Mica Says ‘War’ on Bizav Not Over

NBAA Convention News » 2012
NBAA’s president and CEO Ed Bolen
NBAA’s president and CEO Ed Bolen
October 30, 2012, 2:45 PM

“I wish I could tell you the war [of battling business aviation foes in Washington] is over, but all I can tell you is there’s a slight ceasefire,” said representative John Mica (R-Fla.), chairman of the House Transportation Committee and prime architect of this year’s passage of the long-delayed FAA Reauthorization legislation, at the NBAA’12 opening session. “Some people just don’t get it that business aviation is one of the great economic engines of our economy and of a free-enterprise system.”

Ed Bolen, NBAA’s president and CEO, used the opening of the 65th annual Meeting & Convention to highlight what the organization is doing to win the war and he cataloged recent victories won despite the gridlock in Congress. In addition to FAA Reauthorization, the industry achieved reinstatement of the Block Aircraft Registration Request program, the Ex-Im Bank program for financing foreign purchases of U.S.-made aircraft and passage of the Pilots Bill of Rights.

The 2012 NBAA Convention is dedicated to the memory of Neil Armstrong, who served as one of the first three spokesmen, together with Arnold Palmer and Warren Buffett, for the current “No Plane, No Gain” campaign. The effort was mobilized to rally support for business aviation in the aftermath of the economic collapse of 2008 and the subsequent vilification of this segment. Bill Crutchfield, chairman of Crutchfield Corp. in Charlottesville, Va., has employed business aviation to fuel its growth. Crutchfield told attendees that while people understand the “plane” part of that phrase, many interpret “gain” as simply increased profits or efficiencies for those that use private aircraft. Crutchfield talked about viewing “gain” as what business aviation can do for communities at large. He cited the example of how he was able to establish a call center in an economically depressed corner of the state, ultimately drawing more corporations to locate call centers there, dramatically decreasing poverty levels and raising the quality of life in the region.

The upcoming presidential election received attention in multiple oblique references, with attendees keenly aware that the current administration has often been unsupportive of business aviation. Rich Karlgaard, publisher of Forbes magazine, noted that the nation’s current 2 percent economic growth is insufficient to restore health to the business aviation industry. “Whether [one has] a D or an R on the jersey, we have to get back to between 3 and 4 percent growth,” Karlgaard said at the conclusion of his remarks.

Senator Jerry Moran (R-Kan.), whose constituents include citizens of the Air Capital of the World (Wichita) spun the No Plane, No Gain message down to the grass roots level, talking about the importance of general aviation not from a jobs or operator’s perspective, but from the people in rural communities he represents that rely on it as their lifeline to the world. Yet in a state hard hit by the downturn in business aviation’s fortunes, he emphasized his faith that “the leaders of this industry are no different from those who came to Kansas almost 100 years ago” to create an aviation manufacturing industry. “This industry has had its struggles,” said Moran, “but like the Kansas motto, ‘To the stars, through adversity.’”

 

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Maynard McKillen
on November 1, 2012 - 9:58am

This rather bland attempt to portray business aviation as the victim of vilification may sell well to the corporate crowd, but it fails to rise above the level of whining, epitomizes mischaracterization of the issue, and defends the indefensible.

The American taxpayers are subsidizing flights by corporate jet users. This unearned entitlement must end. Those corporate jet users must pay their share of the cost of services rendered. This ridiculous gravy train must be derailed.

Mica's statement was notably pointless, since he fails to identify who “some people” are. This is a pathetic and classic straw-man argument. Of course, knee-jerk republicans will brainlessly agree it is the democrats and the administration, shout the same into their echo chamber, and thereby protect another one of their sacred, unexamined myths.

Especially laughable was the statement, “...with attendees keenly aware that the current administration has often been unsupportive of business aviation.”

A more accurate statement is that the current administration wants to end corporate-aviation's decades-long status as recipient of unearned federal entitlement.

To do so, the fuel tax percentage must be raised or a User Fee must be instituted on corporate flights in controlled airspace.

As American taxpayers struggle to feed, house and clothe themselves in the aftermath of a Great Recession, the result of insufficient regulation of the banking and finance monoliths, no sector of the American economy, no class of citizens, no industry has earned any extension of the trickle-down economic policies that precipitated this near collapse.

There is a “war” on business aviation? Oh, please, spare us the histrionics...

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Chad Trautvetter
on November 5, 2012 - 3:27pm

Maynard,

While I share your view that the Obama Admin has been against tax deductions–more specifically, accelerated tax deductions–for corporate jets, not corporate jets themselves, there are several flaws to your argument.

1) Business jets are not “indefensible.” Many companies can, and do, justify the use of a business aircraft through more travel efficiency and flexibility. As one example, I’ve seen a department store use a business aircraft to move teams of middle managers between up to four stores in four different cities in one day so they can set up displays for new product launches. Using the airlines, this would have taken four days and three nights of hotel stays for each person, which would have actually cost the store more to do versus using the business aircraft by an almost 2:1 ratio. There are numerous other examples that show similar justification for a business aircraft.

2) The U.S. government can’t single out business aircraft regarding tax deductions. Aircraft are long-term capital expenditures, so they’re eligible as tax deductions over a depreciation schedule. Obama himself signed the accelerated/bonus depreciation bill for long-term capital expenditures, so really it’s just populopus posturing to come out against them while campaigning. So Obama is two-faced on this topic, which is unsurprising since most politicians are hypocrites.

3) NBAA, AOPA and other aviation groups publicly supported a 65-percent increase in the aviation fuel taxes so that user fees could be taken off the table. The Senate FAA bill increased aviation jet fuel taxes from 21.9 cents/gallon to 35.9 cents/gal and avgas from 21.9 cents to 24.4 cents/gal. However, the House Republicans refused to raise taxes of any kind, even ones supported by the end users and their lobbyists, so the House FAA bill never included such an increase. The compromise FAA bill also did not raise the fuel taxes, also because House Republicans refused to allow the bill to pass with any tax increases. So don’t penalize the industry with aviation user fees because the House Republicans put a anti-tax increase pledge before the best interests of both the general/business aviation industry and the country.

4) If general and business aviation went away overnight, the costs for the FAA to run and maintain the air traffic control system would not change. Additionally, ATC was structured specifically for the airlines, not for business/general aviation users. Since business aviation benefits as a side user of ATC services and pays into the system via fuel taxes, it isn’t riding any gravy train when it comes to system user costs. In fact, if anything business aviation is actually subsidizing ATC costs for the airline industry, since the existing ATC system (at its current cost) would need to be maintained for the airlines even without general/business aviation.

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