WASHINGTON, D.C. — General aviation flight hours are expected to grow at a rate of 3.2% a year for the next 10 years
Meanwhile, airline passenger count is forecast to grow at a rate of 3% a year, but there will be more flights with air carriers using smaller regional airplanes with lower ticket costs. The FAA says this will reduce the amount of revenue coming to the government. These are some of the reasons why the FAA wants to overhaul its revenue sources.
These points came out at the 31st annual forecast conference, which attracted some 600 people.
FAA Administrator Marion Blakey used her speech time to tout what she called “”a cost-based revenue system”” in which users pay for the services they receive. Translation: user fees.
Transportation Secretary Norman Mineta also stressed the need for a pay-for-service revenue source. He was critical of those who opposed user fees, declaring he could not say what the final proposal will be and urged patience until the plan is released.
A panel discussion immediately before the Blakey-Mineta speeches gave an indication of the strong positions that will come in the next few months as Congress takes up renewal of the aviation trust fund legislation.
FAA’s voice on the panel, Sharon Pinkerton, declared that the government announced a year ago the need to match revenue to services, a position airlines have been espousing for decades. Pinkerton, assistant administrator for policy, planning and environment, said the balance in the trust fund is at an all-time low because of the airlines’ lower fares. This, however, was questioned by others who stated the trust fund was intended to pay for airport improvement and not FAA operations, where most of the money is now funneled.
Charles “”Chip”” Barclay, president of the American Association of Airport Executives (AAAE) and a moderator on the panel, commented that if the ticket tax is the problem, it should be fixed without disrupting the rest of the revenue stream.
General aviation is paying only 3% of the revenue into the fund, said James May, president and CEO of the airline’s Air Transport Association (ATA). He claimed the airlines pay 90%, including in his figures the taxes paid by passengers, millions of dollars the airlines may use before turning it over to the government. May commented that charges should be based on departures and time in the system. His complaint that congestion increases costs to airlines was quickly debunked by Ed Bolen, president of the National Business Aviation Association (NBAA). Bolen pointed out that airlines scheduling more arrivals and departures than an airport can handle in condensed time slots causes congestion.
The panel generally agreed that a consistent source of revenue is needed to give the FAA a base on which to plan improvements. Bolen and several others urged a greater share from the federal government, citing the economic benefits that air travel brings to the entire population.
Only days after the forecast conference, the ATA released its “”Smart Skies”” campaign outlining its plan for user charges. Basically, it calls for assessing charges for arrivals and departures and the amount of time in the air traffic control system. This would be in lieu of the ticket tax. It adds that different categories of users could pay in different ways “”providing it does not impose any burden on commercial aviation that is not cost based.””
The ATA plan says piston-powered aircraft should continue to pay through the fuel tax. Business turboprops and jets would pay fees, apparently similar to airlines.
With a user fee in place of a ticket tax, ticket prices would obviously go up to meet costs as the airlines have not been paying anything into the trust fund except a small fuel tax. Because business jets do not operate at high levels at the few airports congested by airline traffic, the ATA pitch obviously is aimed at chopping away at business flying.
Officials at the NBAA and the General Aviation Manufacturers Association (GAMA) immediately issued their own positions urging continuation of the fuel tax for all. The groups also commented that if business aviation is charged a user fee, it would not be long until all aviation was included.
At a Congressional hearing, Mineta declared he was sticking by his statement made at the Aircraft Owners and Pilots (AOPA) Expo last year that there would be no user fees for general aviation. He did not explain, however, whether he and the FAA consider business aviation to be general aviation.
Charles Spence is GAN’s Washington, D.C., correspondent.