Sec. 561. ESSENTIAL AIR SERVICE REFORMS
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## SEC. 561 ESSENTIAL AIR SERVICE REFORMS ###
(a)Reduction in Subsidy Cap ####
(1)In general Section 41731(a)(1)(C) of title 49, United States Code, is amended to read as follows: > > ##### “(C) > > had an average subsidy per passenger, as determined by the Secretary— > > > ###### “(i) > > of less than $1,000 during the most recent fiscal year beginning before October 1, 2026, regardless of driving miles to the nearest large or medium hub airport; > > > ###### “(ii) > > of less than $850 during the most recent fiscal year beginning after September 30, 2026, regardless of driving miles to the nearest medium or large hub airport; and > > > ###### “(iii) > > of less than $650 during the most recent fiscal year for locations that are less than 175 miles from the nearest large or medium hub airport; and” > . ####
(2)Notice Section 41731(a)(1)(D)(ii) is amended by striking “90-day” and inserting “140-day”. ####
(3)Waivers Section 41731(e) of title 49, United States Code, is amended to read as follows: > > ### “(e) Waivers > > > #### “(1) In general > > The Secretary may waive, on an annual basis, subsections (a)(1)(B) and (a)(1)(C)(iii) with respect to an eligible place if such place demonstrates to the Secretary’s satisfaction that the reason the eligibility requirements of such subsections are not met is due to a temporary decline in demand. > > > #### “(2) Limitation > > Beginning with fiscal year 2027, the Secretary may not provide a waiver of subsection (a)(1)(B) to any location— > > > ##### “(A) > > in more than 2 consecutive fiscal years; or > > > ##### “(B) > > in more than 5 fiscal years within 25 consecutive years. > > > #### “(3) Limitation > > Beginning in fiscal year 2027, the Secretary may not provide a waiver of subsection (a)(1)(C)(iii) to any location— > > > ##### “(A) > > in more than 2 consecutive fiscal years; or > > > ##### “(B) > > in more than 5 fiscal years within 25 consecutive years.” > . ####
(4)Conforming amendments #####
(A)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Department of Transportation and Related Agencies Appropriations Act, 2000 (Public Law 106-69; 49 U.S.C. 41731 note) is repealed. #####
(B)Subsections
(c)and
(d)of section 426 of the FAA Modernization and Reform Act (49 U.S.C. 41731 note) are repealed. ###
(b)Restriction on Length of Routes ####
(1)In general Section 41732(a)(1) of title 49, United States Code, is amended to read as follows: > > #### “(1) > > to a medium or large hub airport less than 650 miles from an eligible place (unless such airport or eligible place are located in a noncontiguous State); or” > . ####
(2)Exception **[**[49 U.S.C. 41732 note](/us/usc/t49/s41732)**]** The amendment made by paragraph
(1)shall not apply to an eligible place that is served by an air carrier selected to receive essential air service compensation under subchapter II of chapter 417 of title 49, United States Code, if— #####
(A)such service is in effect upon the date of enactment of this Act; and #####
(B)such service is provided by the same air carrier that provided service on the date of enactment of this Act. ####
(3)Sunset Paragraph
(2)shall cease to have effect on October 1, 2028. ###
(c)Improvements to Basic Essential Air Service Section 41732 of title 49, United States Code, is amended— ####
(1)in subsection (a)(2) by inserting “medium or large” after “nearest”; and ####
(2)in subsection (b)— #####
(A)by striking paragraphs
(3)and (4); #####
(B)by redesignating paragraph
(5)as paragraph (3); and #####
(C)by striking paragraph (6). ###
(d)Level of Basic Essential Air Service Section 41733 of title 49, United States Code, is amended— ####
(1)in subsection (c)(1)— #####
(A)by striking subparagraph
(B)and inserting the following: > > ##### “(B) > > the contractual, marketing, code-share, or interline arrangements the applicant has made with a larger air carrier serving the hub airport;” > ; #####
(B)by striking subparagraph (C); #####
(C)by redesignating subparagraphs
(D)through
(F)as subparagraphs
(C)through (E), respectively; #####
(D)in subparagraph (C), as so redesignated, by striking “giving substantial weight to” and inserting “including”; #####
(E)in subparagraph (D), as so redesignated, by striking “and” at the end; #####
(F)in subparagraph (E), as so redesignated, by striking the period and inserting “; and”; and #####
(G)by adding at the end the following: > > ##### “(F) > > the total compensation proposed by the air carrier for providing scheduled air service under this section.” > ; and ####
(2)in subsection
(h)by striking “by section 332 of the Department of Transportation and Related Agencies Appropriations Act, 2000 (Public Law 106-69; 113 Stat. 1022)” and inserting “under section 41731(a)(1)(C)”. ###
(e)Sense of Congress It is the sense of Congress that route structures to rural airports serve a critical function to the Nation by connecting many military installations to major regional airline hubs. ###
(f)Ending, Suspending, and Reducing Basic Essential Air Service Section 41734 of title 49, United States Code, is amended— ####
(1)in subsection (a)— #####
(A)by striking “An air carrier” and inserting “Subject to subsection (d), an air carrier”; and #####
(B)by striking “90” and inserting “140”; ####
(2)by striking subsection
(d)and inserting the following: > > ### “(d) Continuation of Compensation After Notice Period > > > #### “(1) In general > > If an air carrier receiving compensation under section 41733 for providing basic essential air service to an eligible place is required to continue to provide service to such place under this section after the 140-day notice period under subsection (a), the Secretary— > > > ##### “(A) > > shall provide the carrier with compensation sufficient to pay to the carrier the amount required by the then existing contract for performing the basic essential air service that was being provided when the 140-day notice was given under subsection (a); > > > ##### “(B) > > may pay an additional amount that represents a reasonable return on investment; and > > > ##### “(C) > > may pay an additional return that recognizes the demonstrated additional lost profits from opportunities foregone and the likelihood that those lost profits increase as the period during which the carrier or provider is required to provide the service continues. > > > #### “(2) Authority > > The Secretary may incorporate contract termination penalties or conditions on compensation into a contract for an air carrier to provide service to an eligible place that take effect in the event an air carrier provides notice that it is ending, suspending, or reducing basic essential air service.” > ; ####
(3)in subsection
(e)by striking “providing that service after the 90-day notice period” and all that follows through the period at the end of paragraph
(2)and inserting “providing that service after the 140-day notice period required by subsection (a), the Secretary may provide the air carrier with compensation after the end of the 140-day notice period to pay for the fully allocated actual cost to the air carrier of performing the basic essential air service that was being provided when the 140-day notice was given under subsection
(a)plus a reasonable return on investment that is at least 5 percent of operating costs.”; and ####
(4)in subsection
(f)by inserting “air” after “find another”. ###
(g)Enhanced Essential Air Service Section 41735 of title 49, United States Code, and the item relating to such section in the analysis for subchapter II of chapter 417 of such title, are repealed. ###
(h)Compensation Guidelines, Limitations, and Claims Section 41737(d) of title 49, United States Code, is amended— ####
(1)by striking “(1)” before “The Secretary may”; and ####
(2)by striking paragraph (2). ###
(i)Joint Proposals Section 41740 of title 49, United States Code, and the item relating to such section in the analysis for subchapter II of chapter 417 of such title, are repealed. ###
(j)Preservation of Basic Essential Air Service at Single Carrier Dominated Hub Airports Section 41744 of title 49, United States Code, and the item relating to such section in the analysis for subchapter II of chapter 417 of such title, are repealed. ###
(k)Community and Regional Choice Programs Section 41745 of title 49, United States Code, is amended— ####
(1)in subsection (a)(3), by striking subparagraph
(E)and redesignating subparagraph
(F)as subparagraph (E); ####
(2)by striking subsections
(b)and (c); and ####
(3)by redesignating subsections
(d)through
(g)as subsections
(b)through (e), respectively. ###
(l)Marketing Program Section 41748 of title 49, United States Code, and the item relating to such section in the analysis for subchapter II of chapter 417 of such title, are repealed.
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- Pub. L. 106-69
- 113 Stat. 1022
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Sec. 561
ESSENTIAL AIR SERVICE REFORMS
Pub. L.Pub. L. 106-69
Stat.113 Stat. 1022
Cites 4Cited by 0 across 0 sources