Regionals Concerned About EAS 'Lump Sum' Option

Enactment of legislation to reauthorize the Federal Aviation Administration (FAA) is drawing closer, with both houses of Congress expected to bring their respective bills to a floor vote by late June or early July.

The regional airline industry is concerned about possible amendments that could be offered on the floor, including original parts of the Bush administration's proposal that were strongly opposed by the industry. While most provisions of the reauthorization bills passed by House and Senate committees are favorable to the regional carriers, there is still lobbying to be done by associations in blocking certain amendments.

The Senate version of the FAA reauthorization bill is called the Aviation Investment and Revitalization Vision Act (S. 824), or AIR-V. The House reauthorization bill is entitled Century of Aviation Reauthorization Act (H.R. 2115), or Flight 100.

In addition to possible damaging amendments, the Regional Airline Association (RAA) is concerned about a provision contained in both bills that would allow communities to take their Essential Air Service (EAS) subsidies as a lump sum. While the two bills are worded differently, in general the language would allow the money to go directly to the communities, rather than the regional airlines, as a lump sum payment.

"The Senate [language] allows up to seven communities to take a two-year lump sum pay out, and they can use it for whatever they want," said Faye Malarkey, director of legislative affairs for RAA. "They could pay for general aviation or buy an airplane, but if they take the two-year lump sum, they are not eligible [for EAS subsidies] anymore." The House version would allow any number of communities to take the money for anything from marketing the airport to buying an airplane to paying for surface transportation.

RAA would rather see that provision implemented on a trial basis first, "so we can see what happens to those communities before we just go ahead and open it up," Malarkey said.

A second concern with the provision is that the language in the House version is vague in that it says a community can take the cash payment in one year, relinquishing EAS for that year. But then the community might be able to come back the next year and request EAS, which would require the regional airline to restart service to that community. "We want to make sure that if a carrier is being bounced out of these markets, that the government isn't going to try to pull them back in. We are very confident that the House will work with us to address these concerns," she said.

Full Funding For EAS

RAA and the Regional Aviation Partners (RAP) would like to see the EAS program fully funded. The Bush administration's original proposal would have drastically cut funding for the program, as well as given the secretary of transportation sole discretion to implement new EAS procedures that would have disqualified "at least 50 percent of today's eligible EAS communities," said RAP Executive Director Maurice Parker.

The feeling among RAP members is that the administration really wanted to turn the EAS program into a surface transportation service rather than an air service. While the administration's EAS provisions are not contained in the House and Senate versions being readied for floor votes, there are Republican members of Congress who might offer the administration's proposal as amendments, warned Parker.

RAP supports a measure introduced by Rep. Jerry Moran (R-Kan.) that would fund the EAS program at $125 million per year rather than the $113 million per year currently in S. 824 or the $120 million in H.R. 2115. The Moran bill also would provide protection for a community should the secretary of transportation determine a location no longer meets its criteria to receive an EAS subsidy. The bill would require a 90-day notice before suspending subsidy payments to any community. Parker would like to see Moran's bill added to H.R. 2115 on the House floor. This would be a "positive and constructive addition," he said.

The regional airline industry also supports amending the House and Senate versions of the FAA reauthorization bill to add a measure introduced by Sen. Arlen Specter (R-Pa.) and Rep. Joseph Pitts (R-Pa.) that would designate how mileage is to be computed in determining whether a community is eligible for EAS subsidies. Despite the administration's claims that this measure would open up a vast amount of new requests for EAS subsidies, RAP argues that it would only affect three communities already qualified for EAS funds.

Overall, RAP and RAA favor most of the provisions in the Senate and House versions that would impact the regional airline industry. Malarkey told C/R News that RAA "absolutely supports" the extension and expansion of the small communities' air service development pilot programs. "This is something both chambers have picked up, and we think it has been a largely successful program. We requested that this program be extended, and we are very pleased to see that [it is contained in the legislation]."

The associations are also pleased that the Senate version has language that would allow the Department of Transportation to adjust EAS subsidy rates when a carrier experiences a cost increase of 10 percent or more (C/R News, May 12). "That was one of the biggest issues that our carriers isolated," Malarkey said. "Right now that is not included in the House language, but I have meetings scheduled (with members of the House), working on just that issue, [to persuade them to add it] to the House version."

The regional groups also support a measure introduced by Senators Trent Lott (R-Miss.) and Jay Rockefeller (D-W.Va.) that was added to S. 824 in committee. That measure would streamline the process for airport development projects at small communities. It also would adjust the cost sharing percentages for the Airport Improvement Program (AIP) for one year, shifting more of the cost off the local communities and onto the federal government (C/R News, May 12).

>>Contact: Maurice Parker, RAP, tel: 602-685-4112, e-mail: rap.exdir@mindspring.com; Faye Malarkey, RAA, tel: 202-367-1170; e-mail, raa@dc.sba.com<<

The Federal Aviation Administration (FAA) and Transport Canada Civil Aviation (TCCA) have issued airworthiness directives (ADs) for Bombardier CRJ 100s and CRJ 440s, which require operators to check for cracks in the pressure floor skin of the aircraft's center fuselage, followed by submission of inspection findings to the manufacturer. If cracks are found, the necessary repair must be made. The TCCA reported that fatigue cracks have been found that, if not corrected, could result in failure of the pressure floor skin, leading to rapid decompression of the airplane during flight. The FAA AD was listed in Federal Register dated April 29.Bombardier official Bert Cruickshank told C/R News that the company had been aware of the situation for some time and had developed a kit designed to resolve the problem. Maintenance manuals are being prepared introducing the AD inspection into regular maintenance procedures.

>>Contact: Bert Cruickshank at Bombardier, tel: 416-375-3546<<