- Miami Air International, a Florida-based charter airline, has ceased operations and is set to liquidate this week, after customer demand dropped to near-nothing because of the COVID-19 pandemic.
- The airline applied for payroll assistance for its workers through the federal CARES Act, according to the head of the Association of Flight Attendants, but has not received aid or gotten any more information, according to industry leaders.
- The 29-year-old airline has about 350 employees.
- Visit Business Insider's homepage for more stories.
Miami Air International, a Florida-based charter airline, filed for Chapter 11 bankruptcy on March 24. Like scheduled commercial and charter
In late March, the federal CARES Act was passed, offering up to $25 billion in payroll assistance to airlines on the condition that workers not be furloughed or laid off until after September 30, 2020.
Mainline and regional airlines have applied for the assistance, including American Airlines, Delta, Southwest JetBlue, Cape Air, and Republic Airways. Several airlines have received billions of dollars in the first round of payments.
The Treasury Department did not immediately return Business Insider's request for comment.
The airline, which was founded in 1990, plans to file for Chapter 7 bankruptcy this week. It suspended operations on Friday, according to Airways Magazine.
"Congress took action in the period of a week to save these jobs and create a $25 billion safety net for aviation workers, including the 350 at Miami Air. Mnuchin actively ignored Miami Air's less than $10 million dollar payroll grant application for six weeks, and instead pushed the company off a cliff," Nelson said in a press release. "On Friday, workers received their last paycheck and learned the current owners plan to file for Chapter 7. Mnuchin can either get the payroll grant out the door today to protect these workers through September 30, or sign the pink slips himself."
According to a representative for the AFA, the airline received a request for follow-up information from the Treasury Department on April 29. The airline submitted the requested information that day, but has not received any further communication, the representative said.
Representatives for the airline could not be reached.
The payroll assistance provided under the CARES Act consists of a combination of grants and low-interest loans, with loans making up roughly 30% of the funds. Lawmakers and labor unions — including the AFA — objected to the any of the aid being issued as loans, saying the money was intended for the benefit of workers in the struggling industry, not the airlines themselves, and that the repayment requirement could discourage airlines from applying for the aid.
The Treasury also said it would take equity in airlines receiving aid. Under the terms of the bailout, airlines receiving payroll aid are prohibited from furloughing or laying off workers before September 30. Publicly traded companies are also banned from buying back stock or paying dividends to shareholders until September 30, 2021. Executive compensation is also limited.
American Airlines is set to receive a total of $5.8 billion, Delta will accept $5.4 billion, and United will get about $5 billion, the airlines have said.
Miami Air International operates on a charter basis with a fleet of six Boeing 737-800 aircraft. The airline has operated flights for sports teams, the government and military, political campaigns, tours, events, and medical transports.
The airline tried to seek additional funding and support as it began to struggle during the pandemic, but was unable to find new investors or a party interested in acquiring its assets, according to Airways Magazine.
Read the original article on Business Insider