A. The department shall not require a permit or impose a fee on a motor vehicle providing prearranged ground transportation service if the motor carrier providing the service does all of the following:

1. Meets all applicable registration requirements for the interstate transportation of passengers under the ICC termination act of 1995 (P.L. 104-88; 109 Stat. 879; 49 United States Code §§ 13901 through 13908).

2. Meets all applicable vehicle and intrastate passenger licensing requirements of the state in which the vehicle is domiciled or registered to do business.

3. Provides the service pursuant to a contract for either of the following:

(a) Transportation from this state, including intermediate stops, to a destination in another state.

(b) Transportation from this state, including intermediate stops in another state, to a destination in this state.

B. For the purposes of this section:

1. "Intermediate stop" means a pause in the transportation in order for one or more passengers to engage in personal or business activity, but only if the driver providing the transportation to the passenger does not, before resuming the transportation of the passenger or at least one of the passengers, provide transportation to any other person not included among the passengers being transported when the pause began.

2. "Prearranged ground transportation service" means transportation for a passenger or a group of passengers that is arranged in advance or that is operated on a regular route or between specified points.