Citing escalating construction costs, airports have been lobbying Congress to raise the cap on the “passenger facility charge” that fliers pay as part of their airline tickets.
The charge – now at $4.50 for each leg of the trip, up to $18 per round trip – funds the building of runways, terminals and gates.
Airports would like to see the charge increased to $7.50 and indexed to the inflationary cost of construction.
A bill in the House to reauthorize the Federal Aviation Administration proposes an increase to $7 a leg. A Senate committee has voted to keep the cap at $4.50.
“All we’re trying to do is keep up with inflation,” says Todd Hauptli of the American Association of Airport Executives. He argues that the purchasing power of the facility charge has fallen by about 50% since 2000.
Airlines, which act as the collectors on the facility charge, oppose an increase.
They’re already under fire from consumers for charging extra fees for services.
Increasing the cap to $7 “would impose an additional and unwarranted $2 billion-per-year tax increase on commercial passengers,” James May, CEO of the Air Transport Association, the trade group representing most airlines, wrote to Congress earlier this year. “With airport revenue eclipsing record levels … the imposition of an increased PFC tax is not only unwarranted, but will also further reduce demand for travel.”
Since Congress approved the facility charge in 1992, U.S. airports have raised more than $27.5 billion.
Airports have to apply for approval to the FAA for each project that will be funded by facility charge funds.
They also use their own revenue from bonds and FAA grants to fund construction.
John Meenan of the airline association says the airports too often have used the money for projects they shouldn’t and that the FAA has been too lax in approving them.
http://www.usatoday.com/money/industries/travel/2009-11-30-airwar30_ST_N.htm
Tags: airports, federal aviation administration, passenger fee
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