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House Aviation SubCommittee Members Show Increasing Opposition To FAA Funding Plan

Questions Posed About Impact Of User Fees, Fuel Taxes On GA

March 15, 2007 — Several members of the House Subcommittee on Aviation expressed a wide range of concerns Wednesday to FAA Administrator Marion Blakey on the administration?s proposed plan to revamp the agency?s funding mechanism. Blakey appeared at the subcommittee?s hearing to discuss the Administration's FAA Reauthorization Proposal.

But while there is evidence of mounting opposition to the proposal, there is also a growing realization that all parties need to work together to ensure FAA?s reauthorization and funding for future modernization of the air traffic control system.

Among the elements of the proposal questioned were the imposition of user fees and creation of a cost-effective system to collect them; the three-to-four-fold increase in GA fuel taxes; cutting the general fund contribution to fund FAA operations; decreasing funds to increase capacity (runways and infrastructure); and the inequitable cost-shift from airlines to general aviation.

When asked about user fees? impact on general aviation, Blakey pointed to the proposed terminal fees at the 30 hub airports. She estimated the terminal fee costs as being $3.86 for a 172, $5.07 for a Bonanza, and $15.93 for a Citation. EAA seriously questions whether the FAA could efficiently collect such a small fee from numerous different parties. For example, FAA has a long-standing policy that it is not cost effective to collect international oceanic air traffic control fees if the total does not exceed $250 per month. So how could they possibly collect $3.86 cents in a cost-effective manner?

When asked if GA would be harmed by the proposal, Blakey answered, ?No,? and estimated total costs would be less than 5 percent of the cost for annual airplane ownership. But there was no mention of other fees proposed to pay for the costs of numerous certification and registration activities.

Those would include: registering an aircraft ($130); replacing an aircraft registration ($45); issuing an original dealer?s aircraft certificate ($130); issuing an additional aircraft certificate ($105); issuing/renewing a special registration number ($80/$50); recording a security interest ($130); recording a security interest in aircraft parts ($130); issuing or replacing an airman certificate ($50/$25); issuing an airman medical certificate ($42); and for providing legal title opinions pertaining to aircraft transactions ($100). And, of course, there?s the large fuel tax increase. Most onerous is the fact that under the FAA?s proposed bill, the Agency would have the authority to recover other costs as they see fit in the future through the imposition of other fees and there is no stated cap on the dollar amount for each fee.

Verne Ehlers (R-MI) called the proposed large tax increase from 19.3 cents per gallon to 70 cents per gallon on aviation fuel ?unreasonable,? and asked how FAA could justify the 56.4-cent tax-per-gallon increase, specifically referencing the recreational flyer and light-sport aircraft.

Robin Hayes (R-NC) questioned why, under the provisions of the proposal, there would be a 275 percent increase on operating expenses for a pilot flying a Bonanza, but an 18 percent decrease on the operations of a 747. ?This is a terrible imposition on a segment (GA) of the marketplace.? He also cautioned members not to repeat the mistake from several years ago when the luxury tax had an adverse affect on general aviation.

John Mica (R-FL), ranking member of the Transportation and Infrastructure Committee, appears to be the lone strong voice in favor of not just shifting costs to general aviation, but also eliminating the 19 percent general fund contribution. He has stated that all users of the system should pay the entire bill, with no general fund contribution. ?I?m beginning to sound like the ?lone stranger? in supporting the administration?s proposal,? he said. "We've got to sober up and realize that we must devise a new method of adequately funding FAA and the nation's Next Generation air traffic control system.?

James Oberstar (D-MN), chairman member of the Transportation and Infrastructure Committee, expressed serious reservations about the funding aspects of the proposal that shifts costs from the airline passenger to the general aviation ?giant cash register in the sky.?

Other comments by members of the subcommittee:

Subcommittee Chairman Jerry Costello (D-IL) called the FAA?s proposed cuts to fund increased capacity (runways and infrastructure) extremely shortsighted, noting that adding runways and other airport capacity projects are the best means of increasing system capacity and preventing gridlock.

Peter Defazio (D-OR) called the administration?s proposed general fund contribution (19 percent) ?inadequate,? noting that as the costs go up, that fixed dollar amount will be a smaller and smaller portion of the overall revenue. DeFazio also questioned the wisdom of reducing the arrival and departure tax on international travelers by 60 percent. ?We?re cutting their (international passengers) tax bill and shifting it over to citizens of the U.S.,? he said. The lost income is estimated at $1.1 billion-$1.6 billion by 2012.

John Hall (D-NY) expressed concern about the funding for small and growing airports that would be most important to the emerging very light jet industry, as well as the move away from the excise tax structure.

The subcommittee plans three more meetings this month to address the financing proposal (March 21); operational and safety programs (March 22); and the FAA?s Airport Improvement Program (March 28).

EAA continues to urge members to participate in efforts to put a stop to the FAA?s user fee proposal. Contact your elected officials and voice your concerns on how this proposal threatens to adversely affect your rights as an aviation enthusiast. To learn more about the issue, as well as how to get involved, visit The Government Adovocacy section of the EAA Website.

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