NBAA has welcomed news that the US Department of the Treasury has begun making payments to many of the small and mid-sized general aviation air carriers, including FAR Part 135 charter operators struggling with the unprecedented financial challenges raised by the COVID-19 pandemic.
On April 20, the Treasury made the first payroll support programme payments to approved applicants, among them many Part 135 charter operators. All funds provided under the programme can be used only for the continuation of payment of employee wages, salaries and benefits. The programme was launched following implementation of the Coronavirus Aid, Relief, and Economic Security (CARES) Act on March 27.
NBAA has strongly advocated for general aviation air carriers as Treasury implemented the payroll support programme. In a March 31 letter, the association explained to the Treasury that initial guidance on the payroll support programme presented challenges for general aviation businesses, as specific requirements were structured for the major scheduled airlines. On April 10, the department issued guidance responding directly to the association's concerns, and providing essential flexibility for general aviation air carriers seeking payroll support.
As the COVID-19 virus has spread, charter operators across the country are reporting sharp drop-offs in flight requests and activity, in some cases by more than 75% over the same period last year. These operators are a critical part of the nation's air transportation system, providing air medical transportation and delivering critical supplies and personnel across the country.
“We are very pleased to see that payments are beginning to be made to the charter companies employing thousands of people contending with the circumstances presented by the COVID-19 pandemic,” says NBAA president and CEO Ed Bolen. “Our thanks once again to Treasury Secretary Mnuchin and Transportation Secretary Chao for hearing and responding to this pressing concern.”
Meanwhile, the US congressional passage of legislation is provide an additional $310 billion in funding to the Pay check Protection Program (PPP). The programme, administered by the Small Business Administration (SBA), is a key provision of the Coronavirus Aid, Relief, and Economic Security (CARES) Act and has provided relief to more than one million small businesses.
As part of the new PPP funding, $60 billion will be set aside for small lenders and community-based financial institutions. In addition, $50 billion in new funding will be provided to the SBA Economic Injury Disaster Loan programme.
NBAA strongly advocated for inclusion of general aviation businesses in all CARES Act provisions, reminding legislators and the SBA that business aviation, which is mostly made up of thousands of small and mid-size enterprises, generates $77 billion in labour income, helping families across the nation pay bills and put food on the table, while supporting local communities. In addition to eligibility for SBA loans and grants, NBAA advocated and successfully ensured eligibility for general aviation air carriers for relief packages administered by the Department of the Treasury.
“We are very pleased to see Congress respond to the continuing, highly challenging needs of many small businesses and their employees,” says NBAA president and CEO Ed Bolen. “We appreciate the bipartisan efforts of Congress, the Department of Treasury and the Small Business Administration to make billions of dollars available to save the jobs of many small business employees.”
PPP loans are available to small businesses with fewer than 500 employees, sole proprietorships, independent contractors and other specific organisations. These loans have favourable terms, and part or all of a loan can be forgiven if the funds are used for authorised expenses, including payroll expenses, interest on mortgages, rent or utilities, if those commitments were made prior to February 15, 2020.
The SBA announced last week the PPP had run out of funds with thousands of small businesses still awaiting loan approval and funds disbursement.