FAA Legal Interpretation on Ferry Flights?

[Ian_J]

I think somebody posted an FAA legal interpretation a while ago stating that ferry flights (say for a flight school ferrying a plane to a maintenance base) was considered a commercial activity. I also remember something simply not paying a pilot wasn't good enough, because flight time was considered as compensation.

Anyone have a link to this interpretation, or am I remembering it wrong?

 

[Champcar]

I had a discussion with a instructor last week on the very thing. Interested to see if its true.

 

[MidlifeFlyer]

I'm not familiar with any specific interpretation abou this but I don't think there's much doubt that ferrying an aircraft for someone else for compensation is a commercial activity that requires a commercial certificate. And there is that old FAA Legal opinion that logged flight time is considered compensation.

But if you're talking about, say, a member of the club or a CFI going and retunring a club airplane from somewhere, I think you can get carried away with the analysis.

 

[Champcar]

What about if a flight school buys some airplanes, pays for airline tickets for a few Private pilots to go out and pick it up and fly it back.

 

[aloft]

What about if a flight school buys some airplanes, pays for airline tickets for a few Private pilots to go out and pick it up and fly it back.

"And there is that old FAA Legal opinion that logged flight time is considered compensation."

 

[slushie]

If you worked at the flight school in some non-flight position, and there was a random circumstance, such as the transponder needing work at a nearby airport... that is when you can fly it as a private pilot.

 

[MidlifeFlyer]

If you worked at the flight school in some non-flight position, and there was a random circumstance, such as the transponder needing work at a nearby airport... that is when you can fly it as a private pilot.

Why?

 

[Zephyr]

If you worked at the flight school in some non-flight position, and there was a random circumstance, such as the transponder needing work at a nearby airport... that is when you can fly it as a private pilot.

I think if there is a flight school anywhere involved, or pretty much any commercial operation (requiring 100hrs, etc.), you'd be hard pressed to justify free ferry flights by private pilots.

However, at the flying club I'm in and instruct for, where everyone owns shares and are considered part owners (of the corporation which owns the planes), we have private pilots do maintenance ferry flights regularly. The reasoning being that they are already paying fixed upkeep every month, and not paying for wear/fuel on the aircraft just means the cost is spread over the whole group, so it's not really "free".

That seems to be a common model in flying clubs, but at a for-profit flight school it would be a no-no.

~Z

 

[Champcar]

"And there is that old FAA Legal opinion that logged flight time is considered compensation."

If I could just find it in writing.

 

[MidlifeFlyer]

If I could just find it in writing.

That's one's easy...

From a 1992 Opinion:

==============================
Student pilot
With respect to Ms. Frame's operation of Mr. Turel's balloon, you stated that she holds a Student Pilot Certificate, that she uses the time she operates his balloon to pursue her Private and Commercial Certificates, that he allows her the use of the balloon at no cost, and that he instructs her to operate the balloon in high visibility areas for the purpose of advertising "Columbia Bookkeeping Services."

Section 61.89 of the FAR would apply here. The relevant provisions read:
(a) A student pilot may not act as pilot in command of an aircraft...
(3) For compensation or hire.
(4) In furtherance of a business.

Given what you described, we would be of the opinion that this operation would be in violation of sub-section (a)(3) of FAR § 61.89. The FAA has historically taken the position that building-up flight time is a form of receiving compensation when the pilot does not have to pay the cost, or pays a reduced cost, of operation. We would also be of the opinion that Ms. Frame's operation would violate sub-section (a)(4), in that the advertising function of her operation furthers Mr. Turel's business.

****

Let me reiterate the FAA's position regarding a private pilot's accumulation of flight time. If that pilot accumulates flight time, the FAA considers free or reduced cost provision of the aircraft to be compensation, and the pilot is, thus, acting as PIC for compensation. This applies to all aircraft operations, including glider towing and lighter-than-air and hot-air balloon operations. Therefore, those operations would be prohibited unless they fall within the exception in FAR § 61.118(a).
==============================

And from 1990 (this one it pretty famous as these things go - it involves a private pilot towing gliders. And, while the result was changed by a later regulatory amendment (now 61.113(g)), the principle remains:

==============================
The second prong of Section 61.118 says that a private pilot may not, "for compensation or hire, act as pilot in command of an aircraft." There is no question that the pilot of the tow plane is acting as pilot in command of an aircraft. The issue is whether he is so acting "for compensation or hire." With regard to this second prong of Section 61.118, the agency has repeatedly taken the position that building up flight time is considered compensatory in nature when the pilot does not have to pay the costs of operating the aircraft and would, therefore, be deemed a form of "compensation" to the private pilot under Section 61.118.
==============================

BTW, before a numbering chenge, what is now in 61.113 was in 61.118.

 

[Champcar]

That's one's easy...

From a 1992 Opinion:

==============================
Student pilot
With respect to Ms. Frame's operation of Mr. Turel's balloon, you stated that she holds a Student Pilot Certificate, that she uses the time she operates his balloon to pursue her Private and Commercial Certificates, that he allows her the use of the balloon at no cost, and that he instructs her to operate the balloon in high visibility areas for the purpose of advertising "Columbia Bookkeeping Services."

Section 61.89 of the FAR would apply here. The relevant provisions read:
(a) A student pilot may not act as pilot in command of an aircraft...
(3) For compensation or hire.
(4) In furtherance of a business.

Given what you described, we would be of the opinion that this operation would be in violation of sub-section (a)(3) of FAR § 61.89. The FAA has historically taken the position that building-up flight time is a form of receiving compensation when the pilot does not have to pay the cost, or pays a reduced cost, of operation. We would also be of the opinion that Ms. Frame's operation would violate sub-section (a)(4), in that the advertising function of her operation furthers Mr. Turel's business.

****

Let me reiterate the FAA's position regarding a private pilot's accumulation of flight time. If that pilot accumulates flight time, the FAA considers free or reduced cost provision of the aircraft to be compensation, and the pilot is, thus, acting as PIC for compensation. This applies to all aircraft operations, including glider towing and lighter-than-air and hot-air balloon operations. Therefore, those operations would be prohibited unless they fall within the exception in FAR § 61.118(a).
==============================

And from 1990 (this one it pretty famous as these things go - it involves a private pilot towing gliders. And, while the result was changed by a later regulatory amendment (now 61.113(g)), the principle remains:

==============================
The second prong of Section 61.118 says that a private pilot may not, "for compensation or hire, act as pilot in command of an aircraft." There is no question that the pilot of the tow plane is acting as pilot in command of an aircraft. The issue is whether he is so acting "for compensation or hire." With regard to this second prong of Section 61.118, the agency has repeatedly taken the position that building up flight time is considered compensatory in nature when the pilot does not have to pay the costs of operating the aircraft and would, therefore, be deemed a form of "compensation" to the private pilot under Section 61.118.
==============================

BTW, before a numbering chenge, what is now in 61.113 was in 61.118.

Awesome, just what I was looking for. Do you have a link for that? I have been looking all day for something like this on the FAA's website.

 

[aloft]

Somebody just needs to challenge that position in court, and let the legal system come up with a definition of "compensation" that's not so ridiculous. Is logged flight time legal tender? Is it transferable? Can you exchange it for other goods or services? Will it in and of itself put a roof over your head and food on the table? If not, then it is not "compensation" any more than "enjoyment" or "pleasure" is--which are, incidentally, two other things one would likely receive from free flight time.

As I see it, my logbook is a legal record, period. It holds all my endorsements and is proof of currency to fly passengers or under IFR. It has no cash value. An hour or a thousand in my logbook will not get me a job. The skills I acquire or enhance in that hour or thousand will--yet the FAA cannot prevent me from gaining or improving that skill, whether I log the time or not, and whether I paid for the time or not.

DISCLAIMER: The above may or may not contain

 

[MidlifeFlyer]

Awesome, just what I was looking for. Do you have a link for that? I have been looking all day for something like this on the FAA's website.

http://www.faa.gov/about/office_org...200/interpretations/data/interps/1992/Cox.rtf

and

http://www.faa.gov/about/office_org...interpretations/data/interps/1990/Lincoln.rtf

The link to search the opinions is at

http://www.faa.gov/about/office_org.../agc/pol_adjudication/agc200/Interpretations/

If you use Firefox, switch to I.E.. For some reason the search doesn't work with Ff.

"Somebody just needs to challenge that position in court, and let the legal system come up with a definition of "compensation" that's not so ridiculous."

Good luck with the challenge. FAA interpretations of the FAR are presumed valid and I think that you'll find that there were similar definitions of compensation before there were airplanes. Who ever said that "compensation" had to be "legal tender?"

 

[trafficinsight]

the agency has repeatedly taken the position that building up flight time is considered compensatory in nature when the pilot does not have to pay the costs of operating the aircraft and would, therefore, be deemed a form of "compensation" to the private pilot under Section 61.118

This doesn't make sense... if my plane-owner friend says "sure take it around the pattern a few times" and I don't pay the costs the FAA considers that compensation? Compensation for what?

How about if I work on an airplane and then take it up and test fly it? I'm certainly not paying for it, is that considered compensation? (I guess it would be incidental to my job).

Another one of those interpretations says this:

Where it is doubtful that an operation is for compensation or hire, the test applied is whether the carriage by air is merely incidental to the person's other business or is, in itself, a major enterprise for profit.

But then in the very next paragraph it's this:

The FAA construes "compensation or hire" very broadly. It does not require a profit, a profit motive or the actual payment of funds. Instead, compensation under the FAA's view, is the receipt of anything of value.

 

[Champcar]

http://www.faa.gov/about/office_org...200/interpretations/data/interps/1992/Cox.rtf

and

http://www.faa.gov/about/office_org...interpretations/data/interps/1990/Lincoln.rtf

The link to search the opinions is at

http://www.faa.gov/about/office_org.../agc/pol_adjudication/agc200/Interpretations/

If you use Firefox, switch to I.E.. For some reason the search doesn't work with Ff.

Good luck with the challenge. FAA interpretations of the FAR are presumed valid and I think that you'll find that there were similar definitions of compensation before there were airplanes. Who ever said that "compensation" had to be "legal tender?"

Great Stuff...thanks a bunch.

 

[MidlifeFlyer]

This doesn't make sense... if my plane-owner friend says "sure take it around the pattern a few times" and I don't pay the costs the FAA considers that compensation? Compensation for what?

Who said that this situation is against the regulations? It isn't.

I think you're trying to combine two separate questions into one. There are two pieces to the puzzle. Whether something is compensation or not is only the second question. The first question is whether the =activity= is being done for the pilot or for someone else. So there's a difference between

1. your friend letting you take his airplane around the patch or even cross country on vacation; and

2. you ferrying the airplane for your friend to the mechanic shop for its annual.

If you're doing it for someone else, Whether there is compensation is a separate question, and in situation #1 the compensation question never even gets reached because you are not doing the activity for someone else.

How about if I work on an airplane and then take it up and test fly it? I'm certainly not paying for it, is that considered compensation? (I guess it would be incidental to my job).

It would be. You are being compensated for being a mechanic, not for being a pilot.

 

[Ian_J]

For those with questions, I'll tell you why i asked this question.

My flight school's maintenance facility is about 20 miles away from our home airport. My school repeatedly asked CFIs to fly the planes to and from Mx without compensation.

The CFIs now refuse to fly unless they're getting paid.

So, the school offers ferry flights to eager private pilots who are all too happy for the time. The school manager contends this practice is okay because it is not a commercial activity because the pilots are not getting paid.

I'm leaving this school in a week, so I wonder if it's even worth bringing up.

 

[mtsu_av8er]

I'm leaving this school in a week, so I wonder if it's even worth bringing up.

To the FAA, yes!

 

[Minnesota_Flyer]

For those with questions, I'll tell you why i asked this question.

My flight school's maintenance facility is about 20 miles away from our home airport. My school repeatedly asked CFIs to fly the planes to and from Mx without compensation.

The CFIs now refuse to fly unless they're getting paid.

So, the school offers ferry flights to eager private pilots who are all too happy for the time. The school manager contends this practice is okay because it is not a commercial activity because the pilots are not getting paid.

I'm leaving this school in a week, so I wonder if it's even worth bringing up.

They are receiving compensation (time building) to fly for the purpose of supporting a commercial operation. That's quite a dusky shade of grey. If you don't like the school, a call to your local FSDO in about a week could be entertaining.

 

[Champcar]

For those with questions, I'll tell you why i asked this question.

My flight school's maintenance facility is about 20 miles away from our home airport. My school repeatedly asked CFIs to fly the planes to and from Mx without compensation.

The CFIs now refuse to fly unless they're getting paid.

So, the school offers ferry flights to eager private pilots who are all too happy for the time. The school manager contends this practice is okay because it is not a commercial activity because the pilots are not getting paid.

I'm leaving this school in a week, so I wonder if it's even worth bringing up.

I have watched the same thing go on....sad isnt it.