Issue Brief: Foreign Overflight Fees
 | Issue Brief |
Foreign Overflight Fees
September 1998
Summary:
As a result of new authority granted in the Federal Aviation Administration Reauthorization Act of 1996, (P.L. 104-264) the FAA began collecting new user fees for foreign overflights (flights aircraft that neither take off from, nor land, in the United States). These fees were challenged in court, and the Court of Appeals declared that the method used to determine the fee schedule was invalid. The FAA suspended the fee program but plans to reinstate it if legislation can be implemented to clarify the pricing method.Overview:
Section 273 of the Federal Aviation Administration Reauthorization Act (P.L. 104-264) authorized the collection of new user fees for foreign overflights. These fees were to be charged for air traffic control services provided to aircraft that neither take off from, nor land, in the United States. The intent of this legislation was to charge fees for foreign commercial air carriers. Commercial users account for 94% of all overflights. Many other nations already charge a similar overflight fee.When the FAA set about writing the regulations that would establish this fee, it went beyond the intent of Congress by also proposing a general aviation (GA) overflight user fee. On May 19, 1997, the FAA began charging the fee for all foreign overflights, including those by GA aircraft, with the exception of Canada-to-Canada flights. Fees for flights which takeoff and land in Canada were temporarily delayed to avoid disruptions of air traffic patterns along the U.S. Canadian border and to "preserve current operational control relationships with Canadian air traffic authorities."
Later that year, a group of foreign airlines sued the FAA, claiming the FAA acted unlawfully in employing an expedited procedure to implement these fees, and that they violated the anti-discrimination provisions of international aviation agreements. The case was argued before the United States Court of Appeals on November 21, 1997, and the court made its decision on January 30, 1998. The court decided that the fees themselves were not illegal, but that the value-oriented "Ramsey pricing" method they had used to determine the fees did violate the law. As a result of the court decision, the FAA suspended the fee program.
The FAA decided not to appeal the court decision, and in April 1998, the agency announced that it would issue refunds to those who had paid the fees between the time of their implementation and the decision of the court.
Intent of Congress
The Congressional intent of the original legislation was demonstrated in floor debate, which was limited solely to discussion of fees on commercial air carriers. At no time were fees on general aviation discussed. Since then, Congress has taken several actions demonstrating opposition to overflight fees for general aviation.
On April 16, 1997, the leadership of the House Transportation and Infrastructure Committee, and its Aviation Subcommittee, wrote to Acting FAA Administrator Barry Valentine. In the letter, they said "imposing a fee on general aviation was certainly not our focus when we drafted the Federal Aviation Administration Reauthorization Act."
On April 30, 1997, the Senate Appropriations Committee adopted an amendment to the FY97 emergency supplemental appropriations bill to exempt GA from foreign overflight fees. Although the amendment was subsequently dropped from the bill, the Committee later included language in the transportation funding bill stating that for safety reasons, Congress did not intend to authorize foreign overflight fees on general aviation and that GA operations should be exempted.
Safety Implications
There is a substantial safety concern that pilots would attempt to avoid fees by selecting less desirable routes or not obtaining detailed weather briefings. The FAA admitted in its interim final rule imposing the fees that there are safety issues unique to GA that need to be considered when establishing overflight fees.
Legislative Outlook
In its draft FAA Reauthorization proposal, the Administration proposed language clarifying the methodology that should be used in determining foreign overflight fees. The Senate FAA Reauthorization bill, S.2279, includes language similar to the Administration proposal that establishes the controversial Ramsey pricing method for calculating the fees. The Senate bill would also exempt fees for overflights that take off or land in a country contiguous to the U.S. if the origin and destination are within that other country, that country exempts similar categories of flights by U.S. citizens, and that country exchanges responsibility for air traffic control services with the U.S.
Updated on Tuesday, September 15, 1998 3:23:46 PM