NEW YORK (CNN/Money) - Top airline executives appeared before a Congressional committee Tuesday asking for more federal assistance, saying that higher security costs and the threat of war with Iraq is making it impossible for the industry to recover from last year's terrorist attacks.

American Airlines CEO Donald Carty appears before a House subcommittee Tuesday seeking more federal assistance for the airline industry.

Little more than a year after the airlines received a $15 billion aid package from Congress, they asked the House aviation subcommittee to consider tax relief, reimbursement for security costs and an extension of the terrorism insurance policies issued by the government after the Sept. 11 attacks.

"Airlines are not asking Congress to assist with economic or competitive challenges, but we do request that the government relieve the industry of government-imposed security costs stemming from the nation's war on terrorism," said Leo Mullin, chief executive of Delta Air Lines.

Rep. John Mica, R-Fla., chairman of the aviation subcommittee, said the airlines wouldn't get a government bailout but could expect some assistance with security costs.

"They need our help," he said.

Among witnesses Tuesday was Philip Baggaley, a managing director with debt rating agency Standard & Poor's, who warned that even in the best case scenario for the carriers, further federal help is needed for there to be a recovery.

"If the United States takes military action against Iraq, passenger traffic is likely to fall off again," he said. "Just how much is hard to say, and will depend on the speed and success of the military campaign and whether any further terrorist attacks occur. Airlines have been borrowing heavily to fund losses and maintain a cash reserve. Even in the best case -- a return to modest profits in 2004 -- they will emerge from the downturn with a substantial burden of debt and leases."

Baggaley said a significant part of the problem for most of the major carriers is increased competition from lower cost, low-fare competitors such as Southwest Airlines. He said the major carriers need to cut their costs significantly to be competitive.

But Donald Carty, chief executive of American Airlines parent AMR Corp., said government mandates on carriers is undermining the necessary cost-cutting efforts at carriers such as American.

"The airline industry continues to move aggressively to reduce costs," he said. "Unfortunately, at the same time, the cumulative effect of new government taxes, fees, mandates, and restrictions has added billions of dollars in costs to the airlines -- costs that Washington simply cannot continue to expect us to pay and at the same time assume we will survive."

Carty asserted half of the airline industry's expected $7 billion in losses this year could be attributed to security costs, including lost revenue by passengers unwilling to deal with the "hassle factor" of new security measures.

"Without relief from these government-imposed costs, our efforts to control our own costs will be futile, and thus the more painful route of cutbacks, employee furloughs, labor concessions, and the bankruptcy of many will be unavoidable," Carty said.

Joe Leonard, the CEO of discount carrier AirTran Airways (AAI: down $0.09 to $2.69, Research, Estimates), asked that $10 billion in possible federal loan guarantees again be made available if the United States goes to war with Iraq. The deadline for those guarantees passed in June with only three major carriers -- United Airlines, U.S. Airways and America West Airlines, seeking that help.

"There may be a number of airlines that did not avail themselves of loan guarantees before that may need to avail themselves if hostilities begin," Leonard told the committee. Mica said that was a good suggestion.

America West won the guarantees, U.S. Airways has won conditional approval while United is seeking the labor cost savings from its unions necessary to win the guarantees.

Reps. William Lipinski, a Democrat, and Mark Kirk, a Republican, who are both from the Chicago area, United's home, suggested that they would like to see Congress mandate approval of the United loan guarantee application.

Aviation subcommittee members said they were willing to give the airlines temporary help, but some lawmakers said the industry needed to fix problems it brought upon itself.

"The carriers seem unable to muster the discipline to reasonably price their product," said Rep. James Oberstar, D-Minn.

But Mullin said government-imposed security requirements cost Delta, which represents one-sixth of the industry, $660 million in 2002. Delta's terrorism insurance rose $150 million, new cockpit doors cost $20 million, the loss of seats to federal air marshals cost $35 million and restrictions on cargo cost $90 million, Mullin said.

The $2.50 security fee levied every time a passenger boards a commercial aircraft cost the company $265 million, Mullin said.

He asked for a temporary suspension of the security fee and extension of government-issued terrorism insurance.

The airlines also want more money for retrofitting cockpits with bulletproof doors. Michael Wascom, a spokesman for the Air Transport Association, said the government is only reimbursing airlines for $14,000 of the $45,000 cost of each door.

The airlines also hope Congress will lower the amount they're required to repay the government for the costs of screening passengers and baggage.

Before Sept. 11, airlines paid for the screening. After the attacks, the government took responsibility and airlines agreed to reimburse the cost based on their 2000 expenditures.

The airline industry recently told the Transportation Security Administration it spent about $300 million on security in 2000. But the Department of Transportation's inspector general pointed out that the major airlines had claimed before Sept. 11 -- and testified twice afterward -- that they spent $1 billion annually on security.

Wascom said the $1 billion figure was only a rough estimate, and that it's difficult to tell how much is spent on security.

The Senate Commerce and Transportation Committee plans to hold a hearing on airlines and the economy on Wednesday, according to a spokesman for its chairman, Ernest Hollings, D-S.C.