Summary
Statement of Phil Boyer, President, AOPA Legislative Action before the House Committee on Transportation and Infrastructure, Subcommittee on Aviation Concerning the
Federal Aviation Revitalization Act of 1995 (H.R. 2276) September 28, 1995
- AOPA Legislative Action enjoys the financial support of 330,000 dues-paying members. Together with its affiliate, the Aircraft Owners and Pilots Association, AOPA Legislative Action promotes the interests of those who contribute to the economy by using general aviation for business and personal transportation.
- AOPA Legislative Action fully supports H.R. 2276, and was one of the first organizations to endorse the bill. We are pleased that it incorporates the major elements of our five-point FAA reform proposal, including personnel and procurement reforms.
Genuine Reform vs. User Fees
- FAA says it needs $59 billion over seven years, but claims it will get only $47 billion under the GOP balanced-budget plan. This led to the Senate bill calling for user fees for FAA (the McCain bill, S.1329) which the Clinton Administration and FAA support.
- The FAA has proven itself incapable of making reliable cost predictions. The NAS plan, which the FAA said would cost $11 billion, is a classic example. Its cost has ballooned to $40 billion with no end in sight.
- The supporters of user fees have not proven that there is a funding crisis in the cards for FAA. Crisis or not, H.R. 2276 will allow FAA to save money immediately by increasing the agency's efficiency and flexibility. The FAA itself estimates it could save 20 percent in procurement costs - nearly $3 billion by 2002. Cutting the estimated 400 to 500 employees at DOT whose only job is to second-guess the FAA would also save money. And the select panel on innovative financing contained in the bill provides for a new look at FAA financing.
- The McCain Bill also calls for eliminating the portion of FAA's funding that comes from the general fund, rather than the excise taxes on tickets, fuel and cargo that feed the aviation trust fund. However, the general fund contribution is clearly appropriate in light of the economic benefits of the aviation industry to the entire nation.
- In addition, the McCain bill requires FAA to negotiate with the Department of Defense (DOD) for payments by DOD for air traffic control services. Statements by DOD that it owes FAA nothing and intends to pay nothing proves two points - that FAA is no match for DOD in negotiations, and that the Clinton Administration's support for this bill is not unanimous.
- Are user fees needed? AOPA Legislative Action has a two-part analysis of this question: first, is additional revenue necessary? and if so, are new user fees the best means?
Is Additional Revenue Necessary?
- Before taking drastic measures, Congress should take advantage of the cost savings of personnel and procurement reform and other possible savings in FAA's budget and consider FAA's poor record of cost analysis.
Are New User Fees the Best Means?
- Even if new revenue is needed, user fees are not the solution. User fees amount to a back-door tax increase. The fees are likely to increase as Congress moves to balance the federal budget. And user fees would cost much more to collect than excise taxes - the collection cost could even cost more than the fees take in!
- The existing financing mechanism works well. AOPA Legislative Action is not convinced that more money is needed, but if it is, an increase in excise taxes is preferable to user fees. Surveys show that 90 percent of AOPA members prefer excise taxes to user fees.
The Duncan-Lightfoot Bill
- Under the Duncan-Lightfoot Bill, FAA would have the freedom to carry out its mission more quickly and efficiently on a day-to-day basis. When it comes to the big picture, though, the bill preserves the function of Congress in guiding the FAA. User fees would destroy that essential function.
- For these reasons, AOPA Legislative Action wholeheartedly supports the Duncan-Lightfoot Bill.