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From the Online Wall Street Journal.
Bush Proposes Change
In How FAA Is Funded
[FONT=times new roman,times,serif][FONT=times new roman,times,serif]By ROBERT GUY MATTHEWS
February 6, 2007; Page A12[/FONT]
[/FONT]
President Bush told Congress he wants to scrap the passenger-ticket taxes used to help fund the air-traffic control system and replace them with user fees for commercial airlines.
The result, however, will be some air travelers, commercial airlines and corporate jet owners are likely to end up paying more to fly to pay for a new generation of traffic control technology.
If approved, the proposed changes would take effect in 2009 and mark a major shift in how the Federal Aviation Administration is funded. Fees would be assessed for flights depending on how much traffic controllers are used to guide them through the skies. It isn't yet clear if these fees would show up on tickets.
The current system uses a mixture of ticket taxes, fuel taxes and other add-ons to pay for air-traffic control. Business jets represent more than 18% of all flights, but they pay just 5% of those FAA fees. Airlines, which represent some two-thirds of flights but pay more than 90% of the fees, have long complained they are overpaying. They see this proposal as a victory of sorts.
"Whether there are three or 300 passengers on an aircraft, to an air traffic controller, a blip is a blip on the radar screen," said James C. May, president of the Air Transport Association, the leading airline trade group.
A major obstacle to getting the plan off the ground, though, is that the chairman of the House Transportation and Infrastructure Committee, Rep. Jim Oberstar (D., Minn.), has argued that the current tax system doesn't need changing.
"The proposal is pretty sketchy at this point," said Mr. Oberstar's spokesman, Jim Berard. "Until they can provide convincing evidence to change the system, then he isn't going to change the system."
There are 7,836 commercial airplanes and approximately 16,658 corporate aircraft registered in the U.S., according to the FAA. While the number of corporate aircraft is higher, commercial jets are used much more frequently and often fly longer distances, which adds to the workload of air traffic controllers. President Bush says the new system will better assess costs for using the air-traffic-control system.
Under the budget proposal, corporate jets and perhaps private aircraft would still fund the FAA through fuel taxes, albeit higher ones. That worries corporate fliers.
"We will be in overdrive" to lobby against the proposal, said Steve Brown, senior vice president of operations for the National Business Aviation Association, a Washington-based lobbying group. "We will contact all our members and you name it we will be out there."
FAA Administrator Marion Blakey demurred on details such as how much more in user fees would be generated to pay for the system. She said that more details would come "as early as next week" when the Bush administration plans to submit its plans for the reauthorization of FAA funding, due to expire later this year.
Next week, the Transportation Department is likely to spell out how the user-fee system would work, whether it would count the number of planes in the sky, how long they stay in the air, or landings and takeoffs.
What is clear though is that these proposed changes side with public commercial airliners rather than private corporate jets fliers in their debate over which is the fairer way to pay for use of the air traffic control system.
Commercial airliners pay through ticket taxes, the ones that Bush proposes to eliminate, and to a lesser extent fuel taxes.
Corporate fliers pay higher fuel taxes than commercial airliners for use of the system. But because corporate jets don't have ticket-paying passengers, they aren't subject to that tax.
Ms. Blakey said that there would be an increase in the fuel tax under the proposed system. "I think we will see increase on the fuel tax. I am talking about shifting of costs, not increasing of costs" overall.
Write to Robert Guy Matthews at [email protected]19
Bush Proposes Change
In How FAA Is Funded
[FONT=times new roman,times,serif][FONT=times new roman,times,serif]By ROBERT GUY MATTHEWS
February 6, 2007; Page A12[/FONT]
[/FONT]
President Bush told Congress he wants to scrap the passenger-ticket taxes used to help fund the air-traffic control system and replace them with user fees for commercial airlines.
The result, however, will be some air travelers, commercial airlines and corporate jet owners are likely to end up paying more to fly to pay for a new generation of traffic control technology.
If approved, the proposed changes would take effect in 2009 and mark a major shift in how the Federal Aviation Administration is funded. Fees would be assessed for flights depending on how much traffic controllers are used to guide them through the skies. It isn't yet clear if these fees would show up on tickets.
The current system uses a mixture of ticket taxes, fuel taxes and other add-ons to pay for air-traffic control. Business jets represent more than 18% of all flights, but they pay just 5% of those FAA fees. Airlines, which represent some two-thirds of flights but pay more than 90% of the fees, have long complained they are overpaying. They see this proposal as a victory of sorts.
"Whether there are three or 300 passengers on an aircraft, to an air traffic controller, a blip is a blip on the radar screen," said James C. May, president of the Air Transport Association, the leading airline trade group.
A major obstacle to getting the plan off the ground, though, is that the chairman of the House Transportation and Infrastructure Committee, Rep. Jim Oberstar (D., Minn.), has argued that the current tax system doesn't need changing.
"The proposal is pretty sketchy at this point," said Mr. Oberstar's spokesman, Jim Berard. "Until they can provide convincing evidence to change the system, then he isn't going to change the system."
There are 7,836 commercial airplanes and approximately 16,658 corporate aircraft registered in the U.S., according to the FAA. While the number of corporate aircraft is higher, commercial jets are used much more frequently and often fly longer distances, which adds to the workload of air traffic controllers. President Bush says the new system will better assess costs for using the air-traffic-control system.
Under the budget proposal, corporate jets and perhaps private aircraft would still fund the FAA through fuel taxes, albeit higher ones. That worries corporate fliers.
"We will be in overdrive" to lobby against the proposal, said Steve Brown, senior vice president of operations for the National Business Aviation Association, a Washington-based lobbying group. "We will contact all our members and you name it we will be out there."
FAA Administrator Marion Blakey demurred on details such as how much more in user fees would be generated to pay for the system. She said that more details would come "as early as next week" when the Bush administration plans to submit its plans for the reauthorization of FAA funding, due to expire later this year.
Next week, the Transportation Department is likely to spell out how the user-fee system would work, whether it would count the number of planes in the sky, how long they stay in the air, or landings and takeoffs.
What is clear though is that these proposed changes side with public commercial airliners rather than private corporate jets fliers in their debate over which is the fairer way to pay for use of the air traffic control system.
Commercial airliners pay through ticket taxes, the ones that Bush proposes to eliminate, and to a lesser extent fuel taxes.
Corporate fliers pay higher fuel taxes than commercial airliners for use of the system. But because corporate jets don't have ticket-paying passengers, they aren't subject to that tax.
Ms. Blakey said that there would be an increase in the fuel tax under the proposed system. "I think we will see increase on the fuel tax. I am talking about shifting of costs, not increasing of costs" overall.
Write to Robert Guy Matthews at [email protected]19
