Part 135 Check - Time Builders Beware!

[upndsky]

LabCorp uses the Skylab callsign and flies Chieftains and I think a Citation.

Quest Diagnostics uses the Labquest callsign and flies TBM700s and C-310s.

 

[icefr8dawg]

My Bad... PC-12, TBM, Caravan, you can have them, the single engine thing kept me away. Gimme a good old 310 or Baron any day. *Bracing for flack* It's too bad the Caravans and TBM/PC'12 have a lower DOC per lb. because I would imagine we'll see less of the twins.



And it's labquest, I hear them on 127.6 and going into TEB every now and then.

 

[wingnutt]

It's too bad the Caravans and TBM/PC'12 have a lower DOC per lb. because I would imagine we'll see less of the twins.

you know whats funny...the baron operator i used to fly for charged the exact same per mile as the caravan operator i did contract work for shortly thereafter.

when i left the Baron job, he picked up a route that took off and went to the HOU at the same time i did in the van. some days hed beat me and some days id beat him...the two are very comparable

 

[wingnutt]

oh yea, and heres the response the the yahoos that think its all gonna *poof* away one night...

Aviation International News Jan2004

Check 21 law not likely to affect check haulers

by Mark Phelps

What does Federal Reserve chairman Alan Greenspan have to do with the market value of Mitsubishi MU-2s?

Late last year, flying overnight check runs (long recognized as one of the ideal turbine-time builders for budding professional pilots) appeared poised to fall victim to the digital age. Legislation known as “Check 21” became law, clearing the way for banks to cancel checks electronically through the “Fed” without transporting the actual paper. A monumental time and cost saver for the banking industry, the new law will go into effect in October.

But what about all those pilots and companies who have been making their living from flying checks overnight? Turbine Air Services (TAS), which supports the Mitsubishi MU-2 under contract with Mitsubishi Heavy Industries, recognizes the speedy turboprop twin as one of the mainstays in the overnight check-flying market. Some 25 percent of the MU-2 fleet is involved in flying under contracts with the Federal Reserve, according to Pat Cannon, vice president of TAS. If that market were to disappear overnight come October, the market value of the 413 MU-2s in operation could plummet since a quarter of the fleet would find itself out of a job–not to mention the pilots who would be forced to look for other work.

Even National Public Radio expressed concern for the potentially lost jobs with a report aired on its Evening Edition news program the day President Bush signed the Check 21 legislation into law. (One unsympathetic listener subsequently wrote to the network complaining that mourning the loss of such jobs was comparable to feeling bad that the telegraph had put pony express riders on the dole.)

But apparently, the midnight riders actually have little to fear from Check 21 through the next decade. Cannon told AIN that key operators supported by TAS report they have received no indications from the Federal Reserve that its contract flying requirements would diminish for at least 10 years. Among the Check 21 law’s provisions, the nation’s check writers have the option of continuing to receive their canceled checks back in the mail if they so desire. It seems the Federal Reserve now anticipates that plenty of Americans will still want their actual checks back (rather than photocopies). Also, there are enough other sorts of time-critical paper transactions to keep the overnight freighters full for the foreseeable future.

Still, one check-flying company is hedging its bets. AirNet Systems of Columbus, Ohio, operates more than 120 aircraft. AirNet announced last month that it has branched out, creating a new subsidiary called Fast Forward Solutions. The subsidiary’s focus will be “the sale of newly developed payment solutions to financial institutions [using] software technology…image platforms and opportunities resulting from the enactment of Check 21.” In other words, AirNet is using its Rolodex of financial-institution customers to move into the digital check-processing business–kind of like a pony express rider keeping his horse saddled, but also learning how to operate a telegraph key.

 

[capndan]

From what I've heard from sources in the know, the bill may go into effect October 2004 but check runs won't disappear immediately. Some banks are not up to speed with the technology required to eliminate the need for check runs. I would venture that it will be a couple of years before there are drastic changes.

Hey guys:
Read the law! Don't rely on company websites. Read the actual letter of the LAW. It is a law after all. And by the way, banks are REQUIRED to comply by October 24, 2004. Read the actual letter of the LAW It is not voluntary. Bank Of America will be 100% electronic by June 01.
Ask these geniuses at Airnet why their company is selling/outfitting ALL of their banking customers with the software and means to facilitate Check-21? Why would Airnet do that if check-flyings' end were "years" away?
Bottom line is this: Check flying is coming to an end. By November of this year...don't be one of the stooges who'll look around and ask "how did this happen?".
Be fair to yourself and READ THE ACTUAL LAW. Just do a search under "Check-21" or "H.R. 1474" and pay particular attention to the last paragraph of the LAW: ...that ALL banks MUST be in FULL COMPLIANCE within 12 months of the bill being signed into LAW. 12 months are up October 24, 2004.

And here is the PIVOTAL POINT of this: SUBSTITUTE CHECKS. Any bank will have the ability to print-out a substitue check if you demand to see a paper copy of the check you've written.

The SUBSTITUTE CHECK provision and the LAST PARAGRAPH of this LAW are the reasons check flying WILL END this year.

There is still plenty of time to build time if you are so qualified and inclined. And stop listening to the uninformed starcheck pilots who mistake company gossip for facts.

Get the facts and the facts will show I am right.

Good luck.

 

[starchkr]

capn, capn, capn....how misinformed one can be!


I have done the research, and anyone that thinks this will kill the check haulers is just wrong. Your research should begin on the Federal Reserve website (after all, the ruling starts with them) and you will see their definition of this "law." As stated by the Fed, the law only allows banks the right to use electronic imaging, it does in NO WAY say they must comply... it is a completely voluntary program. ONCE AGAIN... the law only gives them the right and ability to use this new process, it does not say they must do it.

Go back and research again before trying to scare people.

 

[tangodelta21]

Upndsky well put.

Enough chicken littles and skies falling for a bit, please. A bill passing in congress doesn't instantly translate into action by the parties affected.

It did for the banner tow people.

 

[capndan]

starchkr is deluded.

starchkr has not read the law. Quoting "facts" from a Fed Reserve "website" is not knowing the law.

starchkr forms an opinion without knowing the facts and therefore has no credibility.

starchkr works for a company that is purposefully phasing-out check flying with it's own banking customers.

starchkr is confused.

To quote Jack Nicholson...starchkr "can't handle the truth".

Still plenty of time to build time flying checks. But check flying will come to an end by November of this year.

Nothing wrong with knowing the facts, knowing the LAW and preparing for a change. (pssst...that's what smart people do)

Don't be like starchkr. Don't be so resistant to change that you blind yourself to the facts of the forthcoming LAW.

When starchkr starts quoting the pivotal points of the LAW: Substitute Check and Compliance within 12 months...you'll know he has been enlightened.

Meanwhile, guys and gals...by all means get out there and build time! I did it for several years and you can too...(until Nov).

 

[starchkr]

Once again, alright here we go...



Capn, and all others... let me quote directly from the FED web site and i then will direct you to the check 21 page off of that website.


As stated on the website... "The law does not require banks to accept checks in electronic form nor does it require banks to use the new authority granted by the act to create substitute checks."

Plain and simple... can't get any easier than that!!!!


www.federalreserve.gov/paymentsystems/truncation/default.htm


Now please explain why the fed would publish this if you say they are going to require all banks to go paperless????

 

[HAZ-MAT]

Getting off the supject here, has anyone read the latest AOPA article about Radio Communications? There was a part about Call signs. Well the article mentioned AirNet (AKA U.S. Check).. the paragraph went something like this... "Wonder what they'll do when the check flying goes away.. will they start calling themselves U.S. Debt." I couldnt believe the paragraph when i read it, had to read it a couple of times.. but it seems like everyones targeted us as doomed! Check out the Article.. its in the AOPA issue with the TBM-700 on it.

 

[uscpilot]

Hey guys:
Read the law! Don't rely on company websites. Read the actual letter of the LAW. It is a law after all. And by the way, banks are REQUIRED to comply by October 24, 2004. Read the actual letter of the LAW It is not voluntary. Bank Of America will be 100% electronic by June 01.

The Fed is given the authority of implimenting the law. They also have the ability to issue regulations regarding the facilitation of the law. So quoting facts from the Feds website is not inaccurate.

And if banks cannot comply by oct 24 then what? Are they going to be fined, have there operations suspended, or maybe have all their assets deleted. From what I have heard there is not a bank in the country that will be able to comply %100 by the end of the year. This is my interpritation of the law, please tell me how I am wrong.
usc
PS I am not trying to incite a full blown argument. These issues are very important to me as it has quite an impact on my family's livelyhood. If your intentions are truely altruistic then please enlighten us. However, if you are just trying to scare those of us still in the industry, please stop.

 

[jtharth]

Capndan is a good guy, he is not trying to scare anyone, he just doesnt believe that we will be in the check flying business in 9 months. he is very knowledgeable on the subject as he deals with the banks EVERY day.

If what he says is true and all banking will be done electronicly, does that mean that we are out of a job in a few months??? NO! i hual work that is 95 % mail and 5% checks. i know that the 5% checks pay for the flight but are banks willing to wait an extra day to get that mail? incidentally, my company has ADDED two bank runs in the past week... we are expanding not shrinking. i think that canptndan is too pessimistic on the subject. there is no reason to think that we will be around much longer, but the timeline that he insists is in place will not come about. think of it this way...

there is a concealed weapons law in the state of florida. that means that someone CAN carry a gun on their person if they are lisenced. does this mean that EVERY person in florida must now carry a gun just because there is a LAW?? i have read the law and i disagree with capn dan.

 

[starcheck1]

Getting off the supject here, has anyone read the latest AOPA article about Radio Communications? There was a part about Call signs. Well the article mentioned AirNet (AKA U.S. Check).. the paragraph went something like this... "Wonder what they'll do when the check flying goes away.. will they start calling themselves U.S. Debt." I couldnt believe the paragraph when i read it, had to read it a couple of times.. but it seems like everyones targeted us as doomed! Check out the Article.. its in the AOPA issue with the TBM-700 on it.

In the article they say U.S. Debit ....as in now everyone uses debit cards I believe...still not a compliment though.

 

[uscpilot]

Capndan is a good guy, he is not trying to scare anyone, he just doesnt believe that we will be in the check flying business in 9 months. he is very knowledgeable on the subject as he deals with the banks EVERY day.

If what he says is true and all banking will be done electronicly, does that mean that we are out of a job in a few months??? NO! i hual work that is 95 % mail and 5% checks. i know that the 5% checks pay for the flight but are banks willing to wait an extra day to get that mail? incidentally, my company has ADDED two bank runs in the past week... we are expanding not shrinking. i think that canptndan is too pessimistic on the subject.

The capt may be a good guy. However he is being very selective in his reading and interpriting of the law. I do agree with him on how to regard what our employeers say with a great amount of skepticism. Check21 will be good for the company as a whole, but not in the long run for check haulers. I think it does spell the end, but it is not 8 months away. It is not the 3-4 years that I have heard others say. My guess is some where in the middle.

I would not bet too much on the mail sustaining our routes. They arent having to pay much if any extra to move the mail with us so they just throw it on (I know I should not generalize, there are exceptions, this is how it is in my micrcosim).

I did not mean to sound like I am hiding in a corner quaking in my boots as my post scrip might have implied. I meerly wanted to get across that spreading unfounded rumor as if were the truth does not help the discoarse.

usc

 

[capndan]

I think most of you are missing the point.

This point is this:

What, according to the law, is the definition of non-compliance?
It is the banks' inability to facilitate electronic transferring of checks due to software/hardware issues.

All banks must comply with Check-21 by late October. Does that mean if they don't have software/hardware to comply that they will continue to fly the checks? NO!
It means these banks will be forced to ISSUE "Substitute Checks" to their customers who demand to see a paper receipt of their check. The "Substitute Check" is a legal document issued/printed from the local bank in question.
Again, the "Substitute Check" provision in the new law is the PIVOTAL point.

Let there be no mistake: All the major players in the banking industry (and you know who they are) are aggressively re-tooling to comply with Check-21 by late October. In many cases, their timeline is much sooner.

These "major players" are also going to be doing "correspondent processing" for the minor players.

Check-21 was signed into LAW to save the banking industry many BILLIONS per year in transportation costs. BILLIONS.

Look at the bigger picture...why wouldn't the banking system adopt Check-21 as quickly as possible to be able to get in on the transportation-savings bonanza?

Yes my friends...check-flying is going to come to an end. Bank mail, loan documents, etc. may continue for a while. Bad news is that most Part 135 check-haulers can probably only sustain themselves to perhaps 20% of what they are today once the check-flying ends.

And it will end....by November.

Be smart...plan for it.

 

[uscpilot]

Captn
I still dont agree with you on how quickly this will be implimented. From what I have been told the majority of banks do not have the ability to issue substitute checks. The economic and political fallout that would result is enough to keep the Fed from implimenting the new law too quickly.
If it does happen as soon as you say I dont think it will be the end for some of the larger 135's. There will be some down sizing no doubt. My reasons for saying this have to do with the fact that my company has invested millions in its aircraft (buying new Caravans, updating the barons, and getting the lears RVSM compliant), and is in the process of building a new sorting/company HQ.
The savings that you are siting are not there. I dont have the data infront of me, but the cost of electronic transfer is still more expensive than physically hauling the checks.
At any rate the end is near, though not this year, and I am planning for it.
usc

 

[capndan]

I dont have the data infront of me, but the cost of electronic transfer is still more expensive than physically hauling the checks.
At any rate the end is near, though not this year, and I am planning for it.
usc

You can't be serious, right?

I mean...which is more expensive: driving your resume to your next employer? Or, faxing your resume to your next employer?

 

[uscpilot]

You can't be serious, right?

I mean...which is more expensive: driving your resume to your next employer? Or, faxing your resume to your next employer?

It is the cost involved in implimenting the technology, not the actual act of pressing a button to send funds.
usc

 

[upndsky]

There was a good article about this in the Wall Street Journal a few months back. According to the article, it costs a bank on average 7-9 cents to fly a check vs. 11-12 cents to electronically process it. So a bank may send a subsitute check (ie. a scan), but in the short haul, it may still be cheaper to fly and send the real thing.

Also, your analogy about faxing a resume is flawed. You are talking about only one item. But multiply that by 10,000 or a 100,000 (the number of checks one plane may carry), and you'd have one heck of a phone bill.

What you will see happening is that the time-critical nature of check hauling will go away. Instead of having many planes carry a little bit in order to meet a deadline, you'll have fewer planes carry larger bulks. The check may be processed electronically, but the physical item still has to be handled in some form or fashion, at least for now.

And again, Check 21 only dictates how banks deal with the Federal Reserve, not how they handle checks inhous, and where I work, that's the bulk of our business.

 

[uscpilot]

Also, your analogy about faxing a resume is flawed. You are talking about only one item. But multiply that by 10,000 or a 100,000 (the number of checks one plane may carry), and you'd have one heck of a phone bill.

Also the cost of buying the fax machine or computer vurses driving it to the employeer is much higher. This is why the electronic transfer will initally cost so much. Eventually as the technology becomes cheaper (like DVD players) more banks will use it.
You are also correct about the inhouse work, which is what I carry, it will be around for a while.
usc