FAA Cracks Down On "Public Charter" Loophole, Bad News For JSX

The way I absolutely detest this administration's approach to the airline industry. This article states that it agrees with JSX, but the loop hole should be shut down? Like what...?
Everything is masquerading as "consumer protection' but it has only made things worse. From blocking the Northeast Alliance to preventing customers from accessing innovative forms of airline travel.

You're buying right into the lobbying and campaigning by those carriers that do not want competition. This is not a loophole. It's the law.

If it looks like a duck and quacks like a duck…

Of course it’s a loophole. You have a commercial airline offering scheduled flights to the public on a per-seat basis, but then getting to use FBOs and bypassing commercial regs by calling themselves “private.”

Absolutely 100% a loophole

@ Jason -- As I see it, it's a poorly written law that didn't consider possible loopholes. As I said, I agree that airlines are campaigning for competitive reasons, and not because of safety.

But my fundamental question is why only allow 30-seat planes to operate as Part 135 when the flight is technically sold by a separate company? Why not just allow all 30-seat jets to be Part 135 operators? I'd be all for that, frankly, as long as it's clearly disclosed at booking...

I think Ben’s position is pretty clear. What are you confused about?

Ben said that JSX is complying with the letter of the law as it is currently written, but agrees with shutting down the loophole as it obviously violates the spirit of the law.

Which aspect are you struggling with?

@ CB -- I have no problem with the idea behind Part 135 operators, or with the idea of all 30-seat jets being subjected to the same standards as JSX.

My only argument is that I think JSX should be treated the same as an airline that directly operates a 30-seat jet. Airlines shouldn't be incentivized to sell flights through a third party to technically not be operating scheduled flights. I'd support the FAA changing the rules so that all airlines can operate these kinds of flights, even when selling them directly.

Do you disagree with me?

Um, who died and declared this a "loophole" - a word used 14 times in this article.

Operators of smaller jets get regulated differently than those who operate A320's and the like. That is. Cape Air (which sucks) is in a different category from Delta. The FAA simply set the regulatory threshold at 30 seats. There is no reason to use the pejorative term "loophole" for JSX's business model.

If there is a story here, it would seem that Buttigieg and Biden are bought and paid for,

That is ridiculous. Cape Air has operated as a Section 135 carrier for decades and no one byshed or moaned. JSX's mortal sin is that they serve routes that Section 121 carriers want for themselves.

It's not a loophole. It's the law. The only people who ever wanted to call it a loophole are the people who are threatened by it.

What this does is reduce competition, raise fares, and eliminate service to several cities that depend on these types of services.

@ jfhscott -- If the regulatory threshold were 30 seats, then I wouldn't see any issue. Rather, the reason this is possible is because the company technically sells flights through a different company than the one that operates flights. If JSX had the same company selling and operating flights, it wouldn't be allowed to operate under Part 135 rules.

My only strong conviction here is that all airlines selling seats on scheduled flights on 30-seat planes should be subject to the same rules, whether the flights are technically operated by another company or not.

@ jfhscott -- Cape Air is different, because it operates flights with planes that have nine seats. There's no loophole there, as airlines can operate scheduled flights with planes that have nine seats while being considered a Part 135 operator.

@ Jason -- I respect your opinion and you're a smart guy, so I'm wondering what your take is on the questions that I asked:
"But my fundamental question is why only allow 30-seat planes to operate as Part 135 when the flight is technically sold by a separate company? Why not just allow all 30-seat jets to be Part 135 operators?"

Ben, I see your point here, as nuanced as it is. You have no problem with the carriers providing service to the public as they do, but feel they should be doing so under a regulatory framework that addresses how they do so and allows for it. I guess it's similar to when Montana had no speed limit other than "reasonable and prudent" on certain highways. It's better if we define what that means, whether it continues to be allowed or not.

I guess I don't quite agree with calling it a loophole. It is a specific carve-out that has existed for decades and has been uses in some form or another for decades. The only thing that has changed is that you have a couple of airlines (namely Southwest who is extremely anti-competitive, but should have bigger fish to fry than JSX which is why they are subject of an activist investor...... and American who SELLS THESE VERY FLIGHTS ON ITS OWN WEBSITE and not only that ground handles said flights with one of its own subsidiaries and subleases them gates in at least 3 hubs) who don't like it and a pilot union that doesn't like losing its death grip on the supply of pilots to drive up the cost (and its own collection of dues).

The one thing that this whole operation has going for it is that airlines like Contour fly to lots of small markets. The great thing about our system of elected representation in this country is that people in those places get represented too and have some influence. I hope the FAA is not able to completely force this service into 121, which will have the impact of forcing some of these cities back to 9 seat prop planes.

Meanwhile Cape Air in I believe nearly every single market operates out of airports with TSA or TSA-approved outsource like in Montana airports with 3000 pax a year (even when they are the only operator). Contour does the same (I don't know of any of its flights that operate without TSA). But I really don't think that Contour is the issue, as AA even subleases them gates and codeshares and provides ground handling for them (yes, AA is benefitting from EAS funds as a sub-contractor of services). Denver Air Connection/Key Lime Air operates as a 121. It's just JSX they don't like because they fly out of Love Field and provide better service than AA, and WN wants to be the only overgrown kid in its sandbox.

Not a fan of this. Never flown JSX, but I see this as anti-competitive. I *might* agree that pilots should not be exempt from the 1500 hour rule, but the rest of it is small potatoes IMO.
If we think loopholes should be closed, might I ask if you're contributing to a backdoor ROTH?

That sounds great! But why then did you write a whole piece advocating for disallowing 30-seat jets to be part 135 operators?

Maybe you should update the piece and express that you'd be happy to de-loophole the loophole instead of removing the loophole?

@ JoePro -- I think the 1,500-hour rule is where most of the savings for JSX come from. For example, according to Airline Pilot Central, a first year JSX first officer receives a daily pay rate of $160 (for days where they are flying), while a first year SkyWest first officer is paid $105 per hour. That's a *massive* difference, and it's because the airline is able to hire pilots with fewer than 1,500 hours.

As far as I'm concerned, lower the minimums for pilots at other regional carriers as well. But it doesn't make sense to me that someone starting an airline would say to themselves "well, I guess we should have one company sell tickets and another company operate flights so that we can hire pilots with fewer hours and pay them less."

Here's my question, which I've been thinking about....

Some of these routes (under Contour) are Essential Air Service (EAS). They are all at least 3 year contracts, some of which were just awarded. Potentially FAA (under DOT) could change the rules in that time period. However the DOT EAS contracts require the airlines to keep operating until replaced, even if the contract ends (they are held over by law). Would the FAA have to create an exception for these services to its own new rule? Or is it going to try and enforce a contract that it itself made illegal to comply with?

@ Mark -- You're talking about my story from a year ago? In that post I also said that I support getting rid of the 1,500-hour rule, which is one of the main advantages that Part 135 operators have.

The extent of my strong feelings here is that I don't think a scheduled 30-seat aircraft should be treated differently based on whether the flight is operated directly or by a third party. To me, that's the loophole.

I find Backdoor ROTHs the most frustrating thing ever.

It punishes the wrong people the laws were meant to tax. People making 20 to 30k over the legal limit for ROTH contributions are still very much middle class and exactly the kind of people to be fiscally smart and need to save more for retirement.

The truly wealthy people with millions and more don't even care about backdoor ROTH because they just purely have so much more.

Back door Roth is completely irrelevant here what the hell are you on cocainr??

In some ways as well it is better if the regulations specifically address/allow the end product that is occurring in reality (as Ben advocates) because that also protects carriers as well from discretionary enforcement.

This clearly has little to do with safety and all to do with the $$ of big aviation in the FAA's pockets. Really, safety? How about go focus on Boeing and the issues it has. Focus on the procedures and checks United conducts. The big 3 are clearly nervous about revenues lost from the demographic I'll call the "inbetweeners": those wealthy enough to pay for first class and higher-revenue tickets, but cannot afford (or willing to spend) on a private charter.

Let's recognize a few things here: 1. This isn't a low-cost carrier coming in and severely undercutting the market and going head-to-head in public terminals. 2. These are used as "shuttle flights" for many people (on the east coast, for example, those flying from the NE to SoFlo during the winter). 3. These are 30-seat planes with limited flight schedules flying from mainly private airports.

These large airlines will do whatever it takes to end any and all competition...

It sucks. There will now be fewer destinations out of SNA. If the FAA kills JSX, it’s not like Delta will now offer service to mammoth lakes. The routes were only working because of the FAA small aircraft exception.

Then it's a airplane I guess.

All JSX has to do it defend itself all the way to the US "Supreme" court.

Then, give Clarence Thomas and his boss, Ginny, along with Sammy Alito, a bunch of free trips (But Shhhhhhhh! Don't tell anyone!), and JSX will be legit permanently. Ka-freaking-Ching!

This is a very well written article. It fills a much needed gap in aviation for both the passengers they serve and the pilots. And they have done so without compromising Saftey thus far. It will be a shame if they are forced stop their service. I do really like the idea of of closing the “loophole” but broadening the category of 135 operations. But what do you expect from an organization that also claimed a Jet Blue Spirit merger would create a monopoly.

I have no background on required pilot training but one of the purposes of private air travel (among many more important ones) is to get away from the useless TSA procedures.

The FAA will have a comment period. If thousands or better still hundreds of thousands of frequent flyers submit thoughtful comments in support of allowing scheduled service for planes operating with up to 30 seats and write our elected representatives to the same effect that will force the FAA to consider this option.

A very good case can be made that the solution is disclosure. If passengers are told that these operations will utilize pilots with less than 1500 hours then they can make the decision whether to fly with them.

I'm not trying to make this political but conservatives should be very supportive of this since they believe choice is the essence of freedom.

It's an election year. What better way for any politician to show they are on the side of the voter than to press for more competition and choices for how people fly? The only argument against this (other than competitors don't like it) is that passengers aren't fully aware of the differences between these operations and those of the scheduled carriers. So the fix is trivial. Require them to post a notice, to be determined by the FAA, to all advertising, email and other communications, tickets, boarding passes etc.

But the only way to make this happen is if VOTERS make a big stink.

I can't believe that JSX ever thought they were going to get away with this for long as they scaled. They are an airline and should be subject to the same safety standards as any other airline. Plain and simple.

Operating an aircraft safely is one thing. An economic business model is something entirely different.

The FAA needs to establish regulations about operating an aircraft safely, as that doesn't actually change if private, commercial or whatever. The Physics stays the same.
That crew may need different levels of experience and training to operate in increasingly more difficult conditions and to schedules is part of safety regulation but again isn't actually part of the economic issue.

It would be radical, but the FAA needs to set the rules of operation and allow the market and clients to determine how they wish to access the aircraft, what type of model wins.

This is not a loophole in the traditional sense of a drafting error, because the regulations linking part 380 and part 135 were intentionally designed this way. In fact, when this was left out of the 1995 Commuter Operations Rule, the FAA went back and fixed it in 1997.

Furthermore, 49 USC 41104 says that DOT cannot impose more onerous regulations on public charters than those already in place. If you want FAA to do this - and you say it's not for safety, then seriously, why? - then it should be done by Congress and not an administrative agency.

Moreover, you write “I’d have no problem with the FAA saying that scheduled airlines with planes that have up to 30 seats should be allowed to operate under Part 135 rules.” So for you this is about fairness - that somehow government rules are currently stacked AGAINST American and Southwest? Of course there is literally nothing in the law stopping, say, American Airlines Group from establishing a scheduled charter business through new subsidiaries. [Their union contract scope clauses as another practical matter, of course.]

Did you know that American Airlines and Southwest both offer charter flights that operate out of private terminals today?

This is pretty simple once you remove pages of random hand waving and pretending that's a thing. It's not.

A company is operating within the laws and regulations. If you think that it's "JSX" it's not. There are many such companies operating througout the US within the laws and regulations. When you use a search engine you may find Aero and others.

But look (crying baby noise here) they upset the lawyers at American Airlines, Delta, United Airlines, and even "we don't even know what Qos is" Southwest Airlines and also Gary. Seriously.

I don't see you crying about Hertz having 50+ corporations so each has its operating area. I don't see you arguing that having more than one corporation is in any way unlawful or against regulations (it's not).

Get off your high horse, sit your fat rear down, shut your mouth, and engage your brain. That last part should tell you that IT'S ALL LEGAL, and a company is allowed to have two or three or even more entitites, and that is not nefarious. It's how business is done.

If you don't like how business is done, don't be a customer. If you think the FAA needs to change the regulations to further protect/promote the Part 121 carriers, that's your right to think stupid thoughts. Welcome to the US.

I love JSX, Aero, and other Part 135 carrier ops I've used.
I don't want our paid-by-airlines FAA to change that.

One Mile at a Time - you are on the side of the overcharging underproviding old guard.

And why do you think lowering the 1500 hr rule will not impact safety? Higher hours of training does not equate to higher flying safety due to more experience? Care to back this up with data?

Do we need a surgeon general's warning on the plane? "Flying on this airline could be hazardous to your safety"

American and Southwest also offer Honor Flights out of regular commercial air terminals where TSA basically opens a door and lets the veterans and escorts walk around the checkpoint. They've been "background screened" of course, but then again JSX and such do that too...

What they’re saying is generally what matters is the experience, not the flight time. I wound rather take a pilot who has been through airline type flight training at a flight school that specializes in pro style flying VS someone that is taking their Cessna 150 flying around a podunk airport till they get 1500 hours.

What loophole, they operate within the law. As far as the 1500 hour rule, insurance companies still dictate some minimum experience level. My guess is that the captain experience level is quite a lot higher to offset the low first officer experience. I'm sure their customers understand it's different because of no TSA. JSX is a tiny spec in air travel so the FAA should concentrate on real aviation problems like a crumbling domestic manufacturer who shall remain nameless.

What loophole, they operate within the law. As far as the 1500 hour rule, insurance companies still dictate some minimum experience level. My guess is that the captain experience level is quite a lot higher to offset the low first officer experience. I'm sure their customers understand it's different because of no TSA. JSX is a tiny spec in air travel so the FAA should concentrate on real aviation problems like a crumbling domestic manufacturer who shall remain nameless.

How does this affect some of the small charter airlines in Florida that run scheduled/charter service to the islands? Is this why they are largely 9 seater Caravans?

Interesting article. I wondered how JSX was able to operate basically as a commercial carrier, but without the TSA. That kinda sucks that it's the other commercial carriers complaining about this "loophole" that made the FAA actually look into it.

I hope the FAA can figure something out as some sort of middle ground. JSX seems like a good business concept as a more convenient way to fly short haul flights.

@DT: The 1500 hour rule is relatively new. It was formed in relation to an accident that was not caused by lack of hours.

Quality of training is what matters. Most major airlines around the world train to proficiency. They take a new pilot and train them with the goal of flying an airliner. Lufthansa, various Middle East carriers, Cathay Pacific, all have widebody first officers/pilots with far less than 1500 hours.

I'd rather have someone with 500 meaningful hours than someone who has 1500 hours gotten by flying as a flight instructor in the right seat watching a private pilot fly loops around an airport during clear sunny days only.

@Nedskid I get that but how do you mandate / regulate/ measure “meaningful” experience. Short of that the 1500 rule is the alternative. More hours result in more chances to learn and experience issues along the way. I find the OP’s post irresponsible to just make a blanket statement on “fewer hours wont impact safety”. This is not opining on best garlic bread - this is real stuff - likely best left to experts and not bloggers.

Lots of people getting hung up on the exact definition of what a loophole is. All that matters is that JSX found some space to operate outside the original intention of the FAA rule and the FAA would like to redefine their legal boundaries to match their intentions.

ppl should be flying Delta anyway

I'm confused, I don't think anything Lucky said contradicted anything in your comment. Are you arguing against or with the post?

I agree with Ben's take.

The 'carve out' within the letter and spirit of the law is 9 or fewer seats.

30 seats is only with the cockamamie, likely illegal, structure JSX is using.

The fact you continue to support lowering pilot minimums with zero background or data to show that it has zero affect for safety other than your hunch is concerning.

Nobody can show that the 1500 hour rule does anything for safety. The accident that caused the knee-jerk reaction to raise minimums to 1500 had not a lot to do with the number of hours of the pilots.

@DT: You do like everyone else and regulate training and skills required for certifications. Not having an arbitrary number of hours. Nobody has shown that raising the minimums to 1500 did anything except drive up pilot wages.

“ I don’t like when the government creates a system whereby airlines are essentially incentivized to find loopholes,”

The entire reason we have reams of detail is precisely because people have lawyers looking for loopholes.

The “solution” would be a process where the FAA enjoins JSX from such practices without any due process or appeal.
Bet you would like that less.

Europe is 250 and planes aren’t exactly falling out of the sky over there…

The #1 threat to aviation currently appears to be the psych of the pilot not the hours.

1500 is the regulation. That’s precisely what is being done. Would you want to get on a plane with a 250 hour pilot going cross country or worse, based on “ meaningful” training? Or a doctor who has not gone through the rigor of intense residency as 1 years of “meaningful” training is as good or better than the 6 + year residency? Hopefully that answers your question and debunks the OP’s baseless point. Back to garlic bread tasting OP.

Right. And the Colgan 3407 accident that caused the 1500 hour rule would have not happened in Europe as the Captain with so many repeated failed training events and checkrides would not have been in his position.

Speaking as a commercial pilot, yes, I would get on a plane with a copilot with 250 hours with a more experienced Captain (who has to have an ATP - and at JSX more often than not just spent 30 years flying big jets at a major airline until retirement age). Residency for doctors is different than a pilot building hours. Doctors spend time in their field, or are given wide experiences through rotations. In your comparison, the doctor equivalent of many 1500 hour pilots (built time by instructing or buzzing around a pattern) would be if they spent their entire residency doing one or two operations on a cadaver and then 5 years putting bandaids on small lacerations and giving people aspirin. I would rather have a doctor who spent a year doing intensive work than 5 years doing arguably one of the easiest tasks possible.

The point is that you “cannot” mandate “ meaningful” experience. The chances are that you will get “ meaningful” at a far higher rate at 1500 hrs than you will at 250. Can you at 250? Sure? But you are increasing the chances of better training at 6 times that number. Why 250? Why not 100? Same answer. You are statistically increasing the odds of a “meaningful” training. Higher hrs will have higher abnormal encounters and this will lead to better preparedness for such events in real life. The OP is plain wrong and has no data to support his childish, pearl clutching assertion. .

Way to go Gary! Well written - just as you have on your site. This is big boy stuff, no garlic bread taste-off! Nicely written and referenced.

Let all airlines operate as Part 135…. The clause it can’t be ‘scheduled’ makes little sense.

The hours requirement is also silly across the board. I’m 100% certain there are many pilots who have 400 hours who are more competent than others with 2,000 hours. Need a better method to ‘qualify’ than simply checking a box, and you should be eligible to qualify as soon as you can.

Smoke a blunt my friend, you are far too worked up over this unless of course you work for JSX.

It is so political !! The big airline guy want to stop their small competition.. I have really enjoyed the convenience of JSX.. Hope they can continue....

The comment about the captain being the more qualified than the first officer is almost opposite for JSX

JSX is hiring low time captains and then hiring high time pilots that maybe aged out of part 121 ops to back them up. Part 121 has mandatory retirement at 65, so super experienced high time 20,000 hour pilots who are like 68 are being hired by JSX to right seat as FOs to backup the newer non ATP captains…

Google the juice box man jsx meme for a laugh

Depending on how this all plays out, there are surely ways around the "regularly scheduled" bit. Have a departure window that isn't regular—give contracted passengers the say on when within that window the plane departs.

Only when pigs fly.

FAA and safety?
That's the clickbait from FAA.

"Part of the safety mission of the FAA is identifying risk early on,"
But FAA was among the last globally to ground the MAX, early on indeed.

"At the same time, we want to look at how future innovation might cause us to think differently."
The Boeing folks innovated a new 737. Let's think differently, let's give Boeing a power to self inspect and disclose nothing about this new MCAS.

"connect small and rural communities to open up more options for everyone at the same high level of safety"
So all those little communities have to spend so much money they don't have to improve terminal, add scanners and hire TSA.

Amazing how the writer of this article and the numerous commenters are grossly misinformed. It’s not a “1500 rule”. It’s a certification requirement. All pilots, not just captains, are required to have an ATP certificate. This was in response to numerous accidents at regional airlines. The goal is to have both pilots be equally certified and trained, and not turn regional flying into a one man show with an apprentice in the right seat.

One of the requirements for an ATP is 1,500 hours of total experience, but here are many other experience requirements in addition to passing a written, oral and practical exam, outlined in FAR 61.153, 61.155, 61.157

250 hours as pilot-in-command (PIC)
100 hours of night flight time
75 hours of instrument training
500 hours of cross-country flight time
50 hours in a class sought

This a lot more involved then putting around in the traffic pattern. We’ve already lent a helping hand by creating the restricted ATP mins that allows total time to be reduced to as low as 750 for military aviators and 1,000 hrs for those with collegiate training from structures part 141 training schools.

Frankly, I’d much rather have a CFI with restricted atp mins than an an-initio trained European pilot with 200 hrs of total training time with more than half in simulators.

Hey just remove 2 seats now you have 28.diferent rules.

re focus... the biggest impact would be to operate from tsa only terminals.
THAT right there is the single most important advantage they have.

The 135 rules should be expanded to include aircraft up to at least 19 seats if not to 30 seats, as there are markets that could be more profitable for the airlines with the larger planes. 9 seat aircraft are good route starting aircraft, but to grow the market larger planes need to be brought in. Quincy. IL is an example, Cape Air flew 9 seat planes, than Skywest wins the EAS contract and uses 50 seat aircraft, finally Southern Air Express wins the new EAS contract and Quincy is back to 9 seat aircraft. Expanding to 19 to 30 seat planes would do thus type of market justice.

Thank you for showing why the 1,500 flight hour requirement is silly. It's just an extra 500 hours of being in the air doing nothing and has no purpose other than inflating pilot compensation and thus consumer flight (and airline bailout) costs.

Sure you can. You mandate a certain number of takeoff and landings, at certain times of day, and in certain weather conditions. You also mandate testing of certain scenarios in a simulator.

I would take a 250 hour pilot with experience in a variety of situations over a pilot who spent another 1250 hours sitting in a seat at altitude on a clear day, every time.

JSX is going to suffer an overnight pilot shortage when this rule takes effect since many of their Captains are "retired" Part 121 airline pilots. Part 121 still has an age 65 maximum.

It's not like JSX has any noticeable marketshare. TSA providing more safety is a bit of a stretch anyways. "Basic Economy" fares have created more safety issues if anything.

Indigo, backed by the American Express Corporation was the first DOT Part 380 and FAR 135 operator in 2000. There is otherwise no “loophole;” there is simply regulation appropriate to operations. Moreover, Part 121 carriers do not set a safety standard per se and like the Wright Amendment they are lobbying to restrict or remove competition. I’m afraid that the FAA administrator who was formerly with UAL is also somewhat captured by airline lobbying.

It's legal until they change the regulations anyway...

Imagine being so delusional that you think interpreting the written law and constitution as written instead of making it up based on feelings is bad. Commies are going to commie though.

Oh no, average people are now flying out of executive airports and FBO type terminals. Time to make rule changes so only the elitists of our kind may continue flying out of these privileged airports.

Why should people flying on an EMB-145 operated by JSX be protected by lesser safety and security laws that people flying on an EMB-145 operated by PSA or Commutaire?

Yeah because the court of appeals would definitely take up such a non ambiguous case, let alone the scotus

it is a dangerous operation ran by unqualified people. It should not even be in business as a 135 operation. It is destined for a disaster any moment. The Faa has been notified by several different professional entities that that business should not be even running. It is repulsive that they put the trusting public inside of their airplanes.

it is a dangerous operation ran by unqualified people. It should not even be in business as a 135 operation. It is destined for a disaster any moment. The Faa has been notified by several different professional entities that that business should not be even running. It is repulsive that they put the trusting public inside of their airplanes.

Well said .

But regardless, this company should be shut down. It is destined for disaster. Someone’s gonna get hurt and they’re gonna take out people in property. In flames. The FAA and NTSB know why they’re gonna put them out of business. And it’s not for the reason you think.