CAR’s Commercial Servicing Carriers Extended For One Year Pending Possible New RFP

At a special meeting called on March 12, the CAR Governing Committee voted to extend the Commercial Automobile Servicing Carrier contracts of the present carriers for an additional 12 months.

The Governing Committee also voted to establish a special committee to make recommendations on the protocol that CAR should follow when contracting with its member companies such as in the Commercial Automobile Servicing Carrier program. The special committee is also to make recommendations regarding the protocol for CAR committee members recusing themselves on particular votes involving the economic interests of their employers.

This special committee is to report back at the regularly scheduled CAR Governing Committee meeting for September 2015.

Special meeting called to clarify prior votes on Taxi/Limousine and Commercial Automobile Servicing Carrier programs

The March 12 Special Meeting was prompted by concerns over the validity of prior votes taken by the Governing Committee at its regular February 25 meeting relating to the Taxi/Limousine and Commercial Automobile Servicing Carrier programs relating to a miscue on a vote to conduct Request For Proposals (“RFPs”) on both programs and the subsequent vote to extend the programs for one year.

Error in counting recusals leads to question over validity of votes

The confusion over the February 25 votes arose after the Governing Committee considered the recommendation of the Commercial Automobile Committee to extend the current Commercial Automobile Servicing Carrier appointments by five years and the current Taxi/Limousine Servicing Carrier appointments by one year without any RFPs.

The Governing Committee did not approve the recommendation for the five-year extension without any RFP for the commercial lines servicing carrier program. Instead the Governing Committee voted on authorizing CAR staff to proceed with RFPs on the schedule presented to the Commercial Automobile Committee.

The vote on that motion was five members in favor, four members opposed, and three members recusing themselves. The acting Chairperson did not vote.

That motion was declared defeated when the Committee was advised erroneously that seven votes were required for the motion to pass.

The Committee then unanimously voted to extend the servicing carrier appointments on both programs for an additional year with again three recusals.

Special meeting called

Following the February 25 meeting, a member of the Governing Committee requested a review of the voting requirements and the quorum necessary for a valid vote when there were recusals by voting members of the Committee. As a result of the review by CAR’s president and outside counsel, the conclusion was reached that:

…it was not appropriate to include the recused Committee members. Accordingly, the correct result of that vote should have been that the motion passed, having received a majority of the votes cast.

However, the subsequent unanimous vote raised the question of which vote was the valid vote. As a result the Governing Committee called the special meeting.

Question on conducting RFPs for the Taxi/Limousine and Commercial Automobile Servicing Carrier programs

The Taxi/Limousine Servicing Carrier Program has had five RFPs to select servicing carriers since its inception in 1995. The last RFP for this program was conducted in 2011.

The Commercial Automobile Servicing Carrier program had its first RFP in 2006 when car elected to move from having each commercial lines carrier act is a servicing carrier and, instead, reduce the number 26 servicing carriers. In 2011, a second RFP winnowed the servicing carriers from six to four based upon a decline in the volume of ceded business.

The premium volume for the Commercial Automobile Servicing Carrier program from 2006 to 2014 appears below: