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What's the FAA's user fee proposal?What's the FAA's user fee proposal?

What's the FAA's user fee proposal?

"The new [FAA] funding system does not have to entail broad user fees," FAA Administrator Marion Blakey said at AOPA Expo in early November.

"What did you mean when you said you don't support broad user fees?" an AOPA member asked her. "Maybe very narrow teeny-tiny user fees," she joked in response.

There's a reason why she couldn't answer, at least not for the Administration.

She doesn't know yet.

But what the FAA would like to send to Congress would be "the most radical shift in funding government programs since the 16th Amendment and the implementation of the permanent income tax in 1913," said AOPA President Phil Boyer. More on that below.

Regardless of what you might have read about the FAA's proposal, it's far from being a done deal.

As Boyer explained during the AOPA Expo general session on user fees [ click here to watch the video], the FAA funding proposal (technically known as FAA Reauthorization) first is vetted, edited, massaged, and changed by the Department of Transportation, which has different priorities than the FAA. That's going on right now.

Then the White House Office of Management and Budget (OMB) tears into it, bringing a different set of priorities and political concerns. White House senior staff (including, perhaps, the most senior of the seniors) will tweak or change the proposal yet again to reflect their agendas.

After that, the Administration's proposed FAA Reauthorization Bill will be sent to Congress. Congress could accept it, change it, or write one of its own.

FAA budget and reauthorization - not the same thing

All of this is supposed to happen before September 30, when the current FAA Reauthorization Bill expires. (That bill continued the proven, four-decade-long precedent of using fuel and ticket taxes, plus a general fund contribution, to fund the FAA.)

But before that, the Administration has to submit a Fiscal Year 2007 budget for the FAA. (To grossly oversimplify, the budget, or appropriations bill, is what the FAA will spend. "Reauthorization" is how much it could spend if Congress approved, and where the money will come from.)

The FAA budget must be sent to Congress in February, and that may be the first time we know for sure what the Administration is thinking about user fees.

"We'll be looking at the budget very closely, looking for holes that weren't there last year," said Boyer. "If they left some blanks in revenue sources that won't be filled by taxes, that will be our first clue those other sources could be user fees."

Can they really say what they're going to spend before they know where the money is coming from?

Yes, this is Washington. After all, the FAA is saying it needs more money (and user fees) for the next-generation air traffic control system, even though it has no idea what that system will cost.

User fees - what the FAA wants

Okay, now to what the FAA would like for a new funding system. And remember, the FAA's funding proposal is currently under examination by the Department of Transportation. The White House hasn't yet had its say.

FAA Administrator Blakey may not support "broad user fees," but there are plenty of narrow ones in the FAA proposal that has been leaked to numerous sources.

User fees for the airlines to access most airports and the en route air traffic control system. User fees for general aviation to use the larger hub airports.

User fees to issue a pilot certificate, a medical certificate, and to register an aircraft.

A huge increase in - perhaps tripling - the GA gasoline tax.

Another FAA favorite is in there as well - peak hour pricing. The agency wants to be able to substantially increase the fees to use certain constrained airports during certain hours as a way to ration demand and control traffic.

It's pretty ugly, but it is just a proposal.

"The Administration is a much broader body than just yours truly," said Blakey at Expo [ click here to see a video excerpt of Blakey on user fees]. "We are in executive review on the ideas and principles behind reauthorization, and I can tell you I cannot predict what the proposal will ultimately say.

"It comes from the White House."

Stay tuned.

November 30, 2006

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