With the election season revving into high gear, companies that are considering carrying candidates for state or federal political office should be aware that such activity is regulated but not prohibited.
Because several regulatory bodies have an interest in the private transportation of public officials and candidates, NBAA urges operators to be aware of the rules governing such flights. Company aircraft can provide office-seekers and office-holders with scheduling flexibility that might not be possible with airlines, and direct service to certain destinations that might normally require multiple connecting flights or that may be unreachable by airlines.
Suzy Rosov, an attorney with the Providence, R.I., law firm of Edwards Angell Palmer & Dodge, advises that providing private travel to candidates is legal as long as the candidate makes the proper disclosures to the Federal Election Commission (FEC) and the member of Congress to the appropriate ethical oversight committee.
Similarly, a company must observe the regulatory requirements governing travel accommodations for candidates and public officials; FEC, FAA and IRS regulations; gift rules; and state law.
Under the Federal Election Act of 1971, a private-sector company cannot provide free or discounted air travel to candidates seeking election or re-election to any federal office, including presidential and vice presidential contenders and members of Congress. The prohibition also extends to anyone traveling with a candidate, such as staff members and reporters.
“The traveler must reimburse you for the flight within seven days,” Rosov wrote. “The amount of reimbursement depends on points of departure and arrival and whether the destination has regularly scheduled airline service. Reimbursement must be equivalent to commercial or charter fares for similar carriage services,” she added.
Although Part 91 operators are generally prohibited from accepting reimbursement for air transportation, an exception reconciles the FAR with election regulations. Operators can accept reimbursement for campaign flights within the limits permitted by the Federal Election Act.
Initially available only for congressional, presidential and vice presidential candidates in federal elections, the reimbursement exception was expanded last year to include state and local candidates. “The primary difference is that state law or local ordinances will govern reimbursement amounts for state and local candidates,” Rosov said. “And note that while you can also make your aircraft available to candidates using a time-sharing agreement, a below-market-rate charter or dry lease, the amount you charge must meet election regulations or state/local law.”
The IRS deems campaign travel to be commercial travel for purposes of federal excise tax rules, even for aircraft operating under Part 91. The current tax rate for domestic commercial transportation (7.5 percent) plus applicable passenger segment fees will apply.
In addition, both the House and Senate have special rules regarding travel, the most important of which is that any privately sponsored trip must be directly connected to the member’s official duties. Rosov noted that the House Ethics Committee has instituted a voluntary certification process for organizations wishing to sponsor privately funded trips. She added that the ethics committee has begun to review the existing congressional travel rules, so operators should be aware of any changes.
Rosov, who concentrates on business aviation transactions, also suggested that operators should confirm with their insurance carriers that their policy covers the transport of a candidate or elected official.