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Exemption No. 3438 

UNITED STATES OF AMERICA 

DEPARTMENT OF TRANSPORTATION 

FEDERAL AVIATION ADMINISTRATION 

WASHINGTON, D.C. 20591 

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In the matter of the petition of * 

* 

EXECUTIVE AIR FLEET CORPORATION * Regulatory Docket No. 22270 

•Afor an exemption from Section * 

135.25 of the Federal Aviation * 

Regulations * 

* 

DENIAL OF EXEMPTION 

By letter dated Ocbober 2, 1981, Mr. William B. Watt, 

Executive Air Fleet Corporation (EAF), 90 Moonachie Avenue, 

Teterboro, N.J. 07 60 8, and J. W. Rosenthal, Esq.', Attorney, of 

Ginsburg, Feldman, Weil and Bress, 1700 Pennsylvania Avenue, 

N.W., Washington, D.C. 20006, petitioned on behalf of EAF for an 

exemption from Section 135.25(b) and (c) of the Federal Aviation 

Regulations (FAR) to the extent necessary to allow petitioner to 

operate without having the exclusive use of at least one aircraft 

that meets the requirements for at least one kind of operation 

authorized in the certificate holder's operations specifications. 

Section 135.25(b) provides, in pertinent part, that each 

certificate holder must have exclusive use of at least one 

aircraft that meets the requirements for at least one kind of 

operation authorized in the certificate holder's operations 

specifications. in addition, for each kind of operation for 

which the certificate holder does not have the exclusive use of 

an aircraft, the certificate holder must have available for use 

under a written agreement (including arrangements for performing 

required maintenance) at least one aircraft that meets the 

requirements for that kind of operation. 

Section 135.25(c) provides, in pertinent part, that for the 

purpose of the previously mentioned paragraph, a person has 

exclusive use of an aircraft if that person has the sole 

possession, control, and use of it for flight, as owner, or has a 

written agreement (including arrangements for performing required 

maintenance),.in effect when the aircraft is operated, giving the 

person that possession, control, and use for at least 6 

consecutive months. 

VS-82-005-E 
In support of its request, EAF states, in pertinent part: 

EAF is a Delaware corporation with its principal place of 

business at Teterboro Airport, Teterboro, New Jersey. EAF is an 

aircraft management firm which also holds a certificate and 

operations specifications issued under Part 135 and, among other 

things, conducts an air taxi charter operation under an exemption 

from the Civil Aeronautic Board (CAB)' pursuant to Part 298 of the 

Board's Economic Regulations. 

EAF's principal business is the performance of management 

and consulting services for clients who own executive jet 

aircraft. Those clients {hereinafter sometimes referred to as 

"owners"} include corporations and individuals who use such 

aircraft for the transportation of their own corporate executives 

or themselves, as the case may be, and their guests. Under 

contracts between EAF and the owners, EAF performs a multitude of 

management advisory functions related to the owners' operation of 

such aircraft. These functions include aircraft maintenance and 

recordkeeping, and the recruiting and training of flight 

crewmembers. 

Several of EAF's present client-owners have determined that, 

in order to utilize their aircraft efficiently, it would be 

desirable to have such aircraft chartered to third parties from 

time to time. in order to accomplish this, EAF obtained the 

certificate and operations specifications referred to above. 

Under its contracts with the owners, EAF has complete 

operational control of the aircraft when it is being operated 

under a charter and the owner' has complete operational control 

(with management services performed by EAF) when the owner is 

using the aircraft for his own account. When EAF operates the 

aircraft, the operation is under Part 135; when the owner 

operates the aircraft, it is operated under either Part 91 or 

Part 125, depending on aircraft size. 

On August 11, 1981, EAF filed a petition for rulemaking 

requesting that the Federal Aviation Administration (FAA) abolish 

the Part 135 exclusive-use requirement. This petition was 

published in the Federal Register on September 28, 1981 (46 FR 

47465). In its petition, EAF relied on the FAA's' abolition in 

July 1981 of the analogous exclusive-use rule of Part 121, on the 

basis that it was "an economic burden... that cannot be justified 

on safety grounds." EAF further pointed out that the situation 

with which exclusive-use rules were intended to deal--namely, the 

plethora of nonscheduled operators which emerged after World War 

II--no longer exists and that the Civil Aeronautics Board no 

longer has any enforcement interest in the area. Finally, EAF 

argued that the rule did not even accomplish its intended purpose 

since requiring each Part 135 operator to have the exclusive use 
of one aircraft hardly constituted "positive control"-- the 

ostensible purpose of exclusive-use rules. In addition, EAF 

submitted a petition for exemption and feels that a grant of 

exemption is warranted due to the needless and wasteful economic 

burden imposed upon it by the rule and by the fact that aviation 

•safety.will not be adversely affected--indeed, will be advanced--

by the abolition of the rule. 

Because its unique and highly respected timesharing and 

aircraft management business does not, of itself, give EAF the 

exclusive use of one aircraft, the company'has been compelled to 

purchase, own, and maintain a single-engine Cessna 152 solely in 

order to satisfy Section 135.25. 

A summary of petitioner's exemption request was published in 

the-Federal Register on November 5, 1981 (46 FR 55051). One 

comment was received. 

This commenter stated,.in pertinent part: 

This industry has been plagued with temporary operators who 

decide to help defray expenses on aircraft or provide employment 

for out-of-work pilots by getting into the air taxi business for 

short periods of time. Requiring that at least one aircraft be 

exclusively available for charter use is one means of requiring a 

commitment to the air taxi business that undoubtedly has 

prevented the existence of even more short-term air taxi 

operators. 

The level of inspection and surveillance of someone in and 

out of the air taxi business over a short period of time cannot 

be as comprehensive as it is for the continuing, full-time 

operators the local FAA offices have dealt with over a period of 

time; hence, the possibility of a lower leyel of safety for those 

operators exists. 

While other means undoubtedly exist to require the 

commitment mentioned above, no other method is currently in 

effect that would replace the aircraft requirement and, 

therefore, the requirements of Section 135.25(b) and (c) should 

not be deleted at this time. 

Based upon a review of the facts presented and in light of • 

the comment received, the FAA believes that the aircraft 

requirement in Part 135 provides a stable base for certification. 

At the present time, as many as 100 operators go out of business 

monthly, with about the same number applying for new 

certificates . 

This aircraft requirement has been in existence since 1949, 

and the industry has voiced no objection to the rule. In the 

revision to Part 135 proposed in 1977, only a few comments weire 

received requesting a change. 
From a safety standpoint, the rule provides proper control 

over operations and maintenance for one aircraft. Executive Air 

Fleet Corporation argues that this does not accomplish that 

purpose. The FAA maintains that by requiring ownership or 

leasing of one aircraft, an applicant will hesitate before making 

application because it must commit itself to control one 

aircraft. Without such a commitment, the operator might be 

tempted to reduce aircraft maintenance and crew training and then 

sell or lease the aircraft before routine FAA surveillance . 

reveals only possible irregularities. Such a situation is not in 

the public interest and could result in operations conducted at a 

reduced level of safety. 

In consideration of the foregoing, I find that a grant of 

exemption is not in the public interest. Therefore, pursuant to 

the authority contained in Sections 313(a) and 601(c) of the 

Federal Aviation Act of 1958, delegated to me by the 

Administrator (14 CFR 11.53), the petition of Executive Air Fleet 

Corporation for an exemption from Section 135.25(b) and (c) of 

the Federal Aviation Regulations is hereby denied. 

/s/ Kenneth S. HuntDirector of 

Flight Operations 

Issued in Washington, D.C, on 

December 31, 1981 .