Webinar

Vice President, Government and Industry Affairs Your Hosts Kristen Moore Director, Legislative Affairs

 Background –  FAA Reauthorization Legislation  Airport and Airways Trust Fund  House vs. Senate legislation  Current status  Future Implications

Background

 Congress passes legislation to authorize federal programs of the Federal Aviation Administration (FAA) every five years. ◦ Authorization legislation provides for the collection of aviation taxes and fees, which are deposited into the Airport and Airways Trust Fund (aviation trust fund) to pay for the majority of the FAA’s programs and activities. ◦ These essential programs include the Airport Improvement Program (AIP), Facilities and Equipment (F&E), and Operations functions of the FAA.  The current authorization, named Vision 100 and passed in 2003, expired on September 30, 2007, along with all excise and fuel taxes that fund the aviation trust fund.  Since September 30, 2007, Congress has passed six short-term extensions allowing the agency to operate under Vision 100.

 The aviation trust fund supports our nation’s aviation system through aviation-related excise taxes.  Funding currently comes from the collection of passenger tickets, passenger flight segments, international arrivals/departures, cargo waybills, aviation fuels, etc.  General aviation operators pay into the aviation trust fund through a fuel tax of 21.9 cents per gallon for aviation jet fuel and 19.4 cents per gallon for aviation gasoline.  On-demand air charter operators pay the same ticket and fuel taxes as scheduled airlines due to their classification as commercial operators.

Why does the trust fund need additional funding?  To pay for the upgrade in aging technology at FAA referred to as the Next Generation Air Transportation System or NextGen.  NextGen is the advancement from a ground-based system of air traffic control to a satellite-based system of air traffic management.  When fully implemented, NextGen will safely allow more aircraft to fly more closely together on more direct routes, reducing delays and benefiting the environment and the economy through reductions in carbon emissions, fuel consumption, and noise.

House vs. Senate legislation

 The U.S. House of Representatives passed H.R. 915, the Federal Aviation Administration Reauthorization Act of 2009 on May 21 st.  The U.S. Senate introduced its version of the FAA Reauthorization legislation, S. 1451, in July and passed the bill out of the Committee on Commerce, Science and Transportation.

 House Bill ◦ Increase in overall funding for FAA and AIP  $53.5 billion for FAA’s capital programs for fiscal years  $12.3 billion for AIP (almost double the amount in Vision 100).  $10.1 billion for Facilities & Equipment.  $30.3 billion for operations.  $794 million for research and development.  Senate Bill ◦ Increase in overall funding for FAA and AIP  $ 34.6 billion for FAA’s capital programs for fiscal year 2010 and  $8.1 billion for AIP.  $7.1 billion for Facilities & Equipment.  $18.9 billion for operations.  $406 million for research and development.

 House Bill: ◦ Requires all Part 145 repair stations to be inspected by FAA twice a year. ◦ Supports private businesses facing competition at airport authorities.  Senate Bill: ◦ Requires all Part 145 repair stations to be inspected by FAA twice a year. ◦ Prohibits FAA from challenging weight restrictions at Teterboro Airport ◦ Allows appeal of an NTSB certificate action.

Current Status

 H.R. 3607, legislation to extend funding authority for the FAA through December 31,  The current delay is mainly the hold-up of the Senate Committee on Finance who has been busy working on health care reform legislation.  Concerns with a provision that would change the definition of FedEx employees covered under the Railway Labor Act (FedEx) to the same labor act as UPS employees.  In 2008, the House and Senate disagreed over bill language requiring all aircraft to pay a “user fee” to help fund the aviation trust fund.

What happens if FAA Reauthorization isn’t completed this year?

 Short-term extensions have delayed essential funding for major projects such as NextGen.  The delay in final passage could mean a new funding mechanism for fiscal year 2011.

If you ever have any questions, please do not hesitate to contact us! Eric R. Byer V.P., Government & Industry Affairs National Air Transportation Association Kristen Moore Director, Legislative Affairs National Air Transportation Association