Aviation Enhancement Act of 1993

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Aviation Enhancement Act of 1993''.

SEC. 2. FINDINGS.

    Congress finds and declares that--
            (1) the United States commercial airline industry is 
        currently suffering severe financial distress;
            (2) sustained record losses and excessive debt burdens are 
        causing air carriers to cancel new aircraft options and orders, 
        thereby threatening the economic viability of the United States 
        aerospace manufacturing industry;
            (3) although most air carriers would benefit from acquiring 
        new generation, quieter, more fuel-efficient aircraft, there is 
        already more capacity than demand for seats, resulting in 
        downsizing, not expansion, of fleets;
            (4) many air carriers are increasingly unable to obtain 
        financing at reasonable interest rates for purchasing new 
        equipment;
            (5) the inability of many air carriers to acquire new, 
        quieter Stage 3 aircraft may jeopardize the planned phase out 
        of noisier Stage 2 aircraft;
            (6) States and local communities, the traveling public, 
        airline employees, and airline shareholders would all benefit 
        from stronger, healthier air carriers operating modern, fuel 
        efficient, quieter aircraft;
            (7) as the owner and operator of the Nation's air traffic 
        control system, the Federal Government is a partner of the 
        commercial aviation industry and must do its part to strengthen 
        the air carrier and aerospace industries;
            (8) it is estimated that the Airport and Airway Trust Fund 
        will contain an unobligated surplus in excess of $4,300,000,000 
        on October 1, 1993;
            (9) a prudent shift of the investment of the Airport and 
        Airway Trust Fund surplus into modernization of the commercial 
        aviation industry's fleet can provide vitally needed economic 
        stimulus for carriers and manufacturers and will ensure that 
        both industries remain competitive into the next century; and
            (10) the Airport and Airway Trust Fund surplus should, 
        therefore, be made available to guarantee loans for the 
        acquisition of new aircraft if such acquisition will assure the 
        phasing out of less fuel efficient and noisier or older 
        aircraft at the same time.

SEC. 3. LOAN GUARANTEES FOR ACQUISITION OF STAGE 3 AIRCRAFT.

    (a) In General.--Title XI of the Federal Aviation Act of 1958 (49 
U.S.C. App. 1501-1518) is amended by adding at the end the following 
new section:

``SEC. 1119. LOAN GUARANTEES FOR ACQUISITION OF STAGE 3 AIRCRAFT.

    ``(a) In General.--The Secretary is authorized, subject to 
appropriations Acts, to guarantee any lender against loss of principal 
or interest on any loan made to an eligible air carrier for the purpose 
of financing the acquisition of new Stage 3 aircraft.
    ``(b) Terms and Conditions.--A loan may be guaranteed by the 
Secretary under this section only if the loan is made subject to the 
following terms and conditions:
            ``(1) Term.--The term of the loan does not exceed 20 years.
            ``(2) Rate of interest.--The loan bears interest at a rate 
        which is less than the maximum rate for such loans determined 
        by the Secretary. The maximum rate for such loans may not be 
        less than the current average market yield on outstanding 
        obligations of the United States with remaining periods to 
        maturity comparable to the maturity of the loan.
            ``(3) Prepayment.--There is no penalty for prepayment of 
        the amount of the loan.
            ``(4) Use of loan amounts.--The loan will be used only for 
        the acquisition of Stage 3 aircraft which--
                    ``(A) are manufactured in the United States; and
                    ``(B) will be delivered to the borrower not later 
                than 3 years after the date on which amounts are 
                appropriated to carry out this section.
    ``(c) Domestic Manufacture.--For the purposes of subsection (b)(4), 
an aircraft shall be considered to have been manufactured in the United 
States only if 50 percent or more of the parts of the aircraft, by 
value, are manufactured in the United States.
    ``(d) Retirement of Aging and Stage 2 Aircraft.--The Secretary may 
guarantee a loan under this section to an air carrier which owns or 
operates aging aircraft or Stage 2 aircraft only if the carrier agrees 
that, upon delivery of the aircraft being acquired with amounts of the 
loan, the air carrier will--
            ``(1) retire from service Stage 2 aircraft or aging 
        aircraft containing a number of seats which equals or exceeds 
        200 percent of the number of seats contained in the aircraft 
        being acquired; or
            ``(2) retire from service all of the air carrier's 
        remaining Stage 2 aircraft and aging aircraft.
    ``(e) Default.--The Secretary may guarantee a loan under this 
section only if the air carrier applying for the loan agrees that, in 
the event of a default, the air carrier will transfer to the Department 
of Transportation title to all equipment acquired with the proceeds of 
the loan.
    ``(f) Distribution of Loan Guarantees.
            ``(1) Determination of available seat miles.--Not later 
        than 30 days after the date on which amounts are appropriated 
        to carry out this section, the Secretary shall determine the 
        percentage of available seat miles attributed, for the most 
        recent 12-month period for which such data is available, to 
        each eligible air carrier certificated on or before October 1, 
        1992.
            ``(2) Allocation.--
                    ``(A) Carriers certificated on or before october 1, 
                1992.--An amount equal to 95 percent of the funds 
                appropriated to carry out this section shall be 
                available for guaranteeing loans to eligible air 
                carriers certificated on or before October 1, 1992, and 
                shall be allocated among such carriers based on the 
                percentage of available seat miles attributed to each 
                such carriers under paragraph (1).
                    ``(B) Other carriers.--An amount equal to 5 percent 
                of the funds appropriated to carry out this section 
                shall be available for guaranteeing loans to eligible 
                air carriers certificated after October 1, 1992, and 
                shall be allocated among such carriers based on a fair 
                and equitable formula to be established by the 
                Secretary.
                    ``(C) Transfer of allocations.--An eligible air 
                carrier may transfer to other eligible air carriers all 
                or part of the amount of loan guarantees allocated to 
                such carrier under this paragraph.
    ``(g) Enforcement.--
            ``(1) In general.--The Secretary is authorized to take such 
        actions as may be appropriate to enforce any right accruing to 
        the United States, or any officer or agency thereof, as a 
        result of the commitment or issuance of a loan guarantee under 
        this section.
            ``(2) Collateral.--All loan guarantees under this section 
        shall be secured by the equipment being financed and any other 
        assets necessary to provide sufficient collateral.
    ``(h) Authorization of Appropriations.--There is authorized to be 
appropriated out of the Airport and Airway Trust Fund to carry out this 
section $4,300,000,000 for fiscal years beginning after September 30, 
1993.
    ``(i) Definitions.--For the purposes of this section, the following 
definitions apply:
            ``(1) Aging aircraft.--The term `aging aircraft' means an 
        aircraft which has been in service for at least 15 years.
            ``(2) Eligible air carrier.--The term `eligible air 
        carrier' means an air carrier which has been issued an 
        operating certificate under part 121 of title 14, Code of 
        Federal Regulations.
            ``(3) Stage 2 aircraft.--The term `Stage 2 aircraft' means 
        an aircraft which complies with Stage 2 noise levels under part 
        36 of title 14, Code of Federal Regulations, as in effect on 
        the date of the enactment of this section.
            ``(4) Stage 3 aircraft.--The term `Stage 3 aircraft' means 
        an aircraft which complies with Stage 3 noise levels under part 
        36 of title 14, Code of Federal Regulations, as in effect on 
        the date of the enactment of this section.
            ``(5) Secretary.--The term `Secretary' means the Secretary 
        of Transportation.''.
    (b) Conforming Amendment to Table of Contents.--The table of 
contents contained in the first section of the Federal Aviation Act of 
1958 is amended by adding at the end of the matter relating to title XI 
of such Act the following:

``Sec. 1119. Loan guarantees for acquisition of Stage 3 aircraft.
                              ``(a) In general.
                              ``(b) Terms and conditions.
                              ``(c) Domestic manufacture.
                              ``(d) Retirement of aging and Stage 2 
                                        aircraft.
                              ``(e) Default.
                              ``(f) Distribution of loan guarantees.
                              ``(g) Enforcement.
                              ``(h) Authorization of appropriations.
                              ``(i) Definitions.''.

Summary: Aviation Enhancement Act of 1993 - Amends the Federal Aviation Act of 1958 to authorize the Secretary of Transportation (Secretary) to guarantee loans to eligible air carriers for financing the acquisition of new Stage three aircraft.  Authorizes the Secretary to guarantee such loans to air carriers that own aging aircraft or Stage two aircraft only if the carrier agrees that it will retire from service:  (1) Stage two aircraft or aging aircraft containing a number of seats which equals or exceeds 200 percent of the number of seats contained in the acquired aircraft; or (2) all of the air carriers remaining Stage 2 aircraft and aging aircraft. 
Authorizes appropriations.