By Kevin McCarty
December 17, 2007

Congress will adjourn this month without completing final action on legislation reauthorizing programs administered by the Federal Aviation Administration (FAA).

FAA’s activities and programs, including airport capital grants under the Airport Improvement Program (AIP), are expected to go forward under continuing authority that Congress is expected to provide in an omnibus spending measure before adjourning for the year. This same measure will also set spending limits on FAA’s spending authority during an interim period.

This omnibus legislation, which will renew temporarily FAA’s operating and program authorities as well as set interim spending limits, will provide Congress additional time to make progress on a FAA renewal bill and final Fiscal Year 2008 spending levels.

The U.S. House of Representatives gave its approval September 20 to its four-year FAA renewal package (H.R. 2881); the full Senate has not yet taken up its version of the legislation (S. 1300), which was developed by the two key committees of jurisdiction.

For cities and other local governments, both bills propose increased federal funding commitments to airport capital needs, raising AIP program levels to $4 billion annually, more than $1 billion higher than the Administration’s request.

While the proposed increase in AIP funding is important, House aviation leaders recognized that AIP program resources fail to keep pace with increasing airport capital needs, driven both by higher construction costs for airport and other infrastructure projects as well as ever-rising airport capital improvement needs. To help close the growing gap between capital needs and available resources, House aviation leaders included an increase in Passenger Facility Charges (PFCs) that individual airports can impose, raising the current law cap of $4.50 to $7.00. According to FAA, this adjustment in the PFC cap would raise about $1.1 billion annually at airports now collecting the maximum PFC charge. The bill now pending before the Senate does not authorize an increase in the PFC, which has been a key priority for the Conference as well as many airport operators.

To bolster revenues in the Aviation Trust Fund to support AIP funding and other FAA activities, such as ongoing agency operations and modernization of the air traffic control system, both bills propose increases in various aviation fuel taxes, excise fees and user fees, although each chamber proposes a different mix of increases.

To help further progress in reducing airport and aircraft noise levels, both measures require the phase-out of all Stage II aircraft by December 31, 2012 for service in the contiguous 48 states, allowing the continued use of these aircraft after 2012 only in limited situations.