Monday, February 13, 2012

President's 2013 Budget Includes Higher Aviation Fees

The White House has released its 2013 budget request, and while the proposals are unlikely to become law this year, it's worth highlighting a few aviation-related provisions. The Obama administration is proposing a $100 departure fee for airlines and business jets to help fund air traffic control. Additionally, the budget proposes increasing the security screening fees added to passenger tickets to a minimum of $5 in 2013, with a $.50 annual increase for the next five years, and authorizing the Secretary of Homeland Security to adjust the fee, currently set by statute, through regulation. According to the Budget document, the current fee structure only brings in 43% of revenue needed to cover security measures. The Budget request also cuts grant funding to large and medium airports by $926 million, but compensates the larger airports by granting them the flexibility to secure funding through higher passenger facility charges. These proposals are found on pages 30 and 160 of the Fiscal Year 2013 (available here).

Again, none of these proposals are likely to receive consideration by Congress. Aviation-related spending for the near future is primarily a settled issue given the recent passage of a four-year FAA funding bill. Budget documents can nonetheless provide useful insight into administration priorities, and airlines and airports will probably register at least mild criticism of the fee proposals over the next few days.

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