NEW TREASURY GUIDANCE AND APPLICATION AVAILABLE FOR AVIATION LOAN PROGRAM
April 15, 2020
On April 6, 2020, the U.S. Treasury Department issued further guidance on the application procedure for loans to air carriers under Section 4003 of the CARES Act, available here. The application document was only for informational purposes in an effort to provide potential applicants with an understanding of what information would be requested by the forthcoming online application form. On April 8, 2020, the Treasury Department released the online application form for the Section 4003 loan program, available here. To receive approval of their applications as soon as possible, carriers are instructed to submit their completed application materials no later than 5:00 p.m. EDT on April 17, 2020. The Treasury Department has indicated that applications received after 5:00 p.m. EDT on April 17 will be considered, but may not receive approval as quickly. Applications received after 11:59 p.m. EDT on April 30, 2020, may not be considered at all. However, Treasury, in their discretion and subject to the availability of funds, may consider such applications for approval.
Importantly, the application guidance states that it only applies to loans from DOT to (1) passenger air carriers; (2) cargo air carriers; (3) eligible businesses that are certified under 14 CFR part 145 and approved to perform inspection, repair, replacement, or overhaul services (“Part-145 certified repair station operators”); and (4) and ticket agents. However, the application guidance in its current form does not provide any further definition of “businesses critical to maintaining national security” which are also eligible for loans under Section 4003(b)(3) of the CARES Act.
We will continue to provide updates on the CARES Act and potential relief for air carriers as it becomes available. If you have any questions about, or intend to apply for loans under Section 4003 of the CARES Act, please contact us for assistance.
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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