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LEXIS-NEXIS® Academic

November 18, 1999, Thursday FINAL EDITION

SECTION: NEWS; Pg. 3

LENGTH: 430 words

HEADLINE: Air industry allows federal construction budget to lapse

BYLINE: Maria Recio, Star-Telegram Washington Bureau

BODY:
WASHINGTON - Congress is about to complete funding of
federal programs for fiscal 2000, but the budget for
airport construction won't be on the list.  And that's OK
with the aviation industry.

The airport and airline community decided that it is better to
let the airport program lapse altogether - it did as of Oct. 1 -
than to continue with a six-month extension.  The reason: It is
betting on greater returns next year in a revamped program designed
by Rep.  Bud Shuster, R-Pa., chairman of the House Transportation
and Infrastructure Committee. Kevin Cox, first deputy executive director of Dallas/Fort Worth
Airport, said the world's third-busiest airport will proceed with
its $ 2.5 billion capital development plan using money from other
sources.  He said he does not support a six-month extension, calling
it "a Band-Aid. "

The Senate and House each passed reauthorization bills this year
to fund the Federal Aviation Administration's airport program, but
they did not agree on a compromise.  The Senate approved a six-month
extension last week, but the House is not going along, knowing that
its action dries up airport funding, but with the industry's blessing.

"We want to see a multiyear bill," said Todd Hauptli, senior vice
president of the American Association of Airport Executives.  "The
Senate bill would keep funding at about $ 2 billion a year, but the
Shuster bill would essentially add $ 3 billion a year for airport
infrastructure.  It should come as no surprise that the airport
community supports Shuster. "

The problem for fiscally conservative lawmakers has been that the
House bill would take the airport program "off-budget," meaning
that the aviation trust fund, which collects about $ 10 billion a
year from an 8 percent airline ticket tax and other fees, would be
insulated from the federal budget process.  The trust fund has an
$ 11 billion surplus, and aviation interests want to see the money spent.

But the Senate, in particular, led by Commerce Committee Chairman
John McCain, R-Ariz., has balked at keeping the aviation program
separate, describing the action as fiscally irresponsible.

More troublesome to airport officials is that the Senate bill
does not include a provision allowing an increase in the passenger
facility charge - a $ 3-per-passenger tax, known as a PFC - charged
by most major airports to help fund local improvement needs.

Shuster's bill would allow local airport authorities to raise the
fee to $ 6 per passenger.

Maria Recio, (202) 383-6103

LOAD-DATE: December 1, 1999