U.S. Department of Transportation Announces Two Air Service Notices Impacting Airlines and Consumers

Source: US DOT

U.S. Secretary of Transportation Elaine L. Chao today announced two additional steps by the Department regarding airline service obligations and consumer protections in response to the COVID-19 public health emergency and to assist the Nation’s economic recovery.

The U.S. Department of Transportation has issued a second Enforcement Noticeregarding airline ticket refunds given COVID-19’s unprecedented impact on air travel. The document provides answers to some of the most common questions about refunds to help consumers understand their rights and to ensure airlines and ticket agents are complying with aviation consumer protection requirements. In a typical month, the Department receives approximately 1,500 air travel service complaints and inquiries. However, in March 2020 and April 2020, more than 25,000 air travel service complaints and inquiries were filed,[1] many of which concern refunds.

“The Department has received an unprecedented volume of complaints from passengers and is examining this issue closely to ensure that airlines’ policies and practices conform to DOT’s refund rules,” said U.S. Secretary of Transportation Elaine L. Chao. “The Department is asking all airlines to revisit their customer service policies and ensure they are as flexible and considerate as possible to the needs of passengers who face financial hardship during this time.”

Additionally, through a Notice of Adjustments to Service Obligations, the Department is announcing an opportunity for incremental adjustments to service obligations under Order 2020-4-2, issued April 7, 2020, in light of ongoing challenges faced by U.S. airlines. To promote the important continued operation by carriers throughout the economic recovery, the Department will allow covered carriers to reduce the number of points they must serve as a proportion of their total service obligation, while ensuring that every community served by a covered air carrier prior to March 1, 2020 will continue to receive service from at least one covered carrier. This Notice initiates that process.

On March 27, 2020, the President signed the Coronavirus Aid, Recovery, and Economic Security Act (the CARES Act) into law.  Sections 4005 and 4114(b) of the CARES Act authorize the Secretary to require, “to the extent reasonable and practicable,” an air carrier receiving financial assistance under the Act to maintain scheduled air transportation service as the Secretary deems necessary to ensure services to any point served by that air carrier before March 1, 2020. Air carriers will have until May 18th to respond to the service obligation adjustments notice.

DOT has continued to monitor the ongoing impacts of the COVID-19 public health emergency on the commercial aviation industry.  The Department has granted several exemptions to carriers’ service obligations, recognizing circumstances where it is not reasonable or practicable for carriers to serve all points or all frequencies in their service obligations.  The Department will continue to monitor the industry, including for signs of improved passenger volume, as the economy recovers.[2]

Less than two weeks after the CARES Act was signed into law, Secretary Chao announced $10 billion would be made available in emergency economic assistance to over 3,000 airports across the country. This funding will support continuing operations and replace lost revenue resulting from the sharp decline in passenger traffic and other airport business due to the COVID-19 public health emergency. The funds are available for airport capital expenditures, airport operating expenses including payroll and utilities, and airport debt payments.

 

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