User fees, security rules dominate NBAA agenda

EBACE Convention News » 2010
April 28, 2010, 8:35 AM

When the U.S. Senate passed its reauthorization bill for the Federal Aviation Administration in late March, the National Business Aviation Association (NBAA) and a host of other general aviation groups breathed a little easier. The concern had been over the possibility of onerous user fees being levied on general aviation–exactly the sort of user fees that are commonly accepted here in Europe through air traffic management agency Eurocontrol.

The GA community has long held that it contributed to the national air transportation system through fuel taxes, allowing users to pay “at the pump.”

Because this setup directly transfers tax revenues from the user to the government, it is highly efficient–a large bureaucracy is not required for collection.

Since the inception of the Airport and Airways Trust Fund, GA has paid separate taxes on jet fuel and aviation gasoline as its share of helping to fund the FAA. When the Senate passed a bill to fund the FAA and continue transformation to a Next Generation Air Transportation System, or “NextGen” ATC, it followed the lead of the House of Representatives by not instituting user fees.

“NBAA and other general aviation associations have been strong advocates for proposals to modernize the nation’s aviation system, and the action taken by Senate leaders today marks a good step in that direction,” NBAA president and CEO Ed Bolen said when the Senate bill was passed March 22.

The House already approved its version of a multi-year “reauthorization” of programs and funding for the FAA last year. The House and Senate funding measures mirror previous modernization proposals supported by NBAA, in that they increase the general aviation jet fuel tax from 22 to 36 cents per gallon to help fund the ATC system transformation.

“Importantly, the legislation builds on the fuel tax to help pay for modernization, instead of resorting to user fees,” Bolen said. “This approach is the one uniformly supported by general aviation to help pay for NextGen.”

The Senate measure, which passed by a vote of 93-0, came after 11 temporary funding extensions that have been passed as part of the reauthorization process. The two different bills must now be reconciled into a single piece of legislation before being sent to President Barack Obama for his signature.

When the Obama Administration released a Fiscal Year 2011 budget containing no new user fees for aviation, the industry felt it dodged a bullet. The White House had been looking at more than $9 billion in new user fees to help make up its budget for the FAA and the NextGen ATC system modernization.

The change put the Obama Administration in sync with a Congress that has consistently opposed any new aviation user fees. But GA advocates began warning the industry not to become too complacent.

“Bad ideas have a funny way of coming back around in Washington,” cautioned AOPA president and CEO Craig Fuller. “In the meantime, the worst thing we can do is sit back, congratulate ourselves and imagine that all our worries are behind us.”

“Whether this is an indication of a permanent policy shift on user fees or a one-time development remains to be determined,” said NBAA’s Bolen. “What we do know for certain is that our industry must continue to make its voice heard on this and other issues.”

He noted that the Obama Administration’s previous budget proposal, which was introduced in February 2009, contained an important provision that read, “Starting in 2011, the budget proposes to replace some aviation excise taxes [such as fuel taxes] with direct user charges.” But that part was excised when the FY 2011 budget was introduced last February.

“We support the Administration’s common-sense decision not to propose user fees,” said General Aviation Manufacturers Association (GAMA) president and CEO Pete Bunce. “A burdensome user-fee system faced widespread opposition in Congress and universal opposition from general aviation.”

James Coyne, president of the National Air Transportation Association (NATA), agreed with his three compatriots. “While NATA is pleased with the Obama Administration’s choice to omit a user fee proposal in the FY 2011 budget, the industry must remain vigilant to ensure that any future user fee proposals are not successful.”

Reconciling the Bills
Following its return from its annual Spring District Work Period in early April, Congress was faced with making a decision on how to best move forward with naming a conference committee to reconcile differences between the House and Senate bills. The goal is to have a conference completed on the bill before the July 4 recess.

But that could take some time, and the Republican senators have already shown that they are opposed to naming conferees. Because the House passed its version of an FAA reauthorization bill last year, the two bodies can go directly to conference to reconcile their separate versions. Although neither contains user fees, there are other significant differences that remain to be worked out before a compromise bill is ready for the President’s signature.

“Our industry has been united in opposing calls for user fees, which require a large bureaucracy to manage and would impose a hidden administrative burden on many small and midsize businesses that rely on an airplane to succeed,” said Bolen.

“The general aviation community has worked diligently over the years with its supporters on Capitol Hill to ensure that any type of user fee proposal contained the federal budget is essentially dead on arrival,” Coyne added. “While general aviation user fees have been offered in previous budgets, Congress continues to oppose these unjustified and unnecessary budget proposals.”

Fuller noted that GA has waged more than a year-long campaign since the moment it learned of a planned $9.6 billion in fees.

LASP Is Counterproductive
Another issue that has been occupying much of NBAA’s resources is the Large Aircraft Security Program (LASP), which the U.S. Department of Homeland Security unveiled in October 2008 through its Transportation Security Administration (TSA). In its original form, which immediately drew howls of protest, any aircraft with a maximum certified takeoff weight of 12,500 pounds or more would not be able to fly unless it had a LASP program approved by TSA.

It required a TSA-approved security plan; a third-party audit of that plan six months after the TSA approval of the plan and every two years thereafter; an in-house security coordinator, who has been provided initial and annual recurrent training; flight crew who have undergone FBI criminal-history record checks, fingerprint checks and TSA security threat assessments; and preflight checks of all passengers against TSA watch lists that would be done through TSA-approved third parties.

GA operators for the most part opposed those rules as unnecessary, costly, logistically difficult to implement and impossible to enforce. TSA claimed that many GA operators fly aircraft that are of the same size and weight as those of the commercial operators that TSA regulates, meaning that they potentially and effectively could be used to commit a terrorist act.

NBAA worked collaboratively with the general aviation community, airports and federal Homeland Security officials to review existing programs, evaluate the need for enhancements and to assist the TSA allocating scarce resources where they can be most effectively used.

But in an issue paper on GA efforts in the aviation security arena, NBAA said the original LASP proposal was “unworkable, counterproductive and will damage the economy.” It further said that the LASP mandate does not reflect the significant differences between commercial airlines and general aviation.

Over the past two years, former TSA Administrator Kip Hawley repeatedly indicated that pilot identification is the agency’s primary focus in the development of a GA security protocol. NBAA said its members recognize the value and endorse the concept of pilot background checks and stand ready to work with TSA to define and implement this portion of the LASP proposal.

Last summer, Congressman Charles Dent (R-Pa.) introduced a bill that would require TSA to negotiate with general aviation interests before promulgating security rules such LASP. The bill would prevent the DHS Secretary from issuing a rule, an interim final rule or a new rulemaking involving LASP unless the secretary first establishes a negotiated rulemaking committee and receives a written report from that advisory committee.

Security Rules
The only exception would be if the DHS secretary determines there is a credible and urgent threat and that an emergency exists that necessitates the immediate issuance of such a rule to save lives or property.

Dent’s bill is similar to an amendment attached to a TSA authorization bill which passed the House with provisions directing the TSA to include GA stakeholders in the process of creating any security regulations that affect the industry. Dent’s bill would address the LASP specifically.

The issue paper said that NBAA and the rest of the general aviation community “remain committed to our continued strong partnership with the TSA in achieving a regulatory process which meets shared goals to enhance aviation security and maintain the vital balance necessary to preserve the mobility and flexibility that are the foundation of business aviation.”  

NBAA suggested a Federal Advisory Committee (FAC) process which is widely used across federal agencies and is well documented in the Federal Advisory Committee Act. The Department of Transportation and the FAA have actively used this process through the use of an Aviation Rulemaking Committee as a critical ingredient in their rulemaking process–particularly involving very technical or operational issues.

Such stakeholder committees explore outstanding issues and work within the agency guidelines in an effort to find an appropriate consensus. Through this process, government and industry stakeholders achieve a regulatory result that meets the needs and concerns of all involved.

NBAA is recommending that members of Congress contact DHS/TSA to encourage such a process. The association said the FAC would enhance efforts to find balanced and sensible solutions that will enhance homeland security while also recognizing that business aviation is a critical lifeline for thousands of communities and businesses across the nation.

“It would be impossible for many small business and other entities to survive and prosper without the ability to access general aviation to conduct business and create local jobs,” NBAA said. “We believe the rule must strike that balance.”

There is evidence the message has gotten through. In early December, DHS Secretary Janet Napolitano testified before the Senate Commerce, Science and Transportation Committee that LASP would undergo a makeover before it is released as a supplemental notice of proposed rulemaking (SNPRM) before the end of this year.

Then TSA general aviation manager Brian Delauter said in early February that the agency is backing off from the tougher LASP rules and plans to collaborate more with industry on GA security measures. He said TSA will “substantially” increase the weight of airplanes to be covered by the revised security plan. That will “significantly reduce” the number of U.S.-registered GA aircraft subject to tougher rules. As originally planned, it would have snared nearly 10,000 aircraft.

Countering Negative Publicity
Not long before last year’s EBACE show, NBAA and GAMA revived the “No Plane, No Gain” campaign, which they had introduced in 1993 to highlight the benefits of business aircraft and to help fuel passage of the General Aviation Revitalization Act (GARA) of 1994.

The successful passage of GARA is credited with resuscitating a moribund general aviation manufacturing industry following years of decline in the 1980s, a recession in the early 1990s and liability lawsuits against airplanes that had been flown safely and successfully for decades.

As the industry rebounded and prospered following adoption of GARA, the program fell dormant. But in light of the ongoing attacks against business aviation by the general media and politicians following the appearance of the CEOs from the Big Three automakers before Congress to ask for government bailouts in late 2008, NBAA and GAMA resurrected the name to “reinforce the value of business aviation to American workers, policymakers, companies and communities across the U.S.”

Just weeks before the “No Plane, No Gain” campaign was reinvigorated, general aviation groups mounted a counterattack to get anti-business aviation language removed from the Troubled Assets Relief Program (TARP).

An amendment to the TARP would have forced companies receiving TARP funds to dispose of their business aircraft. Before the provision was stricken from the bill, GA groups warned Congress that such a requirement would have a devastating effect on the GA industry and the national economy, putting hundreds of thousands of jobs at risk.

“Congress might be trying to bolster the economy, but enactment of this provision will put the jobs of tens of thousands of hard-working Americans at risk,” Bolen said. “This could devastate the small businesses that fuel and service general aviation airplanes, further harm the manufacturers who are already laying off workers and slowing assembly lines, and take away a tool from companies that need general aviation airplanes to operate to and from the thousands of U.S. communities that have little or no scheduled airline service.”

NBAA, NATA and the Alliance for Aviation Across America all issued “action calls” to members when Frank’s proposal was made public, and when the language was removed Bolen acknowledged NBAA members for their critical role in voicing their concerns about the TARP proposal with their members
of Congress.

“NBAA has long said that efforts by the association in Washington are most effective if its members also reach out to Congress,” Bolen told NBAA members in an e-mail. “My thanks to all those in NBAA’s membership who used Contact Congress to send Congress an unequivocal message of opposition to the TARP proposal.”    

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