The Senate Committee on Transportation was called to order by Chairman William R. O'Donnell, at 9:30 AM, on Saturday, March 27, 1999, in Room 1214 of the Legislative Building, Carson City, Nevada. Exhibit A is the Agenda. Exhibit B is the Attendance Roster. All Exhibits are available and on file at the Research Library of the Legislative Counsel Bureau.

COMMITTEE MEMBERS PRESENT:

Senator William R. O'Donnell, Chairman

Senator Mark Amodei, Vice Chairman

Senator Lawrence E. Jacobsen

Senator Maurice Washington

Senator Raymond C. Shaffer

Senator Valerie Wiener

Senator Terry Care

STAFF MEMBERS PRESENT:

Joan Moseid, Committee Secretary

OTHERS PRESENT:

Chairman O’Donnell opened the hearing on S.B. 491. Chairman O’Donnell noted that S.B. 296 and S.B. 324, on which testimony has already been heard, also address the same issue as S.B. 491, but there are some conflicts between the bills.

Senator Care went on the record that his law firm has a client who has an application pending before the Transportation Services Authority (TSA). He said depending on how the hearing goes, he would check with the Legislative Counsel Bureau later as to whether or not he has to abstain.

Tony Sanchez, Lobbyist, Peter Eliades, explained that Assembly Bill 366 of the Sixty-ninth Session separated transportation from utilities, creating the TSA. At that time, efforts were made to merge the TSA with the Taxicab Authority (TA) in Clark County, but the session ended before the details could be finalized.

Mr. Sanchez said S.B. 491 would merge the TA with the TSA, changes provisions for judicial review of decisions by the TSA, changes provisions pertaining to leased taxicabs, increases certain administrative incremental penalties, and places a fee on the operation of limousines. Mr. Sanchez noted section 31 deals with "diversion." He explained "diversion" is when a taxi driver diverts a tourist passenger to a business other than the one requested, and the business tips the taxi driver for bringing customers. He averred "diversion" is already covered by law for taxi drivers, but not the businesses. He said section 31 is a consumer provision that would go after the businesses that encourage "diversion." He stated that Clark County and the taxicab and limousine industry in southern Nevada endorse section 31.

Senator Wiener commented that she had attended a show opening where several seats had been reserved for cab drivers in hopes they would share the experience with their passengers. She wanted to know if that gesture would fall under the bill. Mr. Sanchez pointed out the bill is aimed at drivers who divert a passenger from an already selected destination; knowing they would receive a tip for doing so.

Senator Wiener expressed her concern that perks (perquisites) are also a form of payment. Mr. Sanchez noted the Clark County Code section 8.20.297 specifically prohibits anything at all being given to cab drivers. He said the agencies do not have the manpower to go after hundreds of cab drivers. The codes exempt prior arrangements made with a taxicab company, and not individual drivers, to promote, for example, the opening of a new property.

Senator Shaffer noted that the Legislature is told to address state issues and not to get involved on the local level. In that light he wanted to know why the committee was considering the bill, and who would enforce the provisions in the bill. Mr. Sanchez answered that state law already alludes to the practice, but the TSA does not have the manpower. The bill would assist local law enforcement and district attorneys who would prosecute the businesses.

Discussion ensued as to what constitutes the perception of "diversion." Depending on interpretation of the language in the bill, just answering a fare’s question about a good place to go, and the business giving the cab driver a free cup of coffee, could result in both the cab driver and the business owner being guilty of a crime anywhere in the state.

Senator Washington queried if the word "diversion" could be used in the bill, to aid in defining the activity and the transaction of goods, services or money directly related to the practice.

Chairman O’Donnell explained that "diversion" is already illegal in Clark County for cab drivers. Since it takes two for the practice to work, the bill would include the business licensee who is also culpable. Chairman O’Donnell asked Mr. Sanchez to expound on the TSA in relationship to the bill.

Mr. Sanchez elucidated that under state law the Transportation Services Authority has jurisdiction over the entire state, except for taxicabs in Clark County. The TSA also has regulatory authority over limousines; household goods carriers; and, to some extent tow trucks and buses. He added that the bill would bring all these transports under one agency for greater efficiency of regulation, service, and cost savings.

Senator Washington asked about section 19 and the fees. He wanted to know how they work, and how they work in relation to TSA. Mr. Sanchez iterated it was his understanding that the TSA would be solely funded from the Highway Fund. He said he would propose an amendment to leave the taxicab medallion fee at $100, and not raise it. He said the bill would put a $1,000-a-year fee on limousines, which do not now pay a fee. Mr. Sanchez said he would propose an amendment to set the limousine fee at $500 a year. He iterated that with the proposed amendments the annual revenue generated from fees would be $400,000 that would not have to come out of the Highway Fund. He noted that further consideration would need to be made to distinguish interstate from intrastate buses. He said the bill would raise the annual fee of household goods vehicles and tow vehicles to $500 for each vehicle.

Senator Washington wanted to know the intent behind sections 22-24, which define an independent contractor or a lessee, and would gradually reduce the number of leases to zero, by January 1, 2006. Mr. Sanchez explained that in southern Nevada, leasing and subleasing to drivers is not permitted; the practice is only active in the Reno area. He said the rationale is that it costs more to regulate and enforce leased cabs.

Senator Wiener surmised that essentially a driver and his leased taxi would be functioning as a separate entity from the company who leases the vehicle. She wanted to know how that is addressed.

John F. Mendoza, Chairman, Transportation Services Authority, Department of Business and Industry, stated the intent of the bill was to combine all the regulatory agencies of the transport industry under one agency for better efficiency and service. He noted the bill specifically differentiates between the regulations in Clark County and those in the northern areas.

Mr. Mendoza expounded the independent-contract provision was passed by the Legislature to allow operators to enter into a contract between a third party, the independent contractor, and that contract has to be approved by the TSA. The jurisdiction over the license is still vested with the operator who has the certificate. He said, further, any lease agreement is required to be approved by the TSA. In one instance a fraud had been perpetrated, in that the business noted on their lease agreement that it had been approved by the TSA, and never were. The other evidence found was they shredded approximately 340 lease agreements, depriving TSA the right to view those documents. He said it is very important that TSA know the relationship between the operator and the lessee.

Senator Wiener asked what happens to leases that are for longer than the projected phase out by 2006. Mr. Mendoza responded an agreement such as described would most likely be subject to many legal challenges from both sides, because a regulated business is subject to statutes and to contract law.

Senator Washington noted there was only one county permitting leasing at this time. He wanted to know the number of leased vehicles currently on the road, because the argument for phasing out leasing is the cost to TSA to regulate.

Francis A. Arenas, Manager of Transportation, Transportation Services Authority, Department of Business and Industry, answered that the number of independent-contractor drivers in Washoe County is 507. He said the extra cost factor comes from dealing with leases and independent-contractor drivers; when investigators have to spend more time determining who is liable, and who is at fault regarding what default or violation might have occurred under statute. To do this the lease agreement has to be reviewed, and the type of violation determined.

Senator Washington observed the bill called for at least one commissioner, but no more than two, to be from Clark County. He noted there is no mention about representation from other parts of the state. Senator Washington emphasized in order to ensure regional interests are covered, he would suggest an amendment to the bill to include one commissioner from the northern area of the state.

Senator Wiener noted that the commission would consist of three members. She said the special requirements are limiting, and suggested increasing the number of commissioners to five, in order to cover the concerns of all the state.

Mr. Sanchez stated the Governor has the option of placing the commissioners around the state. He added meetings are already being conducted by telephone and videoconferencing.

Garland Knopp, representing Action Moving and Storage, stated in conversation with other movers, he found they like the bill in general. He said he liked the idea of towing of vehicles used in the illegal transport of household goods. He also liked funding as being contributed.

Al Puliz, Puliz Moving and Storage Company, said he supports the bill except for the method of funding. He opined that moving and storage companies are very diversified as far as services, for example, interstate, and non-regulatory work; such as office, industrial, and other types of moving. The bill only covers the moving of household goods within Nevada. He said of his company’s 40 vehicles, only 20 percent deal with household goods. Based on those numbers, Mr. Puliz questioned how the $500 fee per unit would be determined. For example, one of his trucks goes all over the country 99 percent of the time, but the last week in June is a busy time for movers, and he may use that truck and crew to move household goods for 1 day. He asked if his company would be charged $500 because that truck was used for 1 day. He continued that the TSA and the former Public Service Commission of Nevada (PSCN) have failed in enforcing illegal movers in Nevada.

Dawn M. Porter, representing Colonial Van and Storage, said the company has two operations in California and one in Nevada. She said that sometimes vehicles are swapped between operations. She stated she supports the bill, but the fee structure would be harmful and difficult to administer. She pointed out that the line-item surcharge already in place for taxicabs could be applied in the same way for the intrastate transport of household goods. She emphasized she liked the restriction and strong regulation of people coming into the industry, to make sure they are qualified and able to properly service the public. Ms. Porter stated that without strong regulations and strict enforcement, the bill does the industry no good.

Deborah Simpson, Lobbyist, Independent Limousine Owner/Operator Association, submitted prepared testimony, including a chart, and letters from the City of Indianapolis and the City of Cincinnati (Exhibit C). In summary Ms. Simpson said that southern Nevada’s independent limousine operators are being driven out of business by an unfair and irrational state-imposed licensing system. She said despite meeting every objective requirement to open a business, the TSA refuses to issue these safe, insured drivers certificates to operate. She maintained that under the current anti-competitive law, any new company has to prove that it would not adversely affect or compete with existing companies. This provision alone involves the existing companies in the application process through their requests for more information; creating the need for more hearings and filing fees. Denied state licenses, the would-be entrepreneurs are regularly subjected to enormous fines of up to $22,000, vehicle impoundment, and criminal prosecutions. Ms. Simpson pointed out that Las Vegas has a thriving tourist and convention industry dependent on good transportation services for its 30 million visitors a year, but the wait can be hours for service. She proposed amendments to remove the requirement of proving no adverse effect to competitors; remove the right of competing companies to intervene in the application process; create presumption in favor of granting certification based only on proof of adequate insurance, satisfactory vehicle inspection, and a clean driving record; remove power to immediately impound vehicles for alleged violation; and remove anti-competition language from declaration of legislative purpose.

Chairman O’Donnell wanted to know if there are any regulations regarding the number of limousines a licensee can put on the road. Ms. Simpson responded there is no cap. She added that the licensed companies keep adding to their fleet, while independent applicants are constantly denied access to the market.

Chairman O’Donnell wondered if the companies who add vehicles to their fleets have to first prove it will have an unfair effect on their competition. Ms. Simpson stated the existing limousine companies do not have to provide any proof; they just add vehicles.

Senator Washington said, if he understood, in the past 20 years only a handful of licenses have been granted to new limousine companies. None have been granted in the Las Vegas area, except one for handicap service. He wondered what kind of charges for an application would cost $200,000.

Ms. Simpson articulated that amount came from one instance, and there are other instances that have approached that amount. She explained that most of the money is used to respond to requests for information from competing companies that are allowed to intervene in the process by asking for customer lists, for years of business records or other information. The applicant has to bear the cost of research, copying, accounting services, a court reporter at every hearing, attorney’s fees, and other expenses. The applicant has to pay for any discovery requests, which can be made by any number of interveners, any number of times.

Senator Care asked Ms. Simpson, as an attorney, to give her interpretation and the legal effect of the language in section 30; especially how it relates to the appeals process in sections 11-18. Ms. Simpson responded that it would make it more difficult for anyone to challenge a decision of the TSA; either on a fine or an application. She said under the administration procedures act, which is how a decision is now appealed, there is already a deferential standard that the court must apply when it reviews a decision. Recently, the TSA has been brought to court five times, and won. All of those cases have been a review of fine provisions that have been assessed under the very deferential, very easy standard. It has not been cases that questioned the constitutionality of these laws that are currently pending in court. What the sections of the bill would do is create a presumption in fact for the court to further have to defer to any decision of the agency. This would make it more difficult for anyone to challenge the decision of the TSA.

Edward Wheeler, President, Premier Limousine, and Premier Luxury Coach, reading from prepared text (Exhibit D) stated in 1997 he applied to TSA for an application. The overwhelming application took more than 100 pages and over 2 months to complete. The application asked for 19 areas of information including complex financial projections of earnings and proof of need for more transportation in Las Vegas. He said the TSA gave his future competitors free reign to demand mountains of paperwork that had nothing to do with public safety. The TSA ordered him to turn over his customer list and marketing and advertising strategies. He elucidated that while state employees and representatives stood by, competitors’ attorneys asked where he planned to purchase tires, who provided cellular phone service and at what rate, did he own his home, and other nonrelative questions. He said he was in hearings for 2 days with $2,000-a-day attorney fees, and $1,000 a day for a court reporter. He iterated that after 11 months, he could no longer afford to pursue the application. He concluded that Nevada law allows him to drive a customer from Las Vegas to Los Angeles, but it does not permit him to drive the customer down the block in Las Vegas. He stated he was not in favor of S.B. 491, nor the other bills, and urged the committee to change the present system.

Richard Lowre, President, Independent Limousine Owners Association (ILOA), testified from prepared text (Exhibit E) that TSA will not grant any of the ILOA members a certificate of public convenience and necessity because they are in the business of protecting existing companies from competition. He stressed that most of the independent drivers have been put out of business; some have even lost their homes and means of providing for their families, by the few certified companies with the sanction of the TSA. He stated the ILOA supports licensing and fair regulation of the industry, but urged the committee to give careful consideration to those areas of the proposed legislation that would only strengthen the hold the few have on Las Vegas limousine services.

John Blaire, Independent Contract Driver, De Luxe Yellow Star Cab Company, said he was troubled by the TSA’s push to end leasing. He noted there is no leasing in Las Vegas, yet there are enforcement problems. He emphasized he is not getting an answer to what the difference is between enforcing a lease driver versus a commission driver. He stated he has been both a lease and commission driver and sees no difference. He said leasing allows a driver to make more money, because a commission driver shares half or more with the employer. He said the driver is the one taking the risks on the roads and with the fares. He pointed out the increased regulations would force fares up, and drivers and passengers will lose. He said that every time the fare is raised, the local ridership decreases by 10-15 percent, and it takes 6 months to a year before he starts making money again.

Senator Wiener asked for information about how a lease works and the terms of the lease. Mr. Blaire responded that where he is the lease is by the week. The driver pays in advance from $300 to $350 for an older cab, and $600 to $700 for a newer cab. The driver is responsible for gas and oil, and keeping the car clean. He added that one car can be leased to 3 or 4 people, so it is kept on the road as much as possible.

Chairman O’Donnell asked for details on the practice of diversion. Mr. Blaire said diversion is practiced mostly in Las Vegas where there are no lease drivers. Mr. Blaire said that in Reno the highest he has been paid is $3 a head. He noted that among the topless clubs, the one with the highest cover fee does not tip. He wanted to know where the greed was in that. He added there is no diversion regarding the brothels, but some of them tip up to 20 percent of what the customer spends, and then the fare also tips.

Bob Winner, representing Ambassador Limousine; Boulder Cab; Desert Cab; Lucky Cab; Nellis Cab, and On Demand Sedan, said they are all in support of S.B. 491. He stated it is a good idea to have one agency. He appreciates that there will be a review of the fee structure, since some of the rates seem a little high. He said regarding leasing, his clients think the cabs run well in their area; and take no position regarding leasing anywhere else in the state.

Senator Wiener speculated if S.B. 491 passed, then until the 2006 phase out, leasing could open up in Clark County. She also wondered what legal ramifications would result from portions of the bill being applicable in some parts of the state, but not in others.

Chairman O’Donnell responded that rules and regulations could be promulgated in different parts of the state and have it stand up in court. He speculated that a regulating body making different rules for different jurisdictions, would solicit court challenges.

Donald L. Drake, President, Baker and Drake, Inc., d.b.a. De Luxe Yellow Star Cab Company, stated that the TSA regulations would not work for both Reno and Las Vegas. He said the areas have such diverse economies in addition to other things, that what works in one area would not work well in another. He said for example, Las Vegas’ taxicab customer base is almost all tourists, while Reno’s taxicab customer base is 60-70 percent local residents. He stated he testified earlier on S.B. 324, and was subsequently visited by a TSA representative. Therefore, he is reluctant to say too much, but will comment on a statement made today by Mr. Arenas that the cost of regulation of lease drivers is so much greater. Mr. Drake stated he cannot understand how that could be. For example, when one of his drivers does not turn on his meter, the driver gets a $1,500 citation. The TSA then gives his company a ticket of $1,500 for the same violation. He said, as he sees it, with $3,000 for just one violation, there is no cost for regulation, nor a need for additional money. He said his company and another company had some errors in their master leases for which each was fined $10,000. He said he submitted a corrected lease, and after 4 years the lease has not been examined, and it is still in use. He said that the situation appears discriminatory. He claimed Mr. Mendoza made a comment that Mr. Drake had obstructed justice and destroyed evidence. Mr. Drake said the statement was made long after the investigation and the hearing was held. He asserted that his arguments are strong and his case will prevail in district court. Mr. Drake asked for the committee’s oversight and protection, because he fears repercussion as a result of his testimony.

Chairman O’Donnell acknowledged if Mr. Drake gets another visit from the TSA, he would like to know the full reason and intent behind the visit immediately, and he wants to know that from the TSA.

Chairman O’Donnell asked TSA representatives what the reason was for visiting some of the people who testified at last week’s hearing. Mr. Mendoza responded that this was the first time he had heard of a visit. Mr. Arenas said he had no personal knowledge, but added that TSA investigators go out on a routine basis to carriers to see if they are complying with the laws and regulations.

Chairman O’Donnell asked for a full report by Monday of next week about who made the visit and why.

Mr. Mendoza stated he takes umbrage that TSA is being accused in any way of being repressive; it has never been the philosophy of the agency. Members of the audience raised … (a chorus of protest). Mr. Mendoza continued that the visit was not at the direction of the commission, and if there has been negative conduct, the TSA would also like to know. He added for others who think there has been inappropriate contact, he encouraged them to submit reports for follow-up.

Mr. Mendoza addressed an earlier question by stating there is now deferential regulation in other areas of the state. He said Washoe County and Clark County are regulated on a population basis. The rural counties are included in the Washoe County designation, because there is more than 100,000, but less than 400,000 population.

Chairman O’Donnell noted that by population the TSA has jurisdiction over certain entities, whether they are taxicabs, limousines, household goods, or tow companies, it is already set in statute. However, if there is going to be an overall umbrella with established regulations by the TSA, then there is no population limitation. He said the Legislature cannot write into law that in this county you must promulgate regulations thus and so based upon population; while the next county has to be regulated differently.

Mr. Mendoza stated the TSA has regulation over everything except taxicabs in Clark County. He pointed out that the population-figure standard goes back many constitutional changes to legislation. He added the Nevada Supreme Court has continuously maintained that it is possible, so long as it is on the basis of population. He addressed fines saying that they are based on statute, which allows up to $10,000. He said the investigators take into consideration if it is a first, second or third offense, and what is really happening. He said it is only in cases where there is an egregious operation that larger fines are assessed. Some of the amounts are set by stipulation. He said in Mr. Drake’s case; a couple of drivers complained that they were being charged for things that were not covered by statute. The investigators went to the company’s office and looked at the records. The leases showed charges not covered by statute, and an audit was conducted. As a result the company was charged with fines for five violations. Mr. Mendoza said that at the hearing Mr. Drake voluntarily stated he had shredded the documents. Based on Mr. Drake’s testimony, the TSA decided to continue with the investigation because of destruction of evidence was another type of offense. Mr. Mendoza elucidated that Mr. Drake had been before the commission another time regarding leases. Mr. Mendoza expounded that over the period of the TSA’s existence there have been 30 complaints filed regarding decisions; 6 went to court; and the court found in the TSA’s favor. He added that none of the cases have been reversed.

Mr. Mendoza said only upon application does a person realize what is involved in operating a company. The applicant then understands what information is required so the TSA can analyze whether or not that person would be a good citizen, and if they are financially able to operate the business. He said the TSA has learned that if a person is not financially able to operate, they start skimping on maintenance, overcharging, and reducing payroll by hiring less-qualified drivers. He said the regulations contain seven different points which must be considered when assessing a fine. He explained that a commissioner is the hearing officer, who reports his findings to the other commissioners, who then vote on a decision.

Chairman O’Donnell asked how the funds from fines are handled. Mr. Mendoza answered the TSA has a budget for the agency’s operation; and by statute the fines do not have to go into the agency’s budget, but the use of fines money must be approved by the administration and the Interim Finance Committee. He said he is frustrated with the media and everyone else who has stories about the TSA, and none have ever been proved.

Chairman O’Donnell said he understood Mr. Mendoza’s frustration, but his office also receives numerous calls from the people who are equally frustrated with the system; and something must be done. He said these fines that go into a specific fund, he personally believes is immoral, unethical, and wrong for that to be done, and the Legislature should never have allowed that to happen. He said the perception on the part of the general public who sees a special fund for things like communications radios for vehicles, is that the agency is hiding something.

Senator Washington asked to have the application process explained as to who makes the determinations, who sits on the panel, why are so many documents requested, and why it costs upwards of $200,000 for an application.

Paul J. Christensen, Commissioner, Transportation Services Authority, Department of Business and Industry, stated that he finds the dollar amount an appalling figure; however, there are a lot of factors over which the TSA has no jurisdiction. He pointed out that the application cost cut both ways. He said the TSA is under a judicial decision by a Washoe County judge that forces them to allow interveners. He said the TSA application is similar to those for a liquor or gaming license. When an application is turned in, by law it must be noticed in the newspaper. Other businesses who think this new company may hurt their business have a right to file as an intervener and request information. The applicant also has the same right to ask for business information from the intervener. Mr. Christensen stated that the intervener and the applicant must bear all the costs; and all the TSA ever receives is the $200 application fee. He said the cost of the investigation of the applicant, as required by regulation, is borne by the agency.

Chairman O’Donnell said he has known Mr. Christensen a long time and has known him to be a "straight shooter." He asked Mr. Christensen to honestly tell the committee if there should be less regulation of the limousine and taxicab industries, and why.

Mr. Christensen responded that he did not think less regulation was prudent. He said in his limited experience with the agency, Clark County, and Las Vegas, he finds when entry is relaxed all kinds of problems occur. He said as former chairman of the Las Vegas Convention and Visitors Authority, former chairman of the Clark County Board of Commissioners, and former member of the Las Vegas City Council, he believes the average person does not have a clue how important the tourist industry is to the area. He said there are a myriad of complaints about transport service. He said in the 1960s there were the "taxicab wars," which got so nasty that taxicabs were burned. He emphasized that he did not want to return to that situation. He said over the years there have been many horror stories about experiences with taxicabs and limousines, including illegal operators charging four times the regular rate. He stressed that now he is not sure if the agency is fighting a court case or the news media.

Mr. Christensen read from an article published in the December 1998 issue of Liberty & Law (Exhibit F). He stated when he first came to the agency, he noted a number of applications pending, and proceeded to get them cleared up by holding a hearing for the applicants. He noted Mr. West had not submitted all the information requested, and Mr. West stated he would have that information by a certain date. Mr. Christensen said that Mr. West has asked for numerous delays, yet Mr. West is complaining to the media about his bad treatment. Mr. Christensen said the files are public record, and an applicant can request to look at them to see how to fill out an application. Mr. Christensen submitted a transcript from a hearing held for Mr. West, ending in dismissing the application (Exhibit G).

Mr. Mendoza submitted charts (Exhibit H) showing the breakdown of current certificated limousine carriers, and status of limousine applications filed. He said the agency is firm about setting deadlines and hearing dates; otherwise the applicants delay too much. He submitted a copy of "Taxi Industry Regulation, Deregulation & Reregulation: The Paradox of Market Failure," an article from the summer 1996 issue of Transportation Law Journal (Exhibit I).

Senator Washington stated from a lay person’s point of view, if he applied, the statements just made they would confuse him. He said he would be confused by the application, and probably cause several delays while he struggled through it. He referenced the letters introduced earlier from the cities of Indianapolis and Cincinnati saying they had deregulated their taxicab and limousine industries. He said both cities came up with the same findings that the fares were reasonable across the board, the service had improved, the drivers were more cordial, and the vehicles were cleaner and safer. He referred to the amendments proposed by Ms. Simpson, and asked if the agency could work with those proposed amendments and still regulate the industry.

Mr. Christensen said any governmental application seems like a nightmare to the average citizen. He said he could send a blank application along with one that has been filled out so the senator can see how easy they are. He said that providing the information on background, financing, and so forth is where the application can grow. He commented that the City of Denver is now experiencing problems after deregulation with most of the taxicabs and limousines at the airport, adding to the traffic congestion, and hardly any in downtown to provide service. He added that could easily happen at McCarran International Airport, and to Las Vegas.

Sven J. Nilsson, former President, Professional Drivers Association, stated he was neither for nor against S.B. 491, but said he had a critique of certain provisions in the bill (Exhibit J). He opined he is a retired taxicab driver with 38 years of experience in the taxicab industry; and is speaking out of concern for the industry and the public. He iterated the biggest problem appears to be that one hand does not know what the other hand is doing. He suggested both taxicabs and limousines be regulated by one agency, such as the Taxicab Authority (TA), because they have earned the admiration of other taxicab regulators across the country. He pointed out changes and clarifications needed in several sections of the bill, including a better definition of a limousine, so a mini-bus or compact car is not the responding vehicle.

Scott Keller, representing Coach USA, KT Services, and Gray Line, wanted to know if it was the intent of the bill to address the per capita tours sold in town. He stated there was a significant difference on diversion between his business and non-licensed operators.

Mr. Sanchez responded currently the bill would apply to common carriers. He said he could look into the practice further, if the committee so desired.

Mr. Keller iterated that a problem in Las Vegas is there are as many interstate operators providing local service as there are certificated local operators. It was his understanding that the interstate operators are exempt from all the fees.

Daryl E. Capurro, Lobbyist, Nevada Motor Transport Association (NMTA), stated that since the federal government deregulated interstate carriers, the states were preempted from interstate and intrastate regulation of carriers. He noted this is the reason for S.B. 296.

Mr. Keller commented that the big problem is the local carrier would be subject to the fees and taxes, but the interstate carriers would not have to pay anything. This situation makes it difficult to compete in pricing. He added that frequently his company brings buses from California to service conventions, and if the $500-per-vehicle tax has to be paid on those buses also, then it would make quite an impact on the local carriers.

Mr. Capurro articulated that the only conflict between S.B. 491 and S.B. 296 is that they both cover buses and tow cars. He suggested since only 10 percent of S.B. 491 deals with buses and tow cars, the reference could be removed and the NMTA would have no objection to the bill. He supports merging the TA and TSA with respect to the regulation of taxicabs and limousines.

Barry E. Jones, representing Carson Valley Movers, said it did not cost him $200,000 for his application, but it did take three separate applications over a period of 3 years before the interveners were satisfied. He said the $500 per power unit was not reasonable. He stated a study committee should be established to work on the regulations for the 2001 session. He observed there have to be more enforcement people, since two people cannot adequately cover the whole state.

There being no further testimony, Chairman O’Donnell closed the hearing on S.B. 491, and opened the work session.

Chairman O’Donnell noting the proposed amendment to section 1, subsection 3, queried if it would prevent a tow-car operator from being on any future rotation. Mr. Capurro responded that he did not agree with the language restricting the tow-car list only to the state, since Las Vegas Metropolitan Police Department (Metro) already has a monopoly situation, and would not want to add carriers. He said the bill would not change that situation, so he did not know the purpose of the amendment.

Chairman O’Donnell asked Mr. Capurro if his concerns would be addressed if the bill were amended to provide only the tow-car companies on rotation as of June 30, 1998, would remain or return on rotation, and provide that the bill is effective upon passage and approval. Mr. Capurro articulated that he still believes that section should not be restricted to the state.

Clark C. Whitney, General Manager, Quality Towing, said he would go along, to get along.

Senator Care stated it would be all right with him if the language in lines 12-20 were struck from the bill. He observed that it is alright for companies to be affiliated; but, because of an alter ego theory in law, the tow cars should have different licenses, different policies, and insurance, so they truly are separate companies. He iterated that was Metro’s objection.

Mr. Whitney stated the tow cars do operate under different business licenses and with different equipment. The object of getting together is cheaper and fairer insurance can be had if there is a nationwide policy.

Mr. Capurro indicated he would have no objection to the removal of subsection 3, paragraphs (a), (c), and (d), but to leave paragraph (b) regarding insurance.

*****

Chairman O’Donnell reviewed the proposed amendments, summarizing that at the discretion of the ambulance driver, they can turn off or turn on the siren on the freeway, as needed.

*****

There being no further business, the meeting was adjourned at 2:15 p.m.

RESPECTFULLY SUBMITTED:

Laura Adler

Committee Secretary

APPROVED BY:

Senator William R. O'Donnell, Chairman

DATE: