The $2 trillion stimulus package passed last month included everything airlines requested, and some restrictions they find difficult to swallow, the Wall Street Journal reported. The aid offer includes $50 billion, half in direct payroll assistance and half in loans and loan guarantees. But the $25 billion to pay salaries and benefits this summer comes with more strings than the largest airlines were hoping for. Treasury Secretary Steven Mnuchin told chief executives on Friday that 30 percent of that money is to be repaid and that they will need to offer stock warrants on about 10 percent of the loan amount, which the government could convert to shares later. That surprised some airline industry officials who had believed the money would be in the form of grants. Airline executives spent the weekend discussing concerns with an industry trade group and seeking to negotiate adjustments to those conditions with the Treasury Department, federal officials and airline industry leaders said. “We’ve attempted to treat everyone equitably and do not intend to get into individual negotiations that would require changes across the methodology,” Brent McIntosh, the Treasury undersecretary for international affairs, said yesterday. Other conditions to the aid include a block on laying off workers or slashing salaries until October, and requirements that airlines maintain a certain level of service to the cities in their networks. They must also refrain from buying back shares or paying dividends, and agree to limits on executive compensation. Airlines haven’t raised objections to those requirements.
