< Back to H.R. 951 (106th Congress, 1999–2000)

Text of the Airline Service Improvement Act of 1999

This bill was introduced on March 3, 1999, in a previous session of Congress, but was not enacted. The text of the bill below is as of Mar 3, 1999 (Introduced).

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HR 951 IH

106th CONGRESS

1st Session

H. R. 951

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

March 3, 1999

Mr. DUNCAN 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 1999’.

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 part D of chapter 491 of this title, 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 jet aircraft that comply with the stage 3 noise levels of part 36 of such title 14 between a high density airport and an airport that had less than 2,000,000 enplanements in the most recent year for which such enplanement data is available or between a high density airport and an airport that does not have such nonstop transportation on the date on which the application for an exemption is filed.

      ‘(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 Ronald Reagan Washington National Airport. An exemption may be granted under this subsection for a slot at Ronald Reagan Washington National Airport only if the flight utilizing such slot begins or ends within 1,250 miles of the Airport and a stage 3 aircraft is used for such flight.

      ‘(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 paragraph.

      ‘(4) DEADLINE FOR DECISION- Notwithstanding any other provision of law, the Secretary shall make a decision with regard to granting an exemption under this subsection on or before 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 only while the air carrier for whom the exemption is granted continues to provide nonstop air transportation between the airport for which the exemption was granted under paragraph (1) and the high density airport.

    ‘(f) TREATMENT OF CERTAIN COMMUTER AIR CARRIERS- The Secretary shall treat all commuter air carriers that have cooperative agreements, including code share agreements with other air carriers, equally for determining eligibility for exemptions under this section regardless of the form of the corporate relationship between the commuter air carrier and the other air carrier.’.

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

    (a) FUNDING FOR SMALL COMMUNITY AIR SERVICE- Section 41742(b) of title 49, United States Code, is amended to read as follows:

    ‘(b) FUNDING FOR SMALL COMMUNITY AIR SERVICE-

      ‘(1) IN GENERAL- Notwithstanding any other provision of law, from moneys credited to the account established under section 45303(a), including the funds derived from fees imposed under the authority contained in section 45301(a)--

        ‘(A) not to exceed $45,000,000 for each fiscal year beginning after September 30, 1999, shall be used to carry out the essential air service program under this subchapter; and

        ‘(B) not to exceed $5,000,000 for such fiscal year shall be used--

          ‘(i) for assisting an air carrier 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 obtain jet aircraft service to and from the underserved airport and to promote passenger usage of that service.

      ‘(2) RURAL AIR SAFETY- Any funds that are made available by paragraph (1) for a fiscal year and that the Secretary determines will not be obligated or expended before the last day of such fiscal year shall be available to the Administrator for use under this subchapter in improving rural air safety at airports with less than 100,000 annual boardings.

      ‘(3) ALLOCATION OF ADDITIONAL FUNDING- If, for a fiscal year beginning after September 30, 1999, more than $50,000,000 is made available under subsection (a) to carry out the small community air service program, 1/2 of the amounts in excess of $50,000,000 shall be used for the purposes specified in paragraph (1)(B), in addition to amounts made available for such purposes under paragraph (1)(B).

      ‘(4) AUTHORIZATION OF APPROPRIATIONS- In addition to amounts made available under paragraph (1), there is authorized to be appropriated to the Secretary of Transportation for each fiscal year beginning after September 30, 1999, $15,000,000--

        ‘(A) to provide assistance to an air carrier to subsidize service to and from an underserved airport for a period not to exceed 3 years; and

        ‘(B) to provide assistance to an underserved airport to obtain jet aircraft service to and from the underserved airport and to promote passenger usage of that service.

      ‘(5) PRIORITY CRITERIA FOR ASSISTING AIRPORTS NOT RECEIVING SUFFICIENT SERVICE- In providing assistance to airports under paragraphs (1)(B) and (4), the Administrator shall give priority to those airports for which a community will provide, from local sources (other than airport revenues), a portion of the cost of the activity to be assisted.

      ‘(6) UNDERSERVED AIPORT DEFINED- In this subsection, the term ‘underserved airport’ means a nonhub airport or small hub airport (as such terms are defined in section 41714(e)) that the Secretary determines is not receiving sufficient air carrier service.’.

    (b) CONFORMING AMENDMENTS- Chapter 417 of such title is amended--

      (1) section 41742 is amended--

        (A) in the section heading by striking ‘Essential’ and inserting ‘Small community’; and

        (B) in each of subsections (a) and (c) by striking ‘essential air’ and inserting ‘small community’; and

      (2) in the analysis for such chapter by striking the item relating to section 41742 and inserting the following:

      ‘41742. Small community air service authorization.’.

SEC. 103. WAIVER OF LOCAL CONTRIBUTION.

    Section 41736(b) of title 49, United States Code, is amended by adding at the end the following:

    ‘Paragraph (4) shall not apply to any place for which a proposal was approved or that was designated as eligible under this section in the period beginning on October 1, 1991, and ending on December 31, 1997.’.

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) 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.

      ‘(3) 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.

      ‘(4) NONHUB AIRPORT- The term ‘nonhub airport’ means an airport that each year has at least 2,500 passenger boardings, but less than .05 percent of the total annual boardings in the United States.

      ‘(5) 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 60.

      ‘(6) 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.

      ‘(7) UNDERSERVED AIRPORT- The term ‘underserved airport’ means an airport that--

        ‘(A) is a nonhub airport or a small hub airport;

        ‘(B) is not within a 40-mile radius of another 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- Subject to advance appropriations, 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.

    ‘(c) TREATMENT OF CERTAIN COMMUTER AIR CARRIERS- The Secretary shall treat all commuter air carriers that have cooperative agreements, including code share agreements with other air carriers, equally for determining eligibility for guarantees under this section regardless of the form of the corporate relationship between the commuter air carrier and the other air carrier.

‘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 80 percent of the unpaid principal of any loan;

      ‘(2) on any loan or combination of loans for more than 80 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--

      ‘(1) the Secretary finds that the aircraft to be purchased with the loan is a regional jet aircraft to

be used by 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 at least 2 round-trips per day 5 days per week to the underserved airport; and

      ‘(3) the Secretary finds that 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, 1999.

    ‘(d) OTHER LIMITATIONS-

      ‘(1) ON PURCHASE OF REGIONAL JET AIRCRAFT- 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 airport for which the aircraft is purchased, or to another underserved airport, for a period of not less than 24 consecutive months after the aircraft is placed in service.

      ‘(2) ON SUBORDINATION- No loan guarantee made under this subchapter may be subordinated to another debt of the carrier or to any other claims against the carrier.

      ‘(3) TO PROTECT INTERESTS OF UNITED STATES- No loan may be guaranteed under this subchapter unless the Secretary determines that the lender is responsible and that adequate provision is made for servicing the loan on reasonable terms and protecting the financial interests of the United States.

‘Sec. 41765. Payment of losses

    ‘(a) IN GENERAL- If, as a result of a default by a carrier under a loan guaranteed under this subchapter and after the holder of the loan has made such further collection efforts as the Secretary of Transportation may require, the Secretary determines that the holder has suffered a loss, the Secretary shall pay the holder the amount of the loss under the guarantee contract. Upon making the payment, the Secretary shall be subrogated to all the rights of the recipient of the payment.

    ‘(b) ENFORCEMENT OF UNITED STATES RIGHTS- The Attorney General shall take such action as may be necessary to enforce any right accruing to the United States as a result of the issuance of any guarantee under this subchapter.

    ‘(c) LIMITATION ON STATUTORY CONSTRUCTION- Nothing in this subchapter shall be construed as precluding any forbearance for the carrier which may be agreed upon by the parties to the guaranteed loan and approved by the Secretary.

    ‘(d) AUTHORITY OF SECRETARY- Notwithstanding any other provision of law relating to the acquisition, handling, or disposal of property by the United States, the Secretary may complete, recondition, reconstruct, renovate, repair, maintain, operate, or sell any property acquired under this subchapter.

‘Sec. 41766. Fees

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

‘Sec. 41767. 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. 41768. Payments; administrative expenses

    ‘(a) 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 1999.

    ‘(b) 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. 41769. 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

      ‘41761. Purpose.

      ‘41762. Definitions.

      ‘41763. Loan guarantees.

      ‘41764. Conditions and limitations.

      ‘41765. Payment of losses.

      ‘41766. Fees.

      ‘41767. Use of Federal facilities and assistance.

      ‘41768. Payments; administrative expenses.

      ‘41769. Termination.’.

SEC. 202. AUTHORIZATION OF APPROPRIATIONS.

    There is authorized to be appropriated for the cost of loan guarantee commitments authorized in subchapter III of chapter 417 of title 49, United States Code, $120,000,000 per fiscal year for fiscal years 2000, 2001, 2002, 2003, and 2004.

TITLE III--CONTRACT TOWER PROGRAM

SEC. 301. CONTRACT TOWERS.

    Section 47124(b) of title 49, United States Code, is amended by adding at the end the following:

      ‘(3) NONQUALIFYING AIR TRAFFIC CONTROL TOWERS-

        ‘(A) IN GENERAL- The Secretary shall establish a program to contract for air traffic control services at not more than 20 level I air traffic control towers, as defined by the Administrator of the Federal Aviation Administration, that do not qualify for the program established under subsection (a) and continued under paragraph (1).

        ‘(B) PRIORITY- In selecting facilities to participate in the program under this paragraph, the Administrator shall give priority to the following:

          ‘(i) Air traffic control towers that are participating in the program continued under paragraph (1) but have been notified that they will be terminated from such program because the Administrator has determined that the benefit-to-cost ratio for their continuation in such program is less than 1.

          ‘(ii) Level I air traffic control towers of the Federal Aviation Administration that are closed as a result of the air traffic controllers strike in 1981.

          ‘(iii) Air traffic control towers that are located at airports that receive air service from an air carrier that is receiving compensation under the essential air service program of subchapter II of chapter 417.

          ‘(iv) Air traffic control towers located at airports that are prepared to assume responsibility for tower construction and maintenance costs.

          ‘(v) Air traffic control towers that are located at airports with safety or operational problems related to topography, weather, runway configuration, or mix of aircraft.

        ‘(C) COSTS EXCEEDING BENEFITS- If the costs of operating a control tower under the program established under this paragraph exceed the benefits, the airport sponsor or State or local government having jurisdiction over the airport shall pay the portion of the costs that exceed such benefits.

        ‘(D) AUTHORIZATION OF APPROPRIATIONS- There is authorized to be appropriated $6,000,000 per fiscal year to carry out this paragraph.’.