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Regional Aviation News
Oberstar,DeFazio Introduce Airline Aid Bill
March 20 , 2003
A bill introduced yesterday to help airlines if the U.S. goes forward with a war in Iraq could pass speedily with just a little push from the White House, Rep. James Oberstar (D-Minn.), the House Transportation Committee’s ranking member, declared at a news conference to detail the measure. “If there was just an ounce of concern by the White House that could be expressed overtly or subtly, this bill could move through the committee to the House floor and be passed in a flash,” Oberstar said. But he believes some powerful forces in the White House contend, “Free market forces are best left unattended, and if carriers go into Chapter 11” or liquidation, other airlines will take over their routes. He said he didn’t know which “others” will take over but noted that the industry would be “on the verge” of being controlled by non-U.S. interests. The Aviation Industry Stabilization Bill of 2003 — introduced by Oberstar, Rep. Peter DeFazio (D-Ore.), ranking member on the Transportation aviation subcommittee, and Rep. William Lipinski (D-Ill.) — would cost $4 billion to $5 billion by Oberstar’s estimation.
Oberstar has been planning the measure for weeks (DAILY, March 19). Travelers, who pay security taxes, “have said they are willing to pay the price of a cappuccino to fly safely and the price of a Cinnabon to return home safely,” he said. The tax relief airlines have asked for isn’t in the new bill. The legislation, however, would re-open the airline loan guarantee program — a move the Air Transport Association opposed — but only to help airlines pay for fuel. Oberstar wanted to narrow the measure’s scope with regard to federal loan guarantees, adding yesterday that the Air Transportation Stabilization Board “has not administered the program as we in Congress intended it to be administered. They acted as thought their purpose was to deny loan guarantees rather than approve them.”
The bill extends war risk insurance to Dec. 31, 2007, at current premiums and caps airline liability for third-party damages from terrorist acts at $100 million. It also requires the TSA to reimburse carriers for security upgrades, such as reinforcing cockpit doors, and mandates reimbursement for carrying personnel and materiel to the war zone or any participation in the war as part of the Civil Reserve Air Fleet. It would also tap the strategic petroleum reserve for up to 500,000 barrels per day to keep the price of fuel down. DeFazio acknowledged the Act does not cover everything the airlines have asked for but noted that it’s “more than the Administration has done.” -DM
Source: Aviation Daily, March 20, 2003
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