Despite a finding by the General Accountability Office that the

Department of Transportation's proposed slot auction is illegal, DOT is

proceeding with plans to auction 293 slots at the New York airports, announcing

it last week under cover of a plan committing almost $90 million over the next

eight years to expand capacity at Kennedy Airport.

In a parting shot that becomes effective eight days before Bush

Administration winds to a close, Secretary of Transportation Mary E. Peters

unveiled final rules to auction a limited number of landing and take-off slots

at each of the region's three airports. Saying it is not bound by the GAO

finding, General Counsel DJ Gribbin said at a DOT-called press conference the

auctions would foster increased competition, lower congestion and lower fares.

The plans includes auctioning 113 slots at LaGuardia, 89 at Kennedy and

91 at Newark over the next five years with the first auction set for January 12.

In addition, under the rule for JFK and Newark, existing airlines would keep

1,035 of the slots they currently operate at JFK Airport and 1,154 of the 1,245

slots they currently operate at Newark Airport. Under the final rules, airlines

operating at JFK, Newark and LaGuardia would receive a 10-year ownership of the

vast majority of FAA slots they currently operate. She added that the rules also

would lower the hourly operating cap at LaGuardia airport from 75 slots per hour

to 71 slots per hour by "retiring" an additional five percent of the slots

currently being used, cutting delays by an estimated 40 percent.

Regional Airline Association blasted the Department of Transportation's

decision to move forward with slot confiscation at New York metropolitan

airports. The announcement comes as a crushing blow to smaller communities

across the nation, said the organization, adding slot auctions will result in

"devastating service losses."

"DOT's scheme will leave small communities disconnected as airlines,

struggling with higher costs and reduced points of access to the system, will be

forced to reduce service at smaller markets to focus on more profitable routes

between large cities," said President Roger Cohen. "In fact, a recent study by

the NY and NJ Port Authority concluded 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 Air Transport Association of America (ATA) called the idea ill-

conceived and one that will result in a lengthy and costly legal challenge,

again pushing for action on the recommendations by the New York Aviation

Rulemaking Committee to "implement fair and practical solutions to address

delays and add needed new capacity, rather than needlessly forcing a costly and

protracted legal challenge over an ideological experiment." Also opposed to the

auction plan are the Congressional delegations from New York and New Jersey as

well as the Port of New York and New Jersey.

"The DOT decision patently defies the recommendation of the Government

Accountability Office (GAO), as well as the will of Congress, by attempting to

move forward with an illegal auction of airport slots," said President and CEO

James C. May. "The Secretary of Transportation's own group of key stakeholders

has proposed a clear set of solutions, while rejecting the idea of auctions. It

is past time to act on those recommendations."

The Secretary said that as a result of the auctions, all airlines would

have an opportunity to enter or expand current operations in the New York

market. She noted that additional competition like the kind the auctions would

bring is proven to lower fares and improve service. She noted, for example, that

fares declined by 25 percent at Philadelphia International Airport after a new

airline entered that market in 2004. She added that when a new airline began

serving JFK airport in 2000, fares fell to some destinations by as much as 50

percent.

"Without slot auctions, a small number of airlines will profit while

travelers bear the brunt of higher fares, fewer choices and deteriorating

service," the Secretary said. "Slot auctions, meanwhile, will keep flights to

New York affordable, available and vibrant while giving all airlines an

opportunity to compete in one of the world's most popular aviation markets."

Taxiway Construction at JFK

Under the Secretary's plan, DOT will sign what is known as a Letter of

Intent committing the federal government to invest $89 million between 2009 and

2016 to fund a series of taxiway improvements at JFK airport. The taxiway

improvements include constructing two new taxiways, extending or improving six

others and creating new high-speed exit taxiways. The JFK taxiway work will make

it easier for aircraft to maneuver between gates and the airport's runways,

cutting travel time and limiting delays, the Secretary said. She added that the

new high-speed exit taxiways will reduce inbound delays to aircraft arriving at

JFK.

Atlanta built another type of efficiency project called an end-around

taxiway to eliminate conflicting traffic increase safety and safe fuel. Related

Story www.aviationtoday.com/ran/categories/commercial/10049.html FAA studies say

the Atlanta facility will result in a 30 percent improvement in overall runway

efficiency and annual fuel savings between $26 million and $30 million.

"The goal is simple, find every possible way to safely add as much

capacity as possible to some of the most popular airports in the country," said

Acting Federal Aviation Administrator Robert Sturgell. "Combined with dozens of

other capacity improvements we're making at the airport, this new investment

will lead to more flights, fewer delays and a better traveling experience for

countless flyers."

Secretary Peters said that the construction work was expected to begin in

2009 and would be completed by 2014. She added that the department also was

working with local airport officials to move forward on a range of other needed

capacity projects, including additional taxiways and other airfield

improvements.

She said that until the capacity improvements can come on line, DOT

limited the number of flights that could operate in a given hour at JFK and

Newark airports. Combined with existing caps at LaGuardia airport, the Secretary

said that service at the airport was at risk of stagnating since other

competitors are locked out of the market. She cautioned that studies have found

airfares at capped airports run 11 to 15 percent higher than at comparable

airports without caps.