Support Increased Investment in Aviation Infrastructure

Background:

• In 2007, funding authorizations for aviation programs set forth in the Century of Aviation Reauthorization Act (Vision 100) and authorization of the existing aviation tax structure that provides revenue for the aviation trust fund are set to expire.  As Congress has yet to enact a reauthorization measure, aviation programs and taxes are currently operating under temporary extensions.
• In 2004 the Federal Aviation Administration (FAA) estimated that the national system’s Airport Improvement Program (AIP) eligible capital needs for 2005-2009 will total $39.55 billion or an annual average of $7.91 billion.  The Airport Council International/North America estimated capital needs totaling $71.5 billion for the same period or an annual average of $14.3 billion.  However, needs calculated in this survey were not exclusive of AIP ineligible projects.
• Similar to the Highway Trust Fund, the balance of the Airport and Airway Trust Fund is also declining.  In addition, the federal government and aviation industry are developing and looking for ways to fund the so-called Next Generation Air Transportation System (NGATS or NextGen).
• Congressional Research Service analysis of available preliminary cost estimates indicates that the total cost to build the NGATS by 2025 is estimated to be between $69 billion and $76 billion, which is roughly $5 billion to $12 billion above baseline facilities and equipment spending levels.

AGC Message:

• $4.4 to $10.8 Billion Gap Between Current Spending and Projected Needs.  The Airport Improvement Program (AIP) is the primary source of federal grants to airports for airport development and planning and is the primary source of federal fun.  Its funding is derived from the aviation trust fund.  Current funding for the AIP program is $3.5 billion.  Both the House and Senate FAA reauthorization bills call for an increase in AIP funding from $3.8 billion in FY 2008 to $4.1 billion in FY 2011.
• Increase Passenger Facility Charge (PFC).  Congress may also consider increasing or eliminate restrictions on airports’ use of the passenger facility charge (PFC), a federally-approved local tax imposed more by large- and medium-hub airports.  The House-passed FAA reauthorization bill proposes to increase the PFC cap from $4.50 to $7.00 to offset inflation and help airports meet capital needs.  The Senate bill does not propose an increase.
• Congress Needs to Enact and FAA Reauthorization Bill Now.  Current authorizations for aviation programs and taxes expired on September 30, 2007, and have been operating under temporary extensions.  Like the federa-aid highway program, airports need predictability for planning purposes.  Both the House and Senate have differing proposals to finance the aviation programs, and the Senate has two competing drafts.

AGC Supported Legislation:

• H.R. 2881 - FAA Reauthorization Act of 2007
  06/27/2007 - Introduced
  09/20/2007 - Passed the House 267-151 
• S. 1300 - Aviation Investment and Modernization Act of 2007
  05/03/200 - Introduced