Congress pressured to ditch cap on passenger fees for airports

Libertarian and good-government groups in D.C. are pushing Congress to eliminate a cap on the amount of money that airline passengers can be charged to help pay for airport improvements. 

The groups said Wednesday Congress should lift the cap instead of increasing it, as airport groups have requested, as they are working on a new funding bill for the Federal Aviation Administration, noting they also support a controversial plan from House Republicans to separate air traffic control from the Federal Aviation Administration. 

{mosads}”To be truly transformational, however, Congress must not only remove the federal yoke from air traffic control, but should do the same when it comes to how airports are financed,”  the groups wrote in a letter to leaders of the House Transportation Committee.  

“We need to move to a system where airports are fully self-sufficient, instead of reliant on federal tax dollars,” the groups continued. “We need a system that will allow decisions to be made at the local level and a system where the users of airports bear the responsibility of paying for that use—not taxpayers. In order to do so, the Congress should remove the federally imposed cap on the Passenger Facility Charge (PFC).”   

Airport groups in Washington have been pushing Congress to nearly double the cap on the fee that is added to every plane ticket,  known as the Passenger Facility Charge. It is currently set at $4.50 per flight segment. 

But the FAA funding measure being considered by the House Transportation Committee would keep the fee where it stands, providing a victory for airlines, which have pushed back strongly against the proposal. 

The good government groups said Wednesday that lawmakers should go further than the airports’ proposal and ditch the cap on the passengers fees completely to make airports less reliant on federal funding.  

“By removing the federally imposed cap on the PFC, airports can become self-sufficient and break their addiction to federal taxpayer dollars,” the groups wrote. 

The airline industry, however, has argued that passengers are already charged enough fees when they purchase tickets. 

“The truth is airports have the resources they need. Through partnerships with the airlines, billions of dollars collected from the government and from passengers, investment-grade credit ratings, access to the bond market, and the Airport and Airway Trust Fund; U.S. airports enjoy a wide variety of funding sources to pay for capital improvement projects,” Airlines for America said in a blog post last year that labeled the passenger fee increase an “airport tax.” 

Airports have argued nonetheless that the passenger fee is long overdue for an increase since it has not been raised in 15 years. 

“The PFC cap has not been adjusted since 2000, when Congress set it at $4.50,” the AirportsUnited group says on its website. 

“However, rising construction costs have eroded the purchasing power of the PFCs by about 50 percent,” the airports group continued. “Modernizing the PFC to $8.50 now and indexing it for inflation would restore its original purchasing power, providing local communities the ability to set their individual PFC user fees based on locally determined needs for ensuring the safety and security of their airports.” 

Airport groups have said they will keep trying to push Congress to reconsider its decision.

“There is a long way to go before this legislation is ready for final adoption by the Congress,” they said. 

Travel industry groups have also vowed to fight for the passenger fee increase as the debate over the FAA bill moves forward in Congress. 

“To prosper in a global economy, America needs not only an efficient air traffic system, but better connectivity and affordable options for passengers,” U.S. Travel Association President Roger Dow said in a statement. “That cannot be accomplished without improved infrastructure at our nation’s airports.”

The limited government good groups, meanwhile, said “Washington should get out of the way and allow airports to set a PFC that is in line with their local needs and one that reflects market realities,” however. 

“America’s airports are powerful economic engines, generating more than $1.1 trillion in annual activity and supporting more than 9.6 million jobs,” the wrote. “However, airports require approximately $15.14 billion annually in infrastructure improvements to update aging facilities, relieve delays and congestion, promote safety and security, enhance the passenger experience, as well as spur airline competition to provide consumers with more choices and affordable options.” 

The letter was signed by the Competitive Enterprise Institute; the Institute for Liberty; Council for Citizens Against Government Waste; Citizen Outreach; and the Independent Women’s Forum.

The full letter can be read here.