Transportation Secretary: Airports and Airlines Will Get Billions for Much-Needed Boost

April 14, 2020The Washington Examiner

MOON TOWNSHIP, Pennsylvania — Help is on the way for airlines and airports, Secretary of Transportation Elaine Chao said. During the coronavirus pandemic, the suffering is obvious to anyone who walks into an airport like this one: Pittsburgh International Airport has seen passenger traffic in and out of the facility go from 26,000 people a day to fewer than 400 people boarding flights.

Walking through Pittsburgh International is surreal. Restaurants, bars, boutiques, and coffee shops are shuttered. The arrival and departure signs, typically so full it takes several moments to find your flight information, are nearly empty. The flights that remain are mostly marked CANCELED in bright red. The parking lot is empty.

In an exclusive interview with the Washington Examiner, Chao said she is announcing on Tuesday $10 billion in grants for commercial and general aviation airports funded by the recently signed CARES Act. U.S. airlines of all sizes will get $50 billion in loans and grants in a package that will be finalized later this week.

“The airlines are really hurting,” Chao said ahead of the announcement. “I’ve been in close contact with the airlines, and I’m concerned about employment in the airline industry.”

“The load factor of these passenger airlines ranges now from 4% to 9%. One airline said of the 119 flights out of Washington’s Ronald Reagan Washington National Airport, eight of those flights had only one passenger, and the majority just had a handful. So the airline industry really needs help, and this package of federal assistance provided in the CARES Act is very much needed,” she explained. “The first concern is to provide resources for these airlines to be able to meet their payroll obligations. Because we want workers’ jobs to be saved. We want people to maintain their jobs during this critical time.”

Chao said one of her first and major concerns is to keep the air space open for business.

Chao said that in Europe, air traffic volume has fallen by 85%. In the United States, it has dropped by “about 65%, 68%.”

Chao said the additional money airports will be getting from the CARES Act will be flexible. Many airports, like the one here in suburban Pittsburgh, get their revenues from parking and passenger facility charges — revenue that has completely dried up for over a month. “Parking is a big source of revenue. They also get it from passenger facility charges, basically a ticket tax, and they also get some funding from local, county, and state governments and floating their own bonds,” she said. “So these airports have been hit hard with those loss of revenues, and so have their state and local governments. That is why this $10 billion in funding for airports is very important.”

“Number one,” she explained, “the money is going to be used for payroll because we want to make sure that people are employed. Number two: Usually, the grants are only for a certain specific thing, say the terminal, for example. But under the CARES Act, there will be a greater flexibility given to them, but basically, it’s to maintain operations.”

Chao says America’s economy will not be able to take off again unless American airspace and airlines are able to get back online. “So the airport office has been working literally around the clock to get CARES Act aviation support. … That enables continued passenger and freight traffic. We have actually done very, very well in terms of meeting all these legislative deadlines,” she said of the tight deadlines in the law.

Chao said this year was going to be the best year ever for both passenger and cargo airlines. “It is just so sad to see the whole industry so heavily hit like this through no fault of their own because the airline industry is a very, very tough industry to make money,” she said.

Chao said she’s also worked to enable drone usage for COVID-19 response efforts. “The FAA small, unmanned aircraft rule allows operators to transport goods and certain medical supplies, like test kits, prescription drugs, and, under certain circumstances, blood.” The flight must comply with all provisions of the rules for small, unmanned aircraft. “But we gave special approvals for flights to support emergency activities and appropriate government health or community initiatives, some of which are issued in less than an hour.”

Chao’s team also worked with the FAA to protect flight attendants. “The exemption allows flight attendants to relocate from the seats that they would normally occupy so that they can observe social distancing,” she explained. “And it also excuses them from having to demonstrate the use of certain emergency equipment, including the life preservers and oxygen masks. We’re not forgoing them. We’re just allowing them alternative methods to inform passengers regarding the use of this kind of equipment.”

They also worked to facilitate a safe work environment for air traffic controllers, who typically work in a very confined space. “Under our direction, they are establishing separate teams of controllers that will stay together throughout the duty week. Each crew will have the same employees, thereby limiting the possibility of cross-exposure to COVID-19 that will come through normal shift rotations.”

Chao also said she has asked the FAA to temporarily waive the minimum slot use requirements at airports to help airlines that cancel flights due to the pandemic. “Under normal circumstances, airlines will lose their slots at congested airports if they don’t use their slots at least 80% of the time. So the FAA is temporarily waiving that minimum use requirement.”

One complaint she hears about a lot concerns flight refunds. “In passing the CARES Act, we wanted to make sure that airlines were complying with the U.S. Department of Transportation’s requirements for refunds,” she said. “And so recently, we issued an enforcement notice reminding U.S. and foreign airlines of their obligations to provide a prompt refund to passengers — whether it’s for flights to or from the United States. And also clarifying and reminding these U.S. and foreign airlines of their obligations to provide a prompt refund to passengers for flights to and from and within the United States.”

It’s a complaint Chao can relate to as a frequent flier. “I had several flights to Louisville, Kentucky, that I can no longer use,” she said. “So I know personally about that.”
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