President Signs 2012 FAA Reauthorization Act

On February 15, 2012, President Obama signed into law the reauthorization act for the FAA (titled the “FAA Modernization and Reform Act of 2012” (H.R. 658)). The Act is the first longterm funding for the FAA in 5 years.  Because of ongoing Congressional partisan bickering over the Act, the FAA has instead been funded since 2007 by 23 short-term extensions. While most of the discussion about the Act has been its $63 billion in funding for the FAA through 2015 and its ratcheting up of pressure on the FAA to complete the NextGen air traffic control system, the Act also contains some notable provisions for the air carrier industry.

Emergency Plans for Tarmac Delays

Section 415 of the Act codifies some of the DOT’s recently adopted passenger protections, although it is watered down from earlier versions which codified the bulk of the protections. Significantly, the Act adds some requirements that go beyond the DOT regulations. The most notable provision adds 49 U.S.C. Section 42301, which requires U.S. carriers to submit tarmac delay emergency contingency plans to DOT for approval no later than 90 days after the Act’s enactment. DOT has 60 days to review each carrier’s plan, and the plan will be deemed approved if DOT does not contact the carrier with any changes within that period.  DOT under its current regulation doesn’t review or approve the plans.

Unlike the current DOT regulations, the new law applies only to U.S. carriers and not foreign carriers. Since the Act doesn’t prohibit DOT from requiring foreign carriers to adopt such plans, DOT presumably will continue this requirement for foreign carriers.

Like the existing DOT regulations, the plan requirement applies to carriers providing scheduled or chartered passenger service on aircraft originally designed with 30 or more passenger seats. DOT is required to set minimum standards for the plans, though no time limit has been imposed for it to do so. An air carrier must submit a plan for each large, medium, and small hub airport that is serves, and also any non-hub airports (it appears that just one plan is submitted to DOT discussing all applicable airports, rather than separate plans for each airport). Congress does not define what comprises an “excessive tarmac delay,” but leaves it to DOT to do so. (DOT currently defines a lengthy tarmac delay as 3 hours for domestic flights and 4 hours for international).

Carriers for the first time are required to report in writing any excessive tarmac delays to the DOT Aviation Consumer Protection Division, within 30 days after they occur. Under the current DOT rules, carriers need only record the incident and retain the record in their files. Carriers are also required for the first time to regularly update the plans every 3 years and submit updates to DOT for review and approval.

Essential Air Service Changes

The Essential Air Service (“EAS”) program was enacted to assure a minimum level of commercial air service to small communities which would otherwise be unprofitable for the airlines to maintain. Although many House Republicans wanted to eliminate the EAS program, it survived but in a trimmed-back state. Section 421 of the Act amends the definition of an EAS “eligible place” (49 U.S.C. Section 41731) to require that for the most recent fiscal year beginning September 30, 2012, those locations designated as EAS “eligible places” now must have at least 10 enplanements per service day or more. Beginning with fiscal year 2013, DOT may annually waive the 10 enplanement requirement for a community, if DOT is satisfied that any decline below that number is temporary.

For locations to remain “eligible places,” they must also have received during fiscal year 2011 either: 1) essential air service for which compensation was provided to an air carrier under the program, or 2) a 90-day notice of a carrier’s intent to terminate EAS, where DOT required the carrier to continue providing service to the community. This amendment effectively limits air service subsidies to those communities already receiving them.

Locations in Alaska and Hawaii are exempt from these requirements, as are locations more than 175 driving miles from the nearest medium or large hub airport.

The Act increases funding for the EAS program from approximately $54 million for 2011 to $143 million for fiscal year 2012. This amount will gradually decrease over the next 3 years, down to $93 million for fiscal year 2015. It also authorizes all overflight fees collected by the FAA to be made available to the program. Fuel subsidies are also available for the first time to compensate for future fuel price increases.

Part 145 Foreign Repair Station Inspections

Section 308 of the Act codifies the FAA’s current policy of requiring annual inspections of Part 145 foreign repairs stations. It requires that the FAA, within a year of the Act’s enactment, create a safety assessment system for the foreign stations, based on the type, scope and complexity of the work they perform. The stations must be inspected at least annually. It also requires that the FAA within the next year propose a rule requiring mandatory drug and alcohol testing of all Part 145 foreign repair station employees responsible for safety sensitive maintenance functions on Part 121 aircraft. All of these measures may of course result in increased costs for the many U.S. carriers that increasingly have their aircraft serviced abroad.

Criticism of EU Emissions Trading Scheme

Congress also used the Act as another opportunity to condemn the European Union’s aviation Emissions Trading Scheme. The Act conveys the “sense of Congress,” urging DOT and FAA to use “all political, diplomatic, and legal tools” at their disposal to ensure that the trading scheme is not applied to U.S. registered aircraft or their operators. This would include the EU’s date reporting requirements and the purchase and sale of emissions allowances. The EU recently reported that while it is open to working on a global solution regarding aircraft emissions, it still plans to implement.

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Posted in Essential Air Service, EU Emissions Trading Scheme, FAA Legislation, Reauthorization Act 2012, Tarmac Delays

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Aviation Law Advisor
Cozen O’Connor’s aviation attorneys are committed to keeping their clients apprised of recent developments in the aviation industry. The world of aviation is complex and fast-moving with many participants, including aircraft manufacturers, air carriers, airports, airport operators, FBOs, repair stations and maintenance providers, insurers, airline investors, corporate and private aircraft owners and operators, and aircraft leasing and management companies. Our clients are in every sector of the industry. This blog is just one tool that we use to keep them updated on the litigation, regulatory, legislative and international developments that affect their operations every day.
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