PlaneBroke
Well-Known Member
We need some advise on starting up a fractional ownership program with one light twin and 2 single engine piston airplanes. Is this even worth doing?
I need help setting up a fractional ownership program.
- Thread starter PlaneBroke
- Start date
NJA_Capt
Well-Known Member
With the limited information provided, I would say no. You are better off having a shared flight department vs a fractional program.
PlaneBroke
Well-Known Member
All 3 aircraft are owned in a partnership between 3 people. There are about 10 businesses in the area that asked if they can use the aircraft on a regular basis. The owners want the aircraft to be utilized and they are not trying to make any money on the deal. I guess we would like to set something up so we are not breaking any regs.
We would like to hire contract pilots.
Each business would fly about 50-100 hours per year.
Each business would like to use all 3 airplanes.
Most of the businesses would prefer to pay up front for everything, including the pilot in 50-100 hour blocks at a wet rate.
The money is there to do what ever we need to do so we dont break any rules.
The owners would still like access to the aircraft.
They do not want to set up a 135 program.
They want to have it all set up by yesterday.
We would like to hire contract pilots.
Each business would fly about 50-100 hours per year.
Each business would like to use all 3 airplanes.
Most of the businesses would prefer to pay up front for everything, including the pilot in 50-100 hour blocks at a wet rate.
The money is there to do what ever we need to do so we dont break any rules.
The owners would still like access to the aircraft.
They do not want to set up a 135 program.
They want to have it all set up by yesterday.
TFaudree_ERAU
Mashin' dem buttons
Ten businesses sharing an aircraft? That's 91K or 135, no matter how you slice it. There's no hard number as to how many "contracts" you can have in place for aircraft usage, but the number I always hear being thrown around is 5 or 6. More than that, and the FAA will likely want air carrier certificates and ops specs in place.
PlaneBroke
Well-Known Member
up to 10 businesses sharing 3 aircraft. So if we limit it to 5 or 6 businesses to start we should be ok? I guess if we can figure out how to make these 3 aircraft available to 5 or 6 businesses to start that would be great until we can get a fractional ownership program set up. What contracts need to be in place with 3 aircraft and 5-6 businesses? Can the aircraft be available at a wet rate? With pilot included?
TFaudree_ERAU
Mashin' dem buttons
There are multiple threads about this exact subject in this section of the forum. Most have been discussed in the past month or so. Have you searched?
PlaneBroke
Well-Known Member
I have searched and read a lot of them. I guess I would just like to know how to get the ball rolling. The aircraft are bought and paid for. If we can avoid setting up a fractional ownership program that would be great, but if we have to we will. Trying to get a head start so we dont have to spend a boat load on an attorney, but if we have to we will. Just trying not to beak any rules or have any unscheduled visits from our local fsdo.
Stone Cold
Well-Known Member
You are trying to make sure everything is legal, setting up a convoluted use of an aircraft, and your principles do not want to use a lawyer??? I do not understand...especially if they want it quickly with no mistakes, they should use a professional that knows how to set this up legally and quickly.
PlaneBroke
Well-Known Member
I guess that came out wrong. We are of course going to use a lawyer to help set everything up, would be insane not to. Just trying to get a head start so we have a plan when we meet with the lawyer.
Stone Cold
Well-Known Member
Gotcha...that makes a lot more sense!! Good luck. Hopefully there are a few on here who have the knowledge you need to get you started.
Really, I would get an aviation lawyer involved FIRST. There are way too many aspects to a deal like this not to have a professional give you guidance from the very beginning. A good attorney could actually save you from spending a lot of time (and money!) going down the wrong trail. Lay out what you want to do and let him show you the best way to do it.
I've seen way too many deals (not just aviation) mucked up because the principles walked into a meeting with the lawyer and said "we want to have you set up XXX, and organize it like YYY", rather than saying "We want ZZZ to happen, what's the best way to get there?"
I've seen way too many deals (not just aviation) mucked up because the principles walked into a meeting with the lawyer and said "we want to have you set up XXX, and organize it like YYY", rather than saying "We want ZZZ to happen, what's the best way to get there?"
PlaneBroke
Well-Known Member
Good point. Wilco.