Newly anointed U.S. Transportation Secretary Ray LaHood is still learning to find his way around the DOT building, but U.S. airlines have already asked the Obama administration to withdraw the controversial Bush plan for boosting competition and reducing congestion by auctioning off takeoff and landing rights at New York area airports.

The chief lobbying group for the major carriers has asked DOT Secretary LaHood to swiftly rescind the Bush administration initiative.

Late last year, U.S. air carriers sued to block the auctions on grounds the Federal Aviation Administration (FAA) lacked the authority to carry them out. A U.S. appeals court stayed the auction plan in early December. The order prohibits the DOT from auctioning slots at Kennedy International, LaGuardia and Newark International unless and until the court formally considers and rules on the merits of the case.

"As you noted at your confirmation hearing, auctioning slots does not make sense as a tool to address congestion," James May, president and chief executive of the Air Transport Association, said in a letter to LaHood dated January 22.

“The auction rules, which confiscate landing and takeoff slots from airlines at New York’s primary airports and create a scheme for the FAA to auction them to other airlines, are opposed by the airline industry, the Port Authority of New York and New Jersey, which owns the airports, and by the New York congressional delegation.

“The rules were conceived by political appointees of the prior administration and advance the misplaced ideology that market measures can address delays. As the prior administration admitted, however, slot auctions will not reduce delays. Moreover, in our view, the FAA lacked the authority to issue these rules. On December 8, 2008, the D.C. Circuit indicated preliminary agreement and stayed the rules pending judicial review.

“They (the rules) should now be withdrawn to avoid further litigation expense for all parties and to permit the FAA to refocus its efforts on measures that will, in fact, reduce delays. The court has not yet issued a briefing schedule so there is a window of time for this administration to act,” May advised the new DOT chief by letter.

“Given the circumstances noted above, I urge you to immediately issue a notice withdrawing the rules pursuant to your authority and the department’s procedural rules,” he added.

The Bush administration’s free-market scheme sought to sell valuable takeoff/landing rights at LaGuardia and JFK International in New York and Newark Liberty in New Jersey as a way to reduce air traffic delays that ripple across the nation, costing airlines millions of dollars annually. Air carriers operating at the airports would be forced to give up 10 percent of their slots over the next five years. The slots would then be auctioned off to other airlines operating larger commercial transports.

ATA brought suit against the FAA in the U.S. Court of Appeals for the District of Columbia Circuit. ATA’s lawsuit challenged the FAA’s claim that slots are agency property that can be leased or otherwise disposed of under FAA’s general property management authority.

A legal opinion issued by the Government Accountability Office (GAO) last year said the FAA has no legal authority to auction coveted takeoff and landing rights at the airports to ease congestion and boost competition. “The FAA lacks a legal basis to go forward with the Newark auction or any other auction, and if the FAA were to go forward with auctioning slots without obtaining the necessary authority and retained and used the proceeds, the GAO would raise exceptions,” the GAO stated.

ATA calls the slot auction scheme ill-conceived. “The DOT decision patently defies the recommendation of the Government Accountability Office by attempting to move forward with an illegal auction of airport slots. Rather than needlessly forcing a costly and protracted legal challenge over an ideological experiment, DOT should follow the recommendations made by the New York Aviation Rulemaking Committee (ARAC) and implement fair and practical solutions to address delays and add needed new capacity,” stated May.

The Port Authority believes that airlines entering auctions for the takeoff and landing slots they already own will lead only to higher costs that will be passed through to passengers in the form of increased ticket prices. The PA/NY/NJ estimates those costs could rise by up to 12 percent.

In addition to higher ticket prices, the auction policy will mean fewer flights to small communities at a time when these communities already are struggling in this economy. Specifically, a Port Authority study estimates that 25 small and medium-sized aviation markets would lose service to and from the New York metropolitan airports because auctions would force airlines to operate between large markets in order to make the slot purchase viable economically.

The Port Authority has argued for a strategy that expands capacity by overhauling air traffic control technology. Chairman Anthony R. Coscia said: “We believe the right way to reduce delays is to replace a 1950s-era air traffic control system with investments in 21st century technology, expanding capacity and improving customer service. Our Flight Delay Task Force brought together all the interested stakeholders to develop effective solutions instead of pressing eleventh hour plans that, far from relieving congestion, would only hurt airline passengers and our local and national economies.”