DOT Introduces LGA Auctions, Other Passenger Measures

Landing with a loud thud in Washington, the newly proposed LaGuardia slot auctions, which the Department of Transportation called an experiment, would withdraw slots from carriers and put them up for auction. The first reaction came from the Air Transport Association of America (ATA), which rejected the...

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Landing with a loud thud in Washington, the newly proposed LaGuardia slot auctions, which the Department of Transportation called an experiment, would withdraw slots from carriers and put them up for auction. The first reaction came from the Air Transport Association of America (ATA), which rejected the idea.
“It is truly mystifying, with the airline industry in a financial meltdown due to overwhelming fuel prices, that DOT decides now is the time for a costly economics experiment at LaGuardia,” said ATA President and CEO James C. May, who expressed frustration that work between the airlines and the Port Authority of New York and New Jersey designed to increase capacity and reduce delays have largely been ignored. “It is even more ridiculous considering the DOT’s highly suspect claim of legal authority it has just ‘discovered’ after decades of concluding the opposite. The solution to delays in New York is not figuring out how to charge airlines and their passengers more, as DOT proposes, but rather getting on with modernizing the antiquated air traffic control system. The airlines and the Port Authority have worked in close cooperation with DOT in recommending concrete steps to add capacity and better manage schedule demands. While DOT is moving on 17 of those recommendations, which we appreciate, they are ignoring 60 others while wasting time and precious financial resources in ‘experimenting’ with increased costs to drive down demand. This proposal means fewer choices, higher costs and a reduction in service to smaller communities. The public does not want that, the Port Authority does not want that, and the airlines do not want that. More importantly, what the DOT has proposed will do nothing to reduce delays.”
The Secretary said the department also is proposing a new way to manage congestion at New York’s LaGuardia Airport. Even though this facility has been capped since 1968, it is still consistently one of the top three most delayed airports in the nation, she said. Under a supplemental rulemaking announced last week, DOT proposed two market-based options
“This proposal increases choices for passengers and adds competition, which is proven to lower fares. It also cuts delays and funds new aviation capacity projects for the region,” Secretary Peters said.
Under the first DOT option, all air carriers would be given up to 20 slots a day for the 10-year life of the rule. Meanwhile, over the next five years, eight percent of the additional slots currently used by an airline would be made available to any carrier via an auction. An additional two percent of the slots would be retired to help cut the record delays at the airport. Proceeds from the auction would be invested in new congestion reduction and capacity improvement initiatives in the New York region.
The second option also gives airlines permanent access to up to 20 slots a day for a 10-year period. Beyond those flights, 20 percent of the slots currently used by the airlines would be made available over the next five years to all airlines through an auction. Under this option, the carriers would retain the net proceeds of the auction.
Both options provide financial stability to the airlines operating at LaGuardia by providing them with a defined right to operate at the airport for a decade, something they do not have today, said the DOT, which added it recognizes the significant financial investment the airlines have made in the airport’s infrastructure.
“Our plan strikes a sound balance between protecting investments by incumbent carriers and ensuring that all airlines have the ability to fly to New York’s LaGuardia,” Secretary Peters said. “While the status quo at LaGuardia has led to stagnant service, delays and unnecessarily high fares, open access and competition will help give flyers more choices, fewer delays and lower fares.”
Overall, the Secretary said improving the passenger experience is central to the Department’s efforts and that she wanted to hear directly from travelers how they are being impacted by problems in the air travel industry. To do so, she launched a series of Aviation Consumer Forums to hear from consumers and help educate air travelers about their rights and responsibilities. The first DOT-hosted forum was scheduled for April 17 in Miami, to be followed by public meetings in Chicago and San Francisco in the near future.

Air Traffic Measures Introduced
The secretary also announced new air traffic measures designed to help cut delays this summer. The first involves new and greater flexibility for aircraft to use alternative routes in the sky to avoid severe weather. This includes a new routing alternative that provides an “escape route” into Canadian airspace from the New York metropolitan area so airlines can fly around summer thunderstorms and high winds.
In addition, the FAA will open a second westbound route for aircraft, akin to adding another interstate highway lane in the sky. This would, in effect, provide a parallel route along a heavily-traveled aviation corridor, helping cut westbound delays from the New York area.
“By making better use of our skies, we are working to limit the impact weather has on travelers on the ground,” Secretary Peters said.
Recently, the Air Transport Association testified on delays, saying that most are weather related and, overall delays cost the industry $9 million annually.

DOT Doubles Bumping Compensation, Introduces New ATC Measures
As part of a new series of measures to strengthen passengers protections, U.S. Transportation Secretary Mary E. Peters extended bumping rules to aircraft seating passengers of 30 seats or more rather than the current 60-seats while doubling the compensation required to be paid to passengers involuntarily bumped from flights. RAA objected to the changes proposed by DOT’s NPRM last summer, saying the marketplace is a better arbiter of denied boarding compensation than federal mandates. For regionals the new rule is made more frustrating by the fact that mainline carriers are completely responsible for passenger bookings. Related Story
The department finalized changes to its so-called bumping rule, which doubles the limit on compensation airlines must pay passengers who are involuntarily bumped from their flight. Under the new rule which goes into effect next month, fliers who are involuntarily bumped would receive up to $400 if they are rescheduled to reach their destination within two hours of their original arrival time or four hours for international flights, and up to $800 if they are not rerouted within that timeframe.