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NTU Opposes Hike in Airline Fees
June 25, 2007
The Honorable James Oberstar
Dear Chairman Oberstar:
On behalf of the 362,000 members of the National Taxpayers Union, I write in strong opposition to an increase in the Passenger Facility Charge (PFC) that is now under consideration during reauthorization of the Federal Aviation Administration. History tells us that airports often misallocate PFC revenue to non-essential uses. A glimpse at the latest airport "wish list" suggests that this trend will continue unabated.
Airports Council International-North America recently polled its membership about project needs over the next five years and the attendant price tag. The result of this inquiry was the staggering number of $88 billion over the next five years. This amount is more than three times the Federal Aviation Administration's estimate to modernize the nation's air traffic control system. The airports have clearly confused their wants with their needs. This immense number comes despite the relative financial health of America's airports. A March 2007 report by the Government Accountability Office (GAO) states, "The financial health of airports is strong and has generally improved since September 11, 2001, especially for larger airports." GAO estimates that from 2001 through 2005, airports received on average $13 billion each year for capital improvements. An influx of more than $65 billion over the last several years can hardly be classified as a shortchanging of the airport community.
Congress must not lose sight of the fact that the Passenger Facility Charge was meant to fund basic aviation infrastructure that enhances safety or capacity. The revenue provided through the Airport Improvement Program and the present PFC is more than sufficient to serve the essential needs of airports as we move into the future. Indeed, existing PFC projects ought to be subject to greater cost-benefit analysis. Raising the PFC from the current $4.50 up to $6.00 or even $7.50 would only heap more costs onto a system that is already overburdened with taxes and fees. Saddling airline passengers with higher fees will harm the economy and reduce demand for related services like hotel rooms, car rentals, and tourist spending.
Thank you for your consideration. We look forward to working with you in the future to craft a policy that funds infrastructure while protecting passengers and taxpayers.
cc: Ranking Member John Mica