US Says Subsidies for Rural Airline Service to End as Early as This Weekend

Federal officials has announced that funds from a US government program that supports airline routes to rural airports are scheduled to end as early as this weekend due to the current federal funding lapse.

Federal transportation authorities stated that subsidies under the Essential Air Service initiative are expected to expire as early as this weekend after the agency transferred unrelated funding from the FAA as an temporary measure.

Transportation officials is in the process of alerting carriers about the funding shortfall and alerting communities about potential effects.

Federal authorities allocates approximately $350m in yearly financial support for the program.

In recent months, the White House proposed cutting funding by $308m for the air service program, which enjoys popularity among GOP legislators because it provides services to predominantly Republican rural regions.

During the first presidency of Donald Trump, the administration proposed eliminating the Essential Air Service program – but lawmakers opted to increase financial support instead.

The program typically subsidizes two round trips each day using medium-sized planes – or more frequent flights with smaller planes. According to the department that under the program, approximately 65 communities in Alaska receive service and 112 communities across the other 49 states and Puerto Rico that likely wouldn't have any commercial air connectivity.

“Every state across the country will feel the effects,” the transportation secretary commented during a press conference, observing the program had bipartisan support. “We don't have the funding for that initiative going forward.”

Emily Terrell
Emily Terrell

Financial analyst with over a decade of experience in investment management and wealth advisory, specializing in market trends.