Fee Shift to Fund FAA Criticized

Feb. 15--A proposal to reform and fund the nation's air traffic system in the future would eliminate passenger ticket taxes and reduce costs for airlines.

It also would increase fuel taxes more than threefold for private pilots and other users of general aviation.

The proposal, outlined Wednesday by the FAA and the U.S. Department of Transportation, would shift funding for operating and modernizing the air traffic system to a combination of user fees, increases in fuel taxes and general fund appropriations.

The current funding for the FAA and its authority for its programs expires Sept. 30.

Under the change, commercial operators would pay about 20 percent less of the bill, while general aviation users would foot more of it.

The new cost structure is fair because it aligns costs with usage of the air traffic system, said U.S. Secretary of Transportation Mary Peters.

The general aviation industry opposes the change, saying it will hinder the use of general aviation aircraft and the sale of airplanes and other services and will lead to job cuts.

"The changes proposed by the FAA would overthrow a funding structure that has proven to be stable, reliable and efficient for several decades," said National Business Aviation Association chief executive Ed Bolen.

Reforming the system is essential to keep up with the expected boom in air travel, Peters said in a conference call. By 2025, airline traffic is expected to increase to two or three times the current level, Peters said.

The legislation calls for the development of a satellite-based air traffic control system. It's a way to reduce congestion, passenger delays, travel time and noise and provide tax relief to passengers, the FAA said.

Passengers would no longer pay a ticket tax on domestic flights, and the tax on international arrivals and departures would be cut in half.

But opponents caution that fares would not likely decrease, because airlines would pass along user fee costs in the price of a ticket.

The general aviation industry says the plan provides a huge tax break for the airlines and punishes small and midsize businesses in general aviation.

"It's fitting that the FAA's plan has been introduced on Valentine's Day, because it's a sweetheart deal between the agency and the commercial airlines," Bolen said.

Under the proposal, the amount commercial users pay would drop from 95 percent of the costs to about 73 percent, Peters said.

Commercial jet and turboprop flights, including domestic passenger, cargo, charter, air taxi and fractional operators, would pay user fees. Operators would be billed for the fees, Peters said.

General aviation aircraft operators, meanwhile, including single-engine piston aircraft users, would pay more through an increase in fuel taxes.

For them, taxes on fuel would rise from about 21.8 cents a gallon to 70 cents per gallon.

Other fees also would increase. For example:

--The charge to register an aircraft would rise from $5 to $130.

--The fee for a pilot's license would increase from no charge to $50.

--Aircraft dealer certificates would rise from $10 to $130.

Cost increases could have disastrous effects on Wichita planemakers, industry officials said.

In a survey of its members, the Aircraft Owners and Pilots Association found that 88 percent of general aviation operators said they would reduce their flying if costs rose, said AOPA president Phil Boyer.

That will lead to fewer pilots and fewer planes sold. And "that will hurt general aircraft manufacturers in Wichita and elsewhere," he said.

Wichita Mid-Continent Airport director Victor White said he has some concerns about the funding change. The overall fund to pay for airport improvements drops under the proposal, despite a rise in passenger facility charges on tickets.

"If they cut the amount of grant money available from the airport trust fund, that's a real problem," White said.

Reach Molly McMillin at 316-269-6708 or mmcmillin@wichitaeagle.com [mailto:mmcmillin@wichitaeagle.com].