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Pilot flees after Bonanza hits Toyota Prius

by GlobalAir.com 30. April 2010 17:09
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Boulder County, Colo., was the site of a not-so-typical fender bender Wednesday as a plane got tangled up with a car.

A wind gust and hard landing sent a Beechcraft Bonanza careening.

It hit a Toyota Prius before the pilot fled, said local authorities there, who added that the scene could (rather obviously) result in federal charges. Read the full story from KUSA-TV in Denver.

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4th Circuit Court Of Appeals Affirms NTSB's "Congested Area" Determination

by Greg Reigel 30. April 2010 12:16
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In my article, Identification Of A "Congested Area" Under FAR § 91.119: Hindsight Is 20/20, I discussed an NTSB decision, Administrator v. Folk, in which the primary issue was whether the airmen's low-level flights occurred over a "congested area" as referenced in FAR § 91.119. In a recent unpublished decision, Folk v. Sturgell, the United States Court of Appeals, Fourth Circuit has affirmed the NTSB's determination that the area in question was in fact a "congested area."

The Case

In the Folk case, the FAA alleged that the airmen had both engaged in agricultural aircraft operations in violation of 14 C.F.R. §§ 137.51(b)(1) through (3)2 ( agricultural operations over congested areas); 91.119 (minimum safe altitudes); and 91.13(a) (careless and reckless). One of the main disputes in the case was whether the area over which the airmen had flown was a "congested area." At the hearing, the FAA argued that its case-by-case analysis of the facts and circumstances supported the conclusion that the area was indeed a "congested area." One of the airmen's arguments in response to the FAA's position was that the logical extension of the FAA's position that congested area determinations are made on a case-by-case basis is that nobody can know whether or not an area is congested until after their case has been decided.

During the hearing, the FAA inspector who investigated the allegations regarding the airmen testified that "if an operator conducts an application in an area the FAA might later determine to be a congested area, the operator ignores that potentiality at his or her peril." The inspector went on to say that he had warned the airmen that the area around their farm could be considered a congested area. When the airmen requested a definition of "congested area," the inspector told them there was no definition, and referred the airmen to FAA guidance, including an inspectors’ handbook. After studying the regulations and, apparently, finding no examples in the handbook that applied to their operations, the airmen then decided the area around their farm was not congested.

Unfortunately for the airmen, the ALJ agreed with the FAA. He concluded that the area over which the airmen had flown contained upwards of 30 homes, buildings, and structures and, as a result, was a "congested area." The ALJ also rejected a number of other defenses raised by the airmen and held that the airmen violated the regulations as alleged.

On appeal, the airmen renewed their argument that the area over which they had flown was not a "congested area." Initially, the Board observed that the FAA "has not pronounced a precise definition that includes the factors of the density of the population in an area; whether there is surface traffic in the vicinity; or the numbers and proximity of residences, buildings, or structures." It went on to note that "it is clear that the intent of the regulations is to protect persons and property on the ground and to fairly apply the rules to operators of aircraft, and, in the case of Part 137, to operators of agricultural aircraft." The Board then affirmed the ALJ's determination that the area over which the airmen had operated was a "congested area."

The Fourth Circuit's Decision

In their appeal of the NTSB's decision to the Fourth Circuit, the airmen argued that "the term 'congested area' violates the vagueness doctrine under the Due Process Clause (an argument the airmen were not able to make to the NTSB because the Board lacks jurisdiction to consider constitutional challenges), and that substantial evidence does not support the determination that they flew over a congested area."

With respect to the due process argument, the Court initially noted that a "statute is impermissibly vague if it either (1) fails to provide people of ordinary intelligence a reasonable opportunity to understand what conduct it prohibits or (2) authorizes or even encourages arbitrary and discriminatory enforcement." The Court then held that the airmen failed to show that they lacked a reasonable opportunity to understand what conduct FAR 137.51 prohibits. Rather, the Court found that the inspector's warnings put the airmen on notice that the area could be considered congested and the airmen could have resolved any doubt by filing a congested area plan and waited for the inspector's response.

Additionally, the Court determined that the airmen had not shown that FAR 137.51 "authorizes or even encourages arbitrary and discriminatory enforcement," or that the enforcement action against them was arbitrary. As a result, the Court concluded that FAR 137.51 was not unconstitutionally vague under the Due Process Clause.

Next, the Court reviewed the record to determine whether substantial evidence supported the NTSB's determination that the area was congested. The Court observed that approximately thirty houses are located in the general vicinity of the area and that the airmen's flights passed over corner sections of that area. Based upon that review, the Court concluded "that the area over which [the airmen] flew could reasonably be considered congested based on substantial evidence in the record."

Conclusion

Unfortunately, the Court's decision doesn't shed much light on the "congested area" issue nor does it provide any meaningful clarification. Because this type of case is decided on a "case by case" basis, I think the Court's decision relied heavily on the ALJ's and NTSB's factual findings. As a result, we still do not have a clear definition of what constitutes a "congested area."

The due process argument was an interesting defense. If the airmen hadn't been warned by the inspector or if the airmen had submitted a congested area plan but received not response from the FAA, perhaps then the Court may have been more sympathetic. On a positive note, it appears this argument could still be successful given the right set of facts.

In the meantime, make sure you are familiar with area over which you fly if you want to push the limits of 91.119 and remember that the FAA, NTSB and the Court will judge your flight using 20/20 hindsight.

The information contained in this article is intended for your education and benefit and should not be relied upon as advice to help you with your specific issue. Each case is unique and must be analyzed by an attorney licensed to practice in your area with respect to the particular facts and applicable current law before any advice can be given. Posting a comment to this article does not create an attorney-client relationship and advice will not be given until an attorney-client relationship has been established.

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Greg Reigel

Used bizjet sales up compared to last year

by GlobalAir.com 30. April 2010 09:12
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Thanks to our friends at JetBrokers Europe for tweeting this Business Jet Traveler article which says medium to long-range business jet sales are up about 23 percent from where it was a year ago.

Hopefully, the Great Recession -- especially in the aviation industry -- has hit its floor, and that the rebound gets a clean takeoff and unlimited ceiling in the months to come.

Read the full article here.

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You Need A Methodology For Comparing Aircraft Costs

by David Wyndham 29. April 2010 16:33
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When comparing aircraft costs, it is important to understand what costs are included and what aren't. Otherwise, you can end up comparing "apples and oranges." This can lead to making a decision with wrong or incomplete information. What we often see if that the "number" is smaller than the total cost. The big items are usually included, but adding up a lot of smaller numbers can alter the total cost considerably.

What is a good methodology to use when analyzing the cost of an aircraft? I’m glad you asked. Life Cycle Costing can ensure that all appropriate costs are considered.

Life Cycle Costing includes acquisition, operating costs, depreciation, and the cost of capital.

Amortization, interest, depreciation, and taxes also play a part in what it costs to own and operate an aircraft and can be included in the Life Cycle Costing as appropriate. As the term Life Cycle implies, it looks at a length of time versus a snapshot in time.

How long of a cycle depends on how long you plan on operating the aircraft.

If you plan on keeping the aircraft 10 years, then that is the length of the Life Cycle to use.

The costs should cover the period of ownership and take into account an expected aircraft value at the end of the term. Comparisons of two or more options should also cover the same period of time and utilization. Taxes should be included. Depending on where and how the aircraft is operated will determine the tax impact.

Leases, loans and cash purchases also change the cash flow and total cost.

If you are looking at those options, then you should account for the time-value of money. A Life Cycle Cost can also account for this in a Net Present Value (NPV) analysis. This way, the differing cash flows form two or more options that can be compared and analyzed from a fair and complete perspective.

As an aside, what is NPV? An NPV analysis takes into account the time value of money, as well as income and expense cash flows, type of depreciation, tax consequences, and residual value of the various options under consideration. When an expense (or revenue) occurs can be as important as the total amount of that item. Paying cash is cheaper in total dollars, except that you have all that cash tied up in the aircraft. A lease or loan allows the cash to flow out over time. NPV runs on the assumption that a dollar today can be worth more than a dollar a year from now. Thus, implicit in the NPV is a time cost of money, called an internal rate of return (IRR) or return on investment (ROI).

Life Cycle Costing allows you to compare different aircraft, or different types of acquiring and operating an aircraft. Using the same period and general assumptions with the analysis of different options gives you a balanced comparison of those options. Regardless of the complexity of the aircraft deal, the Life Cycle Cost method should yield a useful result provided you populate it with as accurate a data as you can.

What sort of tool(s) do you use to compare aircraft costs?

 

Star of "Air Force One," pilot of Millenium Falcon promotes GA in Washington

by GlobalAir.com 29. April 2010 15:23
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Indiana Jones traveled to Capitol Hill on Tuesday, saying show business has been good to him.

So has the spirit of flying, apparently, as Harrison Ford met with Congressional members alongside AOPA President Craig Fuller. Among the talking points, a big thank you to lawmakers for not imposing user fees in this year's FAA budget.

Read more on the visit via General Aviation News.

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