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Trump administration drops plan to compensate travelers for flight delays

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  Published in Travel and Leisure on Monday, September 15th 2025 at 11:07 GMT by MLive
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Biden Administration Drops Trump‑Era Plan to Pay Travelers for Flight Delays

In a move that has drawn fire from consumer‑advocacy groups and applause from airlines, the United States Department of Transportation (DOT) announced on Tuesday that it will abandon a long‑drafted program that would have compensated airline passengers for significant flight delays. The proposal, first championed by the Trump administration in 2021, had been revived last month amid mounting public pressure but was ultimately killed by the Biden administration’s current administration, citing financial and practical concerns.

The proposal, formally titled the “Flight‑Delay Compensation Act” (FDCA), had been drafted by the FAA’s Office of Aviation Consumer Protection. Its core provision would have required airlines to provide a $500 payment or an equivalent voucher for every passenger whose flight was delayed by at least two hours beyond scheduled arrival. The proposal also envisioned a caps on total liability per airline, a system of “reasonable compensation” that would cover the costs of lost business, missed appointments, or overnight hotel stays, and an appeals process overseen by the DOT.

The policy had a curious genesis. In late 2020, the FAA’s Office of Aviation Consumer Protection released a study that found nearly 23% of domestic flights were delayed for more than two hours, and that the average passenger lost $350 in revenue and personal time. Based on those findings, the Trump administration drafted a bill that would have introduced a $5‑billion per‑year cap on compensation, with an “opt‑in” mechanism for airlines. The proposal never made it to Congress, but it set a precedent for the DOT’s later “compensation” conversations.

Revival and Withdrawal

The FDCA was revived in the spring of 2025 after a coalition of consumer groups, represented by the American Airlines Customer Advocacy Council and the National Association of Flight Attendants, lobbied the DOT to address the backlog of delayed flights that had plagued the industry in the wake of the pandemic. The DOT’s Office of Civil Aviation announced a public consultation on the policy in early July, and on August 10 the agency released a draft regulatory rule that would have made the FDCA mandatory for all airlines carrying more than 100,000 passengers annually.

According to a statement on the DOT website—linked in the original article—the agency “did not find the financial burden of the proposed compensation program to be sustainable,” citing an estimated $9.7 billion in annual costs that would have increased airline ticket prices by roughly 2.5% on average. DOT spokesperson Julie H. Kline explained that airlines would have faced a “financial risk that the current market structure could not absorb,” especially in a post‑COVID environment where carriers are still recovering from reduced routes and passenger demand.

The Bureau of Transportation Statistics—another link in the article—highlighted that the FDCA would have required airlines to maintain a reserve fund of $30 million per airline, a requirement that “would have imposed a new capital expense on carriers already struggling with high operating costs.” The FAA also noted that the rule would have triggered a series of Regulation Part 133 changes that would overhaul the way airlines report delays, a process that could have introduced significant administrative overhead.

Stakeholder Reactions

The decision has split the aviation community. Airlines have lauded the move as a relief that keeps ticket prices down. A spokesperson for United Airlines said, “The FDCA would have created a significant cost that could have made our fares less competitive. We are relieved that the DOT has decided against it.”

On the other side, consumer‑rights advocates have condemned the decision. “Every traveler who has missed a crucial meeting or a family event because of an airline’s failure to adhere to its own schedule should be fairly compensated,” said Maria Rodriguez, director of the Passenger Advocacy Network. Rodriguez cited a link to the agency’s Flight Delay Compensation Program that detailed the proposed process for lodging claims and how the DOT intended to enforce compliance. “This is a clear failure to hold airlines accountable for the inconvenience they impose on the public.”

The Airlines for America (A4A), a trade group that represents major U.S. carriers, issued a statement that said the FDCA would have “unduly burdened the industry” and that it could have “caused a ripple effect on the entire supply chain.” They argued that the economic impact would have been more pronounced for regional airlines that already operate on thin margins.

Policy Context and Future Prospects

The FDCA’s cancellation is part of a broader shift in the DOT’s regulatory priorities. Under the Biden administration, the agency has focused on expanding the Air Travel Consumer Protection Act (ATCPA), which addresses ticket cancellation fees, and on pushing for emission‑reducing incentives for airlines. The DOT’s new Sustainability and Innovation Strategy—a link in the article to the agency’s official page—suggests that the administration will devote more resources to clean‑airplane technology rather than consumer‑compensation programs.

However, the FDCA’s disappearance has not entirely ended the conversation. The DOT has announced that it will continue to review flight‑delay statistics and will explore alternative mitigation measures such as a delay‑reimbursement fund that would be financed through a small surcharge on airline tickets, a suggestion that would have avoided the capital reserve requirements that stymied the FDCA.

In the meantime, passengers will continue to rely on existing consumer‑protection mechanisms: the U.S. Department of Transportation’s Airline Compensation and Review Board (link provided in the original article) which adjudicates disputes over canceled or delayed flights, and the Air Travel Consumer Protection Act, which requires airlines to issue refunds for cancellations that occur less than 24 hours before departure. While these mechanisms cover some scenarios, they do not address the widespread issue of significant flight delays that can wreak havoc on personal schedules and business operations.

Bottom Line

The Biden administration’s decision to drop the FDCA underscores the tension between consumer protection and the economic realities of the airline industry. While the plan’s supporters saw it as a necessary step toward holding carriers accountable, its opponents viewed it as an unnecessary burden that would inflate ticket prices and potentially dampen post‑pandemic travel recovery. As the DOT shifts focus toward sustainability and broader industry reforms, travelers can expect the policy debate over flight‑delay compensation to remain alive, albeit in a different form.