An "unrestricted" round trip coach fare from coast to coast and back is usually in the neighborhood of $2,000. A charter for the same round trip would cost $30,000 (or more). However, if you have a group traveling together, that $30 thousand can be amortized over the number of travelers. Put 12 people in a Gulfstream IV and suddenly the difference doesn't seem so great. When contractors consider the convenience and time-savings (from not having to go through airport security, etc), the prospect of chartering a private jet becomes easier to rationalize.
For cost reimbursement purposes however, justifications and rationalizations do not matter - the cost to the Government is limited to the to the lowest priced airfare available to the contractor during normal business hours (there are some exceptions which we will discuss later). And, in addition to documenting the "lowest priced airfare", contractors using corporate owned, leased, and chartered aircraft are required by FAR 31.205-46(c) to maintain manifests/logs that indicate:
- Date, time, and points of departure
- Destination, date and time of arrival
- Name of each passenger and relationship to the contractor
- Authorization for trip, and
- Purpose of trip
As mentioned, the cost of utilizing corporate owned, leased, or chartered aircraft is limited to the lowest priced airfare available to the contractor during normal business hours. The contracting officer however can approve a higher amount. The contracting officer can approve a higher amount when commercial flights would require circuitous routing, travel during unreasonable hours, excessively prolong travel, or other factors that would offset differences between private and commercial flights. Any of these exceptions must be justified and documented to the contracting officers satisfaction.
Its not an easy sell to persuade a contracting officer to approve the higher cost of corporate owned, leased, or chartered aircraft. Auditors as well, are going to consider such costs, which include personnel, maintenance, depreciation, insurance, etc as "high risk" and subject it to added scrutiny. One aspect they concentrate on is whether there is a business reason for everyone on the plane. There is always the suspicion that contractors add a few extra travelers just to get the Government to pay for more of the flight cost.