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NATA DISAPPOINTED BY FAA’S REAUTHORIZATION PROPOSAL
AS IT “DEMONSTRATES REMARKABLE MISUNDERSTANDING OF
THE AVIATION INDUSTRY”
Alexandria, VA, February 15, 2007 ― Yesterday, the Federal Aviation
Administration (FAA) issued details of its much anticipated reauthorization
proposal that would significantly change how the agency is funded over the next
ten years. The proposal incorporates a host of new operational and certification user
fees and establishes an Air Transportation System Advisory Board.
“We are disappointed with the lack of vision and stakeholder equity in the FAA’s
proposal,” said NATA President James K. Coyne. “Given the amount of time the
administration has had to develop the proposal, it is remarkably lopsided and
myopic.”
A few disturbing provisions of the FAA proposal are:

A spike in the current fuel tax of 21.8 cents per gallon to a whopping 70.0
cents per gallon.

A reduction in the Airport Improvement Program funding by more than 20
percent over current fiscal year levels.

Implementation of new user fees for a wide array of certification services
affecting general aviation businesses.

Generation of nearly $600 million fewer dollars than the existing financing
structure in FY 2008 according to the President’s budget.

Domination of the proposed Air Transportation System Advisory Board by
the airlines without a single representative from on-demand charter carriers
or fractional ownership providers, two groups that provide a sizeable
contribution to the aviation trust fund."
“This board, as proposed, is totally dominated by airline representation,”
said Vice President of Government and Industry Affairs Eric R. Byer.
“There is no excuse for ignoring the charter and fractional communities.
The FAA proposes to include at least three airline operatives on the ATSA
Board, but totally ignores the airlines’ direct competitors – charters and
fractional – revealing the agency’s bias towards the airlines.”
MORE…

Assessment of a user fee on operations conducted at America’s 30 most congested
airports. “These fees are largely discriminatory against general aviation operations,
including charter and fractional ownership, in hopes of preventing these operations at
the nation’s busier commercial airports,” said Byer. “By law, the FAA’s mission is to
ensure air safety. Has the FAA conducted any analysis of potential negative safety
consequences that could result from the proposed fee-for-service system? Pilots may
avoid utilizing certain radar-controlled facilities due to the associated fees and choose
to use potentially less safe alternatives because of lower or nonexistent fees.”

Inclusion of an apparent blunder by the FAA in structuring which taxes and fees
charter and fractional operators would pay under the new system. In the
reauthorization proposal, the FAA has assumed that charter and fractional operators
purchase their fuel as the airlines do, essentially tax-free. However, this is not the case.
Fuel for these operations is almost universally purchased at the higher general aviation
rate, then a refund for the overpaid taxes is filed.
“Although it would appear by the FAA’s statements that they intend to subject charter
and fractional operations to the same user fees as the airlines, the proposed legislative
language doesn’t accomplish their goal. In fact, our analysis shows that the legislation
as written would tax charter and fractional operations the same as all other general
aviation flights. How does the FAA expect us to trust them when it comes to their
accounting and cost allocation system when they clearly do not understand how the
current system works and cannot seem to even properly draft legislation to impose
their new user fee regime?” Byer asked.
“I think Congressman Vernon Ehlers said it best at yesterday’s House Aviation Subcommittee
hearing that this proposal is ‘dead on arrival,’” stated Byer. “Congressman Sam Graves also
raised a very valid point that in the negotiation process two sides start at extreme ends of an
issue and work towards the middle to come to resolution. This proposal does not even get
interested parties sitting down at a table.”
“This proposal is deeply disturbing as it is the initial step in what is suppose to be a thoughtful
discussion as to how we as a nation can better improve our air transportation system,
including air traffic control, and how we end up paying for these changes,” Byer concluded.
“We urge all aviation service businesses and Members of Congress to review the FAA’s
proposal very cautiously, recognizing the numerous flaws contained within it so when
Congress works on their own proposals they do not contain the same mistakes the FAA has
offered.”
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NATA, the voice of aviation business, is the public policy group representing the interests of
aviation businesses before the Congress and federal agencies.