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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.''.
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.