GAO Nixes FAA Flight Auctions

The U.S. Government Accountability Office last week found that the Federal Aviation Administration did not have the legal authority to auction flight slots. The GAO’s decision handed a victory to the Port Authority of New York and New Jersey, which had threatened to prevent flights from landing if they used auctioned slots.

The U.S. Department of Transportation claimed that the slots were property that it had the right to auction, but the GAO disagreed and said the auctions would constitute a new user fee that the DOT did not have the authority to impose. The FAA had planned to auction flight slots at Newark Liberty Airport last month, but was blocked when an ombudsman-type agency within the FAA agreed to review the matter. 

“The opinion handed down today by the U.S. Government Accountability Office is the right one,” the Port Authority said in a statement. “We applaud the GAO and remain firmly committed to continuing to work with airlines, elected officials and passenger advocates to stop the U.S. DOT and FAA’s proposal. It’s wrong to raise prices for everyone by implementing an untested and unauthorized scheme, particularly in this economy.”

The DOT had argued that the auctions would introduce competition into the market, allowing new participants.

“Given the very limited amount of time Congress gave GAO to do their analysis as well as GAO’s relative unfamiliarity with the complexities of aviation law, today’s opinion was not unforeseen,” the DOT said in a statement. “However, should Congress give the agency an opportunity to conduct a more thorough review, we are confident that GAO will better understand both the validity and the effectiveness of our approach.”

Asked whether department would challenge the GAO decision, spokesman Bill Mosley said in an e-mail: “We’re going to let the statements speak for themselves.”

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