Sets Procedures for Remaining Carrier Payments
October 25, 2001
The U.S. Department of Transportation (DOT) today announced procedures for air
carriers to use in applying for the additional compensation available under
a program to compensate airlines for their losses resulting from the Sept. 11
The Air Transportation Safety and System Stabilization Act, signed by President
Bush on Sept. 22, provided $5 billion in direct payments to carriers to assist
them in recovering from financial losses sustained as a result of the attacks.
The department moved quickly to distribute nearly half of this amount to carriers,
and to date has provided nearly $2.43 billion to 111 carriers.
Under the rule announced today, the department will distribute up to a total
of 85 percent of the compensation for which a carrier is eligible under the
act, including any funds already provided. Procedures for distributing the
remaining funds will be issued at a later date.
In order to be eligible for payments, carriers must report financial data
that includes their losses between Sept. 11-30 and estimated losses for the
rest of the year. The department is making these payments in stages in order
to assure that all carriers are paid according to the law and that no carrier
The act requires compensation to be paid to carriers based on the lesser of
the direct and incremental losses attributable to the attacks, or a formula
amount based on a carriers proportionate share of reported available
seat-miles (for passenger flights) or revenue ton-miles (for cargo-only flights).
Up to $4.5 billion will be provided to passenger carriers and $500 million
to all-cargo carriers.
This direct compensation is distinct from the $10 billion in loan guarantees
authorized by the act.
Carriers must file applications within 14 days of the rules publication
in the Federal Register, except air taxis, which must file within 28 days.
The public may also comment on the rule within 14 days of publication.