Airline Flights Could Get Cheaper if FAA Shuts Down Saturday Morning

Published July 22, 2011

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The FAA control tower at Reagan National Airport is seen in Arlington, Wednesday, March 23, 2011. (AP)
Airline tickets are going to get cheaper Saturday unless Congress can reach an agreement before midnight on extending authority for the Federal Aviation Administration, which gives airlines the ability to collect taxes on behalf of the government.

If the FAA's authority is not extended, airlines would no longer have the authority to collect federal taxes, which according to the Air Transport Association, is about $61 on a $300 round-trip airfare.

"The airlines have been alerted to the potential to need to make this change, and are working on it," said Jean Medina, a spokeswoman for the association.

The FAA would also face a partial shutdown since nearly 4,000 jobs out of the FAA's 47,000 workforce are funded with ticket tax revenues.

The shutdown is the byproduct of political deadlock in Congress over two provisions in legislation meant to extend the agency's operating authority -- one on subsidies for rural airports and another on union power. It is all but guaranteed to happen since the Senate won't approve a House-passed version of a temporary extension of existing law.

Transportation Secretary Ray LaHood has said the government will lose about $200 million a week in airline ticket taxes and $2.5 billion in airport construction projects will come to a halt. But airlines will still operate as normal and air traffic controllers will remain on the job.

One sticking point is on provision sought by House Republicans and the airline industry that would make it more difficult for airline and railroad workers to unionize.

The provision repeals a rule adopted by the National Mediation Board last year that changed the requirements needed for a union to be recognized as the collective bargaining agent for airline and railroad workers. Under the current rule, unions only need a majority of workers voting instead of a majority of those eligible. Before the rule change, those who didn't vote were counted as a :"nays."

Republicans complain that the rule reverses 75 years of precedent to favor labor unions. Democrats and union officials say the change puts airline and railroad elections under the same democratic rules required for unionizing all other companies.

House Republicans also want to eliminate government subsidies for airline service to 13 rural airports, a $16 million provision that Senate Democrats say is unacceptable.

Republicans say the rural subsidy costs more than $1,000 per passenger.

"During this economically difficult time, it is not possible to justify using taxpayer dollars to pay for a subsidy of $1,000 or more per passenger at an EAS airport," said Rep. Tom Petri, chairman of the aviation subcommittee, referring to the Essential Air Service.

Some Republicans have targeted Senate Majority Harry Reid because one of the airports that receives the subsidy is in his home state of Nevada.

"After refusing to lead the Senate to do its basic responsibility and produce a budget for over 800 days, taxpayers are left wondering -- whose interests does the Senate majority have at heart," the conservative groups Americans for Tax Reform, said in an article posted on its website.

The union provision was added to a long-term FAA funding bill earlier this year, but negotiations on that bill have stalled. Without long-term legislation, an extension bill is necessary to keep the agency operating.

"This is no way to run the best aviation system in the world," LaHood said. "Congress needs to do its work."

He declined to answer questions about the possible consequences of a prolonged shutdown. But Sen. Jay Rockefeller, D-W.Va., chairman of the Senate committee that oversees the FAA, said the agency "estimates that it could only operate air traffic and support services through mid-August."

"This would mean services to smaller areas like mine -- West Virginia -- would need to draw down in the near term so that the FAA can focus on primary traffic. That's not something we would look forward to," Rockefeller said in a speech on the Senate floor.

Rockefeller planned to ask Republicans Friday to agree to a clean extension in another speech on the Senate floor.

Long-term authority for the FAA expired in 2007. Unable to agree on long-term funding legislation for the agency, Congress has kept the FAA operating through a series of 20 short-term extension bills.

The Associated Press contributed to this report.

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