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Long road to recovery from what I've heard through the bro network, but he's with us, and that's what matters the most.

Yes. In the US, they do take into account outside areas. A number of shows have been reduced in size, or eliminated, due to urban encroachment over the years. The Thunderbirds could not perform at Oshkosh for years because of it. They finally performed there last year, but I do not know what was changed to pull it off. To be overly simplified, for a show using high speed jets, the showline (Category I Line) will be 1500' and parallel to the spectator area. The opposite side of the showline also has to be 1500' from any people, and is called the Secondary Spectator Area. You will often see houses, and structures inside of it... but those shows will go and pay the residents and businesses to vacate the area during the show.