Air Travel Improvements Face Delays

While passengers endure the "summer from hell," money to pay for airport work is stalled in Congress.

By Martha Lynn Craver, Associate Editor, The Kiplinger Letter

July 24, 2007

Airports to Congress: Help. Congress to Airports: Not now. Squabbles over how to pay for airport modernization -- including a new air traffic control system -- will keep the four-year $66 billion authorization bill to fund Federal Aviation Administration (FAA) operations stalled indefinitely. Failure to make the Sept. 30 deadline for the FAA bill -- now a near certainty -- will spell delays for planned projects at Chicago O'Hare International Airport, Washington Dulles International Airport as well as other cities.

The legislation stands a chance of making it into law later this year, but that’s likely to push at least some construction work into next year. If lawmakers can’t agree on a new law, they’ll probably opt to extend current FAA authorization, inviting even longer delays.

Of course, any mention of the D-word (delay) is enough to tick off harried business and vacation travelers, particularly those who flew in June. In a preliminary report, the FAA called June one of the worst months in U.S. history for flight delays. "If we're unable to have a financing reform bill in place by September 30, the delays and the missed connections and the headlines are only going to get worse -- much worse," says FAA Administrator Marion Blakey.

What's holding up legislation? A couple of contentious provisions are at the heart of the infighting on Capitol Hill.

The House and Senate are sharply divided over the funding of a planned new satellite-based air traffic control system aimed at reducing flight delays in the nation's overcrowded skies and airports. The Senate wants to charge all aircraft a $25 airport departure fee and increase taxes that carriers pay on jet fuel. The House would raise only the fuel taxes.

Cheering on the Senate is the FAA brass and commercial airlines. They contend that the $25 user fees would level the playing field for both commercial and general aviation craft. Commercial airlines note that they currently finance more than 90% of the federal aviation trust fund that's tapped for airport work. General aviation groups argue that the airlines use the bulk of the expensive infrastructure at major airports and should contribute more to federal aviation coffers.

When the smoke clears, expect corporate and other business aircraft to start getting billed for airport departure fees. The new requirement will raise millions of dollars more each year for airport improvements.

The legislation also proposes to force the reopening of contract talks between the National Air Traffic Controllers Association and the FAA. When the two sides failed to agree on a new contract last year, the FAA imposed a contract on the union. Now the union, with a lot of support from Democrats in Congress, wants to repeal current law that allows the FAA to impose a contract if Congress doesn't act to intervene in 60 days. The union wants disputes to go to federal mediation, and if not successful there, to binding arbitration.

Air traffic controllers aren't likely to get their way. Look for Democrats to back off demands to set new labor contract terms in the face of a veto threat by President George Bush.

One sure bet: A hike in the passenger facility charge (PFC) paid by air travelers at commercial airports. The PFCs are tacked onto the price of tickets to help pay for airport projects. Airports would like to see the fee increased to $7 each way, but the hike will probably be bumped to $6 one way, from the current $4.50.

Some consumer protections are also on tap. In response to recent horror stories of passengers being stranded for hours, the legislation will mandate that airlines and airports put contingency plans in place to take care of people facing long delays on the tarmac. Airports and airlines will have to make sure that stranded passengers have access to food, water, clean restrooms and medical care, as needed. Provisions to compensate passengers for delays are in separate legislation, and are not part of the FAA reauthorization bill.

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