The annual Greater California Livery Association’s lobbying event can lead to fewer regulations for charter party carriers.
A small group of limousine operators first formulated the concept of a national association of limousine services at the Limousine & Chauffeur Show in Atlantic City in December 1984. The following May, the National Limousine Association was formally created with offices in Washington, D.C. and Cris Portugal as the first president.
At the NLA’s Fall Seminar in New Orleans, Cris Portugal was elected to serve a second term as the association’s President. Portugal spoke with Limousine & Chauffeur recently about the NLA’s accomplishments thus far, as well as about his goals for the coming year.
Limousine & Chauffeur: How strong is the NLA after its first year and a half, and what are your goals for the coming year?
Portugal: When we first got together in 1984, the feeling in the industry was that we did not have a voice, and we had no guidance. Therefore, some decisions were being made for us without our knowledge. That was what started the National Limousine Association. A bunch of pioneers, about twenty-five people decided to get together and form this thing. Needless to say, they subsidized it. The seed money that came from those people was what got the NLA started.
We’ve had tremendous help on the part of our general counsel and some very good guidance that put us on the right track. But then we had to go back to the people who wanted to have this organization and ask them ‘“What do you want the NLA to do?”
We found out that the insurance problem was important and, even though we followed the old guidelines, we didn’t get anywhere. We hired a person to look into this matter for us and we got nowhere.
We did a considerable amount of soul-searching and decided that it would be better for us to do the work as opposed to using an outside source. We decided to find out where the problem actually existed.
We were very happy to find out that the limousine industry has the best rating of them all. We had no real bad risks within the industry. Yes, there were accidents that happened, and they will happen if you are on the street long enough, but the loss ratios that were governing our insurance rates were primarily based on people who drive taxis and buses. The stats were coming from other parts of the transportation industry.
Limousine & Chauffeur: Are you saying that the limousine industry has a better record than it has been given credit for?
Portugal: No question about it. Not only did we find out that in our research, but the insurance companies will tell you that they have no data that the limousine industry is a bad risk.
That brought up the question, “Well, what are we going to do next?” We went after actual insurance companies. The response was good even though the market was very tight. We got response from a company in Cleveland called Progressive Insurance Company. They were smart enough and open minded enough to see that there was a chance here.
Limousine & Chauffeur: The NLA started with a very small core of people didn’t it?
Portugal: That is correct. When we first started, it was nothing but twenty- five people who went to Washington on January 20, 1985. We were a little leery of whether we should even have this thing going, but the people there were very serious about their industry. They weren’t the people who use the limousine industry as a tax deduction...They were the ones who actually make money out of it and feel very strongly about it.
Limousine & Chauffeur: Do you think the NLA might still be seen by some people as a small group of operators trying to do things on their own, or do you think it’s perceived as an organization that has a broad base of membership now?
Portugal: It’s funny that you would say that. We’re much more than a “club.” We are an association. There are a lot of people around the country who are very narrow-minded and believe that we’re in direct competition with the networks such as Dav-El and Carey. We’re not. We are a trade association. There’s no such thing as passing jobs along through the NLA. There’s no such thing at all. And I defend that strongly.
Limousine & Chauffeur: So you wouldn’t equate the NLA with Carey or Dav-El?
Portugal: Not at all. As a matter of fact, we have a number of Dav-El and Carey people in our organization and some, even, on the board of directors. So those are the people who have been able to see the actual benefits of the NLA.
Limousine & Chauffeur: What about support from those two organizations, Dav-El and Carey? Do those organizations sense that they provide enough organization for their members so that they do not need a national limousine association?
Portugal: I’m not aware of any kind of a boycott from either of those organizations. I think that the Carey organization, and Dav-El, have very good people working with them. I’m happy to have them as our members.
Limousine & Chauffeur: After a year and a half, is the NLA supporting itself or are you still trying to get on your feet?
Portugal: Well, a lot of people around the country say, “What does the NLA do for my $200?” When I went to Las Vegas, I said, “Look, I’ll give you a money-back guarantee because I believe that the NLA can give you more than $200 worth of value on a yearly basis.
If we are really looking at the expense of running a national trade organization, it is a very expensive matter. Among the members of the board, we’ve really been subsidizing this thing to the best of our means.
This cannot continue. Therefore, we’ve had to rely on the people who have seen the light at the end of the tunnel and who have said, “Yes, I want to join this organization because they’re doing what I’d like them to do.” We do have an open door policy. I’m the President and I take everybody’s calls. This has kind of dragged me away from my own business, and it’s been a little tough, but somebody had to do it.
Limousine & Chauffeur: Did you seek re-election as President for another term?
Portugal: No. I had to leave the room for a few minutes to look for a friend and, when I came back, I was re-elected.
Limousine & Chauffeur: Do you think that you’ll have an advantage with a year of experience?
Portugal: I would say so. I look forward to a lot more benefits and accomplishments during our second year. The first year, as you can well imagine, is a very difficult one because there’s nothing to look back on. You have no guidelines whatsoever.
So, I would say that I’ve learned in the past year what all this is about. Now in the second year, I hope to deal with it and make it work.
Therewere a considerable number of changes made by the new board of directors who were elected in New Orleans. We have a new influx of new blood. And we have people in there who are a bunch of go-getters, along with some people who were there during the first year. They were volunteers. This time they were asked if they wanted to be on the board of directors. I would say that the NLA now has good guidelines to go by, and good leadership.
Limousine & Chauffeur: Would you say that increasing membership is one of your biggest goals for the next term?
Portugal: No question about it. The NLA is no longer just a Washington, D.C. operation. We’ve divided the country into eight different regions. Every region has a chairman, and this chairman has co-chairmen to work with. They II handle their own membership programs. We hope to triple our membership in 1987.
In each region we also have a local meeting and convention co-chairman, and a region-wide insurance co-chairman. Those people keep an eye on what’s going on. They also have a state-level legislative watch. These people help contribute to our library which is very important to us because you have to know what’s going on all around the country.
Limousine & Chauffeur: When you say a “regional meetings person”...Will they work on your annual “Seminars,” or will there be additional meetings?
Portugal: You must realize that there are people in the industry who want to have their local associations be much more visible than they are right now. Therefore, by having the different sites already taken care of, they can actually minimize the amount of work it would take to put on a seminar for the region itself.
Now for us, we are very strong as far as our seminar system goes. We have three already planned for 1987. We’ll go to California the first week in March. Then we come all the way across to the East Coast for June, and then we go back to St. Louis for our September Annual Meeting and Seminar. Those people will be the ones who will get everything set up for our sponsorships and such. This includes arranging for speakers, hotels, spouse programs, and any kind of special event that they may want.
Limousine & Chauffeur: What city on the East Coast?
Portugal: We have not decided yet. We might end up coming back to Washington, D.C. which is the cradle of the association world since it is where we can be involved with Congress. We are also considering Miami.
Limousine & Chauffeur: At the Limousine & Chauffeur Show in Las Vegas, there was someone from the California Public Utilities Commission talking about new limousine regulations which have been proposed in California. Do you see a nationwide trend toward more industry regulation?
Portugal: Unfortunately, a lot of California operators are not aware that some of these problems have also occurred in other parts of the country, and have already been tackled by organizations within our industry.
No, I don’t think the PUC is really singling the limousine world as a target. As a matter of fact, California has enjoyed the fact that the liquor law has gone, in some cases, in their favor. But for certain issues, the NLA wouldn’t take any kind of stand because in some states it would help our members and in some others it would hurt them. One of them is regulation.
We can give all the necessary information to people concerning whether they may want to regulate or deregulate in their area, but what they want to do in their own locale is really up to them. Annual limousine inspections may benefit operators in California. We have that on the East Coast and, in some cases, this happens twice a year.
Limousine & Chauffeur: So you think regulatory issues vary according to the area?
Portugal: In some cases there are very large cities in the continental United States where there is no regulation at all. They don’t even know what a limousine should, or should not, do. They don’t even know what a “limousine” is. They don’t have a definition.
Limousine & Chauffeur: Do you think that standards for limousine safety are an issue that the NLA would take a stand on?
Portugal: The word “safety” is a word we should not use loosely. We have a Safety Committee, and we are very, very involved with the safety of our industry. But safety is not necessarily just the car. Safety goes all the way up into the companies...with your hiring practices, and training manuals, and training seminars. That is what safety is.
As far as the NLA telling the coachbuilders that you must do this and you must do that...I don’t think we have the right. They are businessmen and we are too. We should have a set of guidelines as far as shopping for a limousine, and we do. We’re interested in knowing that those companies are going to stay for a while and that it has the proper insurance.
Limousine & Chauffeur: So what do you when someone calls and says, “What can you tell me to look for when I’m buying a limousine?”
Portugal: Well, first of all, we have a belief which is the same as if you called us and asked us to recommend a company in New York City...I’m going to give you a list of NLA members. When somebody calls me and says, “What do you think I should look for in a limousine,” I happen to have a list of associate members in the NLA who have supported our efforts. Of course, we don’t take just any coachbuilder’s check. We check them out first before we accept them. We want them to be a reputable company.
Limousine & Chauffeur: What do you mean, “Check them out?”
Portugal: We want to make sure that the companies who are coming into the organization are actually in this industry for real.
Limousine & Chauffeur: You don’t mean that they all have product liability insurance, though, and that they all have certain standards that you’ve set?
Portugal: Well, in some cases I have had the chance to go and see their operation to make sure that they are actually a “coachbuilder.” We have also received applications for membership from companies that are nothing but a butcher shop. Those people are not allowed to join the NLA. A very nice letter goes back to them telling them that they are not really what we’re looking for.
Limousine & Chauffeur: Now you’ve been doing a lot of travelling to support regional associations. Are you hoping to stress your relationship with regional associations in your second term?
Portugal: It has to be a two-way street. A year ago, approximately, Ken Avery asked me to come down to Ft. Lauderdale for a regional meeting. At that time, I felt there were about sixty-five people who wanted to have some direction.
Well, the NLA was involved in getting them together. We helped them cut down on their costs, and we helped them with guidelines, bylaws, application forms, and so forth. Those are the kinds of things that the NLA is for.
Once a regional association is formed, we expect them to continue supporting our efforts. It has to be a two-way street.
Limousine & Chauffeur: There’s a perception among some operators that, with increased insurance costs and other expenses, and with growing competition, that the limousine industry is going through a leveling off period. Is it your feeling that the industry may not be growing at the rate it was a few years ago?
Portugal: I would say so. I’ve had the feeling that, just like any other industry, the limousine industry is cyclical. Business may decline for a while, but then it will pick up again. I feel that the limousine business will continue and, in some cases, there will be no change whatsoever.
As far as insurance is concerned, perhaps it’s time for the limousine companies of America to go into the insurance business themselves. Congress just passed “Risk Retention” legislation that will allow industries such as ours to become self-insured. We may be able to control our own destiny. Who knows, perhaps that would be the answer to all our problems.
Limousine & Chauffeur: “Risk retention” means that if a group of limousine operators has a certain amount of money backing them, then those limousines can be self- insured?
Portugal: That is correct.
Limousine & Chauffeur: Is that something the NLA would be in a position to do?
Portugal: It’s not that we are in the position to do this, but we are looking at it closely. We have the backup money for it right now. It’s available to us. Having a “risk retention group” would mean that we would be able to offer insurance to our membership for much less than it is costing us right now.
Limousine & Chauffeur: Would that involve having to inspect these companies? Would they have to qualify somehow?
Portugal: When we said we’d go after a national program for insurance, we clearly said it would only be available to NLA members on a qualifying basis. If your losses are too high, or you don’t manage your company properly, then it’s time for you to attend more seminars to find out how it’s done. Otherwise, it’s going to cost you a lot of money.
One of my goal for my second term as President is to have a risk retention program where limousine operators can actually be the owners of their own insurance company. In the long run, monies that are paid out in premiums could be used in a mutual fund that would allow members to have their own lending fund.
Limousine & Chauffeur: What else would you like to say to our readers?
Portugal: I would like to see people become much more involved with the things that the NLA has to offer. We have an 800 hotline, we have a monthly newsletter, we have legal assistance and third party legal assistance, we have a discount program with Uniroyal Tires for our members, we are providing them with educational seminars, and we even provide a discount on Limousine & Chauffeur Magazine.
We are also looking into other discount programs. There are several other companies who are interested in doing things with us. I would personally like to see even more things happening in the NLA but we need the support of more operators. We need the people who have already joined to rejoin, and we need those who haven’t gotten off the bench to come with us. I think it’s time for those people to really see what we’re all about.
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