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Air Transportation Stabilization Board (ATSB)

The Air Transportation Stabilization Board (ATSB) was created by the Air Transportation Safety and System Stabilization Act, which was signed by President George W. Bush on September 22, 2001, for the purpose of issuing federal loan guarantees to airlines experiencing financial difficulties following the terrorist attacks of September 11, 2001. As of May 2005, seven airlines have been granted such guarantees and nine airlines have been denied.

Applicants must meet three criteria under the act: (1) the airline is unable to obtain a loan without the guarantee, (2) the amount of the loan is prudent, and (3) the guarantee is necessary for a viable air transportation system in the United States. ATSB often demands stock warrants or related securities, giving the government an ownership stake in ...

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