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March 8, 2000, Wednesday, Late Edition - Final

SECTION: Section A; Page 18; Column 3; National Desk

LENGTH: 674 words

HEADLINE: Panel Agrees to Raise Spending on Airport Improvements

BYLINE: By MATTHEW L. WALD

DATELINE: WASHINGTON, March 7

BODY:
House and Senate negotiators agreed today on a three-year plan that would increase spending on airport improvements, air traffic control and other aviation needs by 30 percent and would let local airport authorities increase departure taxes to $4.50 from $3 to pay for additional improvements.

The agreement also resolves an impasse on financing airport improvements that has held up airport aid from Washington since October. And it preserves 30-year-old limits on the number of flights from La Guardia and Kennedy airports in New York until 2007, but lifts them at O'Hare Airport in Chicago in 2002. Rodney Slater, the transportation secretary, praised the $40 billion plan for the Federal Aviation Administration, which he described as "a record level of investment," that would allow improvements in safety, security and capacity of the aviation system. It differed from the administration's proposal in several key respects, however.

The Clinton administration had proposed paying for aviation through a combination of the Aviation Trust Fund, which is fed by taxes on passenger tickets, cargo shipments and user fees. But the final bill will rely on general tax revenues for $6 billion to $7 billion over the three-year period, according to the Transportation Department.

The administration had also sought to eliminate the "high density rule" limiting flights at Kennedy and La Guardia, as a way to increase competition among airlines. But it was stymied by sharp opposition from New York-area legislators.

Joseph Crowley, a Queens Democrat whose district includes La Guardia, said that the 2007 provision "gave us room to breath again and fight the battle" to keep the rule permanently. According to the Transportation Department, while the rule was once justified by airport capacity, technology has allowed the scheduling of additional flights. The legislation provides exemptions for some flights to underserved areas.

The compromise also allows an extra 24 landings or takeoffs a day at Reagan National Airport near Washington, and reserves 12 of those for flights beyond 1,250 miles. Flights from National were limited to a particular radius to bolster business at Dulles, also in Northern Virginia.

Senator John McCain, the chairman of the Senate Commerce Committee, had sought the change.

The increase in the passenger facility charge, to $4.50, is intended to help bolster competition, according to its backers. "We think that will help airports get a little more autonomy, and get out from under the thumb of the airlines," said Scott M. Brenner, a spokesman for the House committee. "You go to any airport and there is a dominant airline, and they own every single gate there." With more revenue, airport authorities can build more gates, he said.

Airports would still have to apply to the Federal Aviation Administration for permission to raise their fees.

At the New York Port Authority, Greg Trevor, a spokesman, said: "We are pleased that Congress has recognized that passenger facility charges are a valuable tool for addressing airport capacity issues across the nation. We have no plans to apply for the higher funding level but we will continue to evaluate the needs of our airports."

The agreement, which the House and Senate are expected to take up soon, provides for 30 percent increases in federal aid for runways and other improvements under the Airport Improvement Program.

It also provides about $1 billion a year extra for air traffic control modernization. The administration had proposed turning the F.A.A.'s air traffic control section into a "performance-based organization," giving it a greater degree of independence and some ability to function more like a private business, but Congress rejected the idea.

While the compromise seeks to lock in a high rate of spending on capital improvements, financing for operations, like the salaries of F.A.A. personnel, would still have to be appropriated from year to year, according to Transportation Department officials. http://www.nytimes.com

LOAD-DATE: March 8, 2000