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(1) IN
GENERAL.—The Inspector General of 
the Department of Transportation shall conduct a 
study of the Voluntary Disclosure Reporting Pro-
gram. 
(2) REVIEW.—In conducting the study, the In-
spector General shall examine, at a minimum, 
whether— 
(A) there is evidence that voluntary disclo-
sure is resulting in regulated entities discov-
ering and correcting violations to a greater ex-
tent than would otherwise occur if there was no 
program for immunity from enforcement action; 
(B) the voluntary disclosure program 
makes the Federal Aviation Administration 
(FAA) aware of violations that the FAA would 
not have discovered if there was not a program, 
and if a violation is disclosed voluntarily, 
whether the FAA insists on stronger corrective 
actions than would have occurred if the regu-
lated entity knew of a violation, but FAA did 
not; 
(C) the information the FAA gets under 
the program leads to fewer violations by other 
entities, either because the information leads 
other entities to look for similar violations or 
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because the information leads FAA investiga-
tors to look for similar violations at other enti-
ties; and 
(D) there is any evidence that voluntary 
disclosure has improved compliance with regula-
tions, either for the entities making disclosures 
or for the industry generally. 
(3) REPORT.—Not later than one year after the 
date of enactment of this Act, the Inspector General 
shall submit to the Committee on Transportation 
and Infrastructure of the House of Representatives 
and Committee on Commerce, Science, and Trans-
portation of the Senate a report on the results of the 
study conducted under this section. 
TITLE IV—AIR SERVICE 
IMPROVEMENTS 
SEC. 401. SMOKING PROHIBITION. 
(a) IN GENERAL.—Section 41706 is amended— 
(1) in the section heading by striking ‘‘sched-
uled’’ and inserting ‘‘passenger’’; and 
(2) by striking subsections (a) and (b) and in-
serting the following: 
‘‘(a) SMOKING PROHIBITION IN INTRASTATE AND 
INTERSTATE TRANSPORTATION BY AIRCRAFT.—An indi-
vidual may not smoke in an aircraft— 
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‘‘(1) in scheduled passenger interstate air 
transportation or scheduled passenger intrastate air 
transportation; and 
‘‘(2) in nonscheduled intrastate or interstate 
transportation of passengers by aircraft for com-
pensation, if a flight attendant is a required crew-
member on the aircraft (as determined by the Ad-
ministrator of the Federal Aviation Administration). 
‘‘(b) SMOKING
PROHIBITION
IN
FOREIGN
AIR 
TRANSPORTATION.—The Secretary of Transportation 
shall require all air carriers and foreign air carriers to pro-
hibit smoking in an aircraft— 
‘‘(1) in scheduled passenger foreign air trans-
portation; and 
‘‘(2) in nonscheduled passenger foreign air 
transportation, if a flight attendant is a required 
crewmember on the aircraft (as determined by the 
Administrator or a foreign government).’’. 
(b) CLERICAL AMENDMENT.—The analysis for chap-
ter 417 is amended by striking the item relating to section 
41706 and inserting the following: 
‘‘41706. Prohibitions against smoking on flights.’’. 
SEC. 402. MONTHLY AIR CARRIER REPORTS. 
(a) IN GENERAL.—Section 41708 is amended by 
adding at the end the following: 
‘‘(c) DIVERTED AND CANCELLED FLIGHTS.— 
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‘‘(1) MONTHLY REPORTS.—The Secretary shall 
require an air carrier referred to in paragraph (2) 
to file with the Secretary a monthly report on each 
flight of the air carrier that is diverted from its 
scheduled destination to another airport and each 
flight of the air carrier that departs the gate at the 
airport at which the flight originates but is cancelled 
before wheels-off time. 
‘‘(2) APPLICABILITY.—An air carrier that is re-
quired to file a monthly airline service quality per-
formance report under subsection (b) shall be sub-
ject to the requirement of paragraph (1). 
‘‘(3) CONTENTS.—A monthly report filed by an 
air carrier under paragraph (1) shall include, at a 
minimum, the following information: 
‘‘(A) For a diverted flight— 
‘‘(i) the flight number of the diverted 
flight; 
‘‘(ii) the scheduled destination of the 
flight; 
‘‘(iii) the date and time of the flight; 
‘‘(iv) the airport to which the flight 
was diverted; 
‘‘(v) wheels-on time at the diverted 
airport; 
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‘‘(vi) the time, if any, passengers 
deplaned the aircraft at the diverted air-
port; and 
‘‘(vii) if the flight arrives at the sched-
uled destination airport— 
‘‘(I) the gate-departure time at 
the diverted airport; 
‘‘(II) the wheels-off time at the 
diverted airport; 
‘‘(III) the wheels-on time at the 
scheduled arrival airport; and 
‘‘(IV) the gate arrival time at the 
scheduled arrival airport. 
‘‘(B) For flights cancelled after gate de-
parture— 
‘‘(i) the flight number of the cancelled 
flight; 
‘‘(ii) the scheduled origin and destina-
tion airports of the cancelled flight; 
‘‘(iii) the date and time of the can-
celled flight; 
‘‘(iv) the gate-departure time of the 
cancelled flight; and 
‘‘(v) the time the aircraft returned to 
the gate. 
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‘‘(4) PUBLICATION.—The Secretary shall com-
pile the information provided in the monthly reports 
filed pursuant to paragraph (1) in a single monthly 
report and publish such report on the website of the 
Department of Transportation.’’. 
(b) EFFECTIVE DATE.—The Secretary of Transpor-
tation shall require monthly reports pursuant to the 
amendment made by subsection (a) beginning not later 
than 90 days after the date of enactment of this Act. 
SEC. 403. FLIGHT OPERATIONS AT REAGAN NATIONAL AIR-
PORT. 
(a) BEYOND
PERIMETER
EXEMPTIONS.—Section 
41718(a) is amended by striking ‘‘24’’ and inserting ‘‘34’’. 
(b) LIMITATIONS.—Section 41718(c)(2) is amended 
by striking ‘‘3 operations’’ and inserting ‘‘5 operations’’. 
(c) ALLOCATION OF BEYOND-PERIMETER EXEMP-
TIONS.—Section 41718(c) is amended— 
(1) by redesignating paragraphs (3) and (4) as 
paragraphs (4) and (5), respectively; and 
(2) by inserting after paragraph (2) the fol-
lowing: 
‘‘(3) SLOTS.—The Administrator of the Federal 
Aviation Administration shall reduce the hourly air 
carrier slot quota for Ronald Reagan Washington 
National Airport in section 93.123(a) of title 14, 
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Code of Federal Regulations, by a total of 10 slots 
that are available for allocation. Such reductions 
shall be taken in the 6:00 a.m., 10:00 p.m., or 11:00 
p.m. hours, as determined by the Administrator, in 
order to grant exemptions under subsection (a).’’. 
(d) SCHEDULING
PRIORITY.—Section 41718 is 
amended— 
(1) by redesignating subsections (e) and (f) as 
subsections (f) and (g), respectively; and 
(2) by inserting after subsection (d) the fol-
lowing: 
‘‘(e) SCHEDULING PRIORITY.—Operations conducted 
by new entrant air carriers and limited incumbent air car-
riers shall be afforded a scheduling priority over oper-
ations conducted by other air carriers granted exemptions 
pursuant to this section, with the highest scheduling pri-
ority to be afforded to beyond-perimeter operations con-
ducted by new entrant air carriers and limited incumbent 
air carriers.’’. 
SEC. 404. EAS CONTRACT GUIDELINES. 
(a) 
COMPENSATION
GUIDELINES.—Section 
41737(a)(1) is amended— 
(1) by striking ‘‘and’’ at the end of subpara-
graph (B); 
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(2) in subparagraph (C) by striking the period 
at the end and inserting a semicolon; and 
(3) by adding at the end the following: 
‘‘(D) include provisions under which the Sec-
retary may encourage an air carrier to improve air 
service for which compensation is being paid under 
this subchapter by incorporating financial incentives 
in an essential air service contract based on specified 
performance goals, including goals related to improv-
ing on-time performance, reducing the number of 
flight cancellations, establishing reasonable fares (in-
cluding joint fares beyond the hub airport), estab-
lishing convenient connections to flights providing 
service beyond hub airports, and increasing mar-
keting efforts; and 
‘‘(E) include provisions under which the Sec-
retary may execute a long-term essential air service 
contract to encourage an air carrier to provide air 
service to an eligible place if it would be in the pub-
lic interest to do so.’’. 
(b) DEADLINE FOR ISSUANCE OF REVISED GUID-
ANCE.—Not later than 90 days after the date of enact-
ment of this Act, the Secretary of Transportation shall 
issue revised guidelines governing the rate of compensa-
tion payable under subchapter II of chapter 417 of title 
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49, United States Code, that incorporate the amendments 
made by subsection (a). 
(c) REPORT.—Not later than 2 years after the date 
of issuance of revised guidelines pursuant to subsection 
(b), the Secretary shall submit to the Committee on 
Transportation and Infrastructure of the House of Rep-
resentatives and the Committee on Commerce, Science, 
and Transportation of the Senate a report on the extent 
to which the revised guidelines have been implemented and 
the impact, if any, such implementation has had on air 
carrier performance and community satisfaction with air 
service for which compensation is being paid under sub-
chapter II of chapter 417 of title 49, United States Code. 
SEC. 405. ESSENTIAL AIR SERVICE REFORM. 
(a) AUTHORIZATION OF APPROPRIATIONS.—Section 
41742(a)(2) of title 49, United States Code, is amended 
by striking ‘‘there is authorized to be appropriated 
$77,000,000’’ and inserting ‘‘there is authorized to be ap-
propriated out of the Airport and Airway Trust Fund 
$150,000,000’’. 
(b) DISTRIBUTION OF EXCESS FUNDS.— 
(1) IN GENERAL.—Section 41742(a) is amend-
ed by adding at the end the following: 
‘‘(4) DISTRIBUTION
OF
EXCESS
FUNDS.—Of 
the funds, if any, credited to the account established 
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under section 45303 in a fiscal year that exceed the 
$50,000,000 made available for such fiscal year 
under paragraph (1)— 
‘‘(A) one-half shall be made available im-
mediately for obligation and expenditure to 
carry out section 41743; and 
‘‘(B) one-half shall be made available im-
mediately for obligation and expenditure to 
carry out subsection (b).’’. 
(2) 
CONFORMING
AMENDMENT.—Section 
41742(b) is amended— 
(A) in the first sentence by striking ‘‘mon-
eys credited’’ and all that follows before ‘‘shall 
be used’’ and inserting ‘‘amounts made avail-
able under subsection (a)(4)(B)’’; and 
(B) in the second sentence by striking 
‘‘any amounts from those fees’’ and inserting 
‘‘any of such amounts’’. 
SEC. 406. SMALL COMMUNITY AIR SERVICE. 
(a) PRIORITIES.—Section 41743(c)(5) is amended— 
(1) by striking ‘‘and’’ at the end of subpara-
graph (D); 
(2) in subparagraph (E) by striking ‘‘fashion.’’ 
and inserting ‘‘fashion; and’’; and 
(3) by adding at the end the following: 
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sumers or foreclosed competition by rival (nonalli-
ance) air carriers at such airports. 
(4) Whether increased network size resulting 
from additional international alliance members will 
adversely affect competition between international 
alliances. 
(5) The areas in which immunized international 
alliances compete and whether there is sufficient 
competition among immunized international alliances 
to ensure that consumers will receive benefits of at 
least the same magnitude as those that consumers 
would receive if there were no immunized inter-
national alliances. 
(6) The minimum number of international alli-
ances that is necessary to ensure robust competition 
and benefits to consumers on major international 
routes. 
(7) Whether the different regulatory and anti-
trust responsibilities of the Secretary and the Attor-
ney General with respect to international alliances 
have created any significant conflicting agency rec-
ommendations, such as the conditions imposed in 
granting exemptions from the antitrust laws. 
(8) Whether, from an antitrust standpoint, re-
quests for exemptions from the antitrust laws in 
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