Funding Forecast: Cloudy with a Chance for More Cuts

Be warned: The sequester “meat cleaver” remains raised to cut towers and furlough air traffic controllers in the next fiscal year

The contract tower program is safe, at least for now.

But the budget sequestration that ignited funding cuts to the contract tower program is not going away any time soon. Sequestration’s a decade-long deal designed to chop 5 percent of total spending government-wide. The question on everyone’s mind as we settle into a summer with fewer air traffic control delays and hopefully safer airports is: What happens when the money runs out on September 30? Will we again face a meat cleaver approach to cost cutting that threatens to cripple the industry, or has everyone learned their lesson … enough at least to prevent future tower closures and FAA air traffic controller furloughs?

The simple answer, of course, is that with a federal budget currently resembling a moving target, no one is really sure what will happen next. But most experts agree the aviation industry cannot remain healthy, much less thrive, under the instability of an annual race for dollars.

J. Spencer Dickerson, executive director of the U.S. Contract Tower Association, explains some of the basics. “First the continuing resolution needs to be dealt with for the entire government. Usually funds [for programs like the contract towers] are set at previous levels, but that’s uncertain right now,” he says. “Furloughs will be back in play again though.”

Adds the Reason Foundation’s Director of Transportation Policy Bob Poole: “The sequester is built into the Congressional Budget Office’s (CBO) baseline.” Because the initial implementation of the sequester didn’t begin until well into Fiscal Year (FY) 2013, the system was required to absorb the entire 5 percent cut in six months, making it feel like a cut of 10 percent. “The cuts won’t seem as dire next year though,” he says, “but they will be a problem unless Congress replaces [the sequester] with something else.”

When Airport Business queried the FAA about air traffic control post-September 30, an agency spokesperson quickly responded: “President Obama’s budget does provide funding for the FAA to keep the towers open and the Midnight shifts staffed at the roughly 70 affected airports. We can’t speculate on whether these services will continue next fiscal year until the FAA has final FY 2014 funding.”

Texas Department of Aviation’s (TexDot) Director of Aviation Dave Fulton was considerably more succinct about the depth of the problem the industry faces. In this state, the initial cuts would have halted federal funding at 14 of its contract towers. “Business aviation is huge in Texas,” he says. “We’ve seen considerable traffic using our reliever airports (the primary targets of contract towers cuts). Some airport managers told me they stood to lose airport tenants if the towers closed.”


Counter Moves

Texas Gov. Rick Perry, himself a former C-130 pilot, grabbed a leadership role early on in the contract tower debate by asking that state’s aviation commission to fund the cost of the towers. Texas’ price tag would have been $2 million for each 90 days of continued service, a figure the state could absorb, but only in the short run.

While a state willing to pick up the tab certainly represented good news to tenants and employees at the affected airports, the move would also have set a precedent some states were not keen to follow, fearing the complete loss of future federal funding once they paid the first dime. Some state officials (who preferred not to be named) told Airport Business they were simply not willing to throw in the towel and commit to permanently funding towers locally.

“The thought of the FAA trying to shove this all back on the states worried me too,” says Fulton.


Safety in the Air

If the threat of contract tower cuts reappears in the government’s FY 2014 budget, the 40 odd lawsuits filed this year on behalf of the individual airports affected are certain to come back as well. Within those suits, the principal argument was that the FAA needed to prove the cuts would not adversely affect air safety.

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