The House reauthorization rejects the user fees that could put regional carriers $100 million in the red. Consequently it promises to be an interesting battle between the House and Senate this summer as they reconcile the $25 user fee which is a cornerstone of the Senate’s FAA reauthorization bill with the proposed House bill. Related Story
The House FAA Reauthorization Act of 2007 was introduced by 34 House members last week, including House Transportation and Infrastructure Committee Chair James Oberstar (D-8-MN), Committee Ranking Member John Mica (R-7-FL), Aviation Subcommittee Chairman Jerry Costello (D-12-IL) and Subcommittee Ranking Member Tom Petri (R-6-WI). Contrary to the Senate bill, the House version also raises the cap on passenger facility charges (PFCs) to $7.00 from its current mark at $4.50 per flight segment -- bad news for regional airlines. Airports Council International launched a campaign to increase the cap on Passenger Facility Charges to pay for an estimated $87.4 billion needed over the next four years to pay for new airport infrastructure, such as new runways, terminals needed to keep pace with passenger demand. Related Story  PFCs have funded more than $50 billion in airport modernization since 1990, according to ACI. The bill also provides funding for the Airport Improvement Program.
House leaders apparently heard National Business Aviation Association President Ed Bolen who testified that user fees are costly for governments to administer, requiring a large, expensive bureaucracy. He also told lawmakers user fees come with an administrative burden for operators, between $85 and $125 to process a single invoice, according to the International Air Transport Association (IATA). Bolen also cited the fact that user fees can go up when industry can afford it least: In 2002, when air traffic was depressed as a result of the recession and terrorist attacks, Canada raised its user fees to cover its declining revenues. ATA criticized the bill saying it "does nothing to resolve record delays, growing congestion and the crisis that faces the nation’s travelers.”
While airlines would like to point to others as the cause of recent delay crises, in actuality, DOT data show almost all delays are caused by weather and the airlines themselves, which has prompted a congressionally mandated DOT investigation into deceptive scheduling practices. The National Air Traffic Controllers Association agrees and added weather delays are exacerbated by the airline hub-and-spoke operation, and airline or ATC staffing. The hours flown by business aircraft have remained essentially constant for several years, while airport hub operations have increased.
Regional Aviation Partners reported diminishing interest for supporting the continuation of the essential air service program. Related Story
“After numerous discussions with congressional staff, the writing on the wall indicates that even some of the program’s most ardent supporters on Capitol Hill may succumb to growing pressure to cut the program on the next go around,” said the organization. “For this reason, RAP is focused on reforming the program and obtaining the necessary funding this year to provide communities with the tools needed to increase enplanements and to secure safe and reliable air service while also addressing the problems resulting in fewer and fewer air carriers willing to participate in the EAS program.”
Three senators – a democrat and two republicans – introduced new legislation recently to improve community air service. The Rural Aviation Improvement Act of 2007 calls for many of the reforms advocates have wanted for years. The proposal calls for DOT to create an Office of Rural Aviation within the office of the secretary, responsible for developing uniform four-year essential air service contracts as well as a mechanism for comparing applications submitted by air carriers. It would also be responsible for selecting the carrier to provide service to a given essential air service point.Rural bill introduced Related Story
RAP reported that constant under-funding and DOT changes to the program have resulted in $15 million in EAS funds sitting in DOT coffers carried over from previous years.