General aviation should not experience many problems resulting from a month-long shutdown of the FAA, as most of our contacts with the government administration are related to flight safety, considered essential.
The one area directly affecting flying is in the manufacturing. Twelve of the furloughed FAA individuals are in aircraft certification. A month’s delay should have no major disruption, but manufacturers hope the issue can be quickly resolved after members of Congress return from their August recess.
The disruption is presenting confusion and uncertainties. One area is taxes. The federal government expects to lose about $1.2 billion in tax revenue during the month and even more if no quick solution is found. Much of the revenue involves airline ticket taxes, but an important part is fuel taxes. In a press conference, Secretary of Transportation Ray LaHood said lawyers in the Treasury Department are looking into what should be done about taxes. Some companies are collecting, others are not. Can taxes being collected be turned over to the government? Should companies not collect? The National Air Transportation Association has warned its members that they may not collect a tax that does not exist.
Another issue is the delay of airport construction projects. FAA Administrator Randy Babbitt says some 200 projects have been put on hold, causing about 70,000 workers to be furloughed from those jobs. No information, however, has been given about whether these workers might be assigned to other projects directed by the companies that employ them.
Democrats from the Senate held another press conference Wednesday, Aug. 3, in which they called on the Republican leadership to agree to the 21st “clean” extension of FAA funding and in which they railed about what they called “being hostage.” Their point was that by not agreeing to the Senate’s “clean” extension with no issues involved, the Senate was being held hostage to the wants of the House of Representatives.
Participants in the news conference were Sens. Harry Reid, John Rockefeller, Charles Schumer, and Barbra Boxer. Rep. Steney Hoyer from the House also participated.
Participants made strong points that the main issue is labor,, revolving around how unionization voting is counted. Appointment by President Obama of a new member to the National Mediation Board shifted the balance of power. With the new member, the NMB made a rule change. The rule had been that in the unionization of airlines, all eligible voters who did not cast a ballot would be considered votes against unionization. The new rule said that unionization should be decided by a single majority of the votes cast. The House passed an FAA reauthorization bill this year that would reverse the NMB ruling. The Democratically controlled Senate did not. That is the primary point of contention.
Senate speakers at the press conference insisted the issue was one of labor, not the Essential Air Service program, which subsidizes airline routes to small airports. Unions heavily backed the Democratic party in the 2010 election.
Although the Senators at the press conference continued to talk about the extension being about labor and not the EAS, the fact is there is no labor provision in the House extension.
Members of the Senate and House have had more than three years to find agreement and provide a more stable funding of the FAA. Bitterness evident in statements from the press conferences and in news releases from both forebodes a struggle to obtain agreement when Congress returns in September.
Charles Spence is GAN’s Washington, D.C., correspondent.