H.R. 2748 (105th): Airline Service Improvement Act of 1998

105th Congress, 1997–1998. Text as of Oct 28, 1997 (Introduced).

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HR 2748 IH

105th CONGRESS

1st Session

H. R. 2748

To amend title 49, United States Code, to provide assistance and slots with respect to air carrier service between high density airports and airports not receiving sufficient air service, to improve jet aircraft service to underserved markets, and for other purposes.

IN THE HOUSE OF REPRESENTATIVES

October 28, 1997

Mr. DUNCAN (for himself, Mr. BLUNT, Mr. FOX of Pennsylvania, Mr. EWING, Mr. COOK, Mr. WALSH, Mr. QUINN, and Mr. MCGOVERN) introduced the following bill; which was referred to the Committee on Transportation and Infrastructure


A BILL

To amend title 49, United States Code, to provide assistance and slots with respect to air carrier service between high density airports and airports not receiving sufficient air service, to improve jet aircraft service to underserved markets, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ‘Airline Service Improvement Act of 1997’.

TITLE I--SERVICE TO AIRPORTS NOT RECEIVING SUFFICIENT SERVICE

SEC. 101. AVAILABILITY OF SLOTS.

    (a) PERIOD OF EFFECTIVENESS-

      (1) SLOTS FOR FOREIGN AIR TRANSPORTATION- Section 41714(b) of title 49, United States Code, is amended by striking paragraph (4).

      (2) SLOTS FOR NEW ENTRANTS- Section 41714(c) of such title is amended--

        (A) by striking ‘(1) IN GENERAL- ’;

        (B) by striking paragraph (2); and

        (C) by moving the text of paragraph (1) so that it follows the subsection heading and its margin is aligned with the margin for subsection (g).

    (b) SLOTS FOR AIRPORTS NOT RECEIVING SUFFICIENT SERVICE- Section 41714 of such title is amended--

      (1) by striking subsections (e) and (f) and inserting the following:

    ‘(e) SLOTS FOR AIRPORTS NOT RECEIVING SUFFICIENT SERVICE-

      ‘(1) EXEMPTIONS- Notwithstanding the Metropolitan Washington Airports Act of 1986, the Secretary may by order grant exemptions from the requirements under subparts K and S of part 93 of title 14, Code of Federal Regulations (pertaining to slots at high density airports), to enable air carriers to provide nonstop air transportation using aircraft that comply with the stage 3 noise levels of part 36 of such title 14 between a high density airport and a small hub airport or nonhub airport that the Secretary determines is not receiving sufficient air carrier service to and from such high density airport.

      ‘(2) LIMITATIONS- No more than 2 exemptions per hour may be granted under this subsection for slots at any high density airport, and no more than 6 exemptions per day may be granted under this subsection for slots at Washington National Airport.

      ‘(3) APPLICATION- An air carrier interested in an exemption under this subsection shall submit to the Secretary an application for such exemption. No application may be submitted to the Secretary before the last day of the 30-day period beginning on the date of the enactment of this subsection.

      ‘(4) DEADLINE FOR DECISION- The Secretary shall make a decision with regard to granting an exemption under this subsection not later than the 120th day following the date of the application for the exemption. If the Secretary does not make the decision on or before such 120th day, the air carrier applying for the service may provide such service until the Secretary makes the decision or the Administrator of the Federal Aviation Administration determines that providing such service would have an adverse effect on air safety.

      ‘(5) PERIOD OF EFFECTIVENESS- An exemption granted under this subsection may remain in effect while the air carrier for whom the exemption is granted continues to provide nonstop air transportation between the airport that the Secretary determined was not receiving sufficient air carrier service and the high density airport.

      ‘(6) DEFINITIONS- In this subsection, the following definitions apply:

        ‘(A) NONHUB AIRPORT- The term ‘nonhub airport’ means an airport that each year has less than .05 percent of the total annual boardings in the United States; and

        ‘(B) SMALL HUB AIRPORT- The term ‘small hub airport’ means an airport that each year has at least .05 percent, but less than .25

percent, of the total annual boardings in the United States.’; and

      (2) by redesignating subsections (g) and (h) as subsections (f) and (e).

SEC. 102. FUNDING FOR AIR CARRIER SERVICE TO AIRPORTS NOT RECEIVING SUFFICIENT SERVICE.

    Section 41742(b) is amended to read as follows:

    ‘(b) FUNDING FOR SMALL COMMUNITY AIR SERVICE-

      ‘(1) SOURCE OF FUNDING- Notwithstanding any other provision of law, moneys credited to the account established under section 45303(a) of this title, including the funds derived from fees imposed under the authority contained in section 45301(a) of this title, shall be used to carry out the essential air service program under this subchapter.

      ‘(2) FUNDING FOR AIR CARRIER SERVICE TO AIRPORTS NOT RECEIVING SUFFICIENT SERVICE AND RURAL AIR SAFETY- Any amounts from fees imposed under section 45301(a) that the Secretary determines will not be obligated or expended by the last day of a fiscal year for the purpose of funding the essential air service program under this subchapter shall be made available in such fiscal year to the Administration as follows:

        ‘(A) First, not to exceed $10,000,000 in each fiscal year beginning after September 30, 1998--

          ‘(i) for assisting an air carrier to purchase aircraft to provide air transportation to an underserved airport, to purchase slots to provide air service between a high density airport and an airport that the Secretary determines is not receiving sufficient air carrier service to and from such high density airport, and to subsidize service to and from an underserved airport for a period not to exceed 3 years; and

          ‘(ii) for assisting an underserved airport to market service to and from the underserved airport.

        ‘(B) Second, for use under this subchapter in improving rural air safety at airports with less than 100,000 annual boardings.

      ‘(3) UNDERSERVED AIRPORT- In this subsection, the term ‘underserved airport’ means a nonhub airport or small hub airport that the Secretary determines is not receiving sufficient air carrier service.’.

SEC. 103. UNFAIR COMPETITION COMPLAINTS.

    Section 41712 of title 49, United States Code, is amended--

      (1) by inserting ‘(a) IN GENERAL- ’ before ‘On’; and

      (2) by adding at the end the following:

    ‘(b) DEADLINE FOR DECISION ON UNFAIR COMPETITION COMPLAINTS- The Secretary shall make a decision on any complaint the Secretary receives under this section regarding whether an air carrier has been or is engaged in an unfair method of competition in air transportation or the sale of air transportation not later than 180 days after the date of receipt of the complaint.’.

TITLE II--REGIONAL AIR SERVICE INCENTIVE PROGRAM

SEC. 201. AMENDMENT OF TITLE 49, UNITED STATES CODE.

    (a) IN GENERAL- Chapter 417 of title 49, United States Code, is amended by adding at the end the following:

‘SUBCHAPTER III--REGIONAL AIR SERVICE INCENTIVE PROGRAM

‘Sec. 41761. Purpose

    ‘The purpose of this subchapter is to improve service by jet aircraft to underserved markets by providing assistance, in the form of loan guarantees, to commuter air carriers that purchase regional jet aircraft for use in serving those markets.

‘Sec. 41762. Definitions

    ‘In this subchapter, the following definitions apply:

      ‘(1) AIRCRAFT PURCHASE LOAN- The term ‘aircraft purchase loan’ means any loan made for the purchase of commercial transport aircraft, including spare parts normally associated with the aircraft.

      ‘(2) AIR CARRIER- The term ‘air carrier’ means any air carrier holding a certificate of public convenience and necessity issued by the Secretary of Transportation under section 41102.

      ‘(3) COMMUTER AIR CARRIER- The term ‘commuter air carrier’ means an air carrier that primarily operates aircraft designed to have a maximum passenger seating capacity of 75 or less in accordance with published flight schedules.

      ‘(4) NEW ENTRANT AIR CARRIER- The term ‘new entrant air carrier’ means an air carrier that

has been providing air transportation according to a published schedule for less than 5 years, including any person that has received authority from the Secretary to provide air transportation but is not providing air transportation.

      ‘(5) NONHUB AIRPORT- The term ‘nonhub airport’ means an airport that each year has less than .05 percent of the total annual boardings in the United States.

      ‘(6) REGIONAL JET AIRCRAFT- The term ‘regional jet aircraft’ means a civil aircraft--

        ‘(A) powered by jet propulsion; and

        ‘(B) designed to have a maximum passenger seating capacity of not less than 30 nor more than 75.

      ‘(7) SMALL HUB AIRPORT- The term ‘small hub airport’ means an airport that each year has at least .05 percent, but less than .25 percent, of the total annual boardings in the United States.

      ‘(8) UNDERSERVED MARKET- The term ‘underserved market’ means a passenger air transportation market (as defined by the Secretary) that--

        ‘(A) is served (as determined by the Secretary) by a nonhub airport or a small hub airport;

        ‘(B) is not within a 40-mile radius of an airport that each year has at least .25 percent of the total annual boardings in the United States; and

        ‘(C) the Secretary determines does not have sufficient air service.

‘Sec. 41763. Loan guarantees

    ‘(a) IN GENERAL- The Secretary of Transportation may guarantee any lender against loss of principal or interest on any aircraft purchase loan made by that lender to a commuter air carrier or new entrant air carrier.

    ‘(b) FORM, TERMS, AND CONDITIONS- A guarantee shall be made under subsection (a)--

      ‘(1) in such form and on such terms and conditions; and

      ‘(2) pursuant to such regulations;

    as the Secretary considers to be necessary and consistent with this subchapter.

‘Sec. 41764. Conditions and limitations

    ‘(a) LIMITATIONS ON FUNDS- Subject to subsection (d), no loan guarantee shall be made under this subchapter--

      ‘(1) extending to more than the unpaid interest and 90 percent of the unpaid principal of any loan;

      ‘(2) on any loan or combination of loans for more than 90 percent of the purchase price of the aircraft, including spare parts, to be purchased with the loan or loan combination;

      ‘(3) on any loan with respect to which terms permit repayment more than 15 years after the date the loan is made;

      ‘(4) in any case in which the total face amount of the loan and any other loans to the same air carrier or corporate predecessor of that air carrier that are guaranteed and outstanding under the terms of this subchapter exceed $100,000,000.

    ‘(b) CONDITIONS FOR MAKING LOANS- Subject to subsection (c), the Secretary of Transportation may only make a loan guarantee under this subchapter if the Secretary finds that--

      ‘(1) the aircraft to be purchased with the loan is a regional jet aircraft needed to improve the service and efficiency of operation of the commuter air carrier or new entrant air carrier;

      ‘(2) the commuter air carrier or new entrant air carrier agrees to use the aircraft to provide service to underserved markets; and

      ‘(3) the prospective earning power of the commuter air carrier or new entrant air carrier, together with the character and value of the security pledged, furnish--

        ‘(A) reasonable assurances of the air carrier’s ability and intention to repay the loan within the term of the loan--

          ‘(i) to continue its operations as an air carrier; and

          ‘(ii) to the extent that the Secretary determines to be necessary, to continue its operations as an air carrier between the same route or routes being operated by the air carrier at the time of the loan guarantee; and

        ‘(B) reasonable protection to the United States.

    ‘(c) REQUIREMENT- Subject to subsection (d), no loan guarantee may be made under this subchapter on any loan or combination of loans for the purchase of any regional jet aircraft that does not comply with the stage 3 noise levels of part 36 of title 14 of the Code of Federal Regulations, as in effect on January 1, 1997.

    ‘(d) OTHER LIMITATIONS- No loan guarantee shall be made by the Secretary under this subchapter on any loan for the purchase of a regional jet aircraft unless the commuter air carrier or new entrant air carrier agrees that it will provide scheduled passenger air transportation to the underserved market for which the aircraft is purchased for a period of not less than 24 consecutive months after the aircraft is placed in service.

‘Sec. 41765. Fees

    ‘The Secretary of Transportation shall prescribe and collect from a lending institution a reasonable guarantee fee in connection with each loan guaranteed under this subchapter.

‘Sec. 41766. Use of Federal facilities and assistance

    ‘(a) USE OF FEDERAL FACILITIES- To permit the Secretary of Transportation to make use of such expert advice and services as the Secretary may require in carrying out this subchapter, the Secretary may use available services and facilities of other agencies and instrumentalities of the Federal Government--

      ‘(1) with the consent of the appropriate Federal officials; and

      ‘(2) on a reimbursable basis.

    ‘(b) ASSISTANCE- The head of each appropriate department or agency of the Federal Government shall exercise the duties and functions of that head in such manner as to assist in carrying out the policy specified in section 41761.

    ‘(c) OVERSIGHT- The Secretary shall make available to the Comptroller General of the United States such information with respect to the loan guarantee program conducted under this subchapter as the Comptroller General may require to carry out the duties of the Comptroller General under chapter 7 of title 31.

‘Sec. 41767. Receipts; payments

    ‘(a) MISCELLANEOUS- Amounts received by the Secretary of Transportation under this subchapter shall be credited to miscellaneous receipts of the Treasury.

    ‘(b) PAYMENTS- Payments to lenders required as a consequence of any loan guarantee made under this subchapter may be made from funds appropriated pursuant to the authorization under section 202 of the Airline Service Improvement Act of 1997.

    ‘(c) ADMINISTRATIVE EXPENSES- In carrying out this subchapter, the Secretary shall use funds made available by appropriations to the Department of Transportation for the purpose of administration to cover administrative expenses of the loan guarantee program under this subchapter.

‘Sec. 41768. Termination

    ‘The authority of the Secretary of Transportation under section 41763 shall terminate on the date that is 5 years after the date of the enactment of this subchapter.’.

    (b) CONFORMING AMENDMENT- The analysis for chapter 417 of such title is amended by adding at the end the following:

‘SUBCHAPTER III--REGIONAL AIR SERVICE INCENTIVE PROGRAM

‘Sec.

      ‘41761. Purpose.

      ‘41762. Definitions.

      ‘41763. Loan guarantees.

      ‘41764. Conditions and limitations.

      ‘41765. Fees.

      ‘41766. Use of Federal facilities and assistance.

      ‘41767. Receipts; payments.

      ‘41768. Termination.’.

SEC. 202. AUTHORIZATION OF APPROPRIATIONS.

    There are authorized to be appropriated such sums as may be necessary to carry out subchapter III of chapter 417 of title 49, United States Code.