Source: https://blog.globalair.com/2016/05/default.aspx
Timestamp: 2017-07-22 20:37:50
Document Index: 513708120

Matched Legal Cases: ['§110', 'art 121', 'art 135', 'art 91', '§ 91', 'art 91', '§1', 'art 135', '§ 91', 'art 121', 'art 135', 'art 91', 'art 91', 'arts 121', 'art 91', 'art 134']

31. May 2016 09:20
Share on FacebookMany times an aircraft owner who is not fully utilizing the owner’s aircraft will lease the aircraft to maximize the use of the aircraft and to recover some of the aircraft owner’s expenses. One of the areas about which aircraft owners and operators are frequently confused is the difference between a “wet” lease and a “dry” lease. I’ll give you a hint: It’s not about the fuel. The “Wet” lease 14 C.F.R. §110.2 defines a “wet lease” as “any leasing arrangement whereby a person agrees to provide an entire aircraft and at least one crewmember.” (Note no reference to fuel) Ordinarily, the parties entering into wet lease arrangements are certificated air carriers such as airlines operating under 14 C.F.R. Part 121 and charter operators conducting operations under 14 C.F.R. Part 135. This makes sense since these air carriers have the authority to use aircraft and crew to carry passengers and property for compensation or hire. Non-air carrier aircraft operators conducting operations under Part 91 are prohibited from carrying passengers and property for compensation or hire except in very limited circumstances. However, 14 C.F.R. § 91.501(c) does provide for certain timesharing and interchange arrangements in which both the aircraft and crew are provided together. And although these arrangements are considered wet leases because they include both aircraft and crew, they are Part 91 operations in which the parties to the transactions do not need to be air carriers. The “Dry” lease In a dry lease arrangement, the aircraft owner is providing the aircraft to the lessee without crew. (Here again, whether the aircraft is provided with or without fuel has no bearing on the type of lease) Neither the lessor nor the lessee is required to hold an air carrier certificate in a dry lease arrangement, although nothing prohibits either party from being an air carrier. Operational control One of the key issues that distinguishes a “wet” lease from a “dry” lease is “who has operational control.” 14 C.F.R §1.1 defines operational control as “the exercise of authority over initiating, conducting or terminating a flight.” In a “wet” lease situation, since the lessor is providing both aircraft and crew, the lessor maintains operational control of all flights. In a “dry” lease situation, the lessee provides its own crew and the lessee exercises operational control of its flights. If the lease is for private use or commercial, non-Part 135 use, typically each party will have operational control of the aircraft when it is in that party’s possession. Oftentimes in this situation, operational control will revert to the lessor during the times when the lessee is not using or possessing the aircraft. What’s The Issue? So, why is this distinction between “wet” and “dry” leases so important? Well, in the absence of a specific exemption (such as under 14 C.F.R. § 91.501(c)) the lessor who is operating an aircraft under a wet lease will need to have an air carrier certificate and operate under the regulations that govern air carriers (e.g. Part 121 or Part 135). This means the lessor will have to comply with regulations that are stricter than Part 91 including regulations relating to the types of airports the lessor may utilize, crew qualifications, crew rest and duty times, maintenance requirements etc. And those regulations increase the lessor’s cost to operate. Additionally, the lessor under a wet lease is required to remit federal excise tax (“FET”) on the amount charged to the lessee. A lessee operating under a dry lease is permitted to operate under Part 91 and is not required to comply with many of the more restrictive and costly requirements of Parts 121 or 135. And federal excise tax is not due on the amounts paid by the lessee to the lessor, although sales tax is often assessed on the lease rate. For private operators, these are significant advantages. However, they also need to be weighed against the responsibilities, and potential liability, that goes along with having operational control of a Part 91 dry lease operation. The situation may get confusing when parties decide they want the best of both worlds. Unfortunately, these Part 134 ½ operations, as I call them, are usually FAA enforcement actions waiting to happen. For example, if the lessor provides the lessee with the aircraft under a dry lease and that same lessor also supplies the crew under a separate agreement the FAA will likely view that as a wet lease arrangement since the lessor is providing both aircraft and crew. If the lessor does not hold an air carrier certificate then the FAA will consider those flights to be illegal charter flights. Additionally, the IRS would also probably assess FET on those flights. A similarly improper arrangement occurs if the lessor leases the aircraft to the lessee and then requires that the lessee obtain the crew for the flights either from a specified source, usually affiliated with or controlled by the lessor. If the lessor does not hold an air carrier certificate, the FAA would also consider this a wet lease arrangement. Since the aircraft and crew are coming from closely related or affiliated sources, the FAA views them as both coming from the lessor. It is important to keep in mind that the FAA will look beyond the actual written agreements to determine the relationships between the parties and how the arrangement is actually being conducted. Although a lease is written as a dry lease and says “Dry Lease” at the top of the agreement, for example, that doesn’t mean that the FAA can’t take the position that the arrangement is really being conducted as a wet lease. And if the FAA takes that position when the lessor who is actually operating the aircraft for the lessee does not have an air carrier certificate, then that will be a problem for the lessor, and potentially for the lessee as well. Conclusion The distinction between “wet” and “dry” leases isn’t always clear to aircraft owners and operators. However, it is important to understand the difference because each situation has separate regulatory obligations and requirements. Failure to comply with the legal requirements applicable to the chosen lease structure can result in problems for both the lessor and the lessee. Additionally, as with all written agreements, it is essential that you carefully review all of the provisions of any aircraft lease before you sign. Consultation with an experienced aviation attorney beforehand can help you protect yourself, whether lessor or lessee. By taking the time to understand the terms of the aircraft lease and the applicable regulatory requirements, both parties can ensure that their expectations are met and their interests protected.
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Tags: aircraft leasing, dry lease, wet lease
3 Things Writing Has Taught Me
15. May 2016 08:00
As the academic year is now over, I’ve been reflecting on the last several months and where I am today versus nine months ago. More specifically, how writing for the Calvin L. Carrithers Aviation Scholarship has taught me three things: good writing takes (lots of) practice, writing promotes learning, and writing takes you places.
#1: Good Writing Takes (Lots of) Practice
I remember those first initial essays I ever wrote – my parents marked them all over with notes, enough to make one seriously doubt that writing was their thing. I went on to take classes in writing, work with professional editors, and with many professors for various classes. Long story short, good writing takes (lots of) practice.
Just how much practice? Consider this: every time I write an essay, article, or research paper, I edit it. No matter how much, or how often I write, I always print off a copy and mark it up with a pen or pencil. I’ve written thousands of words over the last five years, but I still make many mistakes. It could be grammar, sentence structure, facts, punctuation, etc. Even now, as a “veteran” writer, I still find myself writing outlines, trying to gather my thoughts, and reformatting articles (even now, I’m trying to decide if I should reword this sentence…)
Just when I think I’ve got a handle on this writing business, I find myself mulling over what topic to cover next in my bi-weekly blogging. I try to brainstorm a list of topics, which I inevitably write about and then need more. I really don’t think any one person can master how to write well, but I’ve had a lot of fun practicing.
#2: Writing Promotes Learning
If you’re a student reading this article, you’re probably rolling your eyes because the last thing you want to do is study more. I can relate because after writing papers for your classes, applying for scholarships and more, you might be sick of writing. However, let’s consider how writing promotes learning.
I’m a prolific note taker when it comes to academics – I do most of my note taking by hand on the PowerPoints, on notebook, paper, and sometimes on my laptop. Writing about what I’m hearing forces me to structure the information into short sentences that get to the point. Sometimes this doesn’t always go as plan because I’ll come back to my notes later and can’t for the life of me figure out what I was saying. Overall though, rewriting my notes, or taking them by hand, goes a long ways in comprehension of a subject matter.
Another way writing promotes learning is through exploring new subjects. For instance, some of my past blog topics came about as a result of wanting to learn more about a particular subject such as the new Student Pilot Certificate rules, or new pieces of legislation affecting different segments of the aerospace industry. I find that I’m much more informed on a subject when I actually write about it.
So, while you may shudder at writing to promote learning, just think of it as telling your best friend a story.
#3: Writing Takes You Places
Writing takes you places – maybe that seems too good to be true, but I can promise you it is. Consider the following: job applications, resumes, cover letters, scholarship applications, and academic classes. All of these require writing and they all can take you places such as a new job, money for your education, and a way to earn your degree – the possibilities are endless.
With GlobalAir.com, I’ve found a creative outlet, a scholarship curator job, and a way to hone my writing skills. I’ve used my writing skills many times over for scholarship applications, class research projects, and much more. I honestly didn’t think I’d be paid to write about my passion for aviation – the Calvin L. Carrithers Aviation Scholarship became my opportunity to pour my passion for aviation onto paper and pushed me to develop my professional writing skills while putting myself through school. I don’t think I’d be where I am today without my skills as a writer and the willingness to develop them. If there is one piece of advice I could pass on to students it would be to practice, practice, practice – we’ll always be writing and there is no time like the present to get started.
Do you know a student in aviation (really, any facet) that has a passion for writing? Globalair.com is pleased to announce the opening for application submissions for the Globalair.com “Calvin L. Carrithers” Aviation Scholarship. The scholarship is offered to all students who are currently enrolled in an accredited university or college aviation program for the 2016-2017 academic year. After a successful launch of the inaugural Calvin L. Carrithers Aviation scholarship program in 2014, students from around the country have benefited from the scholarship. In the 2015-2016 academic year, students from University of North Dakota, Florida Institute of Technology and Eastern Kentucky University were chosen as recipients. Each year four students are awarded the scholarship that entails writing weekly blog posts sharing their flight training or aviation management experiences while being awarded a scholarship of $250 twice a semester, equaling a total award of $1,000.
Interested students should apply at https://www.globalair.com/scholarships/ before August 10, 2016 to be considered.
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4. May 2016 16:57
Share on FacebookWhether you run a small regional airport GA FBO or a major BizAv corporate facility there are many things you can do to keep your customers happy, be they crew, owners or trip support providers.
Customer service: “Going the extra mile” is often cited as the mark of a good customer orientated operation. Frankly, the simple things come first, reading, understanding, confirming and carrying out the handling request instructions. Have everything in place and be ahead of the curve at all times. Get all of this right and it’s a great start. When the customer throws a curve ball, that’s when your team need to be able to fall back on training, back office contacts lists, excellent communication and a will to source a solution. Sometimes the customer will be unreasonable, looking for something that is just unavailable or not possible at that time. This is when team members get the chance to either pull out all the stops to comply with such a request or to fully explain why the request cannot be fulfilled and to explore all the alternatives. Above all, staff should try to anticipate clients needs, learn what specific clients likes, dislikes and patterns are for future reference. Pet hates: Owners or passengers can react badly to staff for what they may see as over familiarization, inattentiveness, sloppiness, unkempt dress, cheap aftershave/perfumes or abrupt manner. Handling their baggage with due consideration is paramount. If an owner takes a dislike to a member or members of staff it can cause all kind of problems and can lead to a change of FBO and loss of business.
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