Licence Application Decision Limousine – Amendment to Licence

Application # Trade Name (s) Address Current Authorization (s) Application Summary

90-13 Applicant SHERWIN, Donald Ross Black Tie Limousine 20-1750 Lenz Road, West Kelowna, BC V1Z 3N1 Special Authorization: Passenger Directed Vehicle Passenger. PT Licence # 70332 Amendment of Licence Amend licence to allow use of a sedan limousine (driver and 3-5 passengers) New Rates for amended service Introduce a sedan limousine rate

Publication Date Submissions Received Board Decision

May 8, 2013 Okanagan Limousine Inc. Amendments to the terms and conditions of licence are approved as set out in the application summary.

Decision Date

Hourly Rates are approved as set out in the application summary. June 12, 2013

Panel Chair

William Bell

I. Board Considerations: The Board may approve a licence application, if the Board considers that: (a) there is a public need for the service the applicant proposed to provide under any special authorization. (b) the applicant is a fit and proper person to provide that service and is capable of providing that service, and (c) the application, if granted, would promote sound economic conditions in the passenger transportation business in British Columbia. All three requirements must be met before the Board will approve an application. (Reference: section 28(1) of the Passenger Transportation Act) Applicants must decide how much information to provide to the Board. Applicants should consider the type, location and scope of the service they wish to provide. The Board has written various Application Guides to explain Board requirements. Page 1

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The Board publishes applications and accepts submissions. II. Background The applicant, Donald Ross Sherwin has been the sole proprietor and operator of Black Tie Limousine (BTL) for 19 years. The company serves the Kelowna and surrounding area. Its current licence and fleet allows the operation of 4 larger size limousines that accommodate 7-11 passengers. In this application, BTL is requesting authority to operate 1 of the 4 vehicles as a sedan limousine. This vehicle would be operated under the applicant’s current licence. A new sedan rate of $90.00 plus GST per hour is also requested for this amended service. It should be noted that the Board approved a rate increase for BTL on April 23, 2013 to bring its rates in line with industry standards. In that application, the applicant pointed out that his clientele had broadened, that their vehicle preferences were changing and that he intended to diversify his fleet. One submission was received. The Board gives more weight to submissions that back up general claims with facts or details. The submission was sent to the applicant who replied. I have considered the submission and the applicant’s reply The submission was from Okanagan Limousine Inc (OLI). The submitter argues there is no need for an additional sedan limousine in the Okanagan Valley and that usage of sedan service is sporadic, inconsistent and unpredictable. It claims that it does not “have the work to run our Corporate Vehicles 24/7”. OLI further claims that it has not applied to change its sedan rates of $55.00 plus GST per hour as customer demand may not support a higher rate. Corporate companies are opting for teleconferencing and web conferencing instead of face to face to meetings. Its contracted sedan service for the Kelowna International Airport is also slow and many passengers opt for the available shuttle service. OLI also submitted that BTL has always just had only stretch limousines and only does All Occasion events, but has never entered the corporate market. It also submits that the impact of General Authority (GA) services in the area such as 15 passenger vans and party buses has resulted in less work for the All Occasion market and that the introduction of another sedan service will not promote sound economic conditions. OLI also subsequently sent a local newspaper Page 2

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article of June 4, 2013 that discusses the slow recovery of the Okanagan economy and asked that it be part of its submission. This was accepted by the Board. BTL responded by stating that it has been in operation for 19 years and has established a significant number of regular and loyal clients, who are seeking a smaller vehicle as an option when appropriate for a given occasion. BTL notes that it is asking to operate only 1 sedan primarily servicing special occasions and submits that it will not significantly impact negatively on other limousine operators who have an airport and corporate focus. BTL responded to the subsequent submission by OLI. It acknowledges that the economy has slowed somewhat in the past years, but that the Okanagan does better than most areas due to year round tourism. BTL points out, however, the article observes that tourism, inmigration and housing sales are anticipated to grow and that these factors combined with the continued success of the region’s service sector bode well for economic improvement. III. Reasons for the Board’s Decision (a) Is the applicant a fit and proper person to provide that service and is the applicant capable of providing that service? The Board looks at fitness in two parts: (i) is the applicant a “fit and proper person” to provide the proposed service; and (ii) is the applicant capable of providing that service? The Board reviews the conduct of an applicant and the structure of its operations. Does the applicant seem to understand passenger transportation laws and policies? Is the business set up to follow these laws? Is there something in the applicant’s background that shows it disregards the law? Applicants must show that they have the resources and skills to manage the service that want to operate. The Board gets much of this information from business plans and financial statements. The Board recently approved a request for rate increases from the applicant as noted above. BTL in this application has supplied a similar rationale referring to the successful operation of the business for 19 years and his financials to support this assertion. The Page 3

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financial information accompanying the application included a personal worth statement as at March 2013, a balance sheet for 2012 and profit and loss statements from 2005 to 2012. The applicant has a reasonable base of resources and capacity to operate the services proposed with a sedan vehicle. BTL also completed the Board’s Disclosure of Unlawful and Bankruptcy Form. Letters of support attest to the company’s positive service. There is nothing to suggest the applicant is not a fit and proper person and the financials demonstrate the business is profitable. Further, business demands indicate a need to diversify his fleet and the applicant has submitted documented evidence in support of this demand. I find that the applicant is a fit and proper person and capable of providing the proposed diversification of his fleet and expanded service operating a smaller sedan limousine.

(b) Is there a public need for the service that the applicant proposes to provide under special authorization? Limousine companies that want to expand to new areas must prove to the Board that there is a public need for this expanded service. Applicants may show public need with the following types of information: 

letters from booking agents, travel agents or prospective passengers

 

signed contracts population data community plans

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other relevant material

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The Board often finds comments written by individuals more useful than form letters or petitions. The Board also reviews business plans and financial statements. I find that the applicant has demonstrated a need that its customer base is changing and that a diversification of its fleet to allow the operation of 1 sedan limousine is required. The application includes six letters of support from a distribution of the company’s clientele including hotels, resorts and individuals. All of the letters speak to the ongoing demand and use and needed option for a luxury sedan service. I find the letters sufficiently demonstrate a public need for the applicant to operate a smaller sedan vehicle as part of its current authorized fleet. Page 4

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I am approving the amendment of the applicant’s licence to allow the inclusion of a sedan limousine to its fleet.

(c) Would the application, if granted, promote sound economic conditions in the passenger transportation business in British Columbia? There are many markets for limousines. Some limousine companies may serve the wedding or special event market. Others may serve corporations. Still others may offer a specialty services. A healthy, competitive limousine industry provides the public with a range of service options while enabling efficient operators to run a successful business. The requested amendment of its licence will allow BTL to serve its customers better with the option of a sedan limousine that is more appropriate on given occasions. If anything, it allows the business more flexibility which in turn should allow it to be more viable. I have also considered the impact of the diversified capacity on competitors in the local market. The local market is well populated with limousine providers and only a few operate a sedan service. BTL has demonstrated a customer base and need for their particular sedan limousine service which they intend to focus primarily on the special occasion market. The proposed sedan rates are in line with those of another local provider and with industry standards. Amending the applicant’s licence to allow the operation of 1 sedan limousine should not unduly harm others in the industry. Taking all of the above into consideration, I find that granting the applicant more flexibility in vehicle size with the proposed rates will promote sound economic conditions in the passenger transportation business in British Columbia. Note: the terms and conditions of licence reflect the”SL” band for 3 – 5 passenger limousines and “LV” band for 6 – 11 passenger limousines. This is in accordance with the Board’s Operational Policy III.6. IV. Rates The sedan rates are approved as set out in the application summary, i.e. $90 per hour, with a one hour minimum. Page 5

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V. Conclusion For the reasons above, this application is approved as set out in the application summary. I establish the activation requirements and the terms and conditions of licence that are attached to this decision as Appendix I. These form an integral part of the decision.

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Licence Required to Operate Vehicles Approval of application may expire

The Registrar of Passenger Transportation must issue the applicant a licence before the applicant can operate any vehicles approved in this decision. 1. The applicant must activate at least 1 vehicle within 6 months of the date of this decision. 2. If the applicant does not meet the requirements set out in 1 above, this Special Authorization expires. 3. The Passenger Transportation Board may vary the requirements set out in 1 above, if circumstances warrant it. 4. If an applicant needs more time to activate its vehicles, then the applicant must make a request to the Board before the end of the 6 month activation period. (Note: “activate” means that the applicant has submitted the documents required to obtain a Special Authorization Vehicle Identifier to the Registrar of Passenger Transportation.)

Notice to Registrar

The Registrar must not, without direction from the Board, issue the applicant a licence or any Special Authorization Vehicle Identifiers if the applicant has not activated at least 1 vehicle within 6 months of the date of this decision. (Note: activated means that the applicant has submitted to the Registrar of Passenger Transportation the documents required to obtain a Special Authorization Vehicle Identifier.)

Special Authorization

Passenger Directed Vehicle (PDV) Terms & Conditions of Licence Vehicles

Maximum Fleet 4 vehicles, 1 may be a sedan limousine Size: Vehicle Capacity Vehicles can accommodate a driver and not less than 6 passengers and (LV): not more than 11 passengers. Vehicle Capacity Sedan limousines must accommodate a driver and not less than 3 and not (SL): more than 5 passengers. Specialty Vehicles: Sedan vehicles may only be operated if the vehicles are sedan limousines, including eco-friendly sedan limousines, as defined by Board policies or rules in effect at the time a special authorization vehicle identifier is issued by the Registrar of Passenger Transportation for the vehicle

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Services Originating Area: Transportation of passengers may only originate from any point in: 

Central Okanagan Regional District (CORD)

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Highway 33 corridor from Beaverdell to Kelowna

Destination Area: Transportation of passengers may terminate at any point in British Columbia and beyond the British Columbia border when engaged in an extra-provincial undertaking. Return Trips: The same passengers may only be returned from where their trip terminates in the destination area to any point in the originating area if the return trip is arranged by the time the originating trip terminates. Transfer of a This special authorization may not be assigned or transferred except licence: with the approval of the Board pursuant to section 30 of the Passenger Transportation Act.

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Approved Rates for SHERWIN, Donald Ross dba Black Tie Limousine

Sedan Rates Only Hourly Rates* For first hour or fraction * Taxes are not included 

$90.00

1 hour minimum charge for any use of a vehicle for less than 1 hour.

General: 

Other rates and rules may be set out in the rates document received from the applicant.

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