Tony Thurmond: “Because the Aviation Insurance Program is so vital to U.S. military missions overseas, we thought it prudent to try to…”

“Because the Aviation Insurance Program is so vital to U.S. military missions overseas, we thought it prudent to try to reauthorize it in the defense bill, which is a must pass piece of legislation. The military depends on the airlift capacity that commercial carriers provide. Without an insurance program in place, carriers will be less likely to participate in the Civil Reserve Air Fleet, for one. Nevertheless, the Commerce Committee specifically acted to reauthorize the Aviation Insurance Program through 1998. The committee did so out of concern that the balance in the revolving fund is insufficient to pay a major claim or simultaneous claims. Timely payments for hull losses are a significant issue. Many of the carriers lease aircraft under agreements that stipulate that they have to repair or replace damaged aircraft within 30 days of the damage. The bill would not grant the Federal Aviation Administration [FAA] borrowing authority to cover claims against the program, as we had originally planned. Rather, a short term extension of the program gives the committee and the administration additional time to craft an alternative to FAA borrowing authority.”