[Congressional Bills 106th Congress]
[From the U.S. Government Publishing Office]
[H.R. 1679 Introduced in House (IH)]







106th CONGRESS
  1st Session
                                H. R. 1679

To amend title 49, United States Code, to provide assistance and slots 
 with respect to air carrier service between high density airports and 
certain small and nonhub airports that have unreasonably high airfares, 
to improve jet aircraft service to markets that have unreasonably high 
                   airfares, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                              May 4, 1999

 Mr. Sweeney 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 
certain small and nonhub airports that have unreasonably high airfares, 
to improve jet aircraft service to markets that have unreasonably high 
                   airfares, 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 ``Airfare Relief 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 With Unreasonably High Airfares.--Section 
41714 of such title is amended--
            (1) by striking subsections (e) and (f) and inserting the 
        following:
    ``(e) Slots for Airports With Unreasonably High Airfares.--
            ``(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 a small hub airport or nonhub airport that 
        has unreasonably high airfares.
            ``(2) Limitations.--No more than 4 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 that has unreasonably 
        high airfares 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 at least 2,500 
passenger boardings but less than .05 percent of the total annual 
boardings in the United States.
                    ``(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.
                    ``(C) Unreasonably high airfare.--The term 
                `unreasonably high airfare', as used with respect to an 
                airport, means that the airfare listed in the table 
                entitled `Top 1,000 City-Pair Market Summarized by 
                City', contained in the Domestic Airline Fares Consumer 
                Report of the Department of Transportation, for one or 
                more markets for which the airport is a part of has an 
                average yield listed in such table that is more than 19 
                cents.''.

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 small hub or 
                        nonhub airport that has unreasonably high 
                        airfares for a period not to exceed 3 years; 
                        and
                            ``(ii) for assisting such an airport to 
                        obtain jet aircraft service to and from the 
                        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 a small hub or nonhub 
                airport that has unreasonably high airfares for a 
                period not to exceed 3 years; and
                    ``(B) to provide assistance to such an airport to 
                obtain jet aircraft service to and from the 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) Definitions.--In this subsection, the terms `nonhub 
        airport', `small hub airport', and `unreasonably high airfare' 
        have the meaning such terms have in section 41714(e)(6).''.
    (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. JOINT FARES AND INTERLINE AGREEMENTS.

    (a) Subchapter I of chapter 417 is amended by adding at the end the 
following:
``Sec. 41717. Joint fares and interline agreements for domestic 
              transportation
    ``(a) Definitions.--In this section, the following definitions 
apply:
            ``(1) Qualifying air carrier.--The term `qualifying air 
        carrier' means an air carrier that operates under a certificate 
        of public convenience and necessity under chapter 411 of this 
        title.
            ``(2) High airfare airport.--The term `high airfare 
        airport' means a commercial service airport that is a nonhub 
        airport (as defined in section 41731 of this title) or a small 
        hub airport (as defined in section 41731 of this title) that 
        has unreasonably high airfares as defined in section 
        41714(e)(6).
            ``(3) Essential airport facility.--The term `essential 
        airport facility' means a large hub airport (as defined in 
        section 41731 of this title) in the contiguous 48 States.
    ``(b) Secretary May Compel Joint Fare Structure.--If the Secretary 
of Transportation determines that it is necessary to enhance 
competition at a high airfare airport, the Secretary may require an air 
carrier that serves an essential airport facility to enter into a 
joint-fare or interline agreement, that the Secretary determines is 
reasonable, with a qualifying air carrier that serves the high airfare 
airport to facilitate air transportation in the market.''.

            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 90 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 90.
            ``(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) High airfare airport.--The term `high airfare 
        airport' means a nonhub airport or small hub airport that has 
        unreasonably high airfares as defined in section 41714(e)(6).
``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 high airfare 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 
        high airfare 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 
Airfare Relief 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.
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