Aviation lobby groups urge: include NextGen in stimulus

 - January 27, 2009, 5:56 AM

In a rare show of unanimity, the Air Transport Association has joined with general aviation and others in lobbying Congress for a $4 billion stimulus package that could jumpstart NextGen and provide many of its benefits during President Barack Obama’s first term.

A coalition of 11 aviation-related organizations said that under the FAA’s current plan, NextGen will not achieve significant investment return for the aviation transportation system until 2025. Included in the group are NBAA, the National Air Transportation Association, AOPA and the General Aviation Manufacturers Association.

“This is due, in large part, to the challenge of aligning investments in air and ground infrastructure and across the stakeholders–the ‘chicken and egg’ syndrome,” the groups said. “An infusion of stimulus funding would jumpstart this process, dramatically advancing the schedule and resulting in job creation, a reduction in carbon emissions and an air transportation system supporting economic growth.”

Under the stimulus proposal, the $4 billion would be used to make grants for 100 percent of the costs to retrofit general aviation and commercial aircraft with NextGen equipment such as on-board avionics, electronic flight bags, cockpit displays, surface moving maps and software upgrades.

The groups explained that combining the FAA’s infrastructure modernization with enhanced aircraft equipage and new procedures will create jobs; improve airline environmental performance and reduce CO2; enhance system capacity/operational performance, leading to reduced delays for consumers; reduce FAA operating costs; and establish all-weather access to general aviation airports.

Using the FAA’s own methodology for calculating jobs created, the coalition estimated that a $4 billion funding infusion for NextGen would generate 77,000 jobs.
Experts estimate that total NextGen implementation will cost $20 billion for FAA program development, deployment and technology acquisition and $20 billion for operators for avionics equipage, training and related costs.

“In fact, we anticipate that the FAA will be requesting stimulus funding to accelerate its NextGen infrastructure needs as well as funds to accelerate the needed standards, procedures and criteria that will be required for aircraft to take advantage of the full benefits from equipage,” the coalition said. “Thus, our proposal for stimulus funding should dovetail well with FAA’s NextGen request.”

The components of the request total $4.048 billion. Of that, $2.2 billion is for ADS-B, $500 million for RNP equipage, $20 million for FAA Rnav/RNP procedure development, $500 million for LPV procedures development, $458 million for electronic display upgrades and $370 million for ground-based augmentation systems to support precision landings.

The coalition is making the request on behalf of the commercial and GA communities. Although $4 billion is only a fraction of the estimated total of $20 billion in required equipage costs, it will provide a sufficient jumpstart to “significantly accelerate these programs and their benefits,” the group added.

In early December, many of the same associations sent a joint letter to the House and Senate leadership recommending six priorities for Congress to consider when assembling an economic stimulus package, including funding for airports, investment in NextGen, an emphasis on research and development, legislation to extend accelerated depreciation on aircraft purchases and other initiatives.

That 12-member coalition strongly recommended that the following proposals be included in the economic stimulus package: include at least $1 billion for the Airport Improvement Program (AIP); fund $3 billion for NextGen equipage; eliminate the Alternative Minimum Tax penalty on airport private activity bonds; extend the current bonus depreciation provision for aircraft purchases through Dec. 31, 2009, and the placed-in-service date through Dec. 31, 2011; accelerate the increases in the domestic manufacturing deduction; and make the R&D tax credit permanent.

In the letter to House Speaker Nancy Pelosi (D-Calif.) and Senate Majority Leader Harry Reid (D-Nev.), they proposed that the current AIP program receive an additional $1 billion in funding over the current $3.3 billion. There are more than 5,000 public-use airports in the U.S., but only about 500 have commercial service.
“These are improvement projects that would increase the utility and safety of these vital airports that could go to contract within 30 days if the money were available,” said AOPA. The aviation groups predicted that this proposed infrastructure funding could create some 35,000 jobs.