The Great Double Whammy Rip-Off

Passengers are rightly upset that the airlines quickly raised their fares in order to pocket more than $25 million a day in federal aviation taxes that cannot be collected because Congress has not extended the FAA reauthorization bill.  But passengers should also be upset that we are draining the aviation system’s bank account.

This is the great double whammy rip-off that Congress has allowed by not acting.  Not only are the airlines keeping money that should be flowing into the Airport and Airways Trust Fund, but they are also using air traffic control services without paying the bill.  Airlines are literally getting a free ride!  The big losers here are passengers, airports, communities and of course the more than 4,000 FAA employees who are out of work through no fault of their own.

Under normal circumstances- and this is anything but normal -every time a passenger buys a ticket, he or she contributes to keeping the runways maintained, as well as the air traffic controllers, their equipment and the buildings in which they work. Ticket taxes provide the majority of the money in the Trust Fund, which also helps pay for FAA personnel who conduct airport and airlines inspections to maintain the safest aviation system in the world.

Right now we are draining the Trust Fund piggy bank in order to maintain the ‘essential services’ that allow the airlines to continue to fly while losing $200 million a week that we will never get back.  We can’t maintain the safest aviation system in the world this way.

ACI-NA has heard from airports all over the country about important safety projects that have stopped because FAA does not have the legal authority to pay for airfield maintenance, snow removal equipment and taxiway improvements.  This is money that passengers paid, through the ticket tax, for airport safety and now that money is being used to subsidize airline revenues, allowing the carriers fatten up their profits. This can’t continue! Congress needs to act now and extend FAA reauthorization.

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2 thoughts on “The Great Double Whammy Rip-Off

  1. I hate to say it, but your igorance of the industry is dropping to the level of the politicians in Washington who are destroying our country.

    First of all, shame on you for suggesting that the safety of the industry will be compromised due to this lapse. You’ve always pointed fingers, but using scare tactics talking about “safey projects” is uncalled for… I hope your members are not suggesting that safety is at risk…because that’s not what the FAA is saying.

    Second, I think most observers of the industry know that airlines have no profits. You really think this extra revenue is going to “fatten their profits?” Their service may stink but I dare you to find any statistics showing a profitable US airline industry….the data I’ve read says they lost $1 billion in the first quarter alone. Monopoly airports enjoy double-digits margins, but airlines dream of single digits margins.

    Show a little professionalism, stop the finger pointing, and go fight for higher PFCs. Blaming airlines for an incompetent Congress doesn’t help your cause.

  2. Appreciate your comments. I do not want to suggest that the system is somehow unsafe and have often deplored people who would do that to score points. What I am saying is that, among the projects that are not being completed during this time are projects related to safety. The point is that these projects are not some kind of porkl barrel gold plating, these projects have real benefit. And, they are paid for! See this editorial from the Salt Lake Tribune.

    You are right, there is no place for mis-using safety and I do not believe I did that. But, I do appreciate your giving me the opportunity to make myself clear. As to your comment about airline profits, you are right they rarely ever do make a profit. Perhaps “bottom line” would have been better.

    As to the comment about monopoly airports with double-digit margins, first of all airports compete with one another for service all the time; and airlines are happy to exploit this to try to get better deals. Fair enough. But double-digit margins? Airports are self-sustaining, even the federal grant money they may get is generated by fees paid by their own passengers. They do not require tax money for operations. There are no double-digit margins. What is generated at the airport does not go into shareholders pockets, nor to fat executive bonuses; it goes into running the airport. If you are a conservative, Tea Party member and looking for an example of something that is a public good being run in a prudent conservative manner, you could do no better than look at airports.

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