Treasury Has Paid $12.4 Billion in Aviation Payroll Support
Treasury Has Paid Out $12.4 Billion in Aviation Payroll Support
(Bloomberg) --
The U.S. Treasury said it has paid out another $9.5 billion in funds to the aviation industry under a program designed to shore up carriers reeling from the coronavirus pandemic.
Meanwhile, an application form was released on Saturday for loans destined for “businesses critical to maintaining national security,” Treasury said in a statement.
Total disbursements so far under the CARES Act have reached to $12.4 billion to 93 air carriers, including major airlines and smaller passenger carriers, Treasury said in its statement.
Additional funds will be paid out on a rolling basis. The funds under the Payroll Support Program must be used for employee wages, salaries and benefits.
The number of flights in the U.S. has fallen dramatically in recent weeks as airline travel plummets while millions of Americans are under order to do no unnecessary travel. Passenger airlines have cut more than 70% of flights compared to a year ago, according to the FlightAware tracking website.
Treasury announced certain details of the program for cargo air carriers and contractors, as determined by Treasury Secretary Steven Mnuchin.
Cargo carriers receiving $50 million or less of payroll support, and contractors getting $37.5 million or less, will not be required to provide financial instruments as compensation for the assistance
The majority of cargo air carriers and contractors seek less than $10 million, according to the statement.
Applications for the national security industry loans may be submitted online starting Monday and are due by May 3, Treasury said.
Mnuchin on Thursday said public companies deemed critical to national security that seek a share of $17 billion in virus-related relief would required to offer an equity stake to the government.
For private companies, Mnuchin “may, in his discretion, accept senior debt instruments” or other financial interests, Treasury said.
The requirements are similar to those for passenger and cargo airlines seeking payroll assistance from the $2.2 trillion coronavirus stimulus package passed by Congress.
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