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Helicopter Firm Folds in Hawaii

Papillon Hawaiian Helicopters, the largest helicopter company in Hawaii, has shut down--the third tour operator to quit since federal flight restrictions were imposed a year ago.

Tour operators say the regulations have gutted their business by forcing them to stay 1,500 feet from the ground or any land formation. Previously, the helicopter tour industry had thrived on close encounters with Hawaii’s unique environment--from mist-shrouded waterfalls to molten lava.

The emergency rules took effect in October, 1994, after several accidents including a Papillon crash off Kauai that killed three people. The altitude restriction now keeps tours from visiting some popular sites, and grounds helicopters on days with low cloud cover.

“As soon as the regulations came into effect, we lost 40% of our business,” said Bill Payne, who was Papillon’s general manager. With a heavy debt load, Papillon was unable to adjust to the blow, and its parent company, Georgia-based Crescent Airways, filed for bankruptcy reorganization in February. Papillon ceased operations in September.

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