Supports PANYNJ Call For Multi-Year FAA Reauthorization, AMT Relief

In a statement submitted for the October 29 hearing on "Investing in Infrastructure: The Road to Recovery" before the House Transportation and Infrastructure Committee, Airports Council International–North America (ACI-NA) called for at least $600 million in airport infrastructure funding to be included in the Economic Stimulus bill, as well as relief for airports from the Alternative Minimum Tax (AMT) disincentives that apply to private activity bonds used to finance new construction.

ACI-NA also urged passage of a multi-year Federal Aviation Administration (FAA) reauthorization bill to help stimulate economic growth and add jobs throughout the United States.

"Airport operators have been working tirelessly with their airline partners to find ways to reduce costs in an effort to maintain air service. This has resulted in many capital projects being delayed so that rates and charges assessed to airlines can be maintained or even lowered," ACI-NA's statement read. "While delaying capital projects may help in the short-term to stabilize airline costs, each deferred project represents foregone construction jobs and economic activity which is critical during this time of economic uncertainty."

ACI-NA also strongly supported the testimony of William DeCota, Aviation Director, Port Authority of New York and New Jersey. DeCota noted that airport funding in the Economic Stimulus package could help create 35,000 high-paying jobs at airports. He also said enactment of long-term FAA reauthorization with an increase in the cap on the Passenger Facility Charge (PFC) user fee to $7.00 would allow airports to keep pace with skyrocketing costs and complete safety, security, capacity and environmental projects which are necessary to continue serving the traveling public safely and efficiently.

The council says a multi-year reauthorization of the FAA is critical for airports to move forward with projects that will generate economic development and employment. ACI-NA asserts the fact that PFC user fees have not been increased and AIP has been operating under several short-term extensions for more than a year, spanning two fiscal years, has caused several projects to be delayed.

In addition, the credit market for airport bonds, known as private activity bonds, or PABs, has dried up due to the higher than normal interest rates applied to these bonds since the interest earned on them is subject to the Alternative Minimum Tax. Many airports are now struggling to find buyers for construction bonds, a situation that could be significantly improved if the AMT penalty from airport PAB bonds were eliminated, similar to relief provided to the housing industry in July 2008.

FMI: www.aci-na.org