market(s) that the transportation network company used to implement the Accessibility Pilot Program.
(B) The services offered to disabled persons, including disabled persons using a fixed-frame wheelchair.
(C) A step-by-step explanation demonstrating the process for an individual to join and utilize the accessibility functions of their transportation network service Accessibility Pilot Program.
(D) A detailed plan that ensures referrals to alternate providers of fixed-frame wheelchair-accessible service are made in a manner that does not unreasonably delay the provision of service. The detailed plan must at a minimum:
(i) explain why the alternate provider of fixed-frame wheelchair-accessible service will not cause unreasonable delay in service;
(ii) include the initial number of alternate providers;
(iii) provide the average number of vehicles equipped to provide fixed-frame wheelchair-accessible service and available to each alternate provider;
(iv) state the hours each alternate provider of fixed frame wheelchair-accessible service is available for service; and
(v) describe the procedures to monitor and ensure alternate providers meet and maintain service levels that do not unreasonably delay fixed-frame wheelchair-accessible service.
(2) Disability Compliance Report Data Requirements. A report under this paragraph also must include:
(A) The number of vehicles equipped to accommodate a passenger with a fixed-frame wheelchair that were available through the company’s digital network in the pilot program market.
(B) The number of fixed-frame wheelchair requests.
(C) The number of rides provided to fixed-frame wheelchair-bound passengers.
(D) The number of instances in which the company referred a fixed-frame wheelchair-bound passenger to an alternate provider because the passenger could not be accommodated by the company.
(E) Average wait times for Accessibility Pilot Program market area. The permit holder must track and report the average time elapsed between the time a passenger initially requested a ride and the time the ride began for each:
(i) fixed-frame wheelchair-bound passenger serviced by the permit holder;
(ii) fixed-frame wheelchair-bound passenger referred to an alternate provider; and
(iii) non-wheelchair accessible requested ride.
(3) A report submitted under this subsection that fails to demonstrate compliance will be considered incomplete and subject to correction and resubmission.
(4) The report must contain a table of contents with each section of the report marked to identify the content cross referenced to each paragraph and subparagraph of this section.
(5) A transportation network company may submit supplemental reports to the department every 90th day.
(d) Accessibility Pilot Program Report. The report required by this subsection must be aggregated in ninety (90) day increments. The report must include final values for the entire period of the Accessibility Pilot Program and at a minimum include:
(1) The number of vehicles equipped to accommodate a passenger with a fixed-frame wheelchair that were available through the company’s digital network in the pilot program market.
(2) The number of fixed-frame wheelchair requests.
(3) The number of rides provided to fixed-frame wheelchair-bound passengers.
(4) The number of instances in which the company referred a fixed-frame wheelchair-bound passenger to an alternate provider because the passenger could not be accommodated by the company.
(5) Average wait times for Accessibility Pilot Program market area. The permit holder must track and report the average time elapsed between the time a passenger initially requested a ride and the time the ride began for each:
(A) fixed-frame wheelchair-bound passenger serviced by the permit holder;
(B) fixed-frame wheelchair-bound passenger referred to an alternate provider; and
(C) non-wheelchair accessible requested ride.
95.5. Notification of Operations at Airports and Cruise Ship Terminals
A permit holder must provide the controlling authority of each airport or cruise ship terminal written notice of its operations or its intent to operate within their jurisdiction. Notification must be provided within thirty (30) days after receipt of a permit issued under this chapter.
95.70. Maintain Current Email Address
A permit holder must provide to the department a valid email address and must keep the email address current during the term of the permit.
95.71. Data Integrity, Name Changes, Address Changes, and Address Additions
(a) A permit holder is obligated to ensure and maintain the accuracy of all information it provides to the department pursuant to this chapter.
(b) A permit holder must notify the department in writing of any change to trade name, mailing address, physical address, email address, or telephone number on file with the department within fifteen (15) days of making such change.
(1) The notification shall identify the person making the change and the affected permit number.
(2) A notice of name change including trade name changes and trade name additions shall include supporting documentation from the Texas Secretary of State.
(c) In the event of a trade name change or an address change, the permit holder shall submit on forms approved by the department, a request for this change and pay, if any, the fee required by §95.80.
(d) A change requested under this section shall not be effective until approved by the department.
95.72. Deceptive Practices Prohibited
A permit holder may not conduct business or advertise under a name that is deceptively similar to a name used by any other licensed transportation network company licensed under this chapter unless specifically approved in writing by the executive director.
95.80. Fees
(a) All fees are nonrefundable except as provided for by commission rules or statute.
(b) Transportation Network Company Permit Fees:
(1) Original Application--$10,500
(2) Renewal--$7,500
(3) Permit Amendment--$25
(4) Address change--$25
(5) Name change--$25
(c) Late renewal fees for licenses and permits issued under this chapter are provided under §60.83 of this title (relating to Late Renewal Fees).
95.90. Authority to Investigate
For purposes of investigating compliance with, or a violation of, these rules or applicable law, a permit holder must make records, drivers and vehicles logged into the transportation network service available to the department within ten (10) days of the request or within the time agreed to by the department.
95.91. Administrative Sanctions
The department may suspend or revoke a permit issued to a transportation network company for violating a provision of Occupations Code, Chapter 2402, or impose administrative penalties, sanctions and civil remedies authorized by Occupations Code, Chapter 51 for violating a rule under this chapter, or order issued by the executive director, or regulation adopted by an airport or cruise ship terminal.
95.100. Statutory Compliance
(a) A permit holder must implement and follow all technical and operational requirements in Texas Occupations Code, Chapter 2402 including the timely filing of reports.
(b) For purposes of compliance with 2402.111(a)(2)(A), a transportation network company shall consider a vehicle capable of transporting fixed-frame wheelchair passengers in the cabin as eligible.
This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be a valid exercise of the agency’s legal authority.
Filed with the Office of the Secretary of State, on November 7, 2017.
Brian E. Francis
Executive Director
Texas Department of Licensing and Regulation