Thu, Oct 30, 2008
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.
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