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Regulatory: Regulation of Transportation under the Obama Administration

Under the Obama administration, the Department of Transportation (DOT) has been unusually active in devising and implementing regulatory initiatives and enforcement programs. The overall pattern appears to be that DOT's activities seek to de-emphasize highway transportation and to promote other forms of transport.

The National Highway Traffic Safety Administration (NHTSA) has been aggressive in pursuing defective Toyotas and has required recalls of millions of vehicles with faulty accelerators. NHTSA also has jointly issued with EPA a rule that will reduce greenhouse gas emissions and require automobile manufacturers to increase substantially the average fuel economy standards for cars sold in model years 2012 to 2016.

The Federal Aviation Administration (FAA) has instituted a series of investigations to review whether regional airlines are complying with agency directives protecting passenger safety, including those governing maintenance procedures. The FAA has imposed record fines on airlines found to be noncompliant.

The Secretary of Transportation moved quickly to pre-empt congressional action and adopted a rule imposing a maximum limit of three hours that a plane may wait on the tarmac before takeoff. The rule is enforced by heavy civil penalties (several million dollars for a large plane) that will prevent airlines from treating the payment as a simple cost of doing business.

The Administration has sought to shift funding from highway construction to public transport. For example, with the money made available by the 2009 stimulus legislation, the administration has emphasized high-speed rail travel. The signature initiative has been a grant of more than $1 billion to begin construction of a high-speed rail corridor across Florida.

DOT has acted forcefully to exercise its authority to grant antitrust approval to mergers and other cooperative projects in the airline industry. For example, the department approved the Delta-Northwest merger, over strong Department of Justice objections that required White House mediation. The department also tentatively approved joint pricing and marketing actions by American Airlines and British Airways, despite Department of Justice reservations.

Finally, DOT, in cooperation with the Department of Housing and Urban Development, is pursuing a "livability" program that would decrease reliance on the automobile as a means of transportation. The goal of the program is to develop livable/environmentally sustainable communities that would provide nonauto transportation alternatives, be affordable, energy-efficient, minimize adverse effects on land and water, and protect the environment. This reflects an updating of what in the 1970s were called "transit-oriented development," which emphasizes construction of high-density, mixed-use housing and retail within walking distance of transit.

John F. Cooney is a partner in the Washington, D.C., office of Venable.

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John Cooney

John F. Cooney is a partner in the Washington, D.C., office of Venable.

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