Viewpoint: Charter Operators Seek Regulatory Ground Stop

Editor’s Note: The FAA announced on June 17 that it will begin a rulemaking to amend Part 110 definitions of “scheduled,” “on demand,” and “supplemental” operations to tighten requirements for carriers flying under the U.S. Transportation Department’s Part 380 public charter regulation. The FAA said it also will convene a Safety Risk Management Panel to assess the feasibility of establishing a new operating authority for scheduled Part 135 operations in 10-to-30 seat aircraft.

Small businesses tend to bear the brunt of government overregulation. It drives up the cost of doing business and drastically impacts the services that small businesses can provide. It happens across nearly every industry every day, and it is nothing new in the way government regulators work.

Following the 2008 financial crisis, Congress passed the Dodd-Frank Wall Street Reform and Consumer Protection Act in 2010 to “protect consumers.” The law stacked regulation on regulation to the point that only large banks could absorb the costs and survive. Predictably, smaller banks were forced to either close their doors or merge with larger institutions, bringing an end to the old local bank that served small businesses in rural America. [Bipartisan legislation that Congress passed in 2018 partially repealed the Dodd-Frank Act to exempt some banks from strict federal regulation. – Ed.]

The same thing seems to be happening in America’s national air travel industry.

Since the travel slump of COVID-19, some Part 121 airlines have shifted operational focus to major hub cities, leaving travelers in “flyover country” with limited options. While the federal Essential Air Service program has given some assurance to these rural and underserved communities, the U.S. Transportation Department (DOT) and the FAA seem to be taking aim at Part 135 operators who are filling the gap in service.

Most of these private air charter operating flights under the DOT Part 380 regulation are small businesses. They serve ticket counters in rural communities, connecting those travelers directly to the national air transportation system across America.

Honestly, it should be a win-win. Underserved communities get direct air access, and small businesses create thousands of jobs and generate hundreds of millions of dollars in economic growth.

But proposed DOT and FAA changes that could eliminate, or at least drastically revise, the DOT 380 program would, in essence, shutter much of the Part 135 industry and impact so many smaller communities that these operators serve.

The U.S. Private Aviation Association has called for a ground stop on these regulatory changes. If the proposed changes to DOT 380, TSA’s Twelve-Five Standard Security Program and new charter regulations are adopted, the result will mirror what occurred in the financial sector. Regulations will favor larger corporations, driving up costs for smaller businesses and leaving consumers with fewer choices and limited access.

Dodd-Frank largely enticed regulatory agencies to simplify their oversight role by having fewer, larger institutions to monitor instead of multiple smaller ones. The financial services industry has never been the same, nor have the communities that smaller banks used to serve.

Rural and underserved communities cannot be left to suffer so that the FAA can consolidate regulatory categories. The future of private air travel is at stake, and pro-market leaders in Congress need to recognize the impact that private air charter has across America and protect the playing field that serves every community in the country.

Josh Kimbrell is a member of the South Carolina Senate and operator of Exodus Aircraft LLC, a Part 135 private charter operator based in Spartanburg, South Carolina.