AFS

- 12

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- E Exemption No. 10688

UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

FEDERAL AVIATION ADMINISTRATION

WASHINGTON, DC 20591

In the matter of the petition of

PATIENT AIRLIFT SERVICES , INC

. Regulatory Docket No. FAA

- 2012

- 0158

for an exemption from part 119 and

135 of Title 14, Code of

Federal Regulations

DENIAL OF EXEMPTION

By letter dated January 31, 2012 Mr. Joseph Howley, Chairman of the Board of Directors,

Patient Airlift Services, Inc. ( PALS ), 120 Adams Boulevard, Farmingdale, New York 11735

petitioned the Federal Aviation Administ ration (FAA) on behalf of PALS for an exemption

from p arts 119 and 135 of Title 14, Code of Federal Regulations (14 CFR). The proposed

exemption, if granted, would permit PALS , a not

- for

- profit volunteer pilot organization, to

use a donated aircraft for t ransporting patients and staff to appointments or meetings by PALS

staff members and volunteer pilots without havi ng to meet the requirements of part 119 and

p art 135.

The petitioner req uires relief from the following regulations :

All of part 119 and all of p art 135

The petitioner supports its request with the following information:

The petitioner states it is a not

- for

- profit v olunteer pilot organization (V PO) with approval

from the Internal Revenue Service as a charitable organization, pursuant to Int ernal Revenue

Code (IRC) Section 501(c)(3). The peti ti oner ’ s primary purpo se is to serve children, adults

and humanitarian organizations by arranging free air transportation to be provided by others

for acce ss to health care and for other humanitarian pur poses. The petitioner receives n o compensation for such flights which it provide s free of charge to persons based on their

financial need and medical requirements.2

A private party has donated an aircraft (Beechcraft Bonanza, N5463D) to the petitioner for use by the petitioner on flig hts for administrative purposes as well as charitable flights

transporting patients and members of the military to or from distant specialized medical

evaluation d iagnostic services or treatment.

The petitioner believes it i s in the public interest to allow it to use donated aircraft for

charitable and administrative flights in the same manner that airc raft belonging to its volunteer

pilots are used without being subject to the extremely burdensome and costly requirements in

p arts 119 and 135 that w ould apply to "air carriers" and/ or "commercial operators."

T he petitioner states that its staff members travel significant distances to meet with hospital

a dministrators, social workers, clinics, individual physicians and patients to establish patient

referral systems and relationships and to coordinate actual patient transport. The coordination

with the hospital administrators, social workers, physicians and clinics is extremel y important

to delivering these free transportation s ervices to patients in financial need.

PALS states that until now

, its staff has been dependent on the availability of volunteer pilots

and their aircraft for such trips, or h as had to drive long distances, or use public transportation

to attend such meet ings. The use of the recently donated private aircraft could greatly

facilitate the work of its staff.

PALS states that o n occasion, when o ther aircraft are not available

, a donated aircraft could

also be used for a charitable flight by the petitioner

. The aircraft could be piloted by the

volunteer pilots who otherwise meet the petitioner’s stringent criteria or by on e of the

petitioner ’ s staff members if that staff member meets the same rigorous qualifications that it

require s of its volunteer pilots.

The petitioner states that i f the FAA wer e to require the petitioner to comply with part s 119

and 135 without the requested exemption

, the petitioner would incur substantial expense to

have the aircraft comply with requirements applicable to air carriers a nd commercial

operators, and, in addition, the aircraft could be operated only by commercial pilots meeting

the FAA requirements for such operations.

T he petitioner believe s the requested exemption is in the public interest, because it will greatly

facili tate its ability to ensure that patients in financial need will be able to get essential

medical care and to conduct other humanitarian flights.

PALS states t he FAA recently granted an exemption to the petitioner from § 61.113(c) to

allow reimbursement of its volunteer pilots for fuel costs incurred in conducting charitable

flights. The FAA exemption recognized that the humanitarian efforts of volunteer pilot

organizations are commendable, and historically, the FAA has tried to encourage this kind of

volu nteerism and public service for the common good.3

Similarly

, an exemption to allow the use of donated aircraft by its volunteer pilot

organization will increase the ability of the petitioner to carry out its cha ritable and

humanitarian works, and, at the s ame time, ensure that such flights are conducted with

enhanced aviation safety as a result of the peitioners extremely stringent requirements for its

pilots.

Flights arranged by the pe t itioner are dedicated to charitable purposes with a demonstrable

publ ic benefit. Examples of cha ritable flights by the petitioner include, but are not limited to,

the t ransport of patients and escorts to distant specialized medical facilities or places of care

and rehabilitation. The petitioner also helps families of serv icemen, i.e., eit her transporting

family members or servicemen to each other during the course of servicemen's medical care.

The petitioner ’s pilot must note in his or her flight log the charitable purpose of the flight.

The petitioner contends that other t han fuel reimbursement payments to volunteer pilots in

accordance with Exemption No. 10294

, n o payments of any kind are ever made to PALS to

any of its volunteer pilots

, or to any other party or entity for the conduct of the flig hts

facilitated by the pe titioner

.

T he petitioner states that since it proposes to operate a donated aircraft only with pilots who

meet the high standards established for its operations, it would augment a culture of safety and

increase documentation of pilot and VPO compliance with safety mandates. The petitioner

states that b y granting the requested exemption, the FAA will further promote its safety and

regulatory objectives t hrough our volunteer pilot organization.

A summary of the petition was published in the Federal Register on June 25, 2012

( 77 FR 37952 ). One comment was received in support of a grant of exemption.

The FAA's analysis is as follows:

The FAA has reviewed the petitioner’s request and finds that a grant of exemption would not

be in the public interest and would not provide an equivalent level of safety as that provided

by the current regulations.

In the PALS request, it proposes to provide free air transportation for charitable and

administrative flights. The petitioner would use volunteer pilots and staff pilots to conduct

the flights using an airplane it own s and third parties would donate money to the charity to

cover flight expenses. In addition, these pilots would log the flight hours, but would not take

a tax deduction for the donated time.

T he charity cannot operate under part 91 because the arrangement would consti tute a

commercial operation for which a part 119 certificate is required. Section 1.1 defines a

commercial operator as a person who, for compensation or hire, engages in the carri age by

aircraft in air commerce of persons or property. Where it is doubtful that an operation is for4

compensation or hire, the test applied is whether the carriage by air is merely incidental to the

person's other business or is, in itself, a major enter prise for profit.

The FAA construes “compensation or hire” very broadly. It does not require a profit , a profit

motive or the actual payment of funds. Instead, compensation under the FAA's view is the

receipt of anything of value

. Thus, compensation fo r the flights as pro posed would exist in

two forms. First, the expenses associated with the flight would be paid by donors to the

charity, not the individual pilot; and second, the pilots would acquire flight hours

at the charity's expense

— flight hours that could be used to demonstrate aeronautical

experience eligibility for an airman certificat e. These forms of compensation are sufficient to

require the operator to have a part 119 certificate.

The FAA has previously stated that a company organized sol ely for the purpose o f owning and

operating aircraft to transport people or property for compensation or hire must have an air

carrier operating certificate because the air transportation provided by the company is not

“incidental” to the company's busines s.

Thus, the practical effect is that the aircraft and crew used in the air transportation are both

provided by the same company, which is effectively a flight department company ope ration

that cannot be conducted under part 91.

The proposed operations are distinguishable from the FAA charitable airlift exception.

Und er that exception, flights conducted by private pilots and offered to the public by a

charitable organization in exchange for donations may be operated under part 91 if they do not

involve the point

- to

- point transportation of persons or property, which wou ld implicate the

requirements of part 119

. For example, under the charitable airlift exception, the passengers

are flown around for a brief period of time, and then returned to the poi nt of origin; whereas in

the petitioner’s proposal, the passengers woul d be flow n from point A to point B. Since the

flights would involve point

- to

- point transportation for compensation, a part 119 certificate is

required.

The petitioner also stated that current flights for patients are conducted under part 91, but

again, t hese types of flights are distinguishable from your proposed operations. It is true that

some the petitioner ’ s flights are permitted to operate under part 91, and are allowed to accept

donations from the public. However, these organizations use the servi ces of pilots who

donate their time and aircraft

. In addition, the public donations made to t hese organizations

are not used to pay the pilots but to reimburse fuel expenses

. Therefore, the flights are not

being conducted for compensation, and are not re quired to comply with part 119.

The humanitarian efforts of many individuals in the aviation community are laudable, yet the

need to maintain the highest level of safety for commercial operations remains. Accordingly,

the FAA believes that the interests of safety are best served by requiring operations conducted

for compensation or hire to be conducted under parts 121 or 135

.5

The FAA finds that the petitioner ’ s petition for exemption from p art 119 and p art 135 is not in

the public interest. This exempt ion would permit pilots who have not received p art 135

training or checking to fly a company airplane that has not been maintained to p art 135

standards to carry passengers.

The FAA’s Decision:

In consideration of the foregoing, I find that a grant of exemption would not be in the

public interest. Therefore, pursuant to the authority contained in 49 U.S.C. §§ 40113

and 44701, delegated to me by the Administrator, the petition of Patient AirLift Services. Inc

., for an exemption from 14 CFR p art s 119 and 135 is hereby denied.

Issued in Washington, DC, on January 23, 2013.

/s/

Michael J. Zenkovick

Acting Director, Flight Standards Service

.