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New Senate Funding Proposal Would Exempt Piston Aircraft From User Fees

But EAA Opposes Plan To Create User Fee Apparatus

May 4, 2007 — While a new FAA funding proposal put forth by Senators Jay Rockefeller, (D-WV) and Trent Lott, (R-MS) shows considerable improvement over the Bush administration's plan, EAA has concerns because it still introduces the concept of user fees and shifts considerable expenses from the airlines to general aviation.

The Senate bill would exempt piston-powered general aviation aircraft from user fees and higher fuel taxes but user fees, such as a $25 "modernization surcharge" for filing an IFR flight plan, would be assessed on turbine GA aircraft. Fuel excise taxes for turbines would also more than double to 49 cents per gallon under the proposal, while the airlines' current 4.3 cent-per-gallon fuel tax would be phased out. That represents an annual $500 million shift in costs from the airlines to general aviation.

The bill, which is promoted as being an ATC modernization bill, in reality does not raise any additional funds for modernization because any new revenue raised from the "modernization surcharge" on IFR flights is more than offset by the cut in fuel taxes for the airlines. Indeed, a preliminary examination of the bill indicates that there could be a net loss in overall revenue from the current system of excise taxes, making it all the more tempting for Congress or the proposed Oversight Board to increase the level of user fees in the future or add additional user fees for other segments of the GA community.

"We continue to believe the current funding system of excise taxes works very well and is projected to be more than adequate to pay for both the FAA and the next generation air traffic control system," said Doug Macnair, EAA vice president of government relations. "We're pleased this newest proposal would spare piston aircraft operators from user fees and higher fuel taxes, but it still establishes an apparatus for the collection of user fees, which in other parts of the world has led to ever-escalating fees across the board. That's why we object to a user fee system of any kind.

"EAA appreciates the efforts of Sens. Rockefeller and Lott as a true departure from the plan put forth by the Bush administration," Macnair added. "Alternatives to the current revenue system may exist and EAA is willing to explore them. But we consistently oppose any establishment of user fees."

EAA has supported the assertion for the need to modernize the air traffic system but maintains that this can be accomplished under the existing tax structure and at current funding levels (which is supported by the General Accounting Office). EAA also maintains that should a funding shortfall develop in the future to support modernization, it is a very simple matter to fund specific modernization projects by levying a modest, dedicated fuel tax increase EQUALLY on ALL users of the system.

This is a very different matter than granting massive tax breaks to the air carriers to be paid for by operators of turbine-powered general aviation aircraft while raising no new revenue for ATC modernization as the current Senate bill proposes.

EAA continues to work with members of the House and Senate to hammer out workable agreement on this critical matter to general aviation. We urge our members to contact their elected representatives in Congress to let them know the direct impact user fees would have on them, their families, businesses, and communities. For more information, visit www.eaa.org/govt/index.html.

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