II
111th CONGRESS
1st Session
S. 983
IN THE SENATE OF THE UNITED STATES
May 6, 2009
Ms. Snowe (for herself and Mr. Bingaman) introduced the following bill; which was read twice and referred to the Committee on Commerce, Science, and Transportation
A BILL
To reform the essential air service program, and for other purposes.
Short title
This Act may be cited as the
Rural Aviation Improvement
Act
.
Repeal of essential air service local participation program
In general
Subchapter II of chapter 417 of title 49, United States Code, is amended by striking section 41747, and such title 49 shall be applied as if such section 41747 had not been enacted.
Clerical amendment
The table of sections for chapter 417 of title 49, United States Code, is amended by striking the item relating to section 41747.
Per passenger subsidy for essential air service
In general
Section 41742 of title 49, United States Code, is amended by adding at the end the following:
Per passenger subsidy cap
In general
The Secretary of Transportation may not provide compensation to an air carrier to provide air transportation under this subchapter to an otherwise eligible place in the 48 contiguous States if the eligible place—
is located fewer than 70 highway miles from a large hub airport or medium hub airport; or
is located fewer than 210 highway miles from a large hub airport or medium hub airport and providing such air transportation would require a per passenger subsidy in excess of the dollar amount described in paragraph (2).
Dollar amount of per passenger subsidy
Dollar amount in 2010
For calendar year 2010, the dollar amount described in this paragraph is $200.
Dollar amount after 2010
For any calendar year after calendar year 2010, the dollar amount described in this paragraph is an amount equal to $200 increased or decreased by an amount equal to—
$200, multiplied by
the percentage (if any) of the increase or decrease (as the case may be) in the CPI for the preceding calendar year compared to the CPI for calendar year 2009.
Rounding
Any increase or decrease under subparagraph (B) of the dollar amount described in this paragraph shall be rounded to the nearest dollar.
CPI for any calendar year
For purposes of paragraph (2), the CPI for any calendar year is the average of the Consumer Price Index as of the close of the 12-month period ending on August 31 of that calendar year.
Consumer Price Index
For purposes of paragraph (3), the term Consumer Price Index means the last Consumer Price Index for all-urban consumers published by the Department of Labor.
.
Per passenger subsidy defined
Section 41731(a) of title 49, United States Code, is amended by adding at the end the following:
per passenger subsidy means—
the total compensation provided by the Secretary of Transportation to an air carrier under this subchapter that is necessary for the air carrier to provide air transportation to an eligible place, divided by
the total number of passengers using such air transportation.
.
Conforming repeal
Section 332 of the Department of Transportation and Related Agencies Appropriations Act, 2000 (Public Law 106–69; 49 U.S.C. 41731 note) is repealed.
Communities above per passenger subsidy cap
In general
Subchapter II of chapter 417 of title 49, United States Code, is amended by adding at the end the following:
Essential air service for eligible places above per passenger subsidy cap
Proposals
A State or local government may submit a proposal to the Secretary of Transportation for compensation for an air carrier to provide air transportation to a place described in subsection (b).
Place described
A place described in this subsection is a place—
that is otherwise an eligible place; and
for which the per passenger subsidy exceeds the dollar amount described in section 41742(c).
Decisions
Not later than 90 days after receiving a proposal under subsection (a) for compensation for an air carrier to provide air transportation to a place described in subsection (b), the Secretary shall—
decide whether to provide compensation for the air carrier to provide air transportation to the place; and
approve the proposal if the State or local government or a person is willing and able to pay the difference between—
the per passenger subsidy; and
the dollar amount allowable for such subsidy under section 41742(c).
Compensation payments
In general
If the Secretary decides to provide compensation for an air carrier to provide air transportation to a place under subsection (c), the Secretary shall pay such compensation at such time and in such manner as the Secretary determines is appropriate.
Duration of payments
The Secretary shall continue to pay compensation under this section only as long as—
the State or local government or person agreeing to pay compensation under subsection (c)(2) continues to pay such compensation; and
the Secretary decides the compensation is necessary to maintain air transportation to the place.
Review
In general
The Secretary shall periodically review the type and level of air service provided under this section.
Consultation
The Secretary may make appropriate adjustments in the type and level of air service to a place under this section based on the review under paragraph (1) and consultation with the affected community and the State or local government or person agreeing to pay compensation under subsection (c)(2).
Ending, suspending, and reducing air transportation
An air carrier providing air transportation to a place under this section may end, suspend, or reduce such air transportation if, not later than 30 days before ending, suspending, or reducing such air transportation, the air carrier provides notice of the intent of the air carrier to end, suspend, or reduce such air transportation to—
the Secretary;
the affected community; and
the State or local government or person agreeing to pay compensation under subsection (c)(2).
.
Clerical amendment
The table of sections for chapter 417 of title 49, United States Code, is amended by adding after the item relating to section 41748 the following new item:
41749. Essential air service for eligible places above per passenger subsidy cap.
.
Preferred essential air service
In general
Subchapter II of chapter 417 of title 49, United States Code, as amended by section 4, is further amended by adding after section 41749 the following:
Preferred essential air service
Proposals
A State or local government may submit a proposal to the Secretary of Transportation for compensation for a preferred air carrier described in subsection (b) to provide air transportation to an eligible place.
Preferred air carrier described
A preferred air carrier described in this subsection is an air carrier that—
submits an application under section 41733(c) to provide air transportation to an eligible place;
is not the air carrier that submits the lowest cost bid to provide air transportation to the eligible place; and
is an air carrier that the affected community prefers to provide air transportation to the eligible place instead of the air carrier that submits the lowest cost bid.
Decisions
Not later than 90 days after receiving a proposal under subsection (a) for compensation for a preferred air carrier described in subsection (b) to provide air transportation to an eligible place, the Secretary shall—
decide whether to provide compensation for the preferred air carrier to provide air transportation to the eligible place; and
approve the proposal if the State or local government or a person is willing and able to pay the difference between—
the rate of compensation the Secretary would provide to the air carrier that submits the lowest cost bid to provide air transportation to the eligible place; and
the rate of compensation the preferred air carrier estimates to be necessary to provide air transportation to the eligible place.
Compensation payments
In general
If the Secretary decides to provide compensation for a preferred air carrier to provide air transportation to an eligible place under subsection (c), the Secretary shall pay such compensation at such time and in such manner as the Secretary determines is appropriate.
Duration of payments
The Secretary shall continue to pay compensation under this section only as long as—
the State or local government or person agreeing to pay compensation under subsection (c)(2) continues to pay such compensation; and
the Secretary decides that it is necessary to pay compensation to an air carrier to maintain air transportation to the eligible place.
Review
In general
The Secretary shall periodically review the type and level of air service provided under this section.
Consultation
The Secretary may make appropriate adjustments in the type and level of air service to an eligible place under this section based on the review under paragraph (1) and consultation with the affected community and the State or local government or person agreeing to pay compensation under subsection (c)(2).
Ending, suspending, and reducing air transportation
A preferred air carrier providing air transportation to an eligible place under this section may end, suspend, or reduce such air transportation if, not later than 30 days before ending, suspending, or reducing such air transportation, the preferred air carrier provides notice of the intent of the preferred air carrier to end, suspend, or reduce such air transportation to—
the Secretary;
the affected community; and
the State or local government or person agreeing to pay compensation under subsection (c)(2).
.
Clerical amendment
The table of sections for chapter 417 of title 49, United States Code, as amended by section 4, is further amended by adding after the item relating to section 41749 the following new item:
41750. Preferred essential air service.
.
Restoration of eligibility to a place determined by the Secretary to be ineligible for subsidized essential air service
Section 41733 of title 49, United States Code, is amended by adding at the end the following new subsection:
Restoration of eligibility for subsidized essential air service
In general
If the Secretary of Transportation terminates the eligibility of a place to receive basic essential air service, a State or local government may submit to the Secretary a proposal for restoring such eligibility.
Determination by Secretary
If the per passenger subsidy required to provide basic essential air service to a place pursuant to a proposal submitted under paragraph (1) does not exceed the per passenger subsidy cap described in section 41742(c), the Secretary shall issue an order restoring the eligibility of the place to receive basic essential air service.
.
Calculation of highway mileage to medium and large hub airports
In general
Section 41731 of title 49, United States Code, is amended by adding at the end the following:
Calculation of highway mileage to medium and large hub airports
In general
In making any decision under this subchapter with respect to compensation or eligibility for compensation for essential air service based on the highway mileage of an eligible place from the nearest large hub airport or medium hub airport, the Secretary of Transportation shall calculate the highway mileage based on the highway mileage of the most commonly used route, as identified under paragraph (2).
Most commonly used route
The Secretary shall identify the most commonly used route between an eligible place and the nearest large hub airport or medium hub airport by—
consulting with the Governor or a designee of the Governor in the State in which the eligible place is located; and
considering the route certified by the Governor or a designee of the Governor to be the most commonly used route.
Applicability
This subsection shall apply only with respect to eligible places in the 48 contiguous States and the District of Columbia.
.
Conforming amendment
Section 409 of Vision 100—Century of Aviation Reauthorization Act (Public Law 108–176; 49 U.S.C. 41731 note) is repealed.
Office of Rural Aviation
Establishment
There is established within the Office of
the Secretary of Transportation the Office of Rural Aviation (in this section
referred to as the Office
).
Functions
The functions of the Office are—
to develop a uniform 4-year contract for air carriers providing essential air service to communities under subchapter II of chapter 417 of title 49, United States Code;
to develop a mechanism for comparing applications submitted by air carriers under section 41733(c) to provide essential air service to communities, including comparing—
estimates from air carriers on—
the cost of providing essential air service; and
the revenues air carriers expect to receive when providing essential air service; and
estimated schedules for air transportation; and
to select an air carrier from among air carriers applying to provide essential air service, based on the criteria described in paragraph (2).
Adjustments to compensation for significantly increased costs
Section 41737 of title 49, United States Code, is amended—
in subsection (a)(1)—
in subparagraph (B), by striking ;
and
and inserting a semicolon;
in subparagraph (C), by striking the period
and inserting ; and
; and
by adding at the end the following:
provide for an adjustment in compensation to account for significant increases in fuel costs, in accordance with subsection (e).
; and
in subsection (e)—
in paragraph (1), by striking
may
and inserting shall
; and
in paragraph (2), by striking
may
and inserting shall
.
Charter air carrier passenger boardings
Notwithstanding any other provision of law, the Secretary of Transportation shall treat passenger boardings on aircraft operated by charter air carriers at airports receiving essential air service under subchapter II of chapter 417 of title 49, United States Code, as passenger boardings for purposes of section 47114(c)(1)(E) of such title.
Authorization of appropriations
Essential air service
Section 41737(d)(2) of title 49, United States Code, is amended to read as follows:
In addition to amounts authorized to be appropriated under section 41742(a), not more than $125,000,000 shall be available to the Secretary out of the Fund for each of the fiscal years 2010 through 2013 to incur obligations under this section. Amounts made available under this section remain available until expended.
.
Small community air service development program
Section 41743(e)(2) of title 49, United
States Code, is amended by striking 2009
and inserting
2013
.