DOT FINALIZES AIRLINE MINIMUM SERVICE ORDER
April 13, 2020
On April 7, 2020, the U.S. Department of Transportation (DOT) issued a final order, available here, establishing parameters for implementing the authority granted to the DOT by Sections 4005 and 4114(b) of the Coronavirus Aid, Recovery, and Economic Security (CARES) Act. The Order finalizes, with some modifications, the Department’s tentative findings, and requires that air carriers receiving financial assistance maintain minimum air services on a nationwide basis. U.S. Air carriers offering scheduled passenger service and all-cargo carriers are covered by the Order; however, the Department is not requiring service obligations of all-cargo carriers at this time. Charter operations and air taxi operators are also not covered.
DOT established the following minimum service levels:
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For points that a covered carrier served with at least one flight at least five days per week, at least one flight per day, five days per week, is required.
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For a point that received service from fewer than five days per week, the carrier would only need to serve that point with at least one flight on one day per week.
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If a covered carrier served a point with any degree of scheduled service from more than one other point, it would only need to provide service from that point to one of the previously served points as long as it met the above frequency requirements.
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A covered carrier could also meet its minimum Service Obligation for a given point by dividing its flights across multiple cities, if it so chose.
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If multiple covered carriers served a point, each covered carrier would be required to serve the point in accordance with the above minimum service levels, regardless of the service decisions made by the other covered carriers serving that point.
With regard to requests for exemptions, which DOT intends to expedite: (1) Covered carriers must file exemption requests with the Department in advance and serve their filings on interested parties; (2) Interested parties will have a brief period of time to submit comments; (3) Until DOT issues a decision, any services covered by a carrier’s Service Obligation must continue. DOT is also providing an industry-wide exemption for circumstances in which direct financial support arrangements between communities and airlines have ceased after the declaration of a public health emergency under section 319 of the Public Health Services Act in response to the COVID-19 epidemic.
The initial term for the service obligations extends through September 30, 2020, which may be extended by the Department. If carriers have any questions about their minimum service obligations, or need help filing exemptions, please contact us.
If you have any questions, please contact Evelyn Sahr (esahr@eckertseamans.com or 202-659-6622); Drew Derco (dderco@eckertseamans.com or 202-659-6665), or Andy Orr (aorr@eckertsemans.com or 202-659-6625).
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