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The Treasury Department has begun distributing payroll grants to U.S. airlines. The department said it paid out a total of $2.9 billion on Monday to 56 airlines.
Some 230 airlines applied for the payroll assistance. Of those, the Treasury Department will award grants to all but the largest 13 carriers. Those large carriers are to receive 70% of their assistance in the form of grants and 30% in the form of 10-year loans. The loans have an interest rate of 1% if repaid within five years. The rate increases to 2% for years six through 10. The federal government can take an ownership state of approximately 10% of the loan amount.
Spirit Airlines is now among the carriers that has accepted federal aid. Treasury said it has reached payroll-assistance agreements with Spirit along with Allegiant, American, Delta, Southwest and United. Alaska, Frontier, Hawaiian, JetBlue and SkyWest (the largest U.S. regional airline) also plan to participate.
Among the 13 largest U.S. carriers, regional airlines Express Jet and Republic have yet to say they’ll accept the payroll package.
Source: travelweekly.com