As Many As 340,000 Aircraft May Need New Paperwork To Be
Legal
After initially proposing a rules
change in 2008, the FAA may soon be set to require aircraft to be
registered periodically, as are cars and boats. If adopted, the
perpetual registration of aircraft would be scrapped and the
registration of every aircraft in the United States would be
cancelled, requiring a new registration within three years.
Currently, aircraft are required to be registered only at the
time of transfer of title. The FAA says the new rules are designed
to increase the accuracy of the information available in the
registry. The registry came into existence in the 1980's when the
use of aircraft in drug smuggling became an issue of increasing
concern for the U.S. Customs Service, the Drug Enforcement
Administration, and law enforcement agencies at all levels of
government. These agencies, seeking quick and accurate
identification of owners of civil aircraft, advocated an annual
registration requirement. In 1988, Congress passed the FAA Drug
Enforcement Assistance Act of 1988 (FAA DEA Act) (partially
codified at 49 U.S.C. 44111), expanding FAA's mission to include
providing assistance to law enforcement agencies involved in the
enforcement of laws that regulate controlled substances. In the FAA
DEA Act, Congress identified specific shortcomings in the system of
records, mandated specific modifications, and authorized and
directed rulemaking to make the aircraft registration system more
effectively serve the needs of buyers and sellers of aircraft, law
enforcement officials, and other users of the system.
In response to this mandate, the FAA
has made a number of administrative modifications to its
registration process including requiring physical addresses or
locations of owners, and requiring legible printed or typed names
on an application for aircraft registration.
As it stands now, owners are required to verify the information
every three years, but only if information concerning the
registration is changed. According to the FAA's proposed rule, all
aircraft owners would be required to re-register and then
periodically renew their aircraft. The total cost per certificate
per aircraft owner is about $26. An aircraft owner would renew his
or her certificate, on average, about 6 more times over a 20-year
period for a total of 7 certificate actions; assuming 7 certificate
actions would result in costs of about $181 over 20 years, or an
average cost of $9 per year. For a small business that owned
several aircraft, the cost of this proposed rule to them would be
negligible and, therefore, not significant. Since annualized costs
would be less than 1% of annual median revenue, the FAA believes
that this proposed action would not have a significant economic
impact on a substantial number of small entities.
Under the new rule, failure to properly re-register an aircraft
could result in it being grounded, since operation of an improperly
registered aircraft is illegal. It could also subject anyone
operating an improperly registered aircraft to civil and criminal
penalties. The new rules would also include leasing companies, and
companies who finance those leases.
In a document provided by GE Capital, which finances a large
number of aircraft leases, that company suggests modifying the
current rules to require a positive verification that information
in the registry is correct, rather than scrapping the entire system
and requiring a complete re-registration every three years. While
there is no date set for any change in the registration rules, but
some industry insiders indicate the change could come as soon as
the first quarter of 2010.
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