General Aviation Manufacturers Association (GAMA) president and CEO Pete Bunce used the association’s annual industry review and market outlook briefing to dispel the “myths” that the Bush Administration has put forth regarding the need for an overhaul of the FAA’s current funding mechanism.
According to Bunce, the current mechanism of aviation excise taxes is a stable and predictable method of funding, despite the Administration’s insistence that it is not. “The current system–which is not broke–is actually stable and sustainable,” he argued.
“Over the past ten years, the U.S. Congress has routinely given the Federal Aviation Administration more than the President asked for in the budget,” said Bunce. “You cannot get much more stable than that.” He added that Airport and Airway Trust Fund revenues, which help fund a large part of the FAA, are at record levels and projected to continue to grow through 2012.
System Not Broken
The GAMA chief then addressed the administration’s claims that a new funding mechanism is necessary to fund the transformation of ATC to the Next Generation Air Transportation System (NGATS). However, according to the President’s budget, the Administration’s user fee plan could generate approximately $1 billion less than the current mechanism through 2012. “The Administration’s proposed funding scheme is not about modernization,” said Bunce. “It is shifting costs from the airlines to general aviation.”
He continued, “We must move past this ill-advised user-fee proposal and focus the efforts of our industry and government partners to design and implement a modernized air traffic management system. No one is more committed to the modernization of the National Airspace System than aviation manufacturers.”
The nation’s airlines support a user-fee-based approach, calling for a schedule of mandatory user fees based on time flown in the system and number of departures–regardless of the size of the aircraft, number of passengers or airports/airspace used.
They also want to eliminate congressional control and oversight from the funding process and essentially take control of FAA funding by establishing a governing board in which they would have a majority stake.
GAMA also challenged the notion that Congress would remain in control of the FAA budget with implementation of the administration’s plan for some user fees. Under the White House proposal, the FAA Administrator would set fees each year to cover costs as necessary.
“The pressure on the FAA to spend taxpayer dollars responsibly, currently overseen by the congressional authorization and appropriations processes, would go away,” said Bunce. “We cannot afford to give the FAA a blank check to fund its operations.”
He noted that the new Democratic majority in Congress already has been talking about oversight of various government operations, adding that taking control of the FAA from Congress concerns members on both sides of the aisle.
When the Fiscal Year 2008 budget was revealed early last month, FAA Administrator Marion Blakey said that general aviation–and in particular business aviation–would continue to pay fuel taxes as opposed to user fees as its share of operating the FAA.
But she warned that those fuel taxes will increase, a change she characterized as “shifting costs, not increasing costs.” In addition, she said the FAA would also be able to “charge all users a fee” for operating in “most congested airspace.”
Finally, Bunce challenged the administration’s claim that a user-fee system would be an efficient method of collecting revenue. “You cannot implement user fees without also creating another bureaucracy to collect them,” he said.