DALLAS – A two-year reauthorization of the Federal Aviation Administration under consideration this week by a Senate committee would provide more federal funding for runways and other infrastructure while keeping the revenue source used to back bonds financing terminal projects at its current level.
The Senate’s Science, Commerce and Transportation Committee will hold a hearing Wednesday on the FAA reauthorization act (S. 2658), which would keep the FAA operating through Sept. 30, 2017, the end of fiscal 2017.
The House Transportation & Infrastructure Committee is expected to vote Monday night on a short-term FAA extension through July 15 so that it does not expire on March 31 and committee members have more time to consider the two-year bill.
The committee adopted a six-year FAA reauthorization bill, the $21.7 billion Aviation Innovation, Reform, and Reauthorization (AIRR) Act, in early February. However, House leaders balked at the proposal by committee chairman Rep. Bill Shuster, R-Pa., to spin-off the national air traffic control system to a private, non-government corporation.
Congress last year approved a six-month FAA measure through March 31. Without the extension, the FAA authorization passed in 2012 after 23 short fixes would have expired in late September at the end of fiscal 2015.
Shuster’s short-term measure (H.R. 4721) would also extend key revenue provisions through March 31, 2017.
The FAA would be crippled if Congress allows the authorization to lapse at the end of the month, Shuster said.
Failure to renew the FAA authorization would cost the Airport and Airway Trust Fund more than $30 million per day of aviation taxes and would prevent airports from receiving grant money that’s already been allocated, Shuster said.
The Senate committee’s reauthorization proposal, sponsored by chairman Sens. John Thune, R-S.D., and Bill Nelson, D-Fla., the ranking Democrat on the panel, would provide $3.35 billion in fiscal 2016 for FAA’s Airport Improvement Program grants, the same as in fiscal 2015.
The AIP grant program, which helps airports finance runways, taxiways and other infrastructure, would receive an additional $400 million in fiscal 2017.
Shuster’s proposal and Thune’s bill would both leave unchanged the federal Passenger Facility Charge at the $4.50 per trip segment that was set in 2000. Airports use the PFC to support revenue bonds to fund terminal construction and modernization, and other surface infrastructure projects.
Thune’s measure would let airports use PFC revenues to help fund highway and other transportation projects that serve their facility, at a level based on airport-only traffic on them.
The proposal would mandate a study of airport infrastructure by the National Transportation Board to determine whether airports have the financial resources to develop the infrastructure needed to handle increased passenger loads. The study must consider airports’ current debt, the purchasing power lost to inflation since the PFC was set at $4.50 in 2000, and the ability of airports to finance their capital improvement plans.
President Obama’s proposed fiscal 2017 budget would raise the PFC cap to $8 per trip segment, and cut the FAA airport grant program to $2.9 billion.
The current $4.50 PFC is expected to bring in $3 billion in fiscal 2016. Raising the fee to $8 would generate an additional $2.4 billion.
Todd Hauptli, president of American Association of Airport Executives, and Kevin M. Burke, president of Airports Council International – North America, said in a joint statement last week that the Senate committee’s FAA plan is fundamentally flawed.
“It is unfortunate the Senate bill fails to include a long overdue adjustment to the local PFC user fee, which would help airports finance essential safety, security, and capacity projects,” they said. “A modernized PFC is essential to future airport development, and we will continue to advocate for its adoption as the debate on FAA reauthorization continues in the House and Senate.”
