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U.S. House COVID-19 aid proposal gives airlines bailout hope, but chances slim

CHICAGO/WASHINGTON (Reuters) - A $2.2 trillion draft bill for coronavirus aid unveiled by Democrats in the U.S. House of Representatives late on Monday gave airlines some hope for a second bailout before tens of thousands of layoffs occur on Thursday, although tough hurdles remained.

FILE PHOTO: American airlines jets made by Embraer and other manufacturers sit at gates at Washington's Reagan National airport as the novel coronavirus (COVID-19) pandemic continues to keep airline travel at minimal levels and the U.S. economy contracts in the first quarter at its sharpest pace since the Great Recession, in Washington, U.S. April 29, 2020. REUTERS/Kevin Lamarque/

“I’m hopeful. I’m not necessarily optimistic,” Chief Executive Nicholas Calio of trade group Airlines for America told “PBS NewsHour” in an interview.

Washington insiders said passage by Thursday, when an initial $25 billion that protected airline jobs through September expires, was unlikely, and the airline group did not detail the congressional action it hoped to see.

An option would be a quick standalone bill for the airlines, although senior Democratic congressional aides said that was also difficult given that many industries are seeking help.

International President of Flight Attendants-CWA Sara Nelson called the proposal, which includes $25 billion for airlines to keep workers on the payroll for another six months, “a significant and serious move in negotiations.”

“It makes agreement on a full relief bill very possible in time to save our jobs,” she said.

Between United Airlines UAL.O and American Airlines AAL.O alone, more than 30,000 employees will be furloughed on Thursday, and tens of thousands more at those airlines and others have agreed to voluntary leave as the sector battles a deep downturn in demand because of the pandemic.

Julie Hedrick, president of the union representing American Airlines’ flight attendants, called on Senate Majority Leader Mitch McConnell and House Speaker Nancy Pelosi to schedule a vote.

“If we are going to save the airline industry, we have to do it now,” she said.

The House bill would provide $28.3 billion for the aviation sector, including $25 billion for passenger airlines and $3 billion for cargo carriers, under the same terms as the first package in March.

The measure would provide $13.5 billion to airports as well as aid for other sectors, including $120 billion to restaurants.

It would also direct $75 million to ensure scheduled passenger air service to small communities.

Reporting by Tracy Rucinski and David Shepardson; Editing by Cynthia Osterman and Peter Cooney

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