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FAA 'funding crisis' manufactured by the administration and the airlines, claims world's largest aviation organizationFAA 'funding crisis' manufactured by the administration and the airlines, claims world's largest aviation organization

FAA 'funding crisis' manufactured by the administration and the airlines, claims world's largest aviation organization

W ASHINGTON, D.C. - "The administration is manufacturing an FAA 'funding crisis' in a smoke-and-mirrors attempt to divert attention away from the real issue - the need to address the problems that constrain capacity, efficiency, and new technology adoption," said Phil Boyer, president of the Aircraft Owners and Pilots Association (AOPA), the world's largest aviation organization, speaking in anticipation of the president's fiscal year 2008 budget to be submitted to Congress next week.

"They are attempting an end-around Congress to put the world's safest, most efficient, and largest air traffic control system into the hands of airline barons who've flown their own businesses into bankruptcy," Boyer said at the National Press Club February 1.

Briefing reporters on what AOPA sees as the key items to watch for in the budget submission, Boyer said the FAA budget proposal would set the stage for a radical new user-fee-based funding system and dramatic tax increases for aviation users. The proposed funding changes could significantly decrease congressional authority for FAA spending and oversight, and reduce or eliminate taxpayer support for and control of the FAA's critical public safety functions.

"The administration's two-year refrain has been that the FAA is running out of money and that it must 'tie its revenue to its costs,'" said Boyer. "That's a bogus justification for user fees. The money will be there from the taxes paid into the aviation trust fund."

The major portion of the FAA's budget traditionally has been paid for from the aviation trust fund, which gets its revenue from federal excise taxes on aviation fuel (much like highway gas taxes), and taxes on airline tickets and air cargo bills. About 25 percent of the agency's budget has been funded from the general fund because of benefits to the general public from a safe, regulated air transportation system.

"This system has worked well for nearly four decades and will continue to meet what the FAA says it will need for future modernization," said Boyer. Boyer said that if the current funding system were continued, the surplus in the aviation trust fund will exceed $7 billion by 2012, while providing some $20 billion over the next five years for FAA capital expenses including air traffic control modernization, plus the historical contribution to airport infrastructure of $3.7 billion per year.

But the FAA doesn't yet know what modernization will look like or what it will cost.

"We strongly support modernizing the air transportation system to reduce costs and improve efficiency, but the FAA doesn't have a final system design. They just think that whatever it is they pick, it will cost as much as $20 billion," said Boyer. "No matter what they do to improve capacity and efficiency in the sky, it won't fix a system in which the airlines schedule 50 aircraft onto a runway that can only handle 30."

And it is airline control of a future air traffic control and funding system that particularly upsets the nation's private pilots and aircraft owners. Various user fee proposals circulated through government circles would create an airline-dominated board that would remove spending decisions from Congress. The airlines would have a strong hand in determining what they charged themselves and other minority system users.

"There is nothing inherent in the user fee proposals that addresses the issues of future airspace capacity, new technology, increased efficiency, and more runway capacity," said Boyer, "so you have to wonder; what's in it for the airlines?

"Wherever in the world user fee systems have been implemented, they've proven to be expensive, complicated, financially unstable, and harmful to the average citizen flying an aircraft for business or personal transportation."

Boyer said that taxes are the most efficient and cost-effective way to fund the FAA. Citing Treasury Department data, he noted that collection costs amounted to a mere 0.001 percent of the total raised for the aviation trust fund.

"A complicated user fee system, with the legions of clerks, accountants, and managers needed to send out, process, and collect bills, could not be nearly as cost effective," said Boyer.

"Our aviation transportation system should be treated like all other public benefit government functions when it comes to financing," said Boyer. "Whether it be airways, highways, or public education, funding should come from generally applied taxes, calibrated to the ability to pay."

The more than 410,000-member Aircraft Owners and Pilots Association has represented the interests of general aviation pilots since 1939. General aviation includes all flying except the scheduled airlines and the military. Two-thirds of all U.S. pilots, and three-quarters of the GA pilots, are AOPA members.


Editors: Video of the complete briefing will be available later today at

Editors: AOPA provides two important resources for covering general aviation news - an online newsroom and a television studio and uplink. Contact us for more information.

February 1, 2007

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