Dramatic victories by Republicans in this week’s federal elections not only alter the power structure in Congress. They’ll dramatically affect negotiations going forward on several issues of interest to the airport industry, most notably FAA reauthorization.
Turnover in Congress, particularly the defeat of Rep. James Oberstar, D-Minn., likely will eliminate some barriers standing in the way of passing a reauthorization bill, says Robert Poole, director of transportation studies with the Reason Foundation.
For instance, in this year’s House version of the reauthorization, Oberstar included a provision that would permit FedEx Corp. drivers to organize under provisions of the National Labor Relations Act, which allows local union organization. Competitor United Parcel Service Inc. is governed by that law.
FedEx is currently governed under the Railway Act, which requires national elections. The company opposes Oberstar’s proposed change. With Republicans in power, Oberstar’s provision will probably be struck from future versions of the bill, Poole says.
But in this case easier does not necessarily mean better for airports. Oberstar’s defeat also eliminates one of the staunchest supporters of increasing the passenger facility charge, which airports use to fund capital projects. It’s been capped at $4.50. The House bill, co-written by Oberstar, who chairs the House transportation and infrastructure committee until his term ends in January, had proposed increasing the limit to $7.
There had been rumors the Senate was considering allowing a $1 increase during negotiations earlier this year, but nothing definitive was ever passed. The Senate reauthorization proposals in recent years have fallen more in line with views expressed by the airline industry, which sees raising the PFC as a tax increase.
“The knee jerk position of a lot of no-tax increase Republicans is going to be to fall for the misleading line peddled by the airlines,” Poole says. “I’ve written many times that it’s not, that it’s an example of local self-help that free market conservatives should be in favor of.”
The industry is currently operating under the 16th short-term extension of the existing legislation, which expired in 2007.
