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Dawn Patroller
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Key U.S. Democrat readies bill to help airlines
Monday March 3, 6:51 pm ET
By Susan Cornwell
WASHINGTON, March 3 (Reuters) - Legislation is being drafted to help U.S. airlines with financial hardships that could result from a war with Iraq, a key congressional Democrat said on Monday.
Warning that war would cost the already ailing industry billions of dollars, Rep. James Oberstar of Minnesota, the ranking Democrat on the House Transportation Committee, said he hoped to introduce the aid bill "as soon as possible."
Oberstar's measure would propose reopening a federal loan guarantee program to cover rising fuel prices, as well as provisions on war risk insurance and compensating airlines for strengthening cockpit doors -- a security measure imposed by Congress after the hijack attacks of Sept. 11, 2001, Oberstar told Reuters.
The bill might also include provisions for opening U.S. strategic petroleum stocks to ease fuel costs.
The first Gulf War in 1991 cost the airlines four to five billion dollars as revenue from transatlantic travel dropped by 50 percent, Oberstar said. "This time it could be as much as 14 or 15 billion," a level that would force some carriers out of business, he said.
Oberstar hopes to get bipartisan support for his bill.
House Republicans say they are listening to airline pleas for help, but they appear in less of a hurry to produce legislation before the start of a possible conflict with Iraq.
SEEKING SUPPORT
So far Congress has looked skeptically at suggestions it should extend another hand to the carriers after approving a $15 billion package of cash and loan guarantee assistance for losses incurred after the 2001 attacks on New York's World Trade Center and the U.S. Pentagon, accelerating the worst-ever industry downturn.
Airline representatives will testify at a hearing on March 12 on the Federal Aviation Administration, providing a forum to discuss airline needs in case of military action in Iraq, a House Republican aide said. Airline industry lobbyists also are trying to forge an aid proposal.
"When we see what their aid request is, we'll have a better idea of what they feel they need. Then we can see what the members say and get a better idea of what we are prepared to do," the Republican aide said.
The Republican aide also said many of the provisions Oberstar described were similar to those in a bill sponsored last year by Rep. John Mica, a Florida Republican and chairman of the aviation subcommittee.
That bill was approved by the subcommittee late in the congressional session and never made it onto the House floor.
U.S. airlines have warned for months that a war with Iraq could force bankruptcies for some commercial carriers.
They have already requested tax relief to compensate for the expense of airport passenger and baggage screening, but an Oberstar aide said this relief was not expected in his bill.
Congress did include assistance for airline insurance costs in legislation to create a new Department of Homeland Security last year.
That measure extended government-issued war-risk insurance through 2003, a provision worth nearly $1 billion to the airline industry. But the carriers want longer relief.
Sen. Trent Lott, a Mississippi Republican who heads the Senate aviation subcommittee, is concerned about unfunded security mandates imposed on the airlines by the government after Sept 11, 2001, and wants to evaluate their cost -- whether or not there is a war with Iraq, a spokeswoman said.
"Some of these security concerns are something we'll take a look at, but he (Lott) would stop short right now of saying whether or not he would support another bailout bill," the Lott spokeswoman said.
Monday March 3, 6:51 pm ET
By Susan Cornwell
WASHINGTON, March 3 (Reuters) - Legislation is being drafted to help U.S. airlines with financial hardships that could result from a war with Iraq, a key congressional Democrat said on Monday.
Warning that war would cost the already ailing industry billions of dollars, Rep. James Oberstar of Minnesota, the ranking Democrat on the House Transportation Committee, said he hoped to introduce the aid bill "as soon as possible."
Oberstar's measure would propose reopening a federal loan guarantee program to cover rising fuel prices, as well as provisions on war risk insurance and compensating airlines for strengthening cockpit doors -- a security measure imposed by Congress after the hijack attacks of Sept. 11, 2001, Oberstar told Reuters.
The bill might also include provisions for opening U.S. strategic petroleum stocks to ease fuel costs.
The first Gulf War in 1991 cost the airlines four to five billion dollars as revenue from transatlantic travel dropped by 50 percent, Oberstar said. "This time it could be as much as 14 or 15 billion," a level that would force some carriers out of business, he said.
Oberstar hopes to get bipartisan support for his bill.
House Republicans say they are listening to airline pleas for help, but they appear in less of a hurry to produce legislation before the start of a possible conflict with Iraq.
SEEKING SUPPORT
So far Congress has looked skeptically at suggestions it should extend another hand to the carriers after approving a $15 billion package of cash and loan guarantee assistance for losses incurred after the 2001 attacks on New York's World Trade Center and the U.S. Pentagon, accelerating the worst-ever industry downturn.
Airline representatives will testify at a hearing on March 12 on the Federal Aviation Administration, providing a forum to discuss airline needs in case of military action in Iraq, a House Republican aide said. Airline industry lobbyists also are trying to forge an aid proposal.
"When we see what their aid request is, we'll have a better idea of what they feel they need. Then we can see what the members say and get a better idea of what we are prepared to do," the Republican aide said.
The Republican aide also said many of the provisions Oberstar described were similar to those in a bill sponsored last year by Rep. John Mica, a Florida Republican and chairman of the aviation subcommittee.
That bill was approved by the subcommittee late in the congressional session and never made it onto the House floor.
U.S. airlines have warned for months that a war with Iraq could force bankruptcies for some commercial carriers.
They have already requested tax relief to compensate for the expense of airport passenger and baggage screening, but an Oberstar aide said this relief was not expected in his bill.
Congress did include assistance for airline insurance costs in legislation to create a new Department of Homeland Security last year.
That measure extended government-issued war-risk insurance through 2003, a provision worth nearly $1 billion to the airline industry. But the carriers want longer relief.
Sen. Trent Lott, a Mississippi Republican who heads the Senate aviation subcommittee, is concerned about unfunded security mandates imposed on the airlines by the government after Sept 11, 2001, and wants to evaluate their cost -- whether or not there is a war with Iraq, a spokeswoman said.
"Some of these security concerns are something we'll take a look at, but he (Lott) would stop short right now of saying whether or not he would support another bailout bill," the Lott spokeswoman said.
