Fees and Charges for Special Services

DEPARTMENT OF TRANSPORTATION

Office of the Secretary

14 CFR Part 389

[Docket No. OST-99-5003; Notice No. 99-1]

RIN 2105-AC47

Fees and Charges for Special Services

AGENCY: Office of the Secretary, DOT.

ACTION: Notice of proposed rulemaking.

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SUMMARY: The Department is proposing to revise 14 CFR Part 389 to bring

the fees we charge to beneficiaries of certain economic, aviation-

related licensing services in line with the costs incurred to provide

those services. We also are proposing to remove or update obsolete

provisions and organizational references included in the existing

regulations.

DATES: Comments should be received no later than March 22, 1999.

ADDRESSES: Five (5) copies of any comments should be sent to Department

of Transportation Dockets, Room PL-401, 400 7th Street, SW.,

Washington, DC 20590-0002, and should refer to this docket.

Acknowledgment of comments requires you to include a stamped, self-

addressed postcard that the Docket clerk will time and date-stamp, and

return.

FOR FURTHER INFORMATION CONTACT: Mr. James H. New or Mr. John D.

Miller, Office of Planning and Special Projects, X-60, Department of

Transportation, at the address above. Telephone (202) 366-4868.

SUPPLEMENTARY INFORMATION: Part 389 of Title 14 of the Code of Federal

Regulations--Fees and Charges for Special Services--describes certain

special services related to aviation economic proceedings that the

Department provides to the public, and sets forth the fees and charges

applicable to those services. This regulation has not been

comprehensively updated since January 1983, when economic regulation of

interstate and foreign air transportation was overseen by the Civil

Aeronautics Board. Congress ``sunset'' the Board in January 1985, at

which time the Board's residual functions were transferred to the

Office of the Secretary, DOT. Today, some of the services identified in

Part 389 are no longer provided, while several other services are

provided but are not included. Further, most of the service processing

fees prescribed in section 389.25(a) are not sufficient to recover our

processing costs, while the prescribed fee in a few instances is too

high. Because of these conditions, the General Accounting Office has

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recommended that the Department update the rule to reflect the services

that we currently provide and to ensure that our fees are commensurate

with the actual costs of providing those services. (GAO/RCED-96-8.)

Consequently, we have undertaken an analysis of the special

services the Department provides in aviation economic proceedings, the

fees currently in force for those services, and revisions that are

needed for us to continue to provide services to the extent

commensurate with our actual costs. A revised schedule of fees based on

the results of our analysis is set forth in this proposed rule.

Additionally, the rule would remove or update obsolete provisions and

organizational references sprinkled throughout Part 389 and replace

references to the Federal Aviation Act with references to Subtitle VII

of Title 49 of the United States Code (Transportation).

Major Changes

The Department is proposing a major reorganization of the

processing fee schedule contained in existing section 389.25(a). Of the

50 fee items listed in the schedule, we are proposing to eliminate 10

and to retain or revise the remaining 40. We also are proposing various

new items, resulting in a net change from 50 to 76 schedule items. All

items considered, there are 55 fee increases, 6 fee decreases, 9

instances in which the fee is unchanged and 6 instances in which an

item is reserved for future use.

Under the proposed fee schedule, prospective or incumbent U.S. air

carriers that apply for new or modified interstate certificate

authority involving the use of ``small'' aircraft, defined as aircraft

with 60 seats or less or with a maximum payload capacity of 18,000

pounds or less, are grouped with U.S. commuter air carriers with regard

to the processing of initial applications for economic operating

authority, amendments to initial applications, and/or applications for

various exemptions or waivers from our regulations. Under the current

schedule, the fees levied for these special services to U.S.

certificated air carriers operating small aircraft are the same as the

fees for U.S. certificated air carriers operating aircraft with more

than 60 seats. Our analysis has determined that the costs to process

applications involving the former are substantially lower than the

costs for the latter, yet are similar to the processing costs for U.S.

commuter air carrier authorizations.

We are also proposing a new, incremental fee in the case of

applications for various international air service rights when the

Department must conduct a comparative proceeding to distribute those

rights among multiple applicants. This comparative process entails

significantly higher costs to the Department than those incurred when a

comparative proceeding is not necessary.

Additionally, except in the case of a treaty or an agreement, we

are proposing to eliminate existing section 389.24, which authorizes

the waiver of processing fees for foreign air carriers under certain

circumstances. Currently, 235 foreign air carriers that have been

granted U.S. economic operating authority qualify for this waiver, and

the annual costs we incur to process service applications from such

carriers amount to $248,000. We have concluded that it is neither

necessary nor appropriate for the U.S. government to continue to absorb

these costs.

User Fee Authority and Implementation

Our revised user charges are proposed under the authority of Title

V of the Independent Offices Appropriations Act of 1952 (``IOAA''; 31

U.S.C. 9701). The IOAA provides that the head of a government agency

may prescribe regulations, subject to policies prescribed by the

President, establishing the charge for a service or ``thing of value''

provided by the agency. The statute states that each service or thing

of value provided by an agency should be self-sustaining to the extent

possible, and that each charge imposed to that end shall be fair and

shall be based on (1) the costs to the government, (2) the value of the

service or thing to the recipient, (3) public policy or interest

served, and (4) and other relevant factors.

During the 1970's and early 1980's the IOAA was subjected to a

series of judicial rulings to resolve issues of interpretation.

Consequently, the principles of user charge implementation under the

statute are well settled, and are embodied in the current version of

Office of Management and Budget Circular A-25 (``User Charges,'' July

8, 1993). This Circular prescribes federal policy and guidelines for

executive-branch and independent agencies to assess fees for government

services and sets forth the procedures by which those agencies are to

implement user fees. The principles and procedures enunciated in OMB

Circular A-25 and relevant to this proposed rule are as follows

(emphasis supplied by DOT):

1. It is the policy of the federal government to assess a user

charge against each identifiable recipient for special benefits derived

from federal activities beyond those received by the general public.

When a service (or privilege) provides special benefits to an

identifiable recipient beyond those that accrue to the general public,

a charge will be imposed to recover the full cost to the federal

government for providing the special benefit.

2. A special benefit will be considered to accrue and a user charge

will be imposed when, for example, a government service (a) enables the

beneficiary to obtain more immediate or substantial gains or values

(which may or may not be measurable in monetary terms) than those that

accrue to the general public (e.g., receiving a patent, insurance, or

guarantee provision, or a license to carry on a specific activity or

business or various kinds of public land use); (b) provides business

stability or contributes to public confidence in the business activity

of the beneficiary (e.g., insuring deposits in commercial banks); or

(c) is performed at the request of or for the convenience of the

recipient, and is beyond the services regularly received by other

members of the same industry or group or by the general public (e.g.,

receiving a passport, visa, airman's certificate, or a Custom's

inspection after regular duty hours).

3. User charges will be sufficient to recover the full cost to the

federal government of providing the service, resource, or good when the

government is acting in its capacity as sovereign. Full cost includes

all direct and indirect costs to any part of the federal government of

providing a good, resource, or service. These costs include, but are

not limited to, an appropriate share of direct and indirect personnel

costs, including salaries and fringe benefits such as medical insurance

and retirement; physical overhead, consulting, and other indirect costs

including material and supply costs, utilities, insurance, travel, and

rents or imputed rents on land, buildings, and equipment; management

and supervisory costs; and the costs of enforcement, collection,

research, establishment of standards, and regulation.

4. No charge should be made for a service when the identification

of the specific beneficiary is obscure, and the service can be

considered primarily as benefiting broadly the general public. However,

when the public obtains benefits as a necessary consequence of an

agency's provision of special benefits to an identifiable recipient

(i.e., the public benefits are not independent of, but merely

incidental to, the special benefits), an agency need not allocate any

costs to the public and should seek to recover from the identifiable

recipient

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the full cost to the federal government of providing the special

benefit.

5. Each agency will identify the services and activities covered by

this Circular, determine the extent of the special benefits provided,

and apply the principles specified [herein] in determining cost. Full

cost shall be determined or estimated from the best available records

of the agency, and new cost accounting systems need not be established

solely for this purpose.

Special Services Provided

The Secretary of Transportation is responsible, under Title 49 of

the United States Code (``Transportation''), Subtitle VII (``Aviation

Programs''), for the economic regulation of interstate and foreign air

transportation. The Department's rules and regulations implementing the

requirements of Subtitle VII are contained in Title 14 of the Code of

Federal Regulations, Parts 200-399. In general, nearly all of the

special services provided by the Department in the course of economic

regulation involve the authority of a U.S. or a foreign air carrier to

conduct revenue-producing interstate or foreign air transportation

under the requirements of Subtitle VII and our implementing

regulations.

Within the Office of the Secretary, the provision of special

services is carried out under delegated authority by the Office of the

Assistant Secretary for Aviation and International Affairs and the

Office of the General Counsel. Both offices in turn are organized by

sub-office and/or division, where the day-to-day processing of

applications for special services takes place. The touchstone of the

user charges set forth in this proposed rule is the direct labor time

expended by these offices to process applications for aviation services

on behalf of specific, identifiable recipients accorded a special

benefit as a consequence of those services. Staff of both offices also

spend time on policy development, analyses and other aspects of

economic regulation that are not directly related to the provision of

special benefits to identifiable recipients. That labor time is

excluded from the scope of this rulemaking.

With respect to processing of applications for special services,

the principal offices under the Assistant Secretary are the Office of

International Aviation and the Office of Aviation Analysis. A third

office, the Office of Aviation and International Economics, although

primarily engaged in policy analysis, occasionally provides direct

analytical support for applications requesting special services.

The Office of International Aviation receives, processes, and acts

on or recommends the disposition of U.S. and foreign air carrier

applications for economic authority to operate between the United

States and foreign points. It also determines the disposition of all

tariff filings by U.S. and foreign airlines. Within this office, the

Pricing and Multilateral Affairs division reviews international fares

and rates filed by U.S. and foreign air carriers to determine whether

the proposed prices are consistent with public interest standards,

Department rules and policy, and applicable international agreements.

This division also reviews inter-carrier agreements, primarily fare and

rate agreements filed by the International Air Transport Association,

to determine whether they should be approved and given antitrust

immunity. Division analysts also support licensing services provided by

the U.S. Air Carrier Licensing division and the Foreign Air Carrier

Licensing division. The former processes requests by U.S. airlines for

authority to serve specific foreign markets and applications for

transfer of international authority among U.S. air carriers. The latter

handles all foreign air carrier applications (excepting Canadian air

taxi registrations) for the authority to operate to the United States,

including applications for foreign air carrier permits, exemptions,

statements of authorization for charter, code-share and wet-lease

operations, and related matters. In addition to these divisions,

geographic aviation specialists for Europe, Asia-Pacific-Africa, and

Western Hemisphere occasionally provide direct labor support for

applications requesting special services.

Within the Office of Aviation Analysis, the provision of special

services primarily involves the Air Carrier Fitness division and the

Special Authorities division. Air Carrier Fitness evaluates the fitness

of applicants for U.S. certificated and U.S. commuter air carrier

operating authority, monitors the continuing fitness of certificated

and commuter air carriers, evaluates requests for transfer of

certificate or commuter authority, and processes applications for name

changes or trade names, as well as applications for various exemptions

and waivers from the Department's regulations. The Special Authorities

division reviews charter prospectuses filed by tour operators, requests

for waivers from charter regulations, and applications for operating

authority from Canadian air taxi operators, foreign air freight

forwarders, and overseas military personnel charter operators. On

occasion, the Essential Air Service and Domestic Analysis division or

the Economic and Financial Analysis division also expend direct labor

time on processing applications for certain special services, such as

requests for a change in mail rates or an exemption from the airport

slot restrictions imposed by the High Density Rule.

Four offices of the Department's General Counsel are involved in

the provision of special aviation services: Environmental, Civil Rights

and General Law; International Law; Litigation; and Aviation

Enforcement and Proceedings. Their chief responsibility is to ensure

that proposed decisions on applications for special services are in

compliance with applicable laws, regulations and international

agreements. These offices also expend direct labor time when issues

such as citizenship, bankruptcy, confidentiality or potential

litigation arise in the course of processing applications.

Development of Fees

The following procedures were used to develop the user fees

proposed in revised section 389.24(a) of the rule:

In accordance with the principles and procedures of OMB Circular A-

25, we first examined the activities conducted by the Department to

carry out economic regulation of interstate and foreign air

transportation in order to identify those services that provide a

special benefit to a specific, identifiable recipient. Where the

beneficiary is obscure, or the nature of the benefit is indeterminate,

or the beneficiary is primarily the public generally, the activity was

excluded from further consideration. An example is an action by the

Department to suspend or revoke an air carrier's economic authority to

conduct interstate or foreign air transportation. Such action is taken

primarily for the benefit of the public generally.

For those services identified as providing a special benefit to a

specific identifiable recipient, the smallest practical unit for

assigning a fee was determined in nearly all cases to be the

application document submitted to the Department requesting a special

service (a license, an exemption, a waiver, etc.). There are two

exceptions: for certain substantive changes to an initial application

for economic operating authority, the smallest practical unit is an

``amendment,'' and for certain requests involving antitrust immunity,

the smallest practical unit is a ``resolution.''

We then analyzed the work flows and direct labor hours to process

applications for special services. This

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analysis was based on (1) the knowledge and expertise of office and

division supervisors, all of whom have many years of experience

overseeing the processing of aviation service requests, and (2) data on

the actual direct labor hours incurred to process a sample of 611

service applications completed during the period March 1997 through

July 1998.

The results of the work-flow cost analysis were then applied to

calculate direct labor costs, which are based on pay rates in effect as

of February 1998 and include a standard allowance for fringe benefits

(personal and sick leave, medical insurance, etc.) that is based on a

government-wide average published by OMB (Circular A-76, Handbook,

March 1996).

In addition to direct labor, indirect (overhead) costs of the

Office of the Assistant Secretary were distributed to service

applications based on rates applied at three levels: office-level

supervision, office-level general and administrative, and general

management and support. The overhead rates are based on actual costs

for the fiscal year ending September 30, 1997, and exclude overhead

items unrelated to the delivery of special services. In making overhead

distributions, the rates were applied to actual direct labor costs. For

certain overhead costs, such as office space, it was necessary to make

a per capita allocation in order to derive a distribution rate. For the

Office of the General Counsel, a single overhead rate was applied to

the direct labor hours incurred.

Finally, fee amounts were assigned to individual special service

items in accordance with these criteria:

If direct labor time data were available for a particular service,

the fee was determined by dividing total direct and indirect costs by

the number of applications completed. For administrative convenience

and ease of payment, values below $100 are rounded to the nearest

dollar and those above $100 are rounded to the nearest ten dollars.

If direct labor data were not available (i.e., no applications for

the special service were completed during the cost-collection period),

the fee was assigned based on the staff's analysis of the work flow to

process an application for the special service.

If no direct labor data were available and the work-flow analysis

identified no reason to assume costs have changed, the existing fee was

retained.

If no cost data were available, the work-flow analysis identified

no other basis to assign a fee, and no extant fee pertained, the

service item was reserved in expectation of a future fee determination.

Appendix A of this Notice contains a summary of our fee

calculations and an item-by-item justification of our proposed fee

amounts, including the legal basis for the services provided to

specific identifiable recipients, the nature of the special benefits

accorded to those recipients, and the basis for the fee amounts

proposed. In addition, we are placing in the docket a Supplement

(``Service Job Costs'') to this Notice that (1) illustrates in detail

how direct labor time was reported, how job costs were calculated, and

how overhead rates were derived; and (2) lists the 611 applications for

special services and their costs included in our work-flow cost

analysis. The Department would like to have comment on whether any fee

items have been overlooked or whether others should be deleted, in view

of the methods used to calculate fees, as explained in this Notice and

its Supplement.

U.S. Air Carriers Operating Small Aircraft

As noted earlier, our proposed fee schedule makes a distinction

between the processing fees applicable to U.S. certificated air

carriers (or applicants for certificate authority) that operate small

as compared to large aircraft in interstate air transportation, and

groups the former with the processing fees applicable to authorizations

involving commuter air carrier operations. Our basis for making this

distinction is the significantly lower processing costs associated with

applications involving small aircraft, as explained in detail in

Appendix A, items 9 through 12 and items 24 through 34. The Department

would like to receive comments on the reasonableness and fairness of

grouping small-aircraft certificated air carriers with commuter air

carriers for purposes of processing fees.

Additional Fee for Comparative Proceedings

We also invite comments on the reasonableness and fairness of our

proposed incremental user charge for applications for international air

service rights when a comparative proceeding is required to distribute

those rights among multiple applicants. Again, the basis for this

proposed fee is the additional cost incurred to conduct a comparative

proceeding, as explained in detail in Appendix A, items 52 through 57.

Elimination of Waiver of Foreign Air Carrier Processing Fees

Current section 389.24 provides that a foreign air carrier, or such

carriers, if from the same country, acting jointly, may apply for a

waiver of the requirements to pay processing fees, based on reciprocity

for U.S. air carriers contained in the requirement of their home

governments, or as provided in a treaty or agreement with the United

States. Further, once a waiver has been granted for a specific country,

no further waiver applications need be filed for that country.

To date, 76 countries and the 12-nation Air Afrique Consortium have

been granted interim or final waivers from the requirement to pay all

or some of the processing fees contained in current section 389.25.

These waivers in all cases are based on reciprocity: a foreign carrier

is relieved from the Department's processing fees only if the aviation

authority of its home country does likewise for U.S. carriers. However,

none of the waivers we have granted are required by treaty or other

formal agreement with the U.S. government and all are revocable at the

Department's discretion. Eliminating the waiver provision and revoking

existing waivers means that once this proposed rule takes effect, all

foreign air carriers would be required to pay the applicable fee

contained in revised section 389.24. We recognize that this action

could spur the governments of foreign nations whose carriers have

benefitted from U.S. fee waivers to reciprocate by revoking the fee

relief they have granted to U.S. carriers and requiring U.S. carriers

to pay processing fees in the future. The Department would like to

receive comments on its proposed elimination of the foreign air carrier

waiver provision.

Our reason for proposing to eliminate the foreign air carrier

waiver provision is its cost to the Department. In fiscal year 1997,

the Foreign Air Carrier Licensing Division received 1,163 applications

from foreign carriers requesting various forms of operating authority.

Of the total received, 710 applications, or 61 percent, were covered by

fee waivers. We estimate that the processing of these applications

entails approximately 2,300 labor hours at a total cost to the

Department of $248,000.

Regulatory Analyses and Notices

Executive Order 12866 (Regulatory Planning and Review)

The Department has analyzed the economic and other effects of the

proposed revisions and has determined

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that they are not ``significant'' within the meaning of Executive Order

12866. The revisions will not have an annual effect on the economy of

$100 million or more or adversely affect in a material way the economy,

a sector of the economy, productivity, competition, jobs, the

environment, public health or safety, or State, local, or tribal

governments or communities. The revisions will not create a serious

inconsistency or otherwise interfere with an action taken or planned by

another agency, and will not materially alter the budgetary impact of

entitlements, grants, user fees, or loan programs or the rights and

obligations of recipients thereof. Nor do they raise any novel legal or

policy issues arising out of legal mandates, the President's

priorities, or the principles set forth in Executive Order 12866.

DOT Regulatory Policies and Procedures

The proposed revisions are not significant under the Department's

Regulatory Policies and Procedures, dated February 26, 1979, because

they do not involve important Departmental policies; rather, they are

being made solely for the purposes of updating the fees charged to the

beneficiaries of special aviation-related services provided by the

Department to help offset the costs of providing the services, and of

eliminating obsolete requirements and correcting out-of-date references

in the rule.

Executive Order 12612 (Federalism)

This proposal has been analyzed in accordance with the principles

and criteria contained in Executive Order 12612 (``Federalism''), and

the Department has determined the proposed rule does not have

sufficient federalism implications to warrant the preparation of a

Federalism Assessment.

Regulatory Flexibility Analysis

I certify that this proposed rule will not have a significant

economic impact on a substantial number of small entities. The proposed

changes would result in a net increase in the processing fees

applicable to small entities. The new fee schedule, however, would not

have a significant economic impact on small entities and would not

affect a substantial number of small entities.

The Small Business Administration suggests that, for aircraft

services, ``small'' represents impacted businesses with 1,500 or fewer

employees. For purposes of this rulemaking, small entities are defined

as certificated air carriers, commuter air carriers, air taxis, and air

charter operators that (1) have 1,500 or fewer employees and/or (2)

operate aircraft with 60 seats or less or 18,000 pounds maximum payload

or less. Departmental records show that 106 certificated air carriers,

49 commuter air carriers, approximately 2,800 active air taxis

operators, and approximately 250 charter operators meet this definition

of a small entity.

Many of these small entities would be unaffected by the changes to

the fee schedule. The actual economic impact on any individual small

entity, however, would depend on the number and type of filings

submitted to implement particular operational decisions. The survey of

applications from March 1997 to July 1998 used to calculate the new

fees indicated that only a small portion of small entities filed

applications for aviation economic proceedings. Moreover, air taxis,

the single largest class of small entities, are exempt from certain

regulatory requirements, including the requirement to obtain

certificated authority. Several of the fees that we propose to increase

are related to certificated authority. Thus, unless they choose to

obtain certificates, the largest class of small entities would not be

affected by most of the proposed fee increases.

Of those small entities that would be affected, most would

experience only modest fee increases because most items for which the

survey of applications suggest that relatively large numbers of

applications are filed would have only modest fee increases. For

instance, the fee for Schedule Item 34, Application for approval of

amendment to commuter air carrier registration under 14 CFR Part 298,

would increase from $0 to $5.

National Environmental Policy Act

The Department has also assessed the proposed revisions for the

purpose of the National Environmental Policy Act. The revisions will

not have any significant impact on the quality of the human

environment.

Paperwork Reduction Act

This rule does not impose any collection of information

requirements requiring review under the Paperwork Reduction Act of

1995. The proposed rule contains no new reporting, recordkeeping, or

compliance requirements, but only sets forth the processing fees

applicable to existing regulatory requirements.

Regulation Identifier Number

A regulation identifier number (RIN) is assigned to each regulatory

action listed in the Unified Agenda of Federal Regulations. The

Regulatory Information Service Center publishes the Unified Agenda in

April and October of each year. The RIN contained in the heading of

this document can be used to cross reference this action with the

Unified Agenda.

Lists of Subjects in 14 CFR Part 389

Administrative practice and procedure, Reporting and recordkeeping

requirements.

Proposed Rule

For the reasons set forth above, it is proposed that Title 14,

Chapter II of the Code of Federal Regulations be amended as follows:

PART 389--[REVISED]

1. Part 389 is revised to read as follows:

PART 389--FEES AND CHARGES FOR SPECIAL SERVICES

Subpart A--General Provisions

Sec.

389.1 Policy and scope.

Subpart B--Fees Related to the Availability of Public Records and

Documents

389.10 Public disclosure of information.

Subpart C--Filing and Processing License Fees

389.20 Applicability of subpart.

389.21 Payment of fees.

389.22 Failure to make proper payment.

389.23 Application for waiver or modification of fees.

389.24 Schedule of processing fees.

389.25 Special rules for tariff page filings.

389.26 Refund of fees.

Authority: 31 U.S.C. 9701, 49 U.S.C. Chapters 401, 461.

Subpart A--General Provisions

Sec. 389.1 Policy and scope.

Pursuant to the provisions of 31 U.S.C. 9701 as implemented by

Office of Management and Budget Circular A-25, revised July 8, 1993,

the Department sets forth in this part the special aviation-related

services made available by the Department and prescribes the fees to be

paid for these and various other services.

Subpart B--Fees Related to the Availability of Public Records and

Documents

Sec. 389.10 Public disclosure of information.

Part 7 of the Office of Secretary regulations, Public Availability

of Information, governs the availability of records and documents of

the Department to the public. (49 CFR part 7)

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Subpart C--Filing and Processing License Fees

Sec. 389.20 Applicability of subpart.

(a) This subpart applies to the filing of certain documents and

records with the Department by non-government parties, and prescribes

fees for their processing.

(b) For the purpose of this subpart, record means those electronic

tariff records submitted to the Department under subpart W of part 221

of this chapter, and contains that set of information which describes

one (1) tariff fare, or that set of information which describes one (1)

related element associated with such tariff fare. For purposes of this

subpart, the term document and record also includes those filings made

electronically under process set at the DOT Dockets website.

(c) For the purpose of this subpart, small aircraft means aircraft

with 60 seats or less or with a maximum payload capacity of 18,000

pounds or less.

Sec. 389.21 Payment of fees.

(a) Any paper document or record for which a filing fee is required

by Sec. 389.24 shall be accompanied by either:

(1) A check, draft, or postal money order, payable to the

Department of Transportation, in the amount prescribed in this part, or

(2) A request for waiver or modification of the filing fee.

(b) The filing fee required by Sec. 389.24, Item 57, concerning

carrier/gateway selection from among multiple applicants, shall be

payable upon submission of an applicant's first filing subsequent to

the Department's notice that a comparative proceeding is necessary.

(c) Except for tariff records filed under Sec. 221.500 of this

title, documents and records filed electronically under process set at

the DOT Dockets website shall be accompanied by a certification that

the filing fee for that document has been or will be paid in accordance

with procedures set at the DOT Dockets website.

(d) Where a document relating to a single transaction or matter

seeks multiple authorities or relief and therefore would otherwise be

subject to more than one filing fee, only the highest fee shall be

required. Where a document relating to more than one transaction or

matter seeks multiple authorities or relief, the required filing fee

shall be determined by combining the highest fees for each transaction

or matter. For purposes of this paragraph, a specific number of

charters or inclusive tours described in one application will be

regarded as a single transaction or matter.

(e) No fee shall be returned after the document has been filed with

the Department, except as provided in Secs. 389.23 and 389.26.

Sec. 389.22 Failure to make proper payment.

(a)(1) Except as provided in Sec. 389.23, documents (except tariff

publications) which are not accompanied by filing fees shall be

returned to the filing party, and such documents shall not be

considered as filed by the Department.

(2) Except as provided in Sec. 389.23, records which are not

accompanied by the appropriate filing fees shall be retained and

considered filed with the Department. The Department will notify the

filer concerning the nonpayment or underpayment of the filing fees, and

will also notify the filer that the records will not be processed until

the fees are paid.

(3) Except as provided in Sec. 389.23, documents and records filed

electronically not accompanied by the required certification in

Sec. 389.21(b) shall not be processed. In addition, electronic filers

not making payment in accordance with the procedures set at the DOT

Dockets website shall be notified that unless payment is made within 10

days from such notification, the document or record shall be deemed to

have been dismissed or withdrawn.

(b) The filing fee tendered by a filing party shall be accepted by

the Department office to which payment is made, subject to post audit

by the Chief, Accounting Division, Office of Budget and Policy, Federal

Transit Administration, and notification to the filing party within 30

days of any additional amount due. Not more than 5 days after receipt

of the notification, the determination of the Chief, Accounting

Division, may be appealed to the Chief Financial Officer, who has been

delegated authority by the Department to decide such appeals. The

filing party may submit to the Department a petition for review of the

Chief Financial Officer's decision pursuant to Sec. 385.30 of this

chapter, and proceedings thereon will be governed by subpart C of part

385 of this chapter.

(c)(1) The amount found due by the Chief, Accounting Division,

shall be paid within 10 days of notification except that:

(i) If that decision is appealed to the Chief Financial Officer,

the amount due shall be paid within 10 days after the Chief Financial

Officer notifies the filing party that he has affirmed or modified the

decision of the Chief, Accounting Division; and

(ii) If the decision of the Chief Financial Officer is appealed to

the Department, the amount due shall be paid within 10 days after the

Department notifies the filing party that it has affirmed or modified

the staff decision.

(2) If the amount due is not paid, the document (except a tariff

publication) shall be returned to the filing party along with the fee

tendered, and such document shall be deemed to have been dismissed or

withdrawn.

Sec. 389.23 Application for waiver or modification of fees.

(a) Applications may be filed asking for waiver or modification of

any fee paid under this subpart. Each applicant shall set forth the

reasons why a waiver or modification should be granted, and by what

legal authority.

(b) Applications asking for a waiver or modification of fees shall

be sent to the Director, Office of International Aviation, or Director,

Office of Aviation Analysis, as appropriate, and shall accompany the

document filed. Applicants may appeal the decision of the appropriate

Director to the Assistant Secretary for Aviation and International

Affairs under Sec. 385.30 of this chapter. When no petition for review

is filed with the Assistant Secretary, or when the Assistant Secretary

reviews the appropriate Director's decision, if the amount found due is

not paid within 10 days after receipt of notification of the final

determination, the document shall be returned to the filing party.

(Approved by the Office of Management and Budget under control

number 3024-0071)

Sec. 389.24 Schedule of processing fees.

(a) Application--filing fees.

Code and application document $Fee \1\

Initial Authority--U.S. Certificated Air Carriers (large

aircraft):

1 Interstate scheduled only........................... 7,030

2 Interstate charter only............................. 7,030

3 All-cargo only...................................... 7,030

4 Foreign scheduled only.............................. 7,200

[[Page 3235]]

5 Foreign charter only................................ 7,100

6 Interstate and foreign scheduled.................... 7,360

7 Interstate and foreign charter...................... 7,270

8 Amendment to initial application, items 1-7

inclusive............................................. \2\ 1,760

Initial Authority--U.S. Commuter Air Carriers and U.S.

Certificated Air Carriers (small aircraft):

9 Interstate scheduled only........................... 3,050

10 Foreign scheduled only.............................. 3,150

11 Interstate and foreign scheduled.................... 3,310

12 Amendment to initial application, items 9-11

inclusive............................................. \2\ 760

Exemptions, Waivers, Transfers--U.S. Certificated Air

Carriers (large aircraft):

13 Pendente Lite Exemption............................. 1,900

14 Waiver to advertise, take reservations, issue

tickets or receive payments before effective authority

is issued............................................. 1,900

15 Waiver of revocation-for-dormancy rule.............. 1,370

16 Notice of intent to resume service when resumption

is 30 days or more after cessation of service......... 4,750

17 Notice of intent to resume service when resumption

is less than 30 days after cessation of service....... 1,370

18 Removal of restriction on authority not involving a

change from small to large aircraft................... 1,650

19 Removal of restriction on authority when a change

from small to large aircraft is involved.............. 4,750

20 Change name/trade name with reissuance of

certificate........................................... 500

21 Trade name registration............................. 240

22 Transfer of certificate: New ownership and/or

management............................................ 7,730

23 Certificate transfer: Intra-corporate reorganization 650

Exemptions, Waivers, Transfers, Amendments--U.S. Commuter

Air Carriers and U.S. Certificated Carriers (small

aircraft):

24 Pendente Lite Exemption............................. 280

25 Waiver to advertise, take reservations, issue

tickets or receive payments before effective authority

is issued............................................. 280

26 Waiver of revocation-for-dormancy rule.............. 280

27 [RESERVED.]......................................... ...........

28 Notice of intent to resume service.................. 280

29 [RESERVED.]......................................... ...........

30 Change name/trade name with reissuance of

certificate........................................... 250

31 Trade name registration............................. 65

32 Transfer of certificate or commuter authority: New

ownership and/or management........................... 4,070

33 [RESERVED.]......................................... ...........

34 Amendment to commuter registration.................. 5

Authority for Charter, Air Taxis, Foreign Tour and Foreign

Freight Forwarder Operations:

35 Public charter prospectus........................... 15

36 Waiver of public charter regulations................ 15

37 Foreign tour operator registration.................. 16

38 U.S. air taxi registration.......................... 15

39 Canadian charter air taxi registration.............. 15

40 Foreign air freight forwarder authority............. 19

41 Amendment to authorization, items 35-40 inclusive... 5

Authorizations, Amendments, Exemptions, Waivers--Foreign

Air Carriers:

42 Foreign air carrier permit, initial or renewal...... 1,550

43 Exemption--More than 10 flights..................... 400

44 Amendment to application, item 42 or 43............. 215

45 Exemption--10 or fewer flights...................... 120

46 Special authorization, part 375..................... 110

47 Foreign aircraft permit, part 375................... 180

48 Charter statement of authorization.................. 350

49 Special authority, part 216......................... 410

50 Emergency cabotage.................................. 330

51 Approval of foreign carrier schedule change per

bilateral agreement................................... 90

International Route Authority, Exemptions, Frequencies,

Charter Allocations:

52 New, renewal or amendment of certificate authority,

carrier selection not required........................ 650

53 New, renewal or amendment of exemption authority,

carrier selection not required........................ 480

54 New allocation of frequencies in limited-entry

markets, carrier selection not required............... 630

55 Renewal or frequency allocation in limited-entry

markets, carrier selection not required............... 230

56 Charter allocations for aviation operations into

foreign countries, carrier selection not required..... 180

57 Additional charge if carrier/gateway selection is

required, items 52-56 inclusive....................... \3\ 3,490

58 Route or frequency transfer......................... 4,990

Code-Share, Wet-Lease, Transborder and Intermodal

Authorizations:

59 Statement of code-share authorization............... 1,100

60 Statement of wet-lease authorization................ 300

61 [RESERVED.]

62 Approval under Part 222 for foreign carriers to

transport international cargo from a U.S. gateway

point to an interior U.S. point via trucking, per

bilateral agreement................................... 290

Regulation of Tariffs and Rates:

63 IATA Resolutions, To and/or from U.S................ \4\ 84

64 IATA Resolutions, Foreign-to-foreign................ \4\ 5

65 IATA Resolutions, Technical change.................. 15

66 Exemption to carry traffic not otherwise authorized

under tariff in effect................................ 53

67 Permission to file tariffs on less than statutory

notice................................................ 40

68 Approval of waiver/modification of tariff

regulations........................................... 12

69 Provide certified copies of tariffs upon request.... 240

[[Page 3236]]

Other Exemptions and Authorizations:

70 Slot exemption at slot-controlled airport........... 4,340

71 Confidential treatment of documents................. 380

72 Approval of agreements/antitrust immunity........... 1,080

73 [RESERVED.]

74 [RESERVED.]

75 Service mail rate petition.......................... 420

76 Overseas military personnel charter authority....... 665

\1\ Fee is per application except as noted. If application involves

multiple items, highest fee applies.

\2\ Per amendment.

\3\ Payable upon submission of first filing subsequent to DOT notice

that a comparative proceeding is necessary.

\4\ Per resolution.

(b) Electronic tariff filing fees. The filing fee for one (1) or

more transactions proposed in any existing record, or for any new or

canceled records, shall be 5 cents per record; Provided: That no fee

shall be assessed for those records submitted to the Department

pursuant to Sec. 221.500(b)(1) of this chapter.

Sec. 389.25 Special rules for tariff page filings.

(a) Tariffs issued by carriers. The filing fee for tariff pages

filed by U.S. air carriers will be charged even if the tariff includes

matters involving participating foreign air carriers. It will also be

charged if the tariff is issued by a foreign air carrier and includes

matters involving participating U.S. air carriers. The fee will not be

charged for a blank loose-leaf page unless it cancels matters in the

preceding issue of the page.

(b) Tariffs issued by publishing agents. (1) If the tariff is

issued for one or more air carriers exclusively, the fee will be

charged for each page.

(2) If the tariff is issued for one or more air carriers and one or

more foreign air carriers, the fee will be charged for each page,

except for those pages that the issuing agent states contain only:

(i) Matters pertaining exclusively to foreign air carriers that

have been granted a waiver, or

(ii) Changes in matters pertaining to foreign air carriers that

have been granted a waiver and that are included on the same page with

other matters that are reissued without change.

(3) The fee will not be charged for a blank loose-leaf page unless

it cancels matters in the preceding page.

(4) No fee will be charged when two pages are published back-to-

back, one page is not subject to the fee under paragraph (b)(2) of this

section, and the page on the reverse is issued without substantive

change.

(5) The fee will be charged for two loose-leaf pages containing a

correction number check sheet unless all other pages of the tariff are

exempt from the fee.

Sec. 389.26 Refund of fee.

(a) Any fee charged under this part may be refunded in full or in

part upon request if the document for which it is charged is withdrawn

before final action is taken. Such requests shall be filed in

accordance with Sec. 389.23.

(b) Any person may file an application for refund of a fee paid

since April 28, 1977, on the grounds that such fee exceeded the

Department's cost in providing the service. The application shall be

filed with the Chief, Accounting Division, Office of Budget and Policy,

Federal Transit Administration, and shall contain: the amount paid, the

date paid, and the category of service.

(Approved by the Office of Management and Budget under control

number 3024-0071) Issued in Washington DC, on January 13, 1999.

Charles A. Hunnicutt,

Assistant Secretary for Aviation and International Affairs.

Note: The following appendix will not appear in the Code of

Federal Regulations.

BILLING CODE 4910-62-P

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BILLING CODE 4910-62-C

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Justifications of Proposed User Fees

The following sections set forth the legal authority for the

special services included in our proposed fee schedule, the nature of

the special benefits those services provide to identifiable private

recipients, and our rationale for the fee amounts we propose. As

described earlier, proposed amounts are based on our analysis of the

work processes and costs required to deliver special services to

specific identifiable recipients, direct-labor time and cost data on

special services for a sample of more than 600 applications that we

completed during the period March 1997-July 1998, and the related

indirect (overhead) costs distributable to the processing of those

applications. When available, applications cost data are applied to

compute the proposed fee, defined as the total cost incurred for a

specific service divided by the total number of applications completed.

If no cost data are available for a particular service (i.e., no

applications for that service were completed during the cost-collection

period), and we have no other analytic basis to justify a change, the

current fee is retained. If a particular type of service has neither

current cost data nor an extant fee, no fee is proposed and a schedule

item is reserved. In accordance with federal user-charge policy (OMB

Circular A-25, par. 8), we intend to continue cost collection and

analysis as needed to revisit the fee schedule at least biennially and

to revise or update fee items as warranted by changes in our costs or

the special services we provide.

Initial Authority--U.S. Certificated Air Carriers (Large Aircraft):

Schedule Items 1-8

Our analysis of the processes involved to perform certification

services determined that there is a significant difference in

processing costs between those prospective air carriers whose

applications entail the operation of ``large'' aircraft (more than 60

seats or more than 18,000 pounds maximum payload) and those whose

applications involve ``small'' aircraft (60 seats or less or 18,000

pounds maximum payload or less). Accordingly, although the statutory

basis and nature of special benefits are identical in both instances,

we are proposing separate certification categories and fees based on

aircraft size, with schedule items 1-8 applied to applications

involving large aircraft.

Schedule Item 1. Initial application for certificate authorizing

interstate scheduled air transportation under 49 U.S.C. 41102(a)(1).

Section 41101(a)(1) of Title 49 of the United States Code (``the

Statute'') provides that an air carrier may engage in interstate

scheduled air transportation of persons, property, or mail only if it

has been issued a certificate by the Department of Transportation.

Section 41102(b)(1) of the Statute requires the Department to find such

an air carrier ``fit, willing, and able'' to provide the air

transportation to be authorized by the certificate, and to find that

the carrier is a U.S. citizen as defined in section 40102(a)(15) of the

Statute. A fee for processing an application for this authority is

warranted because the applicant is seeking the special benefit of the

Department's authorization to conduct revenue-producing interstate

scheduled air transportation.

Schedule Item 2. Initial application for certificate authorizing

interstate charter air transportation under 49 U.S.C. 41102(a)(3).

Section 41101(a)(2) of the Statute provides that an air carrier may

engage in interstate charter air transportation of persons, property,

or mail only if it has been issued a certificate by the Department.

Section 41102(b)(2) requires the Department to find the carrier fit,

willing, and able to provide the air transportation to be authorized by

the certificate, and to find that the carrier is a U.S. citizen as

defined in section 40102(a)(15). A fee for processing an application

for this authority is justified since the applicant is seeking the

special benefit of the Department's authorization to conduct revenue-

producing interstate charter air transportation.

Schedule Item 3. Initial application for certificate authorizing

interstate all-cargo transportation under 49 U.S.C. 41103. Section

41103 of the Statute provides that the Department may issue to a U.S.

citizen an all-cargo air transportation certificate authorizing it to

engage in [interstate] all-cargo air transportation. This section

requires the Department to find the carrier fit, willing, and able to

provide the air transportation to be authorized. A fee for processing

an application for all-cargo authority is warranted since the applicant

is seeking the special benefit of the Department's authorization to

conduct revenue-producing all-cargo air transportation.

Our analysis of the work flow and time required to process the

foregoing applications determined that the resources expended are

essentially the same for each type of initial application. For this

reason, we are proposing the identical fee for each type, based on the

following cost data:

Direct Labor............................................... $22,650.80

Overhead................................................... 15,530.44

------------

Total Cost................................................. 35,136.24

============

Applications processed..................................... 5

Cost per application....................................... 7,027.25

Proposed fee, Items 1-3: per application................... $7,030.00

Our analysis also found that there are measurable differences in

processing costs depending on whether an applicant requests initial

authority to provide (1) Foreign scheduled compared with interstate

scheduled service; (2) foreign charter compared with interstate charter

service; (3) both interstate and foreign scheduled service; and (4)

both interstate and foreign charter service. Accordingly, we are

proposing a different fee for each type as explained below.

Schedule Item 4. Initial application for certificate authorizing

foreign scheduled air transportation under 49 U.S.C. 41102(a)(1).

Section 41101(a)(1) of the Statute provides that an air carrier may

engage in foreign scheduled air transportation of persons, property, or

mail only if it has been issued a certificate by the Department.

Section 41102(b)(1) of the Statute requires the Department to find the

carrier fit, willing, and able to provide the air transportation to be

authorized by the certificate, and to find that the carrier is a U.S.

citizen as defined in section 40102(a)(15) of the Statute. Further,

under section 41102(b)(2), the Department is required to find that the

proposed foreign air transportation is consistent with the public

convenience and necessity and, under section 41102(d), to submit each

decision authorizing an application to engage in foreign air

transportation to the President for approval in accordance with section

41307. A fee for processing an application under these provisions of

the Statute is warranted since the applicant is seeking the special

benefit of the Department's authorization to conduct revenue-producing

foreign scheduled air transportation.

We did not process any applications under this schedule item during

the cost-collection period. However, our analysis determined that

foreign scheduled requires greater processing time than foreign charter

(see cost data below) because of the need to evaluate compliance with

extant bilateral agreements and to prepare the requisite implementing

language for the Department's final order authorizing the requested

operations. The proposed fee is therefore derived as follows:

Cost per application, Foreign Charter, Item 5 (see below).. $7,100.89

Additional processing cost (1.06 hrs. at $90.28 per hr.)... 95.70

------------

[[Page 3240]]

Cost per application....................................... 7,196.59

============

Proposed fee, Item 4: per application...................... 7,200.00

Schedule Item 5. Initial application for certificate authorizing

foreign charter air transportation under 49 U.S.C. 41102. Section

41101(a)(2) of the Statute provides that an air carrier may engage in

foreign charter air transportation only if it has been issued a

certificate by the Department, while section 41102(b)(2) requires the

Department to find such an air carrier fit, willing, and able to

provide the air transportation to be authorized by the certificate, and

to find that the carrier is a U.S. citizen as defined in section

40102(a)(15). Further, under section 41102(b)(2), the Department is

required to find that the proposed foreign air transportation is

consistent with the public convenience and necessity and, under section

41102(d), to submit each decision authorizing an application to engage

in foreign air transportation to the President for approval in

accordance with section 41307. A fee for processing an application

under these provisions of the Statute is warranted since the applicant

is seeking the special benefit of the Department's authorization to

conduct revenue-producing foreign charter air transportation.

The proposed fee for this service is determined as follows:

Direct Labor............................................... $18,275.10

Overhead................................................... 10,128.44

------------

Total Cost................................................. 28,403.54

============

Applications processed..................................... 4

Cost per application....................................... 7,100.89

Proposed fee, Item 5: per application...................... 7,100.00

Schedule Item 6. Initial application for certificate authorizing

interstate scheduled air transportation under 49 U.S.C. 41102(a)(1) AND

foreign scheduled air transportation under 49 U.S.C. 41102(a)(1).

Although the basic evaluation process is the same for dual and single-

authority applications, the former entails a marginally greater amount

of time (2 hours) to analyze the additional service proposal and to

process a second authorization. Thus, the proposed fee for this

schedule item is derived as follows:

Cost per application, Foreign Scheduled only, Item 4....... $7,196.59

Additional processing cost (2 hrs. at $83.25 per hr.)...... 166.50

------------

Cost per application....................................... 7,363.09

============

Proposed fee, Item 6: per application...................... 7,360.00

Schedule Item 7. Initial application for certificate authorizing

interstate charter air transportation under 49 U.S.C. 41102(a)(3) AND

foreign charter air transportation under 49 U.S.C. 41102. As with item

6, item 7 involves marginally greater time for processing a second

authority. The proposed fee is derived in a similar fashion thusly:

Cost per application, Foreign Charter only, Item 5......... $7,100.89

Additional processing cost (2 hrs. at $83.25 per hr.)...... 166.50

------------

Cost per application....................................... 7,267.39

============

Proposed fee, Item 7: per application...................... 7,270.00

Schedule Item 8. Amendment to initial application, schedule items

1-7 inclusive. Under section 302.5 of its procedural regulations, the

Department requires that if an applicant for certificate authority or

for all-cargo authority modifies its application substantially, it must

file an amendment to the application. An amendment may involve a

substantial change to one of the four major elements--ownership/

citizenship, management, finances, or compliance disposition--examined

by the Department as predicates to approval of the requested

authorization, and necessitates significant additional processing

effort. A fee for processing such amendments is warranted since the

applicant is seeking the special benefit of the Department's

consideration of a major change to one or more of the basic elements

affecting the applicant's qualifications to conduct revenue-producing

air transportation.

Our work-flow analysis determined that each of the four basic

elements of a fitness evaluation entails a comparable amount of

processing time. Accordingly, the proposed fee for an amendment \1\ to

an initial application is set at 25 percent of the basic application

fee, as follows:

---------------------------------------------------------------------------

\1\ We traditionally have made a distinction between amendments

and ``supplements.'' As noted above, an amendment involves a

substantive change by the applicant to one of the four basic

elements of its initial application--ownership/citizenship,

management, finances, or compliance disposition. A supplement, by

contrast, involves additional details or elaborative material on the

basic elements rather than a substantive change, and is normally

submitted at the Department's request rather than the applicant's

initiative. We have never imposed a fee for supplements and do not

propose to begin doing so now.

Initial application cost, Items 1-3........................ $7,027.25

x 25% additional cost =.................................. 1,756.81

============

Proposed fee, Item 8: per amendment........................ 1,760.00

Initial Authority--U.S. Commuter Air Carriers and U.S. Certificated Air

Carriers (Small Aircraft): Schedule Items 9-13

As discussed earlier, we are proposing a separate certification

category for applications involving aircraft of 60 seats or less or a

maximum payload of 18,000 pounds or less because those applications

entail significantly lower processing costs. We also have determined

that the time to process applications for commuter authority is

essentially the same as that for interstate scheduled service involving

small aircraft, and therefore are proposing to combine the two

authorities under a single schedule item. The statutory basis and

nature of special benefit for commuter authority are presented below.

Those for certificated authority involving small aircraft are the same

as presented earlier for authorizations involving large aircraft.

Schedule Item 9. Initial application for (1) scheduled passenger

air service (``commuter'') authority under 49 U.S.C. 41738, or (2)

certificate authorizing interstate scheduled air transportation under

49 U.S.C. 41102(a)(1), small aircraft.

Commuter authority. Section 40109(c) authorizes the Department to

exempt any person or class of persons from certain provisions of the

Statute, such as the requirement to obtain a certificate under section

41101(a). In addition, section 40109(f) provides that an air carrier is

exempt from the requirement to obtain a certificate under section

41101(a) if it operates small aircraft and complies with the

Department's liability insurance regulations and other requirements.

Further, section 41738 of the Statute provides that before an air

carrier may provide scheduled air transportation to an eligible place

(as defined in section 41736), it must be found to be a U.S. citizen

and to be fit, willing, and able to perform the service. A fee for

processing an application for this commuter air carrier authority is

warranted since the applicant is seeking the special benefit of the

Department's authorization to conduct revenue-producing scheduled air

transportation to an eligible place.

Certificate authorizing interstate scheduled air transportation

under 49 U.S.C. 41102(a)(1), small aircraft. See justification of

schedule item 1, supra. Our proposed fee for schedule item 9 is based

on the following cost data:

Direct Labor............................................... $15,735.90

Overhead................................................... 8,675.60

------------

Total Cost................................................. 24,411.50

============

Applications processed..................................... 8

[[Page 3241]]

Cost per application....................................... 3,051.44

Proposed fee, Items 9, 10: per application................. 3,050.00

Schedule Item 10. Initial application for certificate authorizing

foreign scheduled air transportation under 49 U.S.C. 41102(a)(1), small

aircraft. See justification of schedule item 4, supra.

As in the case of foreign scheduled certificated authority

involving large aircraft, there is an incremental cost arising from the

need to evaluate compliance with bilateral agreements and to prepare

implementing language. Our proposed fee is calculated as follows:

Cost per application, Interstate Scheduled only, Item 9.... $3,051.44

Additional processing cost (1.06 hrs. at $90.28 per hr.)... 95.70

------------

Cost per application....................................... 3,147.14

============

Proposed fee, Item 10: per application..................... 3,150.00

Schedule Item 11. Initial application for certificate authorizing

interstate scheduled air transportation under 49 U.S.C. 41102(a)(1) AND

foreign scheduled air transportation under 49 U.S.C. 41102(a)(1), small

aircraft. An application seeking both interstate and foreign scheduled

authority likewise requires marginally greater cost to process dual

authorizations. Our proposed fee:

Cost per application, Foreign Scheduled only, Item 10...... $3,147.14

Additional processing cost (2 hrs. at $83.25 per hr.)...... 166.50

------------

Cost per application....................................... 3,313.64

============

Proposed fee, Item 11: per application..................... 3,310.00

Schedule Item 12. Amendment to initial application, schedule items

9-12 inclusive. Finally, as with applications involving large aircraft,

an amendment to an initial application for commuter authority or

certificated authority involving small aircraft typically entails a

substantial change in one of the basic elements evaluated by the

Department (ownership/citizenship, management, finances or compliance

disposition), and requires approximately one-fourth as much time to

process as the initial submission. Our proposed fee is therefore:

Initial application cost, Item 9........................... $3,051.44

x 25% additional cost =.................................. 762.86

============

Proposed fee, Item 12: per amendment....................... 760.00

Exemptions, Waivers, Transfers--U.S. Certificated Air Carriers, Large

Aircraft: Schedule Items 13-23

Schedule Item 13. Application for an exemption from the provisions

of 49 U.S.C. 41102 or 41103 in order to conduct air transportation

operations before the authority for such operations has been granted

(pendente lite exemption). Section 40109(c) of the Statute provides

that the Department may grant an air carrier applicant an exemption to

engage in air transportation operations without first having obtained a

certificate in accordance with section 41102 or section 41103. The

Department must determine that a grant of such authority is in the

public interest, analyze the qualifications of the applicant, and

assess certain consumer protection actions the applicant is required to

take in order to be granted a pendente lite exemption. A processing fee

for this exemption is justified since the applicant is seeking the

special benefit of the Department's authorization to conduct revenue-

producing air transportation before it has obtained the required

certificate authority.

Schedule Item 14. Application for a waiver of the provisions of 14

CFR 201.5 in order to advertise, take reservations, issue tickets, or

receive payments before the underlying operating authority is granted.

Section 201.5 of Title 14 of the Code of Federal Regulations (``the

regulations'') provides that an applicant for air carrier certificate

authority may not advertise or take reservations for its proposed air

service until its application has been approved by the Department, and

that the applicant may not issue tickets or receive payments for its

proposed air service until its authority has become effective. Section

40109(c) of the Statute, however, authorizes the Department to grant

exemptions or waivers from the regulations. Before granting a waiver,

the Department must determine that a grant of such authority is in the

public interest, analyze the applicant's qualifications, and assess

certain consumer protection actions the applicant is required to take.

A fee for processing this application for a waiver is justified since

the applicant is seeking the special benefit of the Department's

authorization to conduct revenue-producing air transportation before it

has obtained the underlying authority for those operations.

Our analysis of the services of schedule items 13 and 14 determined

that both entail essentially the same amount of processing time. Our

proposed fee is therefore the same for each item and is based on the

following cost data:

Direct Labor............................................... $4,926.53

Overhead................................................... 2,686.07

------------

Total Cost................................................. 7,612.60

============

Applications processed..................................... 4

Cost per application....................................... 1,903.15

Proposed fee, Items 13, 14: per application................ 1,900.00

Schedule Item 15. Application by a certificated air carrier for a

waiver of the revocation-for-dormancy provisions of 14 CFR 204.7.

Section 204.7 of the Department's regulations provides that if a

carrier has been awarded a certificate under section 41102 or 41103 of

the Statute, but does not institute the air transportation operations

for which it was found fit within one year of the date of its fitness

determination, the carrier's authority may be revoked for reasons of

dormancy. Similarly, if the carrier institutes air transportation

operations but subsequently ceases conducting all of the operations for

which it was found fit, its authority is automatically suspended and

subject to revocation if the carrier does not recommence operations

within one year. If the carrier requires additional time beyond the

one-year period, it must file an application for a waiver of the

revocation-for-dormancy provisions of section 204.7, together with

updated fitness information. A fee for processing an application for a

waiver of the revocation for dormancy rule is warranted because the

Department must assess the carrier's progress in becoming operational

and because the carrier is seeking the special benefit of Departmental

action to avert revocation of its authority to conduct revenue-

producing air transportation operations.

Our proposed fee for this item is determined as follows:

Direct Labor............................................... $3,550.50

Overhead................................................... 1,935.46

------------

Total Cost................................................. 5,485.90

============

Applications processed..................................... 4

Cost per application....................................... 1,371.48

Proposed fee, Item 15: per application..................... 1,370.00

Schedule Item 16. Notice by a certificated air carrier pursuant to

14 CFR 204.7 of its intent to resume air transportation operations

following a cessation of those operations more than 30 days after the

cessation. Section 204.7 of the regulations provides that if a carrier

holding a certificate under section 41102 or 41103 of the Statute

ceases conducting all of the air transportation operations for which it

was found fit, willing, and able, it may

[[Page 3242]]

not resume those operations until its fitness is redetermined by the

Department. Under our rules, if the carrier desires to re-institute air

transportation operations, it must file a notice of intent to do so

along with updated fitness information. A fee for processing a notice

of intent to resume service is justified because the Department must

re-evaluate the carrier's fitness, including any changes (which often

are substantial) that have been made by the carrier since it ceased

operations, and because the carrier is seeking the special benefit of

the Department's authorization to re-engage in revenue-producing air

transportation operations.

Our proposed fee for this item is based on the following:

Direct Labor............................................... $9,220.69

Overhead................................................... 5,030.99

------------

Total Cost................................................. 14,251.58

============

Applications processed..................................... 3

Cost per application....................................... 4,750.56

Proposed fee, Item 16: per application..................... 4,750.00

Schedule Item 17. Application of notice by a certificated air

carrier pursuant to 14 CFR 204.7 of its intent to resume air

transportation operations following a cessation of those operations

less than 30 days after the cessation. The regulatory basis and nature

of special benefit warranting a user charge for this item are the same

as those for item 16 above. However, the fitness issues associated with

an applicant that has only recently ceased operations normally are less

complex and require less analysis and processing effort because fewer

changes are likely to have been made in the areas requiring a fitness

review. Our work-flow analysis determined that the time required to

process a notice to resume service in less than 30 days is essentially

the same as that for a waiver-of-dormancy application, item 15 above.

We therefore are proposing the same fee for this item, $1,370 per

application.

Schedule Item 18. Application by an air carrier holding a

certificate under 49 U.S.C. 41102 or 41103 for the removal of a

restriction on its certificate authority when the removal does not

involve a change from small to large aircraft. An air carrier may apply

to have the Department lift a restriction contained in the Terms,

Conditions, and Limitations attached to its certificate. Such an

application requires the Department to conduct a continuing fitness

review under section 41110(e) of the Statute to determine that the

carrier will remain fit, willing, and able if the restriction is

removed. Since the applicant is seeking the special benefit of being

granted broader revenue-producing authority by the Department, a

processing fee is warranted. Our proposed fee is determined as follows:

Direct Labor............................................... $2,136.26

Overhead................................................... 1,169.68

------------

Total Cost................................................. 3,305.94

============

Applications processed..................................... 2

Cost per application....................................... 1,652.97

Proposed fee, Item 18: per application..................... 1,650.00

Schedule Item 19. Application by an air carrier holding a

certificate under 49 U.S.C. 41102 or 41103 for the removal of a

restriction on its certificate authority when the removal does involve

a change from small to large aircraft. The statutory basis and nature

of special benefit warranting a user charge for this schedule item are

the same as for item 18 above. Application processing costs, however,

are substantially higher because a change from small to large aircraft

has a major impact on the air carrier's management and financial

fitness. Although we did not complete any applications for this

schedule item during the cost-collection period, our work-flow analysis

determined that the process for evaluating a removal of a restriction

involving a change from small to large aircraft is essentially the same

as the evaluation process for a notice to resume service more than 30

days after cessation (item 16, supra). As in the latter case, the

applicant under this schedule item typically undergoes substantial

changes in its management team and financial structure that necessitate

the Department's scrutiny. Thus, the proposed fee for item 19 is the

same as for item 16, $4,750 per application.

Schedule Item 20. Application by a certificated air carrier under

14 CFR Part 215 to register a name or trade name involving the

reissuance of its certificate. Part 215 of the Department's regulations

provides that a carrier holding a certificate under section 41102 or

41103 of the Statute may not hold itself out as a provider of air

transportation service in any name that has not been registered with

the Department. A name-change application requires the Department to

(1) search its records for any other air carriers with the same or a

similar name, (2) advise the applicant accordingly so that it may, in

turn, notify any such similarly named carriers of its intent to

register the name, and (3) reissue the carrier's certificate in the new

name. A fee for this service is warranted since the carrier is seeking

the special benefit of being authorized to engage in revenue-producing

air transportation operations under a different name or trade name than

previously authorized.

Our proposed fee for this schedule item is as follows:

Direct Labor............................................... $656.52

Overhead................................................... 350.23

------------

Total Cost................................................. 1,006.75

============

Applications processed..................................... 2

Cost per application....................................... 503.38

Proposed fee, Item 20: per application..................... 500.00

Schedule Item 21. Application for trade name registration

(certificate reissuance not required). While the legal basis and nature

of special benefit for this item are the same as for item 20 above, the

proposed fee is substantially lower because only a notice of the

registration must be issued, resulting in materially lower processing

costs:

Direct Labor............................................... $473.95

Overhead................................................... 252.98

------------

Total Cost................................................. 726.93

============

Applications processed..................................... 3

Cost per application....................................... 242.31

Proposed fee, Item 21: per application..................... 240.00

Schedule Item 22. Joint application under 49 U.S.C. 41105 for the

transfer of interstate certificate authority. Section 41105 of the

Statute provides that a certificate issued under section 41102 or 41103

of the Statute may be transferred only upon the Department's finding

that the transfer is in the public interest.\2\ Moreover, the

Department must certify to the Congressional committees having

jurisdiction over matters of commerce that the transfer will not have

an adverse effect on the viability of the carriers involved,

competition in the domestic airline industry, or the U.S. trade

position in international air transportation. A fee is warranted for

approval of a certificate transfer because, in addition to these

findings, the Department must determine that the transferee is fit to

conduct the operations authorized by the certificate to be transferred

and, further, because the applicants are seeking the special benefit of

the Department's approval of an action needed by (1) the certificate

transferee to engage in the revenue-producing air transportation

authorized by the certificate and (2) the transferor so that it may

realize any compensation provided for in the transfer agreement.

---------------------------------------------------------------------------

\2\ This transfer of interstate certificate authority is

distinct from the transfer of foreign route/frequency authority. See

item 58, below, for the latter.

---------------------------------------------------------------------------

[[Page 3243]]

Our proposed fee for this item is based on the following:

Direct Labor............................................... $9,973.37

Overhead................................................... 5,482.51

------------

Total Cost................................................. 15,455.88

============

Applications processed..................................... 2

Cost per application....................................... 7,727.94

Proposed fee, Item 22: per application..................... 7,730.00

Schedule Item 23. Application to 49 U.S.C. 41105 involving an

intra-corporate reorganization only (e.g., reincorporation in a

different state with no changes of ownership or management). In

contrast to item 22 above, an air carrier in this instance is

seeking the special benefit of the Department's approval of a

comparatively minor change to the certificated authority that

enables revenue-producing air transportation, and the certificate

transfer triggered by the carrier's intra-corporate reorganization

entails a less extensive fitness review. The proposed fee for item

23 is therefore substantially lower than for item 22, and is based

on the following cost data:

Direct Labor............................................... $1,262.38

Overhead................................................... 676.29

------------

Total Cost................................................. 1,938.67

============

Applications processed..................................... 3

Cost per application....................................... 646.22

Proposed fee, Item 23: per application..................... 650.00

Exemptions, Waivers, Transfers--U.S. Commuter Air Carriers and U.S.

Certificated Air Carriers (Small Aircraft): Schedule Items 24-34

As in the case of initial applications, we are proposing to group

commuter air carriers and certificated air carriers using small

aircraft into a separate category for exemptions, waivers and

transfers. The structure of this category is similar to that of items

13-23 above regarding authorizations involving large aircraft.

Schedule Item 24. Application for an exemption from the provisions

of 49 U.S.C. 41738 or 41102 to conduct scheduled air transportation

operations before the authority for such operations has been granted

(pendente lite exemption). Section 40109(c) of the Statute authorizes

the Department to grant an air carrier applicant an exemption to engage

in air transportation operations without first having obtained a

certificate or commuter authorization. The Department must determine

that a grant of such authority is in the public interest, analyze the

qualifications of the applicant, and assess certain consumer protection

actions the applicant is required to take in order to be granted a

pendente lite exemption. A processing fee for this exemption is

justified since the applicant is seeking the special benefit of the

Department's authorization to conduct revenue-producing air

transportation before it has obtained the required certificate or

commuter authority.

Schedule Item 25. Application for a waiver of the provisions of 14

CFR 201.5 in order to advertise, take reservations, issue tickets, or

receive payments before the underlying operating authority is granted.

Section 201.5 of the Department's regulations provides that an

applicant for commuter air carrier or certificate authority may not

advertise or take reservations for its proposed air service until its

application has been approved by the Department, and that the applicant

may not issue tickets or receive payments for its proposed air service

until its authority has become effective. Section 40109(c) of the

Statute, however, authorizes the Department to grant exemptions or

waivers from the regulations. Before granting a waiver, the Department

must determine that a grant of such authority is in the public

interest, analyze the applicant's qualifications, and assess certain

consumer protection actions the applicant is required to take. A fee

for processing this application for waiver is justified since the

applicant is seeking the special benefit of the Department's

authorization to conduct revenue-producing air transportation before it

has obtained the underlying authority for those operations.

Schedule Item 26. Application for a waiver of the revocation-for-

dormancy provisions of 14 CFR 204.7 Section 204.7 of the Department's

regulations provides that if a carrier has been awarded commuter

authority under section 41738 of the Statute, or certificate authority

under section 41102, but does not institute the air transportation

operations for which it was found fit within one year of the date of

its fitness determination, the carrier's authority may be revoked for

reasons of dormancy. Similarly, if the carrier institutes air

transportation operations but subsequently ceases conducting all of the

operations for which it was found fit, its authority is automatically

suspended and subject to revocation if the carrier does not recommence

operations within one year. If the carrier requires additional time

beyond the one-year period, it must file an application for a waiver of

the revocation-for-dormancy provisions of section 204.7, together with

updated fitness information. A fee for processing an application for a

waiver of the revocation-for-dormancy rule is warranted because the

Department must assess the carrier's progress in becoming operational

and because the carrier is seeking the special benefit of Departmental

action to avert revocation of its authority to conduct revenue-

producing air transportation operations.

No applications under schedule items 25, 26 or 27 were processed

during our cost-collection period, and we have no other basis on which

to propose a change to the fees currently in force or to assume that

fee costs have changed. Accordingly, the current fee of $280 per

Application is retained for each item.

Schedule Item 27. [Reserved.]

Schedule Item 28. Application of notice pursuant to 14 CFR 204.7 of

the intent to resume air transportation operations following a

cessation of those operations. Section 204.7 of the regulations

provides that if a carrier holding commuter authority under section

41738 of the Statute, or a carrier holding certificate authority under

section 41102, ceases conducting all of the air transportation

operations for which it was found fit, willing, and able, it may not

resume those operations until its fitness is redetermined by the

Department. Under our rules, if the carrier desires to re-institute air

transportation operations, it must file a notice of intent to do so

along with updated fitness information. A fee for processing a notice

of intent to resume service is justified because the Department must

re-evaluate the carrier's fitness, including any changes (which often

are substantial) that have been made by the carrier since it ceased

operations, and because the carrier is seeking the special benefit of

the Department's authorization to re-engage in revenue-producing air

transportation operations.

No applications from commuter air carriers or certificated air

carriers operating small aircraft were processed under this item during

our cost-collection period. However, our analysis determined that the

time required to process a notice to resume service is essentially the

same as that for a waiver-of-dormancy application, item 26 above. We

therefore are proposing the same fee for item 28, $280 per Application.

Schedule Item 29. [Reserved.]

Schedule Item 30. Application under 14 CFR Part 215 to register a

name or trade name involving the reissuance of a certificate or

commuter authorization. Part 215 of the Department's regulations

provides that a carrier holding commuter authority under section 41738

of the Statute, or certificate authority under section 41102, may not

hold itself out to the public as a provider of air transportation

service in any name that has not been registered with the Department. A

processing fee

[[Page 3244]]

for a name or trade name registration application requires the

Department to (1) search its records for any other air carriers with

the same or a similar name, (2) advise the applicant accordingly so

that it may, in turn, notify any such similarly named carriers of its

intent to register the name, and (3) reissue the carrier's authority in

the new name. A fee for this service is warranted since the carrier is

seeking the special benefit of being authorized to engage in revenue-

producing commuter or certificated air carrier operations under a

different name or trade name than previously authorized.

Our proposed fee for this item is based on the following:

Direct Labor............................................... $335.72

Overhead................................................... 169.31

------------

Total Cost................................................. 505.03

============

Applications processed..................................... 2

Cost per application....................................... 252.52

Proposed fee, Item 30: per application..................... 250.00

Schedule Item 31. Application under 14 CFR Part 215 and section

298.36 requesting the Department to accept a registration of a name.

This schedule item is akin to item 30 above in terms of its regulatory

basis and nature of special benefit, but is significantly less costly

to process because only a notice of the registration must be issued.

Our proposed fee therefore is lower, and is based on:

Direct Labor............................................... $171.86

Overhead................................................... 88.65

------------

Total Cost................................................. 260.51

============

Applications processed..................................... 4

Cost per application....................................... 65.13

Proposed fee, Item 31: per application..................... 65.00

Schedule Item 32. Joint application under 49 U.S.C. 41105 for the

transfer of certificate or commuter air carrier authority. Section

41105 of the Statute provides that a certificate authority issued under

section 41102 of the Statute or a commuter authority issued under

section 41738 may be transferred only upon the Department's approval

that the transfer is in the public interest.\3\ Moreover, the

Department must certify to the Congressional committees having

jurisdiction over matters of commerce that the transfer will not have

an adverse effect on the viability of the carriers involved,

competition in the domestic airline industry, or the U.S. trade

position in international air transportation. A fee is warranted for

approval of a certificate or commuter authorization transfer because,

in addition to these findings, the Department must determine that the

transferee is fit to conduct the operations authorized by the

certificate or commuter authority to be transferred and the applicants

are seeking the special benefit of the Department's approval of an

action needed by (1) the transferee to engage in the revenue-producing

air transportation authorized and (2) the transferor so that it may

realize any compensation provided for in the transfer agreement.

---------------------------------------------------------------------------

\3\ This transfer of interstate certificate or commuter

authority is distinct from the transfer of foreign route/frequency

authority. See item 58, below, for the latter.

---------------------------------------------------------------------------

Our proposed fee for this item is based on the following:

Direct Labor............................................... $7,916.28

Overhead................................................... 4,287.70

------------

Total Cost................................................. 12,203.98

============

Applications processed..................................... 3

Cost per application....................................... 4,067.99

Proposed fee, Item 32: per application..................... 4,070.00

Schedule Item 33. [Reserved.]

Schedule Item 34. Application for approval of amendment to commuter

air carrier registration under 14 CFR Part 298. Section 298.23 of the

Department's regulations requires a commuter air carrier to submit an

amendment to its registration form (OST Form 4507) within 30 days of

undergoing any change (e.g., in location, operations conducted, or

aircraft fleet) that would make obsolete the information currently on

file with the Department. A processing fee for the filing of an amended

OST Form 4507 is warranted since the carrier is seeking the special

benefit of the Department's approval of changes it has undergone to

continue to engage in revenue-producing commuter operations.

Our proposed fee for this schedule item is based on:

Direct Labor............................................... $87.25

Overhead................................................... 48.75

------------

Total Cost................................................. 136.00

============

Applications processed..................................... 25

Cost per application....................................... 5.44

Proposed fee, Item 34: per application..................... 5.00

Authority for Charter, Air Taxi, Foreign Tour and Foreign Freight

Forwarder Operations: Schedule Items 35-41

Schedule Item 35. Application for acceptance of a public charter

prospectus. Section 41104 of the Statute provides that the Department

may prescribe a regulation restricting the marketability, flexibility,

accessibility or variety of charter air transportation provided under a

certificate or order issued under section 41102 of the Statute, but

only to the extent required by the public interest. Parts 380, 207, 208

and 212 of the Department's regulations require the filing of a

prospectus describing the economic and consumer protections that the

applicant must provide to members of the public purchasing its charter

transportation. A processing fee for a public charter prospectus is

warranted since the applicant, a direct air carrier or indirect air

carrier, is seeking the special benefit of the Department's

authorization to conduct revenue-producing air charter service.

The proposed fee for this item is as follows:

Direct Labor............................................... $491.81

Overhead................................................... 304.17

------------

Total Cost................................................. 795.98

============

Applications processed..................................... 52

Cost per application....................................... 15.31

Proposed fee, Item 35: per application..................... 15.00

Schedule Item 36. Application for waiver of charter regulations.

Under section 380.3(e) of the public charter regulations, the

Department can approve an application submitted by a public charter

operator or a direct air carrier for a waiver of the provisions of the

charter regulations, provided that a waiver is found to be in the

public interest. A fee for processing an application for this waiver is

justified since the applicant is seeking the special benefit of the

Department's consent to be relieved of certain filing or other

requirements in the conduct of revenue-producing charter operations.

No applications under this schedule item were processed during the

cost-collection period. However, we have concluded that the current fee

of $39 is too high in light of our proposed fees for charter-type

authorizations generally (items 35, 37-40). For this reason, we are

proposing to reduce the fee from $39 to $15 per application.

Schedule Item 37. Application for approval of foreign charter

operator registration. Under section 380.60 of the public charter

regulations, foreign charter operators desiring to organize public

charter group transportation originating in the United States must

register with, and obtain approval of, the Department, including a

determination by the Department whether effective reciprocity exists

with the homeland of the applicant. The registration application, which

must describe the ownership of the company, is held for 28 days, during

which time any person may file an objection. A processing fee is

warranted since the

[[Page 3245]]

applicant is seeking the special benefit of the Department's approval

to advertise, organize, provide, sell and/or offer U.S.-originating

public charters.

The proposed fee for this item is as follows:

Direct Labor............................................... $30.90

Overhead................................................... 17.25

------------

Total Cost................................................. 48.15

============

Applications processed..................................... 3

Cost per application....................................... 16.05

Proposed fee, Item 37: per application..................... 16.00

Schedule Item 38. Application for U.S. air taxi registration. Under

part 298 of the Department's regulations, any company proposing to

operate small aircraft (60 seats or less than or 18,000-pounds payload

or less) in on-demand air service must first register with the

Department and file evidence of effective liability insurance coverage

meeting the requirements of Part 205. Acceptance of the registration

relieves theses operators from certain provisions and requirements of

Subtitle VII of the Statute, including the requirement to obtain a

certificate under section 41102. Since the applicant seeks the special

benefit of the Department's approval to conduct revenue-producing air

taxi operations, a processing fee is warranted.

In October 1997, the responsibility for processing applications for

air taxi registrations was transferred from the Office of the Secretary

to the Federal Aviation Administration. As a consequence, no data on

the cost to process applications under this schedule item were

collected. Nevertheless, we are proposing that the same fee established

below for Canadian charter air taxi registrations--$15 per

Application--also apply to applications for U.S. air taxi registration.

The registration requirements and process involved in both types of

applications are quite similar, with the exception that applications

for U.S. air taxi registration, unlike those for Canadian charter air

taxis, are not required to be held by the Department for a public-

comment period of 28 days. The cost to the Department of this

``holding'' requirement is not material, however, since few, if any,

objections are filed.

Schedule Item 39. Application for Canadian charter air taxi

registration. Under Part 294 of the Department's regulations, a

Canadian charter air taxi operator seeking authority to operate between

Canada and the United States must file a registration request with the

Department accompanied by evidence of effective liability insurance

coverage. The regulation exempts these operators from certain

provisions of Subtitle VII of the Statute and establishes rules

applicable to their operations in the United States. Because the

applicant seeks the special benefit of the Department's authorization

to operate small aircraft across the Canadian border into the United

States for revenue-generating purposes, a processing fee is justified.

Our proposed fee for this item:

Direct Labor............................................... $137.20

Overhead................................................... 76.59

------------

Total Cost................................................. 213.79

============

Applications processed..................................... 14

Cost per application....................................... 15.27

Proposed fee, Item 39: per application..................... 15.00

Schedule Item 40. Application for approval of foreign air freight

forwarder registration. Under Part 297 of the Department's regulations,

a foreign air freight forwarder must file and receive approval to

engage indirectly in interstate or foreign air transportation of

property. Acceptance of the application also relieves carriers from

certain provisions of Subtitle VII of the Statute. If the registration

is approved, the applicant is permitted to arrange for the

transportation of property from the point of origin to the point of

destination using the services of direct air carriers. The processing

fee is warranted since the applicant is seeking the special benefit of

the Department's approval of its registration to engage in revenue-

producing activity.

Our proposed fee for this schedule item is as follows:

Direct Labor............................................... $11.95

Overhead................................................... 6.67

------------

Total Cost................................................. 28.62

============

Applications processed..................................... 1

Cost per application....................................... 18.62

Proposed fee, Item 40: per application..................... 19.00

Schedule Item 41. Application for amendment to registration, items

36-40 inclusive. Under section 380.25 (c) and (d) of the Department's

regulations, a public charter operator may request that an amendment be

made to its original prospectus to add or cancel flights, or to change

flight dates, origin or destination points, or the direct air carrier,

securer or depository bank. Further, under section 380.65, a foreign

charter operator must notify the Department of any change in its

operations or ownership and amend its registration accordingly.

Likewise, under sections 294.22 and 298.23, a Canadian charter air taxi

and U.S. air tax operator, respectively, must notify the Department of

changes in the information contained in its registration and, under

section 297.94, a foreign air freight forwarder must file and have

approved changes to its registration. A processing fee for these

various types of amendments is warranted since, in each instance, the

operator is seeking the special benefit of the Department's approval of

changes to the authority enabling the operator to continue to engage in

revenue-producing operations.

Our analysis of these various types of amendment applications

determined that they entail essentially the same processes.

Accordingly, we are proposing that the same fee be applied to each type

based on the following cost data:

Direct Labor............................................... $99.21

Overhead................................................... 55.37

------------

Total Cost................................................. 154.58

============

Applications processed..................................... 30

Cost per amendment......................................... 5.15

Proposed fee, Item 41: per application..................... 5.00

Authorizations, Amendments, Exemptions--Foreign Air Carriers: Schedule

Items 42-51

Schedule Item 42. Application for an initial, or for renewal of a

previously authorized, foreign air carrier permit under 49 U.S.C.

41301. Section 41301 of the Statute requires a foreign air carrier to

have a permit from the Department to engage in air transportation

operations to a point or points in the United States or its

possessions. Section 41302 of the Statute requires the Department to

find such a foreign air carrier fit, willing, and able to provide the

foreign air transportation to be authorized by the permit, and to find

that it has been designated by the government of its country to provide

the foreign air transportation under an agreement with the United

States Government, or that the foreign air transportation to be

provided under the permit will be in the public interest. A fee for

processing an application permit is warranted since the foreign air

carrier is seeking the special benefit of the Department's

authorization to conduct revenue-producing air transportation service

to a U.S. point.

A foreign air carrier permit may be issued for a specified term

that will require renewal, which normally involves a re-determination

of carrier fitness and a processing effort comparable to that for an

initial authorization. Because an applicant for renewal seeks the

special benefit of continuing its authority to conduct

[[Page 3246]]

revenue operations in foreign air transportation, a processing fee is

warranted.

Our proposed fee for an initial permit or for renewal of a

previously authorized permit is based on the following:

Direct Labor............................................... $860.56

Overhead................................................... 688.71

------------

Total Cost................................................. 1,549.27

============

Applications processed..................................... 1

Cost per application....................................... 1,549.27

Proposed fee, Item 42: per application..................... 1,550.00

Schedule Item 43. Application by foreign air carrier for exemption

from the provisions of 49 U.S.C. 41301. Section 40109(c) of the Statute

provides that the Department may grant a foreign air carrier applicant

an exemption to conduct (more than 10) flights to a U.S. point or

points without its first having obtained a foreign air carrier permit

as required by section 41301. A processing fee for an application for

this exemption is justified because the foreign air carrier is seeking

the special benefit of the Department's temporary authorization to

conduct revenue-producing air transportation to a U.S. point in

circumstances where obtaining a foreign air carrier permit would take

too long or otherwise be inappropriate.

Our proposed fee for this item is based on the following:

Direct Labor............................................... $660.85

Overhead................................................... 528.86

------------

Total Cost................................................. 1,189.71

============

Applications processed..................................... 3

Cost per application....................................... 396.57

Proposed fee, Item 43: per Application..................... 400.00

Schedule Item 44. Amendment by a foreign air carrier of either its

application for a permit or its application for an exemption to conduct

more than 10 flights. If an applicant for a foreign air carrier permit

under section 41301 or for an exemption under section 40109(c) of the

Statute modifies its application substantially, it must file an

amendment to such application. Such amendments trigger significant

additional processing time, and a fee to cover processing costs is

warranted since the applicant receives the special benefit of

additional or different authority for revenue-producing operations,

while saving the time and expense that a new application would entail.

No applications under this schedule item were processed during the

cost-collection period, and we have no other basis to propose a change

in the current fee or to assume that fee costs have changed.

Accordingly, the current fee of $215 per Application is retained.

Schedule Item 45. Application by foreign air carrier for an

exemption from the provisions of 49 U.S.C. 41301 to conduct ten or

fewer flights. Section 40109(c) of the Statute provides that the

Department may grant a foreign air carrier an exemption from the need

to obtain a foreign air carrier permit as required by section 41301 of

the Statute in order to conduct flights to a U.S. point or points.

Department rules (14 CFR 302.401 et seq.) provide for simplified

application procedures for certain exemptions of 10 or fewer flights. A

fee for processing such an exemption application is justified because

the foreign air carrier is seeking the special benefit of the

Department's authorization to temporarily conduct revenue-producing air

transportation to a U.S. point and to defer the time and financial

expenditures required to obtain a foreign air carrier permit.

Our proposed fee for this item is based on the following:

Direct Labor............................................... $69.09

Overhead................................................... 55.29

------------

Total Cost................................................. 124.38

============

Applications processed..................................... 1

Cost per application....................................... 124.38

Proposed fee, Item 45: per Application..................... 120.00

Schedule Item 46. Application for a special authorization under 14

CFR Part 375. Section 41703 of the Statute and section 375.70 of the

regulations provide that the Department may authorize particular

flights that are not within an applicant's other authority and not

appropriately the subject of an exemption under 49 U.S.C. 40109. The

Department must determine that the proposed operations are fully

consistent with the applicable law, that the applicant's homeland

grants a similar privilege with respect to U.S. operators, and that the

proposed operation is in the U.S. public interest. A fee in connection

with an application for such a special authorization is warranted

because the applicant is seeking the special benefit of permission to

engage in an air operation of value that is not otherwise authorized.

Our proposed fee for this item is based on the following:

Direct Labor............................................... $62.34

Overhead................................................... 48.89

------------

Total Cost................................................. 112.23

============

Applications processed..................................... 1

Cost per application....................................... 112.23

Proposed fee, Item 46: per Application..................... 110.00

Schedule Item 47. Application for a foreign aircraft permit under

14 CFR Part 375. Section 41703 of the Statute and section 375.40 of the

Department's regulations state that commercial air operations utilizing

foreign civil aircraft may be undertaken in the U.S. only if a permit

issued by the Department is carried aboard the aircraft. A fee to

offset the costs of processing a permit application is warranted since

the applicant is seeking the special benefit of the Department's

authorization to operate a foreign aircraft in air commerce in the

United States.

Our proposed fee for this item is based on the following:

Direct Labor............................................... $609.84

Overhead................................................... 488.06

------------

Total Cost................................................. 1,097.90

============

Applications processed..................................... 6

Cost per application....................................... 182.98

Proposed fee, Item 47: per Application..................... 180.00

Schedule Item 48. Application for foreign carrier charter statement

of authorization under 14 CFR Part 212. Foreign air carrier permits

issued under 49 U.S.C. 41302 require that charter flights must be

conducted in accordance with 14 C.F.R. Part 212. Part 212 provides that

certain charters require prior approval in the form of a Statement of

Authorization, which the Department grants if it finds that the

charters will be in the public interest. A fee to defray processing

costs is warranted since the applicant is seeking the special benefit

of authority to conduct revenue-producing operations in foreign air

transportation.

Our proposed fee for this item is based on the following:

Direct Labor............................................... $3,735.21

Overhead................................................... 1,917.79

------------

Total Cost................................................. 6,653.00

============

Applications processed..................................... 19

Cost per application....................................... 350.16

Proposed fee, Item 48: per Application..................... 350.00

Schedule Item 49. Application for special authorization under 14

CFR Part 216. Unless specifically authorized by its section 41302

permit, a foreign air carrier may not commingle traffic moving in

foreign air transportation with traffic not moving in foreign air

transportation unless it has a Special Authorization under Part 216.

This situation arises when a foreign carrier serves between a U.S.

point and a homeland point via an intermediate point. The intermediate-

homeland leg of the flight is called a ``blind sector'' with respect to

U.S. air transportation,

[[Page 3247]]

because local traffic on that segment is not carried to or from the

United States and is not in air transportation as defined in the

Statute. Without the ability to commingle traffic on all flight

segments, a carrier would lose valuable revenue. Thus the applicant for

a Special Authorization to commingle blind-sector traffic seeks a

special benefit, justifying a processing fee.

Our proposed fee for this item is based on the following:

Direct Labor............................................... $477.27

Overhead................................................... 350.05

------------

Total Cost................................................. 827.32

============

Applications processed..................................... 2

Cost per application....................................... 413.66

Proposed fee, Item 49: per application..................... 410.00

Schedule Item 50. Application for emergency cabotage exemption

under 49 U.S.C. 40109(g). Section 41701 of the Statute prohibits

foreign civil aircraft from carrying revenue traffic between two U.S.

points (``cabotage'' traffic) unless an exemption is granted under

section 40109(g), which deals specifically with emergency cabotage.

These applications are addressed separately from other exemptions,

because on the one hand, the authority at issue in a given application

usually is narrower, but on the other hand, the statutory criteria for

a grant are more detailed and specialized, and the compressed timeframe

for consideration requires more intense application of staff resources

than do most exemptions in foreign air transportation. A processing fee

is warranted since applicants for this authority are seeking the

special benefit of performing otherwise prohibited air transportation.

Our proposed fee for this item is based on the following:

Direct Labor............................................... $749.35

Overhead................................................... 583.50

------------

Total Cost................................................. 1,332.85

============

Applications processed..................................... 4

Cost per application....................................... 333.21

Proposed fee, Item 50: per application..................... 330.00

Schedule Item 51. Filing by a foreign air carrier of its proposed

schedule for which approval is required under an international

agreement. Section 40105(b) of the Statute provides that the Department

shall, in carrying out Part A of the Statute, act consistently with

applicable international agreements. Some bilateral aviation agreements

provide that the air carriers of each country file their proposed

schedules for the approval of the other country's aviation authorities.

Air carriers required to file schedules in this way may not perform air

transportation without submitting their schedules for review. A

processing fee for schedule filings is warranted since the air carrier

is seeking the special benefit of the Department's approval of its

proposed schedule for engaging in revenue-producing air transportation.

Our proposed fee for this item is calculated as follows:

Direct Labor............................................... $1,253.03

Overhead................................................... 1,002.61

------------

Total Cost................................................. 2,255.64

============

Filings processed.......................................... 24

Cost per filing............................................ 93.99

Proposed fee, Item 51: per filing application.............. 94.00

U.S. Air Carrier International Route Authority, Exemptions,

Frequencies, and Charter Allocations: Schedule Items 52-58

The various items in this schedule category involve the

authorization of international air service rights. Under the United

States' pro-competitive international aviation policy (60 FR 21841),

the Department routinely grants such rights to all qualified

applicants, except in circumstances when the availability of rights is

artificially constrained. In the absence of constraints, the Department

requires only a simple application and acts to confer authority

expeditiously. When limits apply, however, as in the case of

restrictive bilateral agreements, and when applicants seek more

authority than can be granted, we must conduct a comparative proceeding

to select carriers (and in some cases gateways) for distribution of the

limited rights available. Compared with a non-contested proceeding, a

comparative proceeding typically entails substantially higher

processing costs because each applicant submits a detailed service

proposal with supporting data, which in turn are analyzed by the

Department and by competing applicants. Thereafter, the Department

issues a tentative decision; applicants respond to that decision and to

one another's arguments; and following consideration and analysis of

all pleadings, the Department issues its final decision.

In the interest of cost recovery, we are proposing that each

applicant initially pay the processing fee in effect for the relevant

non-contested air service rights (see items 52-56 below) and, if a

comparative proceeding proves necessary, remit an additional fee to

cover the additional cost (see item 57).

Schedule Item 52. Application for new, amended or renewed

certificate authority, comparative proceeding not required. Section

41101 of the Statute provides that an air carrier may perform air

transportation only if it holds a certificate of public convenience and

necessity authorizing the transportation. A processing fee for

applications under this item is warranted because in each instance of

new certificate authority, amendment to an extant authority, or

certificate renewal, the applicant is seeking the special benefit of

the Department's authorization to commence, change or continue revenue-

producing air transportation service.

The processing cost data collected under this schedule item do not

indicate a need for distinct processing fees among applications for

new, amended or renewed certificate authority. Therefore, we are

proposing a single fee as follows:

Direct Labor............................................... $6,306.10

Overhead................................................... 4,774.50

------------

Total Cost................................................. 11,050.60

============

Applications processed..................................... 17

Cost per application....................................... 650.04

Proposed fee, Item 52: per application..................... 650.00

Schedule Item 53. Application for new, renewal or amendment of

exemption authority, comparative proceeding not required. Section

40109(c) of the Statute provides that an air carrier may obtain an

exemption from section 41101 authorizing it to perform air

transportation without a certificate of public convenience and

necessity. A processing fee for this exemption authority is warranted

since, in each instance of new exemption authority, amended authority,

or exemption renewal, the applicant is seeking the special benefit of

the Department's authorization to commence, change or continue revenue-

producing air transportation without having a certificate of public

convenience and necessity.

As with applications for certificate authority (item 52, supra),

our processing cost data do not indicate a need for distinct fees among

new, amended and renewed exemption authority, and we are proposing the

following single fee:

Direct Labor............................................... $23,626.46

Overhead................................................... 18,036.22

------------

Total Cost................................................. 41,662.68

============

Applications processed..................................... 87

Cost per application....................................... 478.88

Proposed fee, Item 52: per application..................... 480.00

Schedule Item 54. Application for initial allocation of scheduled-

service

[[Page 3248]]

frequencies in limited-entry market, comparative proceeding not

required. Section 40105(b) of the Statute provides that the Department

shall, in carrying out Part A of the Statute, act consistently with

applicable international agreements. Some bilateral aviation agreements

limit the capacity of service, usually expressed in terms of number of

weekly flights or ``frequencies'' of various-sized aircraft that U.S.

air carriers may fly on the authorized routes. The Department must

allocate the available frequencies among applicant U.S. carriers and

establish the extent and duration of those allocations, taking public

interest considerations into account. Because the applicant for

scheduled-service frequencies is seeking the special benefit of the

Department's authorization to conduct revenue-producing air

transportation, a processing fee is warranted.

Our proposed fee for this schedule item is a follows:

Direct Labor............................................... $2,178.93

Overhead................................................... 1,600.09

------------

Total Cost................................................. 3,779.02

============

Applications processed..................................... 6

Cost per application....................................... 629.84

Proposed fee, Item 54: per application..................... 630.00

Schedule Item 55. Application for renewal of allocation of

scheduled-service frequencies in limited-entry market, comparative

proceeding not required. Initial allocations of limited scheduled-

service frequencies (item 54, supra) are made for finite terms,

typically one or two years, because of the need to weigh the effects of

any changes in market conditions. When the need for allocation

persists, limited-term allocations are renewed. Since the applicant for

frequency renewal seeks the special benefit of the Department's

approval to continue revenue-producing air transportation, a processing

fee is warranted. In contrast to the case of certificate or exemption

authority (items 52 and 53, supra), the cost of processing an

application for renewal of a frequency allocation is materially lower

than that for the initial frequency award. Accordingly, the proposed

fee for a renewal application is substantially lower:

Direct Labor............................................... $1,047.80

Overhead................................................... 769.95

------------

Total Cost................................................. 1,817.75

============

Applications processed..................................... 8

Cost per application....................................... 227.22

Proposed fee, Item 55: per application..................... 230.00

Schedule Item 56. Application for allocation of limited charter

flights, comparative proceeding not required. Section 40105(b) provides

that the Department shall, in carrying out Part A of the Statute, act

consistently with applicable international agreements. Some bilateral

aviation agreements limit, usually on a seasonal or annual basis, the

number of charter flights that may be operated. The Department must

allocate the available charters among applicant U.S. carriers before

each charter allocation period, balancing the applicants' expectations

against their historical performance and the need to reserve a portion

of the periodic allocation for emergencies or other unforeseen demand.

During the charter period, carriers must relinquish unused allocations,

and others may apply for additional flights. Since the applicant seeks

the special benefit of the Department's authorization to conduct

revenue-producing charter air transportation, a processing fee is

justified.

Our proposed fee for this schedule item is a follows:

Direct Labor............................................... $596.41

Overhead................................................... 458.14

------------

Total Cost................................................. 1,054.55

============

Applications processed..................................... 6

Cost per application....................................... 175.76

Proposed fee, Item 56: per application..................... 180.00

Schedule Item 57. Additional charge for an application for limited

authorities (Items 52-56 inclusive) when a comparative proceeding is

required. Schedule items 52-56 above apply to various forms of U.S.

carrier authority to serve foreign markets. As we describe earlier,

when applications exceed available rights, it falls to the Department

to conduct a comparative proceeding to determine the distribution of

those rights among applicants, resulting in significant additional

processing costs. It often is not known at the time of initial

application whether selection procedures will be required, because even

when rights are limited, the applications in aggregate may not exceed

the available rights. Therefore, we are proposing that each applicant

initially pay the fee applicable per items 52-56 above, and then remit

an additional fee with its first filing subsequent to the Department's

notice that a comparative proceeding is necessary.

Our proposed additional fee in the event of a comparative

proceeding is established as follows:

----------------------------------------------------------------------------------------------------------------

Cost per

Applications Total cost application

----------------------------------------------------------------------------------------------------------------

Carrier/gateway selection required.............................. 24 $95,266.01 $3,969.42

Selection not required (items 52-56)............................ 124 59,364.60 478.75

-----------------------------------------------

Incremental cost................................................ .............. .............. $3,490.67

===============================================

Proposed fee, Item 57: $3,490 per application

----------------------------------------------------------------------------------------------------------------

Schedule Item 58. Application to transfer foreign route/frequency

authority. Foreign route authority granted to a U.S. air carrier under

49 U.S.C. 41102 or 40109, along with any frequency allocation required

for its exercise, may not be transferred to another air carrier without

the Department's approval. A fee for processing an application for

transfer is warranted since the applicant is seeking the special

benefit of the Department's approval of an action needed by (1) the

transferee to engage in the revenue-producing air transportation under

the authority and (2) the transferor so that it may receive any

compensation provided for in the transfer agreement.

Our proposed fee for this item is calculated as follows:

Direct Labor............................................... $2,993.01

Overhead................................................... 2,061.49

------------

Total Cost................................................. 4,994.50

============

Applications processed..................................... 1

Cost per application....................................... 4,994.50

Proposed fee, Item 58: per application..................... 4,990.00

Code-Share, Wet-Lease, Transborder and Intermodal Authorizations:

Schedule Items 59-62

Schedule Item 59. Application for code-share Statement of

Authorization.

[[Page 3249]]

Schedule Item 60. Application for wet-lease Statement of

Authorization.

U.S. air carrier certificates issued under 49 U.S.C. 41102 and

foreign air carrier permits issued under 49 U.S.C. 41302 require that

code-share/wet-lease flights must be conducted in accordance with Part

212 of our rules. Part 212 provides that certain such arrangements

require specific prior approval in the form of a Statement of

Authorization, which the Department grants if it finds that approval

will be in the public interest. A processing fee is warranted because

the applicant is seeking the special benefit of the Department's

authorization to conduct an additional type of revenue-producing

operations in foreign air transportation.

While code shares and wet leases require the same form of

authorization and involve a similar special benefit, their application

processing costs differ materially. We therefore are proposing

different fees for schedule items 59 and 60, as follows:

Code Share

Direct Labor............................................... $15,820.70

Overhead................................................... 11,594.31

------------

Total Cost................................................. 27,415.01

============

Applications processed..................................... 25

Cost per resolution........................................ 1,096.60

Proposed fee, Item 59: per application..................... 1,100.00

Wet Lease

Direct Labor............................................... 2,679.05

Overhead................................................... 2,084.40

------------

Total Cost................................................. 4,763.45

============

Applications processed..................................... 16

Cost per application....................................... 297.72

Proposed fee, Item 60: per application..................... 300.00

Schedule Item 61. [Reserved.]

Schedule Item 62. Application for Statement of Authorization to

conduct intermodal services provided for in bilateral agreement. Part

222 of the Department's regulations provides that a foreign air

carrier, whose homeland government has executed an agreement with the

United States exchanging air freight intermodal rights, may obtain

authorization to perform such services in the United States by applying

to the Office of International Aviation. (Part 222 also provides that a

foreign air carrier seeking such authority not covered by a bilateral

agreement must apply for an exemption under 49 U.S.C. 40109, in which

instance the application is processed under schedule item 53, exemption

authority, above.) The Department grants an intermodal statement of

authorization if it will be in the public interest. An application

processing fee is warranted because the applicant is seeking the

special benefit of the Department's authorization to conduct revenue-

producing operations in foreign air transportation.

Our proposed fee for this item is calculated as follows:

Direct Labor............................................... $488.35

Overhead................................................... 390.82

------------

Total Cost................................................. 879.17

============

Applications processed..................................... 3

Cost per application....................................... 293.06

Proposed fee, Item 62: per application..................... 290.00

Regulation of Tariffs and Rates: Schedule Items 63-69

Schedule Item 63. Approval of inter-carrier agreement(s), agreement

type To and/or from the U.S.

Schedule Item 64. Approval of inter-carrier agreement(s), agreement

type Foreign-to-foreign.

Schedule Item 65. Approval of inter-carrier agreement(s), Technical

correction. Section 41309 of the Statute provides for the filing of

inter-carrier agreements with the Department for approval and

consequent grant of antitrust immunity. The Department's implementing

regulations (14 CFR Part 303) require carriers seeking approval of an

inter-carrier agreement to submit and have approved by the Department

an application in the manner prescribed by the regulation. A processing

fee for such applications is justified since the applicant is seeking

the special benefit of the Department's approval of immunity from the

antitrust laws of the United States.

Our proposed fees for schedule items 63, 64 and 65, shown below,

reflect differences in their respective processing costs. The fee for

item 63 and 64 is per resolution while that for item 65 is per

application.

To/from U.S.

Direct Labor............................................... $10,502.46

Overhead................................................... 7,722.49

------------

Total Cost................................................. 18,224.95

============

Resolutions processed...................................... 216

Cost per resolution........................................ 84.37

Proposed fee, Item 63: per resolution...................... 84.00

Foreign-to-foreign

Direct Labor............................................... 1,080.05

Overhead................................................... 864.35

------------

Total Cost................................................. 1,944.40

============

Resolutions processed...................................... 417

Cost per resolution........................................ 4.66

Proposed fee, Item 64: per resolution...................... 5.00

Technical correction

Direct Labor............................................... 195.36

Overhead................................................... 156.34

------------

Total Cost................................................. $351.70

============

Applications processed..................................... 23

Cost per application....................................... 15.29

Proposed fee, Item 65: per application..................... 15.00

Schedule Item 66. Application for an exemption under 49 U.S.C.

40109 to carry traffic not otherwise authorized under tariffs in

effect. Under section 41504 of the Statute and section 221.3 of the

Department's regulations, air carriers and foreign air carriers are

required to file tariffs for scheduled foreign air transportation of

persons, and may carry such traffic only for the prices stated in those

tariffs. When a carrier wishes to carry revenue traffic for which it

does not have an effective tariff on file, or wishes to carry such

traffic at a price other than that in its applicable tariff, it must

obtain an exemption from the Department under section 40109 of the

Statute. A processing fee is warranted since the applicant for this

exemption seeks the special benefit of the Department's authorization

to conduct revenue-producing foreign air transportation not otherwise

authorized by a tariff in effect.

No applications under this schedule item were processed during the

cost-collection period, and we have no other basis to propose a

modification of the current fee or to assume that fee costs have

changed. Accordingly, the current fee of $53 per Application is

retained.

Schedule Item 67. Application for permission to file tariffs on

less than statutory notice. Section 41504 of the Statute and section

221.160 of the regulations provide that required tariffs are to be

filed a certain number of days before those tariffs can take effect.

Under Subpart P of the regulations, however, carriers may request

permission to have their tariffs take effect in less than the

statutorily required notice period. A processing fee is warranted since

the applicant for this Special Tariff Permission seeks the special

benefit of the Department's authorization to implement tariffs on

shorter notice than statutorily required.

The basis of our proposed fee for this item is as follows:

Direct Labor............................................... $2,124.07

Overhead................................................... 1,700.04

------------

Total Cost................................................. 3,824.11

============

Applications processed..................................... 95

Cost per application....................................... 40.25

Proposed fee, Item 67: per application..................... 40.00

Schedule Item 68. Application for approval of waiver/modification

of tariff regulations. Section 221.200 of the regulations provides that

air carriers and

[[Page 3250]]

foreign air carriers may apply to the Department for a waiver or

modification of the requirements contained in part 221 (Tariffs). An

application processing fee for such waiver or modification is warranted

since the applicant seeks the special benefit of the Department's

approval for relief from provisions of the requirements regulating

tariffs.

No applications under this schedule item were processed during the

cost-collection period, and we have no other basis to propose a change

in the current fee or to assume that fee costs have changed.

Accordingly, the current fee of $12 per Application is retained.

Schedule Item 69. Application for provision of certified copies of

tariff material upon request (with DOT seal). Section 389.15 of the

regulations provides that certified copies of tariffs filed with the

Department will be provided upon request. Certification of these data

are required in civil cases in order for parties to formally submit air

carrier tariff provisions involving charges and conditions of carriage

in international air transportation officially filed with the

Department. A fee for providing this service is warranted because of

the special benefit to the applicant of having certified copies of

officially filed tariff material for use in legal proceedings.

The basis of our proposed fee is as follows:

Direct Labor............................................... $807.58

Overhead................................................... 646.30

------------

Total Cost................................................. 1,453.88

============

Applications processed..................................... 6

Cost per application....................................... 242.31

Proposed fee, Item 69: per application..................... 240.00

Other Exemptions and Authorizations: Schedule Items 70-76

Schedule Item 70. Application for an exemption for slots at a slot-

controlled airport. Under section 41714 of the Statute, an air carrier

may apply to the Department for an exemption from 14 CFR Part 93,

Subparts K and S (the High Density Rule), in order for the carrier to

increase its number of operations (takeoff or landing ``slots'') at

JFK, La Guardia, and/or O'Hare airports (Reagan National also is slot

controlled, but is excluded from the exemption). Recognizing that air

carriers may be restrained from entering markets as consequence of slot

restrictions, the Congress provided the exemption mechanism as a way to

increase air carrier access at three of the four slot-controlled

airports. A processing fee for a slot exemption application is

justified since the applicant is seeking the special benefit of the

Department's authorization enabling access to takeoff and landing

rights that otherwise would not be available.

Our proposed fee for this item is based on the following:

Direct Labor............................................... $11,155.93

Overhead................................................... 6,211.62

------------

Total Cost................................................. 17,367.55

============

Applications processed..................................... 4

Cost per application....................................... 4,341.89

Proposed fee, Item 70: per application..................... 4,340.00

Schedule Item 71. Motion for confidential treatment of documents.

Section 302.39 of the Department's Procedural Regulations sets forth

the procedures that an applicant or other party must follow in seeking

the Department's concurrence to withhold certain information from

public disclosure in the context of a Departmental proceeding. A

processing fee for this item is justified since the applicant is

seeking the special benefit of the Department's approval to withhold

sensitive information.

Our proposed fee for this item is determined as follows:

Direct Labor............................................... $499.57

Overhead................................................... 253.37

------------

Total Cost................................................. 752.94

============

Applications processed..................................... 2

Cost per application....................................... 376.47

Proposed fee, Item 71: per application..................... 380.00

Schedule Item 72. Application for approval of and antitrust

immunity for inter-carrier agreements. Under sections 41308 and 41309

of the Statute, air carriers and foreign air carriers may seek approval

of antitrust immunity for agreements and activities with common

business objectives. Applicants seek the benefit of this immunity in

order to protect themselves from lawsuits alleging behavior normally

not permitted under the antitrust laws. A processing fee is warranted

since the applicant is seeking the special benefit of the Department's

approval of immunity from antitrust enforcement.

No applications under this schedule item were concluded during the

cost-collection period, and we have no other basis to propose a change

in the current fee or to assume that fee costs have changed.

Accordingly, the current fee of $1,080 per Application is retained.

Schedule Item 73. [Reserved.]

Schedule Item 74. [Reserved.]

Schedule Item 75. Petition for a change in mail rates. Section

41901 of the Statute provides that the United States Postal Service or

a certificated air carrier may file a petition with the Department to

change the mail rates set by the Department to be paid by the Postal

Service to U.S. air carriers for the carriage of U.S. mail between the

United States and foreign countries and/or within the State of Alaska.

A fee for processing a petition is warranted since the petitioner is

seeking the special benefit of the Department's approval to change

existing mail rates.

No applications under this schedule item were processed during the

cost-collection period, and we have no other basis to propose a change

in the current fee or to assume that fee costs have changed.

Accordingly, the current fee of $420 per Application is retained.

Schedule Item 76. Application for overseas military personnel

charter operator authority. Under Part 372 of the Department's

regulations, any U.S. citizen desiring to operate as an overseas

military personnel charter operator may apply to the Department for

operating authority. If granted this authority, the operator is

relieved from provisions of section 41102 of the Statute for the

purpose of enabling the operator to provide overseas military personnel

charters utilizing aircraft chartered from direct air carriers or

foreign air carriers. A processing fee is warranted since the applicant

is seeking the special benefit of the Department's permission to

advertise, organize, provide, sell and/or offer to sell overseas

military personnel charters.

No applications under this schedule item were processed during the

cost-collection period, nor has the Department had occasion to process

any such applications for several years. Absent evidence of a cost

change, the current fee of $665 per Application is retained.

[FR Doc. 99-1233 Filed 1-20-99; 8:45 am]

BILLING CODE 4910-62-P