Defending Public Transportation Contractors
Part 1: Lead Agencies and Brokers

For decades, motorcoach providers have provided commuter-express service, under contract, to transit agencies (and, occasionally, to municipalities, counties or regions which do not have formal transit agencies).  Particularly in the past 20 years, this role has expanded: Motorcoach providers are increasingly providing service on local and regional routes, often with regular buses – not even motorcoaches.

Similarly, many motorcoach companies also own schoolbuses, and provide schoolbus service, under contract, to school districts. For decades, roughly a third of all schoolbus service has been contracted out, and this percentage has remained surprisingly consistent. For the same reasons that contracted transit service has been expanding, I expect contracted schoolbus service to soon expand as well.

Other modes, like non-emergency medical transportation (NEMT) or “ambulette” service operate solely under contract to funding agencies or their brokers. These contractors have far worse problems: Their “lead” or funding agencies are not even transportation bureauracies (like transit agencies or departments of transportation), but usually healthcare agencies. In some cases, the lead agencies are not even healthcare agencies: A few years ago, non-emergency services (NEMT, Medicaid and VA transportation) in New Jersey were “managed” by the state’s Department of the Treasury.

Paratransit services are also contracted out for the most part, where the lead agencies are mostly transit agencies. In small, rural communities, transit service to the general public is often demand-responsive; some of this is provided by public agencies while some services are contracted out.

Finally, a percentage of special needs schoolbus transportation is contracted out – often to those contractors which provide general education pupil transportation to the same school districts. This practice is less common because the students who use these services are far more vulnerable, and many school districts like to maintain tighter control over the quality of service. In contrast, transit and healthcare agencies responsible for paratransit and non-emergency services cannot wait to pawn off the responsibilities to deal with them to contractors, particularly as the contractors indemnify them, and “hold them harmless,” for all errors and omissions. When brokers are shoehorned in to relieve lead agencies from even the fumes of supervisorial responsibility, these agencies are insulated by two layers of indemnification.

Trends, Trials and Tribulation

The significant amount of public transportation service contracted out reflects a number of factors including:

• Contractors almost always provide the service for less money than public agencies – even accounting for the often bloated bureaucracies still ostensibly in charge of managing and monitoring service, and the high costs of service, overall, as a result. While thoroughly indemnified, these lead agencies and brokers still control many of the most critical factors which affect safety. The most obvious of these factors are the design of routes, the selection of stops, the establishment of schedules and/or the assignment of trips.

• In the case of shared-ride demand-responsive services, they are usually contracted out because they are far more complex to design (when any semblance of design is even performed) and exponentially more complex to operate.¹ Especially where design is non-or-barely-existent, operations are even more complex. Transit agencies at least have transit bureaucrats in charge, and most agencies contain staff with varying degrees of skill in at least setting parameters for their scheduling software. The same is not true for school district bureaucrats. However, the complexity of demand-responsive schoolbus service (mostly for “special needs” students) is far less than paratransit or NEMT service: In special needs service, routes and schedules are largely the same from day to day, all year long (notwithstanding cancellations). So, along with a greater concern for more vulnerable students, special needs school transportation is less often contracted out.

• Regarding fixed route general education schoolbus service, many or most school districts have a weak command of route design, stop selection and the array of things that can go wrong when they are not designed properly (see http://bit.ly/TAWhopiksstps;  http://bit.ly/TAEvalStps; http://bit.ly/TADsmgBetwStps; http://bit.ly/TAStpPos; http://bit.ly/TACrsOrient; http://bit.ly/TABsSpsLndMns). However, the same routes operate largely unchanged throughout the schoolyear. Plus, for decades, routes, schedules and stops have been established by software (which simply optimizes the chaos from the lack of design). So the principal issue related to contracting out service is cost.

• As noted, contractors are universally required to indemnity or “hold harmless” their lead agencies – effectively relieving themselves of any accountability for incidents. (Enlightened attorneys coupled with competent experts can usually pierce this accountability – even while the contractors pay for its monetary components.) In reality, lead agencies commit many errors and omissions which contribute to incidents, and/or which create an operating environment which makes it challenging and/or unprofitable for their contractors to avoid the risks.

• Unlike most public agencies, contractors’ drivers are typically not unionized. But even when they are (the larger contractors more commonly are), the lead agencies can screen out the onerous union provisions by disallowing them in the requests for proposals to which contractors are required to submit bids.

• Most elusive of these factors – and a central theme that will weave in and out of this series of installments – is that few plaintiffs’ attorneys bother to file against lead agencies or brokers who are often largely (and in some cases almost solely) responsible for the incidents. While excellent, honest hardworking plaintiffs’ attorneys exist, they hardly abound.

As a result of these and other factors, lead agencies effectively operate with near-complete impunity – again, often insulated by a second layer of brokers. With no accountability (or rare or marginal accountability at best), in a society lacking accountability in general, contracting is a major force: With the cost savings, indemnification, elimination or minimization of union-related constraints, and the avoidance of complexity, contracting is hard to resist. The problem is, of course, that contractors do not make many major decisions, and are often victimized by hapless policy-making and planning decisions which lead to incidents for which they are most-often blamed – even where much or all of the errors and omissions are not their fault.

Immunity and Impunity

The degree to which impunity mirrors immunity varies considerably by mode. At one end of the spectrum, despite its many shortcomings (particularly its disinterest in system design and efficiency), the school transportation community is vividly distinguishable from fellow modes in that officials, management and staff alike love and adore the passengers. At the other extreme – transit service and many paratransit services – officials, management and staff loathe the passengers.

This disposition is particularly true of disabled passengers, and even more so for wheelchair users. Such passengers require more time (particularly wheelchair users – who must be loaded and unloaded via a lift or ramp even while their chairs are often not secured) and are clearly more trouble (and more confrontational since their wheelchairs are so often not secured – particularly on fixed route services). These passengers subject their transporters to greater “exposure” because of the body of regulations (mostly the Americans with Disabilities Act) designed to protect them. And particularly with the paucity of knowledge about, and disinterest in, designing paratransit services, costs for transporting these passengers by paratransit are dramatically higher than those for transporting them by fixed route services.

Motorcoach operations lie in between these extremes. But other than when contracted by transit agencies, their concern for passengers lies closer to that of school districts. Even where management and drivers may not care about passenger safety as a personal matter, the motorcoach operating environment revolves heavily around the notion of “customer service.”

Motorcoach service is also peculiar in that it encompasses a mix of excellent safety features juxtaposed on a reckless disregard for other aspects of it.  An example of this disregard is the common disinterest in fatigue-related factors in the driver assignment process (see http://bit.ly/TADrFtg; http://bit.ly/TAHOSprobs.). Similar is the disregard for the likelihood of drivers possessing Obstructive Sleep Apnea (see http://bit.ly/TABusLag1; http://bit.ly/TAbusLag2; http://bit.ly/TABusLag3; http://bit.ly/TABusLag4 and https://bit.ly/3qA0sGp). At the other end of the spectrum, the concern for comfort often ropes in safety along with it. Plus many motorcoach practices and characteristics – such as the prohibition of standees, heavily-padded forward-facing seats, pneumatic suspension systems and, since 2015, the requirement for the installation (not the usage) of three-point occupant restraints -- provide significant safety advantages which transit service (provided with buses) does not.

Largely because of the factors cited above, more and more private transportation companies continue to operate under contract to public agencies and brokers. With the impunity these factors provide, lead agencies have increasingly asserted more and more control over key operating parameters. And as they do – particularly when they sandwich in brokers to ostensibly oversee and direct operations – the decisions these agencies and brokers make are increasingly responsible for incidents in which their contractors are involved. In some cases, the operating environments created  by these agencies and/or their brokers leave the contractors few reasonable opportunities to operate safely. As a consequence, compromises of passenger, pedestrian and motorist safety abound (see https://www.safetycompromises.com/ ).

Defending Contractors

Because of these factors and trends, defending contractors is gradually becoming easier – at least for those who understand the complex dynamics involved in both operations and the impacts which the even-more-complex dynamics of the relationships among operating agencies,  lead agencies and brokers create. This is not to say that contractors are never at fault. But they are rarely solely at fault. In some cases – most commonly in the NEMT sector when contractors operate under the alleged “direction” of brokers – it is challenging to place much fault on contractors for even the worst incidents.

This reality is not easy for even a seasoned expert witness to learn. That is because so few attorneys are willing to file against lead agencies and, particularly, brokers, particularly in certain sectors. (The reasons for this will be explored, in detail, in a future installment in this series.) So the opportunities to review the relationships between contractors and brokers are usually limited, and most plaintiffs’ attorneys focus only on the smaller fish directly in front of them whose involvement can be understood or expressed in simple terms, and where the lawsuits require significantly less effort, less understanding and less cost.

Because the negligence is almost indefensible, I have always been reluctant to serve on the defendant’s side of a wheelchair tipover case.  However, I recently departed from this pattern on a case where I agreed to help defend a nursing home whose staff members were blamed for a wheelchair tipover largely because the plaintiff’s attorney was too cheap and lazy to file against the broker which selected the contractor, governed its operations, poisoned its operating environment with reckless disregard and a degree of stupidity offensive to anyone with a modicum of knowledge about operations. Examining the evidence, I found the brokerage contract so onerous that it was almost impossible for a contractor to operate safely in the operating environment which the broker and its hapless lead agency had created. The unlucky contractor on whose vehicle the incident occurred was, in fact, scapegoated for the incident by the broker, and never assigned any further trips – effectively destroying the company. But while I am not helping to defend that long-gone contractor, I learned along the way that it “never had a chance,” and could only have regularly (if even occasionally) secured a wheelchair at great financial risk. The notion that the plaintiff’s nursing assistant – working for my carrier’s client -- was responsible for it was preposterous.

In future installments in this series, I will explore the relationships between contractors and their lead agencies and brokers in great detail. Armed with such knowledge, and an expert who understands these dynamics intimately and has had experience dealing with them as a contractor, a contractor’s attorney (selected by its carrier) can learn about these relationships and defend his or her client. Of course, few or no attorneys read NATIONAL BUS TRADER (although many do review reprints of many of my articles in excellent attorney-oriented resources like the newsletter of experts.com). So it is incumbent upon the readers of publications like NATIONAL BUS TRADER to explain these relationships to their carriers’ counsel. And these attorneys must, in turn, explain them to their carriers so that they permit their attorneys to make the effort needed to defend their clients when the facts provide grounds for doing so (or at least sharing the “damage pie”).

Without connecting these dots, contractors’ carriers are simply going to permit their counsel to dance around a bit and try to lower the settlement value through the trio of lies, spoliation and shenanigans which comprise the defense in most cases where genuine fault exists at some level. Armed with this understanding, both carriers and their attorneys will have other  and, usually, better choices.

¹ No better illustration of this is that schoolbus service in the U.S. began largely with buckboards. After the first day of school, no drivers were needed: The horses effectively learned the routes and stops – although they could not make adjustments for absentees (or “no-shows”) and the technology to communicate cancellations did not exist. This hardly mattered because, in the era before telephones were common, drivers could not do so either.

Ned Einstein is the President of Transportation Alternatives, a passenger transportation and automotive consortium engaged in consulting and forensic accident investigation and analysis (more than 600 cases). Specializes in elderly, disabled, schoolchildren. Mr. Einstein has been qualified as an Expert Witness in accident analysis, testimony and mediation in vehicle and pedestrian accidents involving transit, paratransit, schoolbus, motorcoach, special education, non-emergency medical transportation, taxi, shuttle, child transport systems and services...

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