This seems to be a very carefully worded letter that only makes things more confusing. The position that EAA. AOPA, and others, as referred to in the letter, is consistent with previous positions taken by the FAA that a CFI is not operating an aircraft for compensation of hire when he is conducting flight instruction for hire, rather, he is being compensated for his instruction. This has been interpreted to mean that a CFI does not need to hold a second class medical. Basic Med is enough. This has been particularly pointed out in the last two CFI renewal courses I have gone through. The language in this letter could affect that.

Smmary: If the CFI is being paid to conduct flight training in a C-172, is he operating that aircraft for compensation or hire? Previous interpretations say no, this letter calls that into question.