The first attempt at reauthorizing funding for the Federal Aviation Administration has been met with resistance by several members of Congress, who aren’t ready to hand over control of the industry’s air traffic control operations to a private entity.
Airport directors aren’t happy either.
ARN queried several industry leaders and received responses from four, all of whom are, will be or have been involved in leadership of one or more lobbying organizations in recent years. They have mixed feelings on the proposal to privatize air traffic control.
But the quartet universally expressed concern that Congress has again ignored the industry’s push for an increase in the passenger facility charge cap, which generates funds used in capital improvement projects. It currently sits at $4.50, where it has been since 2000.
“I think it is a big deal, as this is a local user fee with local control,” says David Edwards, president and CEO of Greenville-Spartanburg International (GSP). “Airports should be freed from the regulatory restrictions on PFC amounts, since these are not federal grant dollars. It is hard to understand the resistance of Congress on this issue since it is a user fee.”
Airport directors and their trade associations have been pushing hard for an increase to the PFC despite heavy opposition from the airline industry.
Jeff Mulder, director of airports at the Tulsa Airports Improvement Trust and chair of the American Association of Airport Executives, says it’s especially troubling because the currently proposed bill would fund the FAA for what would be a long six years.
“It is a significant issue,” he says. “If that version ultimately is passed, we would be stuck out in the cold for another long time period.”
“It’s important that the airport industry has the proper funding to update and build needed infrastructure,” adds Maureen Riley, executive director of the Salt Lake City Department of Airports and the chair of Airports Council International – North America for 2015-16. “An increased PFC is fundamental to providing a stable and reliable funding stream for that purpose, without relying on the support of our airline partners to fund facilities that foster competition.”
Scott Brockman, director at Memphis International (MEM), called the proposal a missed opportunity that “fails to recognize, accept and address significant challenges at airports with growing infrastructure needs.”
A “modest increase” in funding the Airport Improvement Program, another source of funds for projects, is helpful and justifiable, Brockman adds, but also is not enough to significantly dent the industry’s needs.
“This is a very big deal,” he adds. “We can’t afford to wait for another three to five years for another FAA reauthorization process to roll around for a PFC increase. We’re falling further and further behind each day, and we need action now.”
The industry may have a bit more time to keep pushing for the increase. Recent media reports have indicated that the bill, whose chief supporter is House Transportation Committee Chair Bill Shuster of Pennsylvania, faces stiff opposition in the House. The Senate has yet to introduce its reauthorization proposal. There is near universal agreement that a second short-term extension of the existing FAA funding bill will be necessary before a long-term bill can be passed.
The biggest issue is the issue of air traffic control privatization. Directors also have mixed thoughts on that portion of the bill. Mulder says he’s neutral, but likes the fact that Congress is discussing bigger issues. He says the federal government needs to take the same transformational look at the PFC and adds that he does believe the government belongs in the business of developing and operating a system that provides services to the public.
“Their role should be regulating and oversight,” he says. “A government entity is not well equipped to develop and operate a user-funded system.”
Edwards supports privatizing air traffic control, though he’s disappointed that airports were not included as stakeholders to serve on the resulting organization’s board.
In the event Congress maintains its unwillingness to increase the PFC, directors cite a number of other issues they would like to see addressed.
Edwards would like to see regulatory reform moving the federal government out of the business of airports. Its role “should be limited to ensuring the safety of airside movement areas and airspace at airports,” he says.
Mulder says Congress also needs to address the pilot shortage and should allow airlines to provide their own flight training, as proposed by the Regional Airline Association. And Riley adds that Congress could take a step in the right direction by allowing airports to issue bonds that are not subject to the Alternative Minimum Tax.
Regardless of other issues, the directors are united in their main goal. “Of course, the primary goal still should be an increased PFC,” Riley says.
Adds Brockman: “The House bill really can’t be considered successful – and certainly not transformational – from the airport perspective unless it allows airports to address their infrastructure development needs through an increase in the PFC cap.”
