What has been touted by some as a “compromise” FAA budget reauthorization bill has turned out merely to shift proposed general aviation user fees onto owners of small turbine aircraft.
The wording chosen by Senators Trent Lott and Jay Rockefeller of the Senate Commerce Committee does nothing to stop the FAA from imposing user fees on general aviation while hiking fuel taxes, although it would keep taxes on piston-powered aircraft fuel where they are today and impose no user fees on that segment of GA.
Instead, it would shift the entire burden onto turbine-powered planes flying IFR, which would be subject to a fee of $25 per flight. The bill proposes raising the general aviation tax on turbine fuel from 24 cents to 49 cents a gallon, certainly better than the 70 cents requested by the FAA, but an unwarranted increase, according to critics.
The National Business Aviation Association’s CEO Ed Bolen had a quick and sharp response to the senators’ proposal.
“For decades, Congress has responsibly managed a system of aviation excise taxes to ensure that the U.S. has the largest, safest and most efficient air transportation system in the world,” he said. “It is regrettable that at a critical point in our transformation to the Next Generation Air Traffic System, the bill is proposing a sharp pivot away from a proven funding structure toward the foreign-style user fees that have been so harmful to small aircraft operators outside the U.S.”The Rockefeller-Lott proposal would impose a per-flight fee on a wide variety of GA aircraft, used mostly by small and mid-size businesses in small towns and rural areas that often have little or no airline service, Bolen commented. “NBAA members strongly support efforts to transform the nation’s aviation system to meet future needs,” he continued, “but we oppose the user fees included in the Senate proposal.”
Bolen particularly derided replacement of “the ultra-efficient fuel-tax system” with a new, expensive and burdensome “bureaucracy of billing agents, collection agents, auditors, dispute arbitrators and others.”
He also drew attention to the fact that the FAA could raise user fees, not to mention broaden their imposition, without consulting Congress once fees were authorized. Such fees “are subject to manipulation and can be raised when industry can afford it least,” he said. As an example, he noted that “in 2002, when air traffic was depressed as a result of the recession and terrorist attacks, Canada raised its user fees to cover its declining revenues.”
Bolen added that, in addition to establishing new user fees, portions of the bill still under development “could eliminate the airlines’ fuel tax obligation” by more than doubling fuel taxes for general aviation.”User fees should not be mistaken for a modernization plan, and the airlines shouldn’t be given a financial windfall at the expense of general aviation,” Bolen stated bluntly.
AOPA President Phil Boyer’s words were softer but nonetheless critical of the Rockefeller-Lott proposal which, he said, “misses the fundamental AOPA principle of no user fees for any segment of aviation. We have real concerns about the precedent-setting introduction of user fees and the impact on our members who fly turbine aircraft.”
Under the Rockfeller-Lott proposal, Part 91 turbine owners would see taxes on JetA double and an IFR user fee of $25 per flight, called an “Air Traffic Modernization” surcharge. The proposal calls for increasing the jet fuel tax from 24 to 49 cents per gallon, to be phased in over the next five years.
Under this proposal there would be no user fees for piston aircraft, nor any increase in the existing fees for services such as aircraft registration or pilot certificates. The bill also would eliminate the FAA’s proposed “congestion fee” for GA operations in Class B airspace.
On the plus side, the bill would increase spending on airport improvements above current levels, unlike the FAA’s proposal to cut airport funding by almost $1 billion a year.
GA advocates say user fees for any segment of aviation are unacceptable.
“Once a ‘fee’ or ‘surcharge’ enters our funding system, we step onto the slippery slope, and it would only be a matter of time before fees trickle down to all of general aviation,” AOPA’s Boyer said. “It has happened everywhere else in the world.”
Boyer also again questioned the need for additional FAA funding sources. “We have yet to see a concrete plan and budget for ATC modernization, and the government’s own experts have told Congress that the current funding system can easily provide the money that the FAA thinks it might need for its NextGen program,” he said.
The Rockefeller-Lott bill is one of at least three FAA reauthorization bills now in the works. The first was the FAA’s “Next Generation Transportation System Financing Reform Act of 2007,” backed by the Bush administration and the airlines. It proposes huge tax increases and user fees, but has not been well received by House and Senate aviation committees. Rockefeller-Lott is the Senate Commerce Committee’s alternative to the FAA’s bill. In addition, members of the House Transportation and Infrastructure Committee are writing their own FAA reauthorization bill, details of which are not yet public.
After the bills are formally introduced, there will be hearings, votes and amendments. Whatever FAA reauthorization bills come from the House and Senate, they probably will be different, so a conference committee will sort out the language and send a compromise bill to both houses for a final vote.