36 CFR Part 1192 Americans with Disabilities Act (ADA) Accessibility Guidelines for Transportation Vehicles (2016 Non-Rail Vehicle Guidelines) - Preamble

1. Costs: Summary of Methodology and Results

On the cost side, the Final RA estimates the economic impact of new or revised requirements in the 2016 Non-Rail Vehicle Guidelines that are expected to have an incremental impact relative to the existing guidelines or current transit industry practices. As with the proposed rule, most of the changes in the 2016 Non-Rail Vehicle Guidelines are stylistic or editorial only, and thus not expected to have an incremental cost impact. There are, however, five requirements (or related sets of requirements) in the 2016 Non-Rail Vehicle Guidelines for which regulated entities are expected to incur incremental compliance costs. One of these requirements (i.e., automated stop and route announcement systems) applies only to certain large transit agencies. The other four requirements—signage for accessible seating and doorways, exterior destination or route signs, public address systems, and stop request systems—while applicable to non-rail vehicles, are only “new” for OTRBs. (Such requirements have been in effect for buses and vans since 1991.)

For purposes of assessing the likely cost impact of these five requirements over the 12-year regulatory time horizon, the Final RA uses a unit cost approach that reflects both initial costs (e.g., equipment, installation, and training) and ongoing costs (e.g., operation and maintenance), as applicable for each respective requirement. While the cost methodology used in the Final RA builds on the cost methodology used in the regulatory assessment that accompanied the proposed rule, see U.S. Access Board, Cost Estimates for Automated Stop and Route Announcements (July 2010) (copy available on agency website), it also incorporates revisions to certain estimates, assumptions and modelling approaches. These changes were made to, among other things, address comments, reflect changes in the 2016 Non-Rail Vehicle Guidelines, and incorporate updated research or data. Revisions and updates reflected in the Final RA’s cost methodology include: use of three (rather than two) sets of cost assumptions—low, medium, and high—when estimating incremental costs of the 2016 Non-Rail Vehicle Guidelines; incorporation of the four new accessibility requirements for OTRBs into the cost model; evaluation of the cost impact of the automated announcement systems requirement using three size-based “tiers” (Tiers I, II and III) for large transit entities; and, addition of a small business analysis.

In sum, the Final RA estimates annual costs of the five new or revised accessibility requirements in the 2016 Non-Rail Vehicle Guidelines with incremental impacts for each of the twelve “regulatory years” and, within each of these years, separately for each of three (i.e., “high,” “medium/primary,” and “low”) cost scenarios. (Annual costs estimates under each cost scenario are generated by respectively indulging all applicable “high” cost assumptions, all “medium” cost assumptions, and all “low” cost assumptions.) Generally speaking, the “medium” cost estimates collectively serve as the primary scenario in the Final RA when calculating incremental costs because it models the most likely set of cost assumptions, while the “low” and “high” cost estimates respectively provide the lower- and upper-bound cost projections.

In terms of results, the Final RA evaluates the cost impact of the new accessibility requirements in the 2016 Non-Rail Vehicle Guidelines from three main perspectives: total costs; annualized costs to large transit entities for automated announcement systems; and annualized costs for the four accessibility requirements that are newly applicable to OTRBs. The results for each of these three cost perspectives are summarized below.

Annualized Cost of New or Revised Accessibility Requirements in the 2016 Non-Rail Vehicle Guidelines

Table 3 below provides the annualized cost, under each of the Final RA’s three cost scenarios, for the five new or revised accessibility requirements in the 2016 Non-Rail Vehicle Guidelines that are expected to have an incremental cost impact. All monetized costs were estimated over a 12-year time horizon using discount rates of 3% and 7%.

Table 3 - Annualized Cost of New Accessibility Guidelines in the 2016 Non-Rail Vehicle Guidelines for Buses, Vans, and OTRBs, All Regulatory Years (3% and 7% Discount Rates)

These results show that annualized costs of the 2016 Non-Rail Vehicle Guidelines will, most likely range from $4.5 million to $ 5.0 million, depending on the discount rate. Notably, even under the high scenario, annualized costs are not expected to exceed $8 million. Results from the Final RA thus demonstrate that the expected cost impact of the 2016 Non-Rail Vehicle Guidelines falls far below the threshold for economic (monetary) significance of regulatory actions provided in EO 12866. See EO 12866, § 3(f)(1) (defining “significant regulatory action” as, among other things, a rule that would likely have an “annual effect on the economy of $100 million or more”).

Annualized Costs to Large Transit Entities for Automated Announcement Systems

Second, the Final RA also examines likely annualized costs related to the requirement that large transit entities provide automated announcement systems for stop and route identification on their large vehicles operating in fixed route bus service. Large transit agencies, in turn, are defined in the 2016 Non-Rail Vehicle Guidelines as public transportation providers operating 100 or more buses in annual maximum service in fixed route bus modes, through either direct operation or contract, based on annual data required to be reported to the National Transportation Database [hereafter, “VOMS 100 threshold”]. See T104.4 (defining “large transit entity”); see also 49 CFR pt. 37 (regulations governing the DOT-administered National Transportation Database). While the scope of the automated announcement systems requirement is thus necessarily limited to larger transit entities, there are still—relatively speaking—a wide range of “sizes” within the community of covered transit agencies, which can range in fleet size from just over 100 buses operating in fixed route bus service to hundreds.

Accordingly, to provide a more refined picture of estimated costs to large transit entities for automated announcement systems, the Final RA separately models costs for this requirement based on three prototypical size-based “tiers”—Tiers I, II & III—with Tier I being on the smaller end of the size spectrum and Tier III on the larger end. These three size-based tiers are intended to represent the typical range of “sizes” of large transit agencies covered by the automated announcement system requirement. Assumptions about relevant cost-modeling characteristics for each of these three tiers of large transit agencies—namely, the number of large buses in annual maximum service in fixed route bus modes, fixed routes, garages, vehicle operators, and mechanics—along with estimates concerning the status and nature of current ITS deployments (if any) by these transit entities, serve as the framework for modeling costs.¹⁹ As detailed in the Final RA, assumptions about the number of transit agencies per tier, as well as their respective fixed route bus fleets and current state of ITS deployments, were developed from research by Access Board staff and data reported in the 2014 National Transportation Database. See Final RA, Section 5.1.1.

It also bears noting that the Final RA’s cost model for the automated announcement systems requirement accounts for potential growth by public transit agencies over time. That is, it is assumed that, every third year during the 12-year regulatory timeframe, one transit agency will “cross” the VOMS 100 threshold, and, thereby, become newly subject to the requirement for automated announcement systems. These “new” large transit agencies are assumed to have characteristics similar to—though slightly smaller than—large transit agencies in “Tier I,” based on the assumption that transit entities crossing the VOMS threshold will do so in an incremental fashion. See Final RA, Section 5.1.1.

Presented in Table 4 below are per-agency annualized costs for the automated announcement systems requirement under each of the Final RA’s three cost scenarios. These annualized costs range from about $44,000 (for a Tier I agency under the low scenario) to about $430,000 (for a Tier III agency under the high scenario). Under the primary scenario, which models the most likely set of cost assumptions, per-agency costs for announcement systems are estimated to be as follows: Tier I - $80,659; Tier II - $154,985; and, Tier III: $264,968.

Table 4 - Annualized Per Agency Costs of Automated Announcement Systems Requirement for Large Transit Agencies (Tiers I, II & III)

These annualized cost figures underscore the logical cost corollary that per-agency costs directly relate to agency size, with the “smallest” large transit agencies (Tier I) experiencing the lowest annualized costs under all scenarios, and, conversely, the “largest” large transit agencies (Tier III) having the highest annualized costs. Nonetheless, even for Tier III agencies, costs are not estimated to exceed $450,000 annually under even the high scenario.

Annualized Costs of New Accessibility Requirements for OTRBs

The third set of cost results presented in the Final RA relates to the four new OTRB-related accessibility requirements in the 2016 Non-Rail Vehicle Guidelines. Because various transportation-related industry sectors use OTRBs for scheduled transportation services, charter services, sightseeing, and other services, these accessibility requirements (unlike the automated announcement systems requirement) do not affect a discrete a set of regulated entities. Consequently, reliable estimates of per-firm costs related to the new OTRB accessibility requirements cannot be made. Instead, the Final RA examines costs for these four requirements on a per-vehicle and per-requirement basis.

With respect to per-requirement costs, the Final RA evaluates the respective costs of each of the four new OTRB accessibility requirements under the three cost scenarios over the projected 12-year term of the 2016 Non-Rail Vehicle Guidelines. For each cost scenario, results are broken down separately (in nominal dollars) by requirement for each year, and then presented as rolled-up annualized values for all requirements at 3% and 7% discount rates. In sum, the annualized cost for these four new requirements collectively across all OTRBs is estimated to be $0.9 million under the primary scenario at a 7% discount rate, while the low and high scenarios respectively project $0.5 million and $1.4 million in annualized costs using the same discount rate. For a complete presentation of cost-per-requirement results, see Final RA, Section 7.1.3 & Appendices F-1 to F-3.

Second, in terms of per-vehicle costs, the Final RA examines likely costs related to the four new OTRB accessibility requirements. Annualized costs of these new requirements are examined under each of the three cost scenarios, with results presented on a per-vehicle basis using 3% and 7% discount rates. The results from these per-vehicle annualized cost analyses are presented below in Table 5.

Table 5 - Per-Vehicle Annualized Costs of New Accessibility Requirements for OTRBs

As this table demonstrates, the cost of the new OTRB accessibility requirements are expected to be quite modest, when viewed from a per-vehicle perspective, under all three cost scenarios. Indeed, annualized costs per vehicle are only expected to be about $1,100 or less (depending on the discount rate) under the primary scenario.