Proposals to Fund FAA Aviation Programs May Be Costly to General Aviation’s (GA) Pocketbook; Send a Message to Congress to Leave GA Alone

The FAA’s aviation programs, as well as the authorization of the existing aviation tax structure that provides revenue for airport improvements and partial FAA operations will expire September 30, 2007. As a result Congress must reauthorize these programs and the aviation tax structure before this date. During this reauthorization, Congress will visit possible alternative mechanisms for financing the future needs of the aviation system. The FAA recently proposed major changes on how it would like to finance and reform the federal aviation system.

The General Aviation (GA) industry, which includes agricultural aviators, has serious reservations about the FAA’s proposal because it would require significantly more payment from GA users of the federal aviation system than those users are currently required to pay. For example, the FAA proposal calls for a 220% increase in the GA tax rate for Jet A, (currently 21.9¢/gallon, increasing to 70¢/gallon) and a 261% increase for aviation gas (currently 19.3¢/gallon, increasing to 70¢/gallon).

As the law currently stands, aerial applicators making agricultural applications are exempt from federal excise taxes on aviation fuels, thanks to NAAA’s recent efforts urging Congress to enact such legislation. This all could change once Congress opens up the funding process (see below on what you can do to prevent this from happening).

The FAA’s proposal would also allow the FAA, and not Congress, to set the excise tax rate and other proposed rates based on usage of the federal aviation system. These additional GA charges proposed include fees established for operations in terminal airspace for large hub airports and increases in registration fees for specific services such as issuing an airman certificate, issuing a medical certificate, registering an aircraft, and recording a security interest. The level of fees for these services as prescribed in the FAA’s proposal ranges from $42-$132.

To prevent these significant increases in federal excise taxes from becoming public law, it is important that agricultural aviators contact their U.S. Representative and Senators and urge them to maintain the current federal aviation system funding structure, including provisions providing continued federal excise tax relief for farmers and aerial applicators on aviation fuels used for agricultural aerial applications.

To identify your elected Senators visit www.senate.gov. To identify your elected U.S. Representative visit www.house.gov. These sites direct you to the websites of your Senators and Representative which contain contact information (phone, fax, address, etc.).

You may also phone or fax your congressperson by simply contacting the Capitol Switchboard by dialing 202-224-3121; the operator will connect you to the office and you can state that you are a constituent, and would either like to talk to the congressperson (or his aviation staffer) or fax the congressperson a letter and then request the fax number (the best approach is to either send a fax or letter).
Sample language for your correspondence is as follows:

Dear Senator (Last Name):               Dear U.S. Representative (Last Name):

Recently, the Federal Aviation Administration (FAA) proposed a budget that would force small and independent businesses and pilots across rural America to pay a substantially greater portion of the FAA’s budget while allowing America's biggest commercial airlines to avoid paying billions of dollars in aviation related taxes. The FAA proposal is projected to cost the agricultural aviation industry over $20 million dollars per year just in federal excise taxes. This does not include proposed fees on other federal aviation uses. The timing of this proposal could not have come at a worse time. Since 2004 aviation gas prices have increased over 75% and Jet A prices have increased almost 150% for aerial applicators. These costs are harmful for both agricultural aviators and farmers alike, both of which are instrumental in providing a safe, affordable and abundant supply of food, fiber and now fuel for the nation and the world.

In 2005, Congress, in an effort to provide some relief from the high cost of energy to aerial applicators and farmers, enacted legislation exempting aerial applicators from federal excise taxes levied on fuels used to make agricultural aerial applications. At this point there is no provision in the FAA’s funding scheme for this continued relief on the tax burden for crop treatments by air.

The purpose of the federal excise tax on fuels used in aviation is to generate revenue for the Airport Improvement Program, which builds new and retrofits and expands existing public airports. The majority of agricultural aviation operators do not use public airports; rather they use their own private landing strips. Furthermore, if an aerial applicator were to use a public airport the FAA has established rules and regulations providing guidance for these entities to recover costs through fees and other charges to make the airport self-sustaining. Aerial applicators are charged these fees if they use these airports. Aerial applicators also rarely, if ever, use or show up on the nation’s air traffic control system network because they operate restricted category aircraft that fly at low altitudes in un-congested airspace. Since agricultural aviators seldom use public use airports or the air traffic control system it is unfair for them to be penalized by the FAA’s costly funding scheme.

The FAA has stated its proposal to alter the current federal aviation system will help to modernize the current system, yet it has not specified a detailed proposal on how they intend to do just that. Another important fact to consider is that the current system is the safest, most efficient air traffic control system in the world and has been for many years. The revenues of the current system are at record levels and are projected to increase at a rate of 6% annually for the next five years. Unfortunately, the FAA’s proposal appears to be about shifting costs from airlines to GA. The proposal actually raises nearly $1 billion LESS between FY 2008 and FY 2012 than is raised under the current system, while at the same time cutting taxes for the “legacy” and low-cost airlines by a total of $1.986 billion a year according to the AOPA. Furthermore, the proposal would usurp Congress’ constitutional taxing authority and reduce congressional oversight of the federal aviation system.

The bill put forth by the FAA will isolate our farming communities and cause severe economic harm by unfairly imposing new fees and taxes upon small businesses and general aviation. I urge you to vote for legislation that maintains the current funding structure including the existing provisions providing federal excise tax relief on aviation fuels used for agricultural aerial applications. This is a far more equitable approach for small and independent businesses and pilots across rural America than the FAA’s proposal. Thank you for your consideration.

Sincerely,
(Signature)
(Name)_________________

Please send a copy of your letter to the NAAA by fax at (202) 546-5726 or by email at information@agaviation.org. NAAA is actively fighting against this proposal and will be sure to follow up with individual Members of Congress and the key leaders on congressional committees in an effort to prevent this proposal from being enacted.

If you need help contacting your congresspersons do not hesitate to contact us at NAAA headquarters at 202-546-5722; we would be happy to help. But please act. Unless Congress hears from us you could be spending 70¢ more in federal taxes for a gallon of aviation fuel than you currently do.