Air Force paying pilots bonuses to stay, quit


WASHINGTON -- The Air Force gives its highly trained pilots $12,000 annual bonus to keep them flying warplanes instead of switching to better-paying jobs with the airlines.

But with the Air Force shrinking rapidly after the end of the Cold War, it's now offering many of those same pilots an even bigger bonus -- approaching $300,000 -- to quit.

"I call it the end-of-the-Cold War windfall," an Air Force pilot said.

Air Force officials concede that the bonuses are contradictory, but they insist that they are the best way for the service to get out of the bind in which it finds itself with the demise of the Soviet Union: cutting the bloated pilot ranks while preserving an adequate supply of fliers for the 21st century.

The Navy has a similar program but does not allow its pilots to take both bonuses at the same time. The contrast between the services' two programs has triggered interest on Capitol Hill and will be investigated by the House Armed Services Committee, a committee aide said.

Over the past 21 months, 195 Air Force pilots receiving the annual bonuses left before completing their 14-year commitments -- and pocketed hefty goodbye bonuses, to boot.

A senior Air Force official said neither the Air Force nor the pilots who signed up for the annual bonus program could anticipate the speed of the military's cutbacks after the end of the Cold War. The Air Force started offering a second bonus program to encourage some pilots to leave. Most pilots who have served through 11 years -- instead of the 14 they originally agreed to stay -- can pocket a lump sum averaging $72,000 or annual payments for twice the number of years they served. In that case, for example, an Air Force major with 12 years' service would receive an annual check of $12,445 for 24 years, for a total of $298,680.

In essence, what this means is that an Air Force pilot can collect his annual retention bonus through his last day and then pick up the bonus to leave.

Navy officials say none of their bonus-taking pilots are eligible for departure bonuses until they complete 14 years of service. The Air Force began the annual bonus program in 1989 to help entice midcareer pilots -- typically in their early 30s, making $50,000 a year plus $650 a month in flight pay -- to sign up for a second seven years. Historically, many of these pilots leave the Air Force after completing their mandatory seven years of service.

Nearly one-third of the Air Force's 15,000 pilots have bought into the plan.

Given the economic troubles of the airline industry, some on Capitol Hill question whether the bonus program is needed. American Airlines, for example, plans to furlough 350 pilots this summer. During the recent slump, the industry has laid off 1,500 other pilots.

"There's currently a commercial pilot glut," said David Mellino of the Air Line Pilots Association, a pilots' union. "Many are on furlough, and there aren't a lot of airlines hiring."

The Air Force, too, has a pilot surplus and has shifted more than 800 new pilots to desk jobs over the past two years, but officials say they expect a 2,000-pilot shortage by 1998.

"Some shortages will occur even with the bonus, but without the bonus, they will be severe," Lt. Gen. Billy Boles, the Air Force personnel chief, recently told Congress.

The bonuses will cut down on the expensive training that rookie replacement pilots need, he said. It costs the Air Force $1.5 million to train a pilot.

"We are asking for $54 million [for bonuses in 1994] to try to save $300 million to $600 million in deferred training costs," General Boles said. "We think that's a very good return on the taxpayers' money."

While an Air Force study claims that a $12,000 bonus doubles the number of pilots who remain in the service, a survey of pilots several years ago showed that too little flying time -- and not

inadequate compensation -- is what drives most of them out of the service.

Ten years ago, the Navy came under criticism for the way it handled its bonus program. Congress' General Accounting Office said in a 1982 report that the Navy exaggerated the impact the bonuses had on keeping pilots. Air Force and Navy retention rates were "nearly identical" at the time, even though the Air Force was paying no bonuses.

The bottom line, according to the GAO: Up to 80 percent of the Navy bonuses was wasted.

"We need to see if the Air Force program has the same problem," a congressional aide said.

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