DALLAS -- An airport advocacy group called on airlines to drop their opposition to a doubling of a federal air passenger fee used to finance facility improvements, following a report from the Transportation Department that airline baggage fees totaled almost $1 billion in the second quarter of 2015.
"It's Groundhog Day again," said Todd Hauptli, president of the American Association of Airport Executives, said Monday. "The airlines continue to oppose self-help for airports while helping themselves to billions of dollars in bag fees and other ancillary charges."
The AAAE backs a provision in President Obama's proposed fiscal 2015 budget that would raise the passenger facility fee to $8 per trip segment from the current $4.50 and reduce the Federal Aviation Administration's airport improvement grant program to $2.9 billion from $3.5 billion in fiscal 2014.
Airlines For America, which represents carriers that transport 90% of U.S. air passengers, contends that the 90% increase in the PFC is not needed by airports that have strong credit ratings and access to low-interest financing through the tax-exempt bond market.
The Transportation Department's Bureau of Transportation Statistics said Monday that airlines collected more than $962 million in baggage fees in the second quarter of 2015, a higher total than for any previous three-month period. Airline reservation change or cancellation fees of $772 million during the same period were also a record amount.
"Airlines have collected more than $3.3 billion in bag and ticket change fees in the first half of 2015, which follows a record $3.5 billion in bag fees and another $3 billion in reservation cancellation or change fees collected in 2014," Hauptli said. The PFC, which has been capped at $4.50 since April 2002, generated $2.78 billion in fiscal 2014 for airports, according to the BTS. Revenue from the fee is expected to reach $2.87 billion in fiscal 2015 and $2.89 billion in fiscal 2016.
Nicholas E. Calio, president of the airline association, said a $300 domestic roundtrip ticket already includes $63 in federal taxes.
"Raising the PFC will drive up the cost of flying for millions of Americans who rely on air travel, cost jobs, limit service options to small and medium communities and ultimately harm the U.S economy," Calio said.
Discord between airports and airlines over the PFC make it unlikely that lawmakers can reauthorize the FAA before its funding expires next week when the federal fiscal year ends on Sept. 30, Hauptli said.
"With the federal government on the verge of a possible shutdown and with the path forward for a long-term FAA bill far from certain, it's time for Congress to reject airline rhetoric and provide airports with the certainty and flexibility they are seeking to address growing infrastructure needs through a modernized PFC program," he said.
But Vaughn Jennings, managing director for government communications for Airlines For America, disagreed. The airports' contention that the dispute over the PFC is causing the delay in FAA reauthorization is "both inaccurate and inappropriate," he said. "There is no crisis in airport funding and no justification for a 90% airport tax increase on every American who flies. You have a choice about whether to check a bag. You do not have a choice about whether to land at an airport."
Rep. Bill Shuster, R-Pa., chairman of the House Transportation and Infrastructure Committee, said earlier this month that a short-term extension will be needed to keep the FAA operational until long-term reauthorization can be agreed on.
The most recent FAA reauthorization required 23 short-term patches before the current funding bill was passed in 2012. It included a two-week gap funding in 2011 that halted airport projects with an estimated cost of $10.5 billion, according to the American Council of Engineering Companies.
