General aviation small businesses are experiencing tremendous economic losses as a direct result of unprecedented actions taken by the Federal Aviation Administration in response to the terrorist acts of September 11, 2001. This small business sector faces dire consequences including the layoff of thousands of workers.
The losses incurred by general aviation small businesses do not appear to qualify under any established federal disaster relief law or program. In testimony before the House aviation subcommittee on September 25, 2001, AOPA President Phil Boyer gave a proposal for a general aviation federal aid recovery plan.
That proposal was incorporated in the General Aviation Small Business Relief Act (H.R. 3007), introduced on October 3, 2001 in the House of Representatives by Bill Shuster (R-Pa.). The legislation would amend Section 7(b) of the Small Business Act (15 U.S.C. 636 [b]) to require the Small Business Administration to provide grants and loans to small GA businesses that qualify and would defer repayment of loans and interest rates for one year.
AOPA also worked with Senators Tom Harkin (D-Iowa) and Jim Inhofe (R-Okla.) who introduced the General Aviation Small Business Assistance Act (S. 1552) on October 16, 2001. This bill complements the American Small Business Emergency Relief and Recovery Act of 2001 (S. 1499) introduced by Senators John Kerry (D-Mass.) and Christopher "Kit" Bond (R-Mo.) on October 2, 2001, and its companion bill in the House (H.R. 3230), introduced by Representative Donald Manzullo (R-Ill.) on November 6, 2001.
The Harkin-Inhofe bill would provide for direct grants to GA small businesses affected by the shutdown of airspace, whereas the Kerry-Bond bill would provide disaster loans to GA small businesses similarly affected. Terms include deferred payments and forgiven interest on these loans for two years.
One GA Relief bill that will now head to the full House of Representatives for a vote is H.R. 3347, the General Aviation Industry Reparations Act of 2001. On November 27, House Aviation Subcommittee Chairman John Mica (R-Fla.) introduced H.R. 3347, which will provide, if enacted as it was amended by the full committee, $3 billion in loan guarantees (which will be authorized from the unused portion of the $10 billion in loan guarantees provided through last September's airline bailout bill) and $2.5 billion in grants to general aviation businesses. The newly formed Air Transportation Stabilization Board would administer funding, and the President would have the power to give priority for compensation to a GA entity based on the length of time that entity has been unable to operate. AOPA Legislative Affairs worked closely with Chairman Mica's staff to finalize the bill. H.R. 3347 was reported out of the House Transportation and Infrastructure Committee on February 27 and must now be approved by the full House of Representatives. Meanwhile in the Senate, Jim Inhofe of Oklahoma introduced companion legislation to Rep. Mica's bill, S. 2007, on March 12. Sen. Inhofe's bill has been referred to the Senate Banking, Housing, and Urban Affairs Committee.
And S. 1499, a bill introduced by Small Business Committee Chairman John Kerry (D-Mass.) passed the Senate by voice vote on March 22. Sen. Kerry negotiated with the White House and Republican Christopher Bond (Mo.), ranking member of the Small Business Committee, to clear the way for the President's signature on the AOPA-backed bill. The original version of the bill, which provided $800 million in aid over five years, was considered too costly by the Administration. The compromise legislation would provide $300 million over five years.
Please look below for recent congressional action on these bills and individual bill summaries.
H.R. 3347, General Aviation Industry Reparations Act of 2002
Bill status and sponsorship
Includes the following:
S. 2007, General Aviation Industry Reparations Act of 2002
Includes the same language as H.R. 3347 (outlined above)
H.R. 3007, General Aviation Small Business Relief Act of 2001
The Federal Emergency Management Agency (FEMA) should be used to administer grants provided by relief legislation. FEMA would also provide assistance in obtaining loans through various SBA loan programs in the event that grant monies are not sufficient. Though FEMA's responsibilities have traditionally been to assist communities, individuals and businesses with grants and loans in times of natural disaster, FEMA is best suited to administer this General Aviation Small Business Relief Act.
H.R. 3230, American Small Business Emergency Relief and Recovery Act of 2001
S. 1552, General Aviation Small Business Assistance Act
S. 1499, American Small Business Emergency Relief and Recovery Act of 2001
AOPA thanks our members for their continued support in protecting the freedom to fly.