It seems every few days lately I get an offer to put my aircraft on someone’s Part 135 certificate and start generating revenues 1-2-3. Never mind that I don’t own an aircraft and never have; these e-mails seem to be targeting anyone and everyone on an aviation mailing list. One solicitation called it a Part 135 “business in a box,” another claimed it was an “easy” way to enjoy the tax benefits of Part 135. So my best guess is that at least one of these e-mails has landed in the inbox of a Flight Standards inspector somewhere in the country or maybe even FAA Administrator Randy Babbitt’s. Have they wondered what was up with these solicitations?
Well, I have. What all these e-mail offers have me wondering is are these legitimate offers or the same old rent-a-certificate scams of a few years ago where Part 135 certificate holders basically rented their certificates to aircraft owners as a win-win for everyone but the passengers? Maybe I’ve been in the business too long, but “easy,” “quick” or “cheap” and aircraft owners sharing Part 135 revenues sounds suspicious to me.
Let’s face it: if you dry-lease your aircraft to a Part 135 operator you’re paid a fee for the aircraft hours of use; you don’t share revenues from air carrier flights. So a scheme to share revenues for listing your aircraft on a Part 135 certificate holder’s ops specs is, well, suspect. Note to the FAA, are you following me yet?
Operational Control under the Microscope
With a fairly new Administration, maybe a bit of history is appropriate. The fiery early-morning crash of a Platinum Jet Challenger into a warehouse off the end of a runway at Teterboro Airport on Feb. 2, 2005, focused the FAA’s–and eventually the aviation industry’s–attention on the issue of operational control, or who was in charge of operating an air carrier’s revenue flights. Although Platinum never held its own Part 135 certificate (it listed its aircraft on the ops specs of Darby Aviation, an operator in Muscle Shoals, Ala.) it was found to be operating the aircraft on that fateful day. The crew was unqualified and the flight attendant purportedly had no idea how to open the aircraft door. If not for the quick actions of the passengers, the fire that ensued could have been deadly.
While Darby got a “rental” fee and a percentage of the flight revenue, it had given up operational control of this and other flights to Platinum Jet, according to the FAA. What followed is not news to most AIN readers but may be to some new players over at 800 Independence Ave.: enforcement action against Platinum, increased FAA scrutiny of Part 135 operators, dog-and-pony tours by FAA attorneys explaining operational control to aircraft operators, and sporadic enforcement action culminating with the record $10 million civil penalty against Tag Aviation and the emergency revocation of AMI Jet Charter’s ticket.
So the question I have, if these operations are back out in the open, is what happened to the FAA’s push on operational control? Have operational control problems gone away or did the most flagrant violators just lie low for a while and are now back in the open and free from FAA scrutiny? Was the agency’s enforcement action fair? Or did it selectively prosecute one major operator and leave everyone else alone to operate, business as usual?
I’ve talked to a couple of certificate holders that have spent a lot of money on aviation lawyers drawing up “bullet proof” agreements and now the aircraft owners’ pilots are paid directly by the Part 135 certificate holder (that is then reimbursed by the aircraft owner). Convoluted, sure, but has the operation changed?
Is a wet-lease by any other name not a wet-lease? (As an amusing aside, one operator referred to his pilots as “1099 employees.” I’m no tax expert, but employees get W-2 forms and independent contractors get 1099 forms. So what’s a 1099 “employee”? And is this just part of the confusion that reigns?)
From what I’ve seen and heard, the operators remain the aircraft owners and not the Part 135 certificate holders–even after all these expensive legal documents, and even after all the FAA FSDO blessings of this paperwork (which I venture to guess few inspectors have read and fewer yet have understood). If the Part 135 certificate holders don’t have operational control, does anyone care anymore?
FAA enforcement has never been viewed as fair or consistent by many people in aviation. Accidents usually focus the agency’s attention on a particular problem and strong–some say Draconian–enforcement action may follow. I’ve had my issues with the FAA’s enforcement, but I was a strong supporter of the agency’s actions on operational control. I believe that safety is inextricably tied to responsibility and control and that there can be no safe operation if an air carrier does not have operational control of its flights. Yet there is something wrong with making one company a scapegoat for the ills of a larger segment and letting everyone else off scot free. I know government resources are limited and that it might not be possible to prosecute everyone for every violation, but I’d at least like to feel that the FAA treated similar instances of bad conduct in the same way.
I’m not saying that Tag/AMI operations were right, but I’m starting to think the FAA’s enforcement action was unfair.
The opinions expressed in this column are those of the author and not necessarily endorsed by AIN.