Airlines, FAA tout user fees at annual FAA forecast conference

February 3, 2006

Airlines, FAA tout user fees at annual FAA forecast conference

When the FAA and all the airlines are in total agreement about something, it's not usually good for general aviation.

"What struck me the most about Tuesday's speeches and panels at the FAA forecast conference was the unity among all the airlines that we should change to a user fee system," said Andy Cebula, AOPA executive vice president of government affairs. The FAA holds the annual forecast conference to present its predictions on aviation traffic and economics, and to discuss issues with the aviation industry.

"While representatives of the Bush administration at the conference never said 'user fees,' they did use the code phrase 'cost-based revenue structure,'' said Cebula, "which is just bureaucrat-speak for calculating what it costs the government to do business, then directly charging the users enough to cover those costs without congressional oversight."

Said AOPA President Phil Boyer, "Make no mistake, this is about control. Neither the bureaucrats nor a select group of users should have the final say on how the system is run. The best interests of general aviation and the general public are served with Congress firmly in the left seat and in control. There are some who would much rather be able to spend as much as they like, and make the users pick up the tab, without Congress 'interfering.'"

Then there is the issue of overall cost effectiveness and accountability. A user fee system removes direct congressional control, reducing the impetus to contain costs.

"If you are a monopoly, and you can charge your customer whatever it costs to do business, what incentive do you have to keep charges low? It's not like there would be a competing air traffic control system that would charge a lower price," said Boyer.

"Today we are unified," Southwest Airlines Chairman Herb Kelleher said during a forecast conference luncheon address. Kelleher said that airline chieftains, who are members of the Air Transport Association (ATA), had signed an agreement to support replacing the current aviation tax system with one where the airlines are charged for airspace use. However, Kelleher said he didn't think that small GA aircraft should be charged user fees.

But ATA President James May has claimed that some types of general aviation don't pay their "fair share" of the ATC system. May said during the forecast conference that the $10 billion that the airlines pay each year in ticket taxes and other fees would be replaced with a formula that would likely include a fee for takeoffs and landings, plus fees for ATC contacts.

"This is why we in all of general aviation have to keep Congress in control," said Boyer. "Once a user fee system is implemented for some users, it's only a matter of time before the fees are pushed down to every user. As we've seen in Europe and New Zealand, they start at the flight levels, then add piston IFR, and ultimately VFR. And in Canada, GA got user fees but still has to pay the fuel tax."

Most user fee systems have hit their users with escalating charges. Israel, for example, is now proposing to almost triple the fee for a private pilot check ride, from $280 to $747. A commercial pilot practical test would increase more than five times, to $1,706.

"We don't agree the funding system is broken," said Boyer. "The aviation fuel tax does a fair job of apportioning costs among the users relative to how much of the system they use. The bigger and faster an aircraft is, the more likely that it will use a small part of the air traffic control system. The bigger, faster aircraft uses more fuel, and consequently pays more tax.

"And the gas tax literally costs peanuts to collect," Boyer continued. "Can you imagine the huge new bureaucracy that would have to be created to calculate and collect user fees? It couldn't possibly be as cost effective."

Boyer also took issue with the FAA's dire predictions of more small airliners and very light jets (VLJs) darkening the skies.

The FAA significantly reduced its forecasted growth in airline passenger traffic for 2006, predicting just a 0.3-percent increase. "Their predictions out to 2017 show just a 2.4-percent annual increase in the number of annual airline tower contacts, and only 1.9-percent increase in GA operations," said Boyer. "FAA's forecasts have historically been overly optimistic."

And about all of those VLJs, like the Eclipse and Cessna Mustang, which are supposedly going to be overwhelming controllers? "Even if the most optimistic predictions about VLJs turn out to be true, we will not see large numbers entering the system over the next five years. That means we have time to see how this market truly develops," Cessna CEO Jack Pelton said recently in a Washington speech.

March 2, 2006