WASHINGTON -- Sen. Rick Santorum, seeking to bring US
Airways out of bankruptcy, wants to let the strapped airline string
out $3.1 billion in payments to its employee pension plan over 30
years.
The bill will help the airline fulfill its "financial
obligation to the hardworking employees by providing them the
ability to restructure their pension plan," Santorum, R-Pa., said
in a statement released Wednesday night.
US Airways, based in Arlington, Va., declared bankruptcy in
August, the first to do so in the travel slump following the Sept.
11 terrorist attacks. The company is carrying a $61 billion debt,
lost $2.1 billion in 2001 and said it needs to cut costs by $1.6
billion to remain viable.
A US Airways reorganization plan, filed two weeks ago in federal
bankruptcy court, hinges largely on reducing its estimated $3.1
billion pension fund liabilities.
The pension liabilities initially were scheduled to be paid
within seven years. Santorum's plan gives legal authority to the
federal Pension Benefits Guarantee Corp. to approve stringing out
the pension obligation over 30 years, said spokeswoman Erica
Clayton Wright.
The reorganization plan intends to pull the airline out of
bankruptcy by March -- a goal some analysts have called optimistic.
The terror attacks hit the airlines hard; most recently, United
Airlines declared bankruptcy last month.
US Airways is the nation's fifth-largest airline, and employs
about 32,000 workers -- down from its pre-Sept. 11 work force of
more than 46,000. An estimated 17,000 employees work in
Pennsylvania. US Airways hubs are in Philadelphia, Pittsburgh and
Charlotte.
A spokesman for Sen. Ernest F. Hollings, S.C., the ranking
Democrat on the Senate Transportation Committee, said Wednesday
evening he was unaware of Republican bailout proposal. A US Airways
spokesman could not immediately be reached for comment.
Previous Stories:
- January 2, 2003: US Airways To Lay Off More Flight Attendants
- December 19, 2002: US Airways, CWA Reach Agreement
- November 26, 2002: US Airways Announces 2,500 More Furloughs
- November 1, 2002: US Airways Layoffs, Cutbacks To Take Toll
- October 28, 2002: US Airways Plans To Lay Off More Pilots
- September 30, 2002: 161 To Lose Jobs As US Airways Reservationists
- August 15, 2002: US Airways To Cut Flights, Jobs
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