American Trans Air has filed for bankruptcy. It says it will continue current operations while in Chapter 11.

It hasn’t received debtor-in-possession financing and will instead seek to use cash held as collatoral for the federally back loan that it received. This move generates risk for taxpayers but is similar to what was recently approved in the USAirways bankruptcy filing.

American Trans Air has agreed to sell gates at Midway and landing slots at Reagan National to Airtran. That deal will have to be approved by the bankruptcy court, and creditors may well argue that some other as yet undisclosed offer is superior — so the Airtran deal is hardly done.