Streetsblog Capitol Hill reported yesterday that the U.S. DOT would end a Bush-era mandate to reward new transit projects for using private contractors — but a similar pro-privatization rule for bus service remains in effect, preventing local transit agencies from competing with private charter companies.

Fairgoers in Minnesota depart a private charter bus that benefited from federal rules barring competition with public transit agencies. (Photo: Star-Trib)

The rule, finalized last year, has forced Washington D.C.’s Metrobus to stop providing free buses to Redskins football games and blocked Indianapolis’ transit agency from offering lower-cost service to the town’s famed Indy 500 car race.

This year, it’s Minnesota State Fair attendees who are contending with privatized bus service that left them waiting for hours and caused "ugly scenes," as the local Star-Tribune reports today.

The rule was intended to shield "private charter operators from unfair competition by
federally subsidized public transit agencies," as the Bush administration wrote in its initial regulatory justification. 

As a result, public transit agencies were barred from offering bus services to special events if a private company was able to do the job instead. The rule prompted outcries from the American Public Transportation Association, but it has yet to be overturned by the Obama administration.

In a June letter to senior members of the House transportation committee, 19 lawmakers — three of them Republican — asked for the rule to be reversed in the next long-term federal infrastructure bill. From the letter, spearheaded by Reps. Adam Schiff (D-CA) and David Dreier (R-CA):

By making public transit agencies ineligible to provide what has always been considered public transit service, this ill-advised [Federal Transit Administration] rulemaking contradicts federal goals to encourage public transportation to alleviate traffic congestion and improve air quality nationwide.

Charter bus service is reserved and exclusive service to events, many of which are traditionally open only to a select group. Service open to any member of the public to board and ride, without advance reservation, to a public event has always been considered public service and that definition should be restored.

That long-term infrastructure bill is likely to be delayed for at least a year at the request of the White House, however. The question is whether the FTA is willing to undo the pro-privatization rule on its own before the bill is taken up.

(thanks to commenter Brad on the Transport Politic for the link)