What's the latest on the "Common Purpose" cost sharing system?

[peter-h]

I fly an N-reg aircraft and never accept anything from passengers.

However, the FAA does allow cost sharing, subject to everybody cost sharing having the same "common purpose".

Some interpretations (NTSB ) of this seem extremely restrictive and IMHO out of line with what normal people might be doing. One could even think that if the pilot flies to some town for the $200 burger, while one of the passengers eats nothing and instead takes photos of the beach, that fails the test.

In the above case, one might argue that both a $200 burger and taking beach photos are equally trivial and thus meet the test, but just how non-trivial does the "common purpose" need to be?

What about 1 person going to a business meeting while another not going to the same meeting?

A slightly more apparently illegal scenario would be one where, on a 3-ways cost-shared flight, one person is receiving instruction from an instructor while another is not (3 people total).

What is the latest US case law on this?

Here in the UK, cost sharing is banned in any non-G-reg aircraft anyway, but we don't have any "common purpose" requirement at all.

 

[midlifeflyer]

Pretty much what you described.

I don't think the FAA and NTSB will ever come up with a hard and fast rule with a bright line dividing what it considers transportation for hire and proper shared expenses, unless it's to simply prohibit sharing costs altogether. Too many clever folks out there with creative ways of trying to fit a grey charter into the shared expense exception.

(Hmm... if I transport Mr. Jones and his family in my 210 for their vacation but have a hamburger when I get there, I can just claim....")

I think we're much stuck with a "quacks like a duck" case by case analysis analysis.

 

[MauleSkinner]

IIRC, one of John Yodice's articles in AOPA involved a "common purpose" violation when the the pilot and his wife went to dinner at a restaurant that "they wanted to try sometime" and the cost-sharing passenger was doing business or visiting someone in the hospital or something like that.

The bottom line on the violation was that, while the pilot and his wife wanted to try the restaurant "sometime", they weren't already planning the trip for that time. The FAA decided that the trip was flown on the passenger's schedule, and was therefore an illegal charter.

 

[poadeleted20]

Some interpretations (NTSB ) of this seem extremely restrictive and IMHO out of line with what normal people might be doing. One could even think that if the pilot flies to some town for the $200 burger, while one of the passengers eats nothing and instead takes photos of the beach, that fails the test.

I don't think that's true, and if you saw something which gave you that idea, then I'd like to see it.

In the above case, one might argue that both a $200 burger and taking beach photos are equally trivial and thus meet the test, but just how non-trivial does the "common purpose" need to be?

The FAA's test is pretty much that the flight already be planned by the pilot as to destination and date/time of flight:

from Eastern Region Counsel letter, October 25, 2005
"...the flight must be one for a common purpose of all the aircraft occupants, i.e., going to a destination at which the pilot and passengers have business or other activities. 1 FEDERAL AVIATION DECISIONS, Interpretation 1977-81 (citing former § 61.118(b), which simply provided, "A private pilot may share the operating expenses of a flight with his passengers") (Clark Boardman Callaghan, 1993); id., Interpretation 1978-79; see also 2 FEDERAL AVIATION DECISIONS, Interpretation 1985-26 (1993). ... The ability of pilots to list flights with no specificity as to dates or points of operation would appear to ignore the common purpose requirement.

What about 1 person going to a business meeting while another not going to the same meeting?

It seems to be the destination, not the reason for being there, as long as you all have a reason to be there other than to fly the plane. IOW, if you are going to a football game while your buddy is going to a gun show going on at the same time in the convention center across across from the stadium, I think the two of you have a common purpose for the flight -- same destination airport, same time.

A slightly more apparently illegal scenario would be one where, on a 3-ways cost-shared flight, one person is receiving instruction from an instructor while another is not (3 people total).

If the three people include the instructor, and the instructor has no other reason for the trip than to instruct, but is still sharing the cost, then yes, that would seem to violate the rule, since the instructor has no "common purpose" for the trip. OTOH, if the instructor is not sharing the cost, and the only costs shared among those who do have a "common purpose" for the flight are the direct costs of the flight (but not the instructor's fee), then I don't see a problem.

What is the latest US case law on this?

More important than case law is a recent interpretation from the FAA -- the Mangiamele letter, which contradicts much of what the FAA has said on the subject over the last 40 years, and is currently under appeal for reconsideration:

http://www.faa.gov/about/office_org...erpretations/data/interps/2009/Mangiamele.pdf

However, the later Bobertz letter appears to follow more traditional FAA thinking:

http://www.faa.gov/about/office_org...interpretations/data/interps/2009/Bobertz.pdf

 

[peter-h]

Thank you Ron - those two FAA letters will take a fair bit of time to digest

It seems to be the destination, not the reason for being there, as long as you all have a reason to be there other than to fly the plane. IOW, if you are going to a football game while your buddy is going to a gun show going on at the same time in the convention center across across from the stadium, I think the two of you have a common purpose for the flight -- same destination airport, same time

The above is an interesting interpretation. I did not realise the common location determined the common purpose. That would make most private sharing scenarios OK because fairly obviously they will be going to the same airport!

As regards an illegal charter, I don't see how the pilot/operator can ever make money given that he cannot ever recover the full cost of the flight. It might be illegal under the "common purpose" rule but if the pilot is not making a profit then why would he bother doing the flight?

 

[poadeleted20]

As regards an illegal charter, I don't see how the pilot/operator can ever make money given that he cannot ever recover the full cost of the flight. It might be illegal under the "common purpose" rule but if the pilot is not making a profit then why would he bother doing the flight?

The regs doesn't discuss whether you make a profit or not, only whether money or other compensation changed hands. That saves the FAA from getting into a quibble over whether or not a profit was made.

 

[Palmpilot]

However, the later Bobertz letter appears to follow more traditional FAA thinking:

http://www.faa.gov/about/office_org...interpretations/data/interps/2009/Bobertz.pdf

Your interpretations seem reasonable. Let's hope the FAA is as reasonable.

One thing that really annoys me, though, is this passage from the Bobertz letter:

Generally, accrual of flight time is compensation and the FAA does not enter into a caseby-case analysis to determine whether the logging of flight time is of value to a particular pilot. Legal Interpretation to John W. Harrington, from Donald Byrne, Assistant Chief Counsel (Oct. 23, 1997) [1997-23].

The thing that bothers me is that the statement is so broad, implying that logging of flight time is always compensation.​

If I were making the decision, logging of flight time would only count as compensation if someone other than the pilot were paying the expenses of the flight (partially or wholly). If someone provides me with a plane and doesn't charge me rent for it, then fine, I'm receiving compensation. But if it's my plane and I'm paying all the expenses, or if it's a rental plane for which I'm paying the full rental and other expenses, then it's not compensation - it's just me getting what I paid for. If go to a store and buy a dozen eggs, the eggs are not compensation, they're what I paid for. The fact that I choose to give someone a free ride is irrelevant, because I could have just as easily flown to the destination as a joyride for the same cost.​

I hope that's the way the FAA sees it.​

And yes, I'm aware of the exception to what I'm saying in the case where a pilot received goodwill from someone he did business with. In that case, I would say that the compensation was the goodwill, not the logbook entry.​

BTW, the Civil Air Patrol instructs pilots not to log the time in certain situations, as a way to avoid compensation issues. Do you think that would work in general? (In other words, I'm not asking about the CAP-specific situation.)​

 

[poadeleted20]

Your interpretations seem reasonable. Let's hope the FAA is as reasonable.

One thing that really annoys me, though, is this passage from the Bobertz letter:

The thing that bothers me is that the statement is so broad, implying that logging of flight time is always compensation.

It's not always "compensation," but it always has value, and hence can comprise compensation if it is obtained in exchange for something else, like provision of air transportation.

If I were making the decision, logging of flight time would only count as compensation if someone other than the pilot were paying the expenses of the flight.

That's more or less how the FAA views it.

If someone provides me with a plane and doesn't charge me rent for it, then fine, I'm receiving compensation.

Only if you are providing something in return, such as air transportation or pilot services. If they just let you fly the plane free, with no strings attached (no quid pro quo, Clarisse), there's no compensation, since compensation requires an exchange of items of value (goods, services, money, etc).

But if it's my plane and I'm paying all the expenses, or if it's a rental plane for which I'm paying the full rental and other expenses, then it's not compensation - it's just me getting what I paid for.

Right.

If go to a store and buy a dozen eggs, the eggs are not compensation, they're what I paid for.

However, if instead of paying for them you agree to sweep out the store in exchange for the eggs, then they are "compensation."

The fact that I choose to give someone a free ride is irrelevant, because I could have just as easily flown to the destination as a joyride for the same cost.

As long as they don't pay you anything, and don't give you anything else of value in return for the ride, then there is no "compensation" and you have done nothing wrong.

And yes, I'm aware of the exception to what I'm saying in the case where a pilot received goodwill from someone he did business with. In that case, I would say that the compensation was the goodwill, not the logbook entry.

In that case, you are correct.

BTW, the Civil Air Patrol instructs pilots not to log the time in certain situations, as a way to avoid compensation issues. Do you think that would work?

The FAA has said in some interpretations that flight time is only compensation if it is logged. However, I'd be interested to know in what situations the CAP says not to log the time, since the only free time I know of the CAP providing is in SAR efforts, and the FAA has exempted that from the no-compensation rule -- see 61.113(e). In any other situation, I'd think the CAP would want to avoid even the appearance of impropriety, and hiding the otherwise-illegal flight by not logging it would seem to me something which they would avoid.​

 

[Areeda]

The way I see this is that the FAA uses the duck test.

If the purpose of the flight is to get someone or something somewhere else it should be done by someone with a 135 certificate.

If the pilot has a good reason to go to that place, that time and takes someone with them it's ok. I think that reason has to exist before the passenger or property presents itself too.

I admit I may be naive.

Joe

 

[poadeleted20]

I think Joe is quacking to the FAA's tune.

 

[Palmpilot]

The FAA has said in some interpretations that flight time is only compensation if it is logged. However, I'd be interested to know in what situations the CAP says not to log the time, since the only free time I know of the CAP providing is in SAR efforts, and the FAA has exempted that from the no-compensation rule -- see 61.113(e). In any other situation, I'd think the CAP would want to avoid even the appearance of impropriety, and hiding the otherwise-illegal flight by not logging it would seem to me something which they would avoid.

CAP does, on occasion, fly people and property who are neither CAP nor USAF personnel. Often it's emergency services personnel from other agencies. I once flew a kidney overnight for transplant in the San Diego area. On 9/12/2001 and again later in the week I participated in flying blood samples to Red Cross labs in Portland, OR and the L.A. area. Depending on the circumstances, refraining from logging may apply to CAP pilots who do not have a commercial pilot certificate or higher (with a class 2 medical or higher). Details at this link:

http://www.capmembers.com/media/cms/FAR_EXEMPTIONS_FOR_CAP_AIRCRAFT_OPE_CDAB0D431F658.pdf

(See Note 1 at the bottom.)

BTW, there have been times in the past when CAP has not been particularly proficient at avoiding the appearance of impropriety.

 

[poadeleted20]

CAP does, on occasion, fly people and property who are neither CAP nor USAF personnel. Often it's emergency services personnel from other agencies. I once flew a kidney overnight for transplant in the San Diego area. On 9/12/2001 and again later in the week I participated in flying blood samples to Red Cross labs in Portland, OR and the L.A. area. Depending on the circumstances, refraining from logging may apply to CAP pilots who do not have a commercial pilot certificate or higher (with a class 2 medical or higher).

If the CAP is paying for the flights, and not the pilots involved, there's no question based on past FAA rulings that pilots without both a CP/ATP and a medical valid Second Class would be in violation if they logged these flights. I can't say for sure whether or not they constitute a violation without that logging, but the lack of a "common purpose" for those flights always makes the FAA sit up and take notice. I'd be interested to know if the FAA Chief Counsel has reviewed that policy. In particular, if it can be shown the CAP obtains any compensation from the labs or hospitals or whatever (including "goodwill") in return for having transported the blood/organs/etc, it would appear to be a Part 135 violation for both CAP and the pilot involved whether the pilot logs the time or not.

 

[JeffDG]

More important than case law is a recent interpretation from the FAA -- the Mangiamele letter, which contradicts much of what the FAA has said on the subject over the last 40 years, and is currently under appeal for reconsideration:

http://www.faa.gov/about/office_org...erpretations/data/interps/2009/Mangiamele.pdf

Sweeet! Glad it's being reconsidered! We've discussed that letter at length in other forums!

 

[Palmpilot]

If the CAP is paying for the flights, and not the pilots involved, there's no question based on past FAA rulings that pilots without both a CP/ATP and a medical valid Second Class would be in violation if they logged these flights. I can't say for sure whether or not they constitute a violation without that logging, but the lack of a "common purpose" for those flights always makes the FAA sit up and take notice. I'd be interested to know if the FAA Chief Counsel has reviewed that policy.

Generally, the pilot is reimbursed by CAP, and I think that CAP is reimbursed by the outside agency, if any, for whom the flight is made.

I would hope that the reimbursement policy at the link I provided has been reviewed by the CAP General Counsel's office, but I don't know whether it has been reviewed by the FAA. I always figured that if I started hearing of CAP pilots getting violations over it, then I would start worrying.

Presumably, CAP's activities are undertaken pursuant to its Congressional charter, so that might figure into it somewhere as well.

 

[midlifeflyer]

The regs doesn't discuss whether you make a profit or not, only whether money or other compensation changed hands. That saves the FAA from getting into a quibble over whether or not a profit was made.

A profit test also wouldn't work. A few years back airlines were operating at a loss. Many pilots would be more than willing to fly cargo and charter, have customers simply defray part of their costs and avoid Part 13 altogether.

And it's not even "change hands." I don't the phrase has been used, but the cases and opinions, including those about flight time, good will and tax deductions as compensation, all point to a "the pilot gets a benefit for performing a service" as one of the tests for receiving compensation.

 

[Henning]

If the CAP is paying for the flights, and not the pilots involved, there's no question based on past FAA rulings that pilots without both a CP/ATP and a medical valid Second Class would be in violation if they logged these flights. I can't say for sure whether or not they constitute a violation without that logging, but the lack of a "common purpose" for those flights always makes the FAA sit up and take notice. I'd be interested to know if the FAA Chief Counsel has reviewed that policy. In particular, if it can be shown the CAP obtains any compensation from the labs or hospitals or whatever (including "goodwill") in return for having transported the blood/organs/etc, it would appear to be a Part 135 violation for both CAP and the pilot involved whether the pilot logs the time or not.

Here's the question I come up with to that. Since CAP is the Auxiliary arm of the USAF, does the CAP and the pilots operating under the jurisdiction of the CAP come under the auspices of the FAA at all, or are they exempted as State Aircraft like the rest of the Air Force and other governmental agencies?

 

[Palmpilot]

Here's the question I come up with to that. Since CAP is the Auxiliary arm of the USAF, does the CAP and the pilots operating under the jurisdiction of the CAP come under the auspices of the FAA at all, or are they exempted as State Aircraft like the rest of the Air Force and other governmental agencies?

According to the document at the link in my previous post, the FAA ruled in 1981 that CAP aircraft are civil aircraft, not public aircraft, and are therefore subject to the Federal aviation regulations.

 

[bluesky74656]

If the pilot has a good reason to go to that place, that time and takes someone with them it's ok. I think that reason has to exist before the passenger or property presents itself too.

So, if I say to a friend, "I would love to take you for a ride, so call me next time you're in town and we'll go," it would be illegal because he is setting the date/time for the flight and not me? That is assuming he paid his share of the flight.

Furthermore, there are various types of airport restaurants within a reasonable distance. If I ask him if he's in the mood for burgers or Italian does that make the flight illegal because in effect he is choosing the destination?

That's what it sounds like to me... but I feel that it doesn't pass the duck test.

 

[poadeleted20]

Sweeet! Glad it's being reconsidered! We've discussed that letter at length in other forums!

I didn't say it's being reconsidered, I said it's under appeal for reconsideration. We'll see whether they reconsider it or not.

 

[poadeleted20]

Generally, the pilot is reimbursed by CAP, and I think that CAP is reimbursed by the outside agency, if any, for whom the flight is made.

If that's true, it sounds like the CAP is running an air transportation for hire scheme, and that takes a 135 certificate.

I would hope that the reimbursement policy at the link I provided has been reviewed by the CAP General Counsel's office, but I don't know whether it has been reviewed by the FAA. I always figured that if I started hearing of CAP pilots getting violations over it, then I would start worrying.

No telling if the FAA's aware of the outside payments or not. And the CAP General Counsel doesn't have the authority to decide whether or not the FAA's rules are being broken.

Presumably, CAP's activities are undertaken pursuant to its Congressional charter, so that might figure into it somewhere as well.

That line at the top about being civil, not public, aircraft and having to obey the FAA's rules says that won't matter. I'd be wary of participating in such activities if I were in the CAP and found out the CAP was getting paid for providing that transportation by party benefitting from the transport.

 

[poadeleted20]

So, if I say to a friend, "I would love to take you for a ride, so call me next time you're in town and we'll go," it would be illegal because he is setting the date/time for the flight and not me? That is assuming he paid his share of the flight.

I believe so. Pay for the flight yourself, and there's no issue.

Furthermore, there are various types of airport restaurants within a reasonable distance. If I ask him if he's in the mood for burgers or Italian does that make the flight illegal because in effect he is choosing the destination?

Not if you're paying for the flight.

Note, however, that the FAA won't check to see who paid for lunch.

 

[John Baker]

It does not matter how any of us elect to interpret the regulation, the only thing that matters is how the FAA & NTSB interpret it. Even that has little to do with the regulation itself, but more on the mood of the enforcing officer. Aerobatics over a densely populated area has been officially interpreted as three buildings on a farm. The pilot lost that case.

The only thing we can do is try our best to follow the rules as they are written. Trying to find a little "wiggle room" in those regulations can only lead to costing you a whole bunch of money and time.

You can, if you decide, fly anyone, anywhere, for any amount of money. Your biggest risk is if one of your "passengers" is injured in some way and decides to sue you. Your insurance will not kick in, and you can bet that the FAA will be all over it like a dog in heat.

So, for a few hundred dollars, your going to risk all that you now own or may ever own. Once someone has won a judgment against you, they can keep going after you until they have been paid in full.

I guess some people can pull it off without a hitch, but for myself, every time I have ever tried to get slick, it always backfired on me. It just is not worth the risk.

John

 

[Palmpilot]

If that's true, it sounds like the CAP is running an air transportation for hire scheme, and that takes a 135 certificate.

FAA exemption # 6485, which is referenced in the document I linked, seems to say otherwise.

http://aes.faa.gov/

And the CAP General Counsel doesn't have the authority to decide whether or not the FAA's rules are being broken.

Should everyone go directly to the FAA Chief Counsel's Office on everything, and not rely on the advice of attorneys knowledgeable in the subject matter?

That line at the top about being civil, not public, aircraft and having to obey the FAA's rules says that won't matter.

I seriously doubt that CAP is acting outside the authority granted to it by Congress, and I'm quite sure that the FAA does not have the Constitutional authority to override Congress. That could have something to do with why the FAA granted CAP's two exemption requests.

I'd be wary of participating in such activities if I were in the CAP and found out the CAP was getting paid for providing that transportation by party benefitting from the transport.

Don't worry: If you ever join CAP, no one will force you to accept those missions. Meanwhile, if you're seriously concerned about it, I'm sure the CAP General Counsel's office can explain it better than I can. Here's their contact info:

http://members.gocivilairpatrol.com/cap_national_hq/general_counsel/

 

[poadeleted20]

FAA exemption # 6485, which is referenced in the document I linked, seems to say otherwise.

http://aes.faa.gov/

I did not see that in the document, but after reviewing it, I agree that this exemption appears to cover reimbursement for blood/organ transport missions on behalf of nonprofit organizations. However, I also note the following limitation in that exemption:

3. The pilot in command (PIC) conducting operations under
this exemption must hold a commercial pilot certificate
with appropriate category and class ratings for the
aircraft to be used in the operation. The PIC also
must hold an instrument rating except when conducting
day VFR flights within 50 nautical miles of the
departure airport.

4. The PIC conducting operations under this exemption must
hold at least a current second-class medical
certificate.

Given that, the use of a Private Pilot for those missions would violate that exemption and the bolded part of 61.113:

(a) Except as provided in paragraphs (b) through (g) of this section, no person who holds a private pilot certificate may act as pilot in command of an aircraft that is carrying passengers or property for compensation or hire; nor may that person, for compensation or hire, act as pilot in command of an aircraft.

...even if the pilot does not log it and thus not also violate the italicized part.

Should everyone go directly to the FAA Chief Counsel's Office on everything, and not rely on the advice of attorneys knowledgeable in the subject matter?

Given some of the odd rulings that have come out of the Chief Counsel's office over the last few years, I think it would be wise to do so before doing something that might be contstrued as a Part 135 violation. However, in this case, it appears the CAP General Counsel already decided this operation would violate those rules (as I thought it would), but obtained the proper exemption from the FAA Chief Counsel -- at least as far as the use of CP/ATP pilots holding medical certificates valid as Second Class. OTOH, the use of Private Pilots appears forbidden, and simply not logging the flight time does not appear sufficient to avoid a violation if PP's are used for those missions.

 

[midlifeflyer]

Don't give up so easily, Ron. Use the search engine there to l ook up Civil Air Patrol or better yet, plug in 61.113(e) in the reg box. You'll find it.

 

[poadeleted20]

Don't give up so easily, Ron. Use the search engine there to l ook up Civil Air Patrol or better yet, plug in 61.113(e) in the reg box. You'll find it.

I found Exemptions 8691, but that only covers cadet orientation flights ("This exemption applies only to a flight or series of flights directly related to CAP cadet orientation flights. No corporate missions may be operated under this exemption."), and it allows logging, too. I also found 6771 regarding SAR flights, but that's another story and now covered by 61.113(e). I haven't found one which allows PP's to fly missions where third parties are paying for transportation of blood/organs. Am I still missing something?

 

[Areeda]

So, if I say to a friend, "I would love to take you for a ride, so call me next time you're in town and we'll go," it would be illegal because he is setting the date/time for the flight and not me? That is assuming he paid his share of the flight.

Furthermore, there are various types of airport restaurants within a reasonable distance. If I ask him if he's in the mood for burgers or Italian does that make the flight illegal because in effect he is choosing the destination?

That's what it sounds like to me... but I feel that it doesn't pass the duck test.

The problem as I see it is that there are no hard and fast rules primarily because so much effort goes into getting around the rules.

I agree neither of your scenarios pass the duck test for me either.

If a friend comes into town, one of my favorite ways to entertain them is to take them for a flight to have lunch. If they want to pay their share fine, if not it's no big deal.

Ron's solution works for me. When in doubt don't let them pay.

Joe

 

[Palmpilot]

Given that, the use of a Private Pilot for those missions would violate that exemption and the bolded part of 61.113:
...even if the pilot does not log it and thus not also violate the italicized part.

I think you're right. Looks to me like Note 1 in the CAP document is without a legal basis. It seems to be saying that a PP can accept full reimbursement for third party missions if he doesn't log it, and that makes no sense to me at all. It also seems to say that a PP can accept partial reimbursement for such missions by paying a pro rata share of the expenses, but that flies in the face of the common purpose doctrine.

I have a CP certificate, but I long ago decided that I would not accept third party missions, other than USAF-assigned missions, when I didn't have a Class 2 medical that was less than a year old because the rules for private pilots looked like more complexity than I wanted to deal with. (I've always referred to that particular CAP document as the "Frankenstein's monster" regulation!) Looks like my instincts were correct.

Given some of the odd rulings that have come out of the Chief Counsel's office over the last few years, I think it would be wise to do so before doing something that might be contstrued as a Part 135 violation.

In this case, it looks like consulting them is not even necessary. Just reading the regs and exemptions is sufficient to see the problem.

I hereby retract my implied faith in the judgment of CAP's legal department!

One thing I had forgotten is that CAP HQ does not have a great track record of protecting the legal interests of its pilots. Some years ago they put in a regulation that allowed pilots to be assessed for the full damage to a CAP aircraft if the corporation (in its sole judgment!) deemed the pilot to be negligent in some way. Given the predominance of pilot error in accident causes, this was tantamount to completely eliminating pilot coverage under CAP's hull insurance. As a result, a lot of pilots stopped flying CAP missions altogether, until HQ relented and put in reasonable limits to pilot liability depending on the severity of the negligence.

 

[Palmpilot]

I found Exemptions 8691, but that only covers cadet orientation flights ("This exemption applies only to a flight or series of flights directly related to CAP cadet orientation flights. No corporate missions may be operated under this exemption."), and it allows logging, too. I also found 6771 regarding SAR flights, but that's another story and now covered by 61.113(e). I haven't found one which allows PP's to fly missions where third parties are paying for transportation of blood/organs. Am I still missing something?

6771 is also cited in the CAP document we have been discussing. It's only partially covered by 61.113(e) because the latter does not have a provision for per diem payments or servicing and maintenance costs, and because the exemption applies to all USAF-assigned missions, not just "search and location" missions. There is an extensive list of examples in the exemption.

I didn't think you'd want to get into the details of CAP's operations, but I guess it was just too tempting a morsel to pass up!

BTW, I'm never figured out why the FAA felt it was necessary to use the term "search and location operations," instead of just "search operations." Seems redundant, since locating the target is, after all, the desired result of a search.

 

[EdFred]

Don't log it, don't accept anything but cash, and don't file IFR.

 

[TangoWhiskey]

Sweeet! Glad it's being reconsidered! We've discussed that letter at length in other forums!

Wow, that Mangiamele letter references a letter sent to our own Tim Metzinger! Small world.

 

[peter-h]

I have a slightly related question:

What US regs apply to syndicates (owner groups; not sure what the US name is) around an aircraft?

Here in the UK, up to 20 people can own it (or be shareholders in a limited company owning it) but nobody may own less than 5% - unless the aircraft is maintained to a specified higher level in which case there is no restriction on the # of owners etc.

The non-direct costs are shared out between all the shareholders.

Is it possible for an N-reg to be owned by say 2 people, one having a 1% share and the other having a 99% share, and they share the non-direct costs accordingly?

 

[TMetzinger]

I have a slightly related question:

What US regs apply to syndicates (owner groups; not sure what the US name is) around an aircraft?

Here in the UK, up to 20 people can own it (or be shareholders in a limited company owning it) but nobody may own less than 5% - unless the aircraft is maintained to a specified higher level in which case there is no restriction on the # of owners etc.

The non-direct costs are shared out between all the shareholders.

Is it possible for an N-reg to be owned by say 2 people, one having a 1% share and the other having a 99% share, and they share the non-direct costs accordingly?

d

To answer your last question first - absolutely. I've been in that situation. My partnership agreement specified a specific hourly rate that covered direct and non-direct costs, but I was NOT on the hook for anything. When I left the partnership, I got my 1% of capital back.

We have a subpart of 91 (I think it's K but am too lazy to look it up right now) that addresses fractional ownership. The key difference between a "fractional" and a "club" or "partnership" is that in the fractional, none of the owners fly the airplane, and what they "own" is not a part of a specific airplane, but a share in the company with no real power except to walk away. NetJets and ExecJets are two examples of fractional ownership, and the subpart reads an awful lot like part 135.

 

[TMetzinger]

Wow, that Mangiamele letter references a letter sent to our own Tim Metzinger! Small world.

I'm not sure why, though. Perhaps it was the most recent letter that talked about charitiable stuff. What I asked in the letter was a completely different question.

 

[tdager]

IIRC, one of John Yodice's articles in AOPA involved a "common purpose" violation when the the pilot and his wife went to dinner at a restaurant that "they wanted to try sometime" and the cost-sharing passenger was doing business or visiting someone in the hospital or something like that.

The bottom line on the violation was that, while the pilot and his wife wanted to try the restaurant "sometime", they weren't already planning the trip for that time. The FAA decided that the trip was flown on the passenger's schedule, and was therefore an illegal charter.

Just goes to show how f-ed up our government regulations are and makes one wonder why ANYONE wants more government intrusion in ANY part of our lives.

 

[midlifeflyer]

I have a slightly related question:

What US regs apply to syndicates (owner groups; not sure what the US name is) around an aircraft?

Here in the UK, up to 20 people can own it (or be shareholders in a limited company owning it) but nobody may own less than 5% - unless the aircraft is maintained to a specified higher level in which case there is no restriction on the # of owners etc.

The non-direct costs are shared out between all the shareholders.

Is it possible for an N-reg to be owned by say 2 people, one having a 1% share and the other having a 99% share, and they share the non-direct costs accordingly?

AFAIK the FAA doesn't really care about the number of people or companies that own an aircraft, their percentages of ownership or the form of ownership. So the scenario of a 99%-1% ownership scenario is certainly possible. Forms of ownership of anything, though, are subject to state law and with 50 states, there could conceivably be a bit of variation there.

What the FAA does care about is operation and operational control, and the related question of whether the operation is private or subject to regulation as a commercial operation. Most of the FAA's interest in form of ownership, whether by regulation, formal opinion or case law, tends to center around keeping tabs on who has operational control, especially of larger or multiply-shared aircraft.

As examples, you can look st such things as Subpart F of the FAR, beginning at 91.501 – Large And Turbine-powered Multiengine Airplanes And Fractional Ownership Program Aircraft and 91.23 dealing with special requirements for leasing large aircraft and the various FAA and opinions that discuss operational control and company flight departments.

 

[poadeleted20]

I have a slightly related question:

What US regs apply to syndicates (owner groups; not sure what the US name is) around an aircraft?

Here in the UK, up to 20 people can own it (or be shareholders in a limited company owning it) but nobody may own less than 5% - unless the aircraft is maintained to a specified higher level in which case there is no restriction on the # of owners etc.

The non-direct costs are shared out between all the shareholders.

Is it possible for an N-reg to be owned by say 2 people, one having a 1% share and the other having a 99% share, and they share the non-direct costs accordingly?

The FAA doesn't care about how co-owners (partners, co-owners, owners of a corporation which owns the plane, etc) share the indirect costs as long as the pilot of each flight pays at least his/her share of the direct costs of that flight and share those direct costs with anyone other than a passenger with a "common purpose" for the flight.

 

[Everskyward]

IIRC, one of John Yodice's articles in AOPA involved a "common purpose" violation when the the pilot and his wife went to dinner at a restaurant that "they wanted to try sometime" and the cost-sharing passenger was doing business or visiting someone in the hospital or something like that.

The bottom line on the violation was that, while the pilot and his wife wanted to try the restaurant "sometime", they weren't already planning the trip for that time. The FAA decided that the trip was flown on the passenger's schedule, and was therefore an illegal charter.

It would be interesting to know how the FAA even found out about this.

 

[EdFred]

It would be interesting to know how the FAA even found out about this.

Oh I'm sure we have a few posters on here that would blow the whistle on someone in that situation if they found out.

 

[Commander Dave]

I think we're much stuck with a "quacks like a duck" case by case analysis analysis.

Mark,

Do you know Vernon Hein? He was my DPE for my Multi-Commercial and he pretty much used those exact words in relation to Commercial Ops.

"If it walks like a duck, talks like a duck - then it's probably a duck..."

Too funny to hear that from someone else