Licensing regulations and the Americans With Disabilities Act

Recently, the New York Times reported that a federal judge ruled that the city of New York must start approving taxi medallions so that more taxis were wheelchair accessible. After reading the article, I decided to go to the case itself, Noel V. New York City Taxi and Limousine Commission, 2011 WL 6747466 (S.D. N.Y. December 23, 2011). In this case, the plaintiffs sued the New York City Taxi and Limousine Commission because their regulations were not set up to approve a sufficient number of taxis that were wheelchair accessible. Interestingly enough, the Commission defended on the grounds that title II of the ADA did not apply to them. There were two possible ways title II could apply.  First, there is a section of title II that applies to public entities operating a demand responsive system. Second, and more common, is that title II demands that governmental entities be accessible to persons with disabilities. With respect to the first issue, the court decided that the Commission was not operating a demand responsive system (which would have required that each and every taxi be wheelchair accessible), and therefore, the provisions of the Americans with Disabilities Act pertaining to a demand responsive system did not apply. However, the court did find that the Commission was a public entity subject to title II of the Americans with Disabilities Act, and therefore, its operations must be accessible to persons with disabilities. The Commission admitted that it had both the ability and authority to provide more wheelchair accessible vehicles but simply had chosen not to do so. Therefore, only 232 taxi cabs in New York out of 13,237 were accessible to individuals using wheelchairs. The court held that the Commission did not provide meaningful access to this public benefit. Therefore the court ordered that the Commission to propose a comprehensive plan that provides meaningful access to taxi services for passengers using wheelchairs. The plan must include targeted goals and standards as well as anticipated measurable results. Furthermore, until such a plan was proposed and approved by the court, all new taxi medallions sold or new street hail livery licenses or permits issued by the Commission must be for wheelchair accessible vehicles. No doubt this is a great victory for persons with disabilities.

However the question becomes where did the “meaningful access” standard come from? That, is an interesting story. Noel relies on another case, Henrietta D v. Guilani, 119 F. Supp. 2d 181 (E.D.N.Y. 2000), where the court held that a city program that provided federal and state benefits for individuals suffering from AIDS was run in such a way that the beneficiaries of that program lacked meaningful access to it. This decision relied on Alexander v. Choate, 469 U.S. 287 (1985), a Rehabilitation Act case, which upheld a Tennessee reduction of annual inpatient hospital days that the Tennessee Medicaid program would pay. It is there that the, “meaningful access” phrase first appears. It appears in the context of saying that the reduction in hospital stays is a neutral decision and does not impact upon whether a person with a disability had meaningful access to the program. Therefore, one can see that in Noel the term, “meaningful access” is being used quite a bit differently than what it had been used in prior case law.

What does this all mean? It is very strange in a way. The Commission never argued at the lower level that summary judgment should be denied because a question of fact existed as to whether the program and activities of the Commission were accessible to persons with disabilities or whether there were other ways that could be formulated so that the program and activities of the Commission could be accessible to persons with disabilities, wheelchair users in this case. Perhaps, an appeal might claim that the lower court did not apply the proper legal standard (that is, “meaningful access” is being used in this case in a way different than existing precedent, and therefore, the argument goes that an appellate court should send the case back down with the correct legal standard, whatever that may be).

At any rate, a deceptively complex case, that bears following in the future. It also serves notice on regulatory bodies that their regulations should be formulated in such a way that they do not have a disparate impact on (screen out) persons with disabilities. Failure to do so, could subject the agency to a title II suit along the lines described here.

Update: During the week of March 19, the city received a stay from the Second Circuit United States Court of Appeals with respect to the District Court decision referenced here. The city has also made clear that it will be appealing the decision, perhaps along the lines discussed here.

In fact, this case was appealed and on June 28 the second circuit came down with its decision whereby the Second Circuit held that the city was not in violation of part a of title II of the Americans with Disabilities Act and that the District Court erred in granting partial summary judgment for the plaintiff and entering the temporary injunction. The Second Circuit vacated and remanded for entry of partial summary judgment for the city. In doing so, the Second Circuit had to find that the district court abused its discretion in its decision.

How did the Second Circuit go about reversing the District Court decision? First, the court noted that the Americans with Disabilities Act while broad in scope was not without its limits.

Second, the court turned to the federal regulations dealing with licenses. The court said that what this section does is prohibit the agency issuing the regulations from refusing to grant licenses to persons with disabilities who are otherwise qualified own or operate taxis but does not assist persons who are consumers of the licensee’s product. Such a conclusion was also supported by the Department of Justice’s technical assistance manual, which the court found to be persuasive authority.

Third, the court found that a program or activity of the public entity was not involved here. That is, an activity of the public entity does not become a “program or activity” of the public entity merely because it is licensed by the public entity unless the private industry practice is the result of the licensing requirements. Such was not the case here (that is, the licensing scheme did not cause the discrimination). While the number of taxis that have to be accessible were small, nothing prevented the private companies from using whatever number of accessible taxis they desired. To buttress this point, the court cited to several cases that made this distinction between the regulatory agencies and the licensees or the people being regulated themselves. They did distinguish one case that did not make that distinction, but that case was substantially different as it dealt with the situation with a private entity had to use equipment required by the public agency (machine for the state lottery in West Virginia).

Finally, an interesting question arises as to why the plaintiffs went after the public entity and not the taxi companies themselves. It turns out, as the Court notes, that federal regulations specifically exempt providers of taxi service from being required to purchase or lease accessible automobiles. Therefore, since the taxi industry is exempt from being required to purchase or lease accessible taxis, there can be no underlying violation of the ADA for a licensing authority to fail to address that by regulation.

What does this all mean? It means that for purposes of the Americans with Disabilities Act, there is a big difference between the regulations issued by a public entity and the people or entities subject to those regulations. Unless those regulations mandate discrimination, the Americans with Disabilities Act is not going to allow a title II claim to proceed. It also means that the time to ensure that the regulations increase accessibility to the maximum extent is at the time the regulations are being formulated not once they are done. For example, when a state or the federal government formulates regulations, those regulations first have to be proposed, then receive comments from the public, then those comments have to be digested by the regulatory body, and then the final regulations have to be issued. These regulations of New York were not state or federal but it is possible that prior to issuing the licensing regulations, there may have been some ability for the public to comment on the proposed licensing regulations. If not, that fact might offer grounds for attacking the regulations.

Comments

  1. http://online.wsj.com/article/SB10001424052702304746604577380442306407100.html

    the Comptroller have to certify contracts with the city of New York. He is refusing to certify it because of the ADA issues. See the link above the Wall Street Journal.

    Bill

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