FSE Major Update–Aircraft Ownership Expenses Fee + Repossession

Summary:
FSE is implementing a monthly "Aircraft Ownership Expenses Fee" for all privately-owned aircraft. We are also implementing a process to repossess aircraft from dormant accounts. These processes go into effect on July 1st -- that is, the first set of monthly payments for all aircraft will occur on July 1st. This gives everyone approximately 6 weeks to evaluate their fleets and make business decisions.

Ownership Expenses Fee: Since the beginning of FSE airplanes have been the majority revenue generating vehicle but are not subjected to any sort of significant expense burden like would be expected in a commercial aviation enterprise. These Ownership Expenses Fees will simulate the fixed costs of commercial aircraft ownership such as insurance, tie-down/hangar space, AIRAC subscriptions, registration fees, routine maintenance not included in the 100-hr, such as oil, tires, etc., and other costs associated with operating an aircraft in a commercial service manner. Individual line items for each of those expenses (insurance, registration, etc.) will not be broken out. Instead, a single fee will be charged each month to simulate the total fixed-cost of ownership.

Aircraft Repossession: FSE is also implementing an aircraft repossession process to remove aircraft from dormant accounts and return them to the available pool of aircraft. Aircraft will be removed from player and group accounts after 36 consecutive months of non-payment of the Ownership Expenses Fee. The dormant account will receive a cash compensation at the current buyback value of the aircraft, minus recovered debt.

Details:
The monthly Ownership Expenses Fee for each aircraft will be equal to 1% of the aircraft's current "buyback value". This value fluctuates for each individual aircraft as the aircraft goes up or down in value. Although the buy-back value for any aircraft can fluctuate daily, the Ownership Fees for each aircraft are "locked in" on the 1st of each month so that each player knows what his or her Expenses will be at the end of the month.

For more information on how the buyback value works, please see the user manual page at: sites.google.com/sit...p#TOC-System-Buyback

Ownership Expenses Fees will be deducted automatically from the true-owner's CASH balance every month. Additional details are:

Payment is processed just after midnight UTC on the 1st day of the month. (same time as bank interest is disbursed)
Any CASH balance that is not sufficient to cover every aircraft in the fleet will be debited aircraft-by-aircraft until the balance is reduced to zero, or to an amount where it can no longer cover the fees. The remaining aircraft will not have their fees paid for that month, and will be grounded.
Neither personal nor group CASH balances will be reduced to a negative amount.
Any money in the BANK balance will be ignored.
Leased aircraft will have the fees debited from the true-owner's (lessor) account, not the account currently holding the aircraft (lessee). Lessees will need to negotiate the fee amount with their lessors as part of the overall lease agreement.

Non-Payment result: Any aircraft which did not get Ownership Expenses Fees auto-paid due to lack of sufficient CASH balance will be grounded as "non-airworthy" and cannot be flown by anyone. Each non-payment will be charged against the aircraft as a "debt". This debt against the aircraft will be increased by the Ownership Expenses Fee amount each month. The aircraft owner can restore an aircraft to airworthiness standards by paying the full amount of accumulated debt. Once an aircraft has been grounded with a debt, it will no longer be considered for auto-payment. Simply putting "enough money" into the CASH balance will not clear the debt – all debts must be paid manually by the owner, or by any group staff members for group aircraft.

Leased aircraft with a debt will remain listed under the lessee's account, but will not be flyable until the true-owner clears the debt. The lessee can return the aircraft at any time, but cannot pay the debt on behalf of the lessor. If the aircraft remains in debt for 36 months, the aircraft will be auto-returned to the lessor and sold back to the system (see below).
Aircraft for sale will include the debt as part of the purchase, and the buyer will pay the listed asking price to the seller and, in addition, the buyer will pay the full amount of the debt to the Bank of FSE. The aircraft will then be debt free, and the buyer will have the aircraft. This includes both private and public sales.
Aircraft sold back to the system will have the debt subtracted from the buy-back price. The debt will be cleared, and the seller will receive the difference. This includes the owner intentionally selling the aircraft back to the system, as well as the system reposessing the aircraft (see below).

Repossession: After 36-months of debt has been accumulated, the aircraft will be repossessed by the FSE System. The owner's account will be compensated the buyback value minus the total debt value.