President Obama can’t have it both ways

But there is a problem, best summed up by Erskin Bowles, co-chair of the National Commission on Fiscal Responsibility and Reform, who called this a $50 billion gap in the President’s budget because it calls for funding without saying where the money would come from.

In addition to not providing a source for this so-called infusion of transportation infrastructure funding, the Administration called for a $1.1 billion cut in the Airport Improvement Program (AIP). 

With all the talk in Washington focused on reducing funding levels to FY08, AIP, which is already at FY06 funding levels, would be cut back to FY00 levels. This is particularly confusing as the program is funded by the very people who use the national air transportation system, with the money plowed back into the system to improve safety and security, as well as reduce delays.

The one positive in the President’s budget for aviation infrastructure is the call for more local control with an increase in the limit imposed by the federal government on the Passenger Facility Charge (PFC). 

The PFC is set locally and used exclusively for local airport projects. It is exactly the type of locally-focused, self-funded mechanism that typically earns raves from both fiscal conservatives and their progressive counterparts. It’s also a job creation machine that puts every program dollar into airport infrastructure and capital improvements without a penny going to Washington bureaucrats.

The $2.50 increase in the PFC cap called for in the President’s budget, which is only 10% of the cheapest airline baggage fee, would help fund runway reconstruction and terminal improvements that encourage competition, which is increasingly important as airlines merge and raise ticket prices.

These projects would benefit communities, travelers and taxpayers by creating jobs and making air travel more convenient, safe and affordable.

Around the world, governments, airports and airlines are using this approach to finance exciting improvements in aviation infrastructure. In the US, by contrast, we are falling behind as airlines, with the tacit acquiescence of the US government, oppose this knowing that inadequate infrastructure keeps competition out.

Washington simply can’t have it both ways: cutting actual investments while promoting large illusory, unfunded infrastructure programs and limiting the ability of localities to meet their own needs. 

AIP and the PFC are self-funding, and empower local communities to address their aviation infrastructure needs which in turn, create local jobs in the short term and provide economic benefit to the community and the nation in the long run.

Greg Principato is the President of the Airports Council International- North America.