"Ideology As Much As Economics"
Many of the nation's
biggest airlines are the strongest advocates for user fees for
general aviation pilots -- but could user fees harm the carriers,
too? The Aircraft Owners and Pilots Association (AOPA) says yes,
citing a new study by aviation industry expert Darryl Jenkins.
The study, titled "Turbulence Ahead: How User Fees Could Ground
The FAA", shows user fees could hurt both consumers and the
airlines -- as economic downturns that affect the amount of money
user fees bring into an airport, also means less money brought in
by GA pilots paying user fees, than would normally be taken in
through the traditional way private pilots pay for airport services
-- fuel taxes.
Jenkins, a visiting professor at Embry-Riddle Aviation
University and recognized expert on airline economics, reiterated
the association's position that the current FAA funding system
works just fine.
"There is no evidence to justify radical changes in the aviation
tax and fee system," Jenkins wrote. "Every available industry
indicator relating to the FAA -- including passenger volume and
yield -- are on the rise."
The bulk of the money flowing into the aviation trust fund comes
from airline passenger ticket taxes, while fuel taxes help pay for
general aviation's use of the system. And Jenkins notes that, while
there was a short revenue downfall after 9/11, the trends are back
up, with record-level revenues predicted in the immediate
future.
"One thing all those who are publicly supporting user fees have
in common is the mistaken belief that fares are going down,"
Jenkins said. "This argument is categorically wrong. Prices have
been rising over the last year and with increases in the price of
jet fuel, there is pressure...to raise prices further."
"Jenkins' research adds to the evidence that AOPA has been
presenting against user fees," said AOPA President Phil Boyer. "A
user-fee funded aviation system is bad public policy, strongly
opposed by general aviation pilots, and, ironically, potentially
harmful to the very people that it is supposed to benefit."
Jenkins says user fees would be "financial disaster" for U.S.
airlines.
"The reason is that when revenue from user fees decreases for
any reason (typically, a soft economy), airlines and other
stakeholders will have to make up the shortfall. The result will be
an increase in operating expenses when airlines are least able to
afford it, and such scenarios have already occurred in Canada and
Germany."
Jenkins also notes the airlines themselves could also legally
avoid paying user fees, considering that several of the so-called
"legacy" carriers -- among the most vocal user-fee proponents --
are today operating under the protection of bankruptcy laws.
"Airlines in financial difficulty could avoid paying millions of
dollars in user fees by filing for Chapter 11 bankruptcy
protection," said Jenkins. "The resulting shortfall would have to
be made up by other users."
In contrast, a
bankruptcy filing does not excuse payment of excise taxes.
Jenkins maintains user fees are a step in the direction of
privatizing or commercializing air traffic control -- "for reasons
of ideology as much as economics," he says.
"Do we really want air traffic control or other FAA services
subject to the same economic vagaries that have ravaged the
airlines? The damage to their human capital over the past two
decades has been mind-numbing," Jenkins said.
"Could the FAA be improved, or made more efficient? Of course.
But that hardly justifies abandoning a system that for all its
faults has created the world's largest aviation system, which
— on most days — performs with a reasonable level of
efficiency and a remarkable level of safety," Jenkins
concluded.
Jenkins was commissioned by the National Air Traffic Controllers
Association to prepare the white paper study.