The National Air Transportation Association (NATA) and National Business Aviation Association (NBAA) sent a letter to U.S. Secretary of the Treasury Steven Mnuchin on Wednesday requesting additional guidance and flexibility for the general aviation community on the loan and grant provisions enacted in the Coronavirus Aid, Relief, and Economic Security (CARES) Act. The letter (PDF) also asked the Department of the Treasury to consider the scale and business operations of GA air carriers and FBOs when developing loan and grant program guidance. Signed into law last Friday, the CARES Act designated up to $25 billion in financial assistance for passenger air carriers, up to $4 billion for cargo carriers and up to $3 billion for aviation contractors.
“Under the CARES Act, general aviation businesses and FBOs that are contractors to the scheduled airlines are eligible to apply for payroll support grants and loans,” NATA and NBAA said in a joint statement. “However, the initial guidance issued by the Treasury Department presents challenges for general aviation businesses, as certain requirements were structured for the scheduled airlines.”
As previously reported by AVweb, the CARES Act allows the Secretary of the Treasury to “receive warrants, options, preferred stock, debt securities, notes, or other financial instruments issued by recipients of financial assistance … which, in the sole determination of the Secretary, provide appropriate compensation to the Federal Government for the provision of the financial assistance.” NBAA and NATA called for flexibility on such loan guarantees for GA carriers and FBOs that are not publicly traded and have limited liquidity. The associations also asked the Department of the Treasury to consider that most of their members are not required to report operating metrics described in initial CARES guidance.