DALLAS - Inadequate funding for airport infrastructure combined with growth in passenger loads will create major capacity meltdowns at U.S. airports from Memorial Day through the summer, Rep. John Mica, R-Fla., said Thursday as he released a new congressional report on airport finances.
Airlines have collected billions of dollars in baggage fees and flight charges in recent years that do not contribute to federal aviation trust funds, while the passenger facility charge that airports use to finance terminal projects has been frozen since 2000, he said.
Passengers can expect more delays, aircraft ground congestion, and security challenges at airport ramps and terminals, especially during bad weather and high-volume travel times, Mica said.
"Crowded airport aprons, terminals, and runways are jammed with planes and passengers as revenues for improvements have been drained," he said. "When weather and air traffic control delays occur, and at peak travel periods through 2015, airline passengers should expect airport meltdowns."
The federal PFC of $4.50 per trip segment, which is levied by individual airports and collected by airlines through tickets, has lost half of its purchasing power to inflation since it was last increased in 2000, he said.
Future expansion projects may be limited by a lack of available revenue because of the limit on the PFC, Mica said. Of the U.S. commercial airports that can levy a PFC, 349 already collect at the cap of $4.50 per segment, the report said. Passengers can pay a maximum of $18 in PFCs on a roundtrip ticket.
President Obama proposed an increase in the PFC cap to $8 in his fiscal 2016 budget request. Airports are seeking an $8.50 limit, while airlines oppose any increase in the PFC.
Mica said he will introduce legislation "to aid airports as they struggle with facility and capacity issues" when Congress takes up reauthorization of the Federal Aviation Administration this summer. He is a member of the House Transportation & Infrastructure Committee and chairman of the transportation subcommittee of the House Committee on Oversight and Government Reform.
A report on airport funding released this week by the Government Accountability Office said most large airports use PFCs to support revenue bonds. Airports are highly leveraged, with up to 74% of current and future PFC revenues dedicated to debt service, the report said.
Airports issued an average of $6.3 billion of bonds a year for new projects from 2009 through 2013, with 94% of the total issued by large hub airports, the GAO said. Outstanding airport debt grew to more than $83 billion in fiscal 2013 from $71 billion in fiscal 2009, with total debt service of $3.3 billion a year.
"Nonetheless, three bond rating agencies that the GAO spoke with continued to give airports high or stable ratings and one stated that access to capital markets for larger airports remains strong," the report noted.
The PFC generated a total of $2.8 billion in fiscal 2014, according to the GAO.
The current $4.50 PFC is expected to bring in a little more than $3 billion in fiscal 2016, growing to $3.6 billion by fiscal 2024, the GAO said. Raising the maximum PFC to $6.47 per segment, which would account for inflation over the past 15 years, would add $1.3 billion to collections in 2015 and $1.6 billion in 2025.
Raising the PFC to $8 as provided in President Obama's proposed budget for fiscal 2016 would generate an additional $2.4 billion next year and $2.8 billion in 2024.
The airlines are asking for a PFC cap of $8.50 that would be indexed to inflation, which the GAO said would bring in an additional $2.7 billion for airports in fiscal 2016 and an additional $4.5 billion in fiscal 2014.
Airlines collected more than $3.5 billion in baggage fees and almost $3 billion in reserve changes or cancellations in 2014, the Department of Transportation's Bureau of Statistics said in April. Airline baggage fees since 2008 total $21 billion.
