Congress Extends FAA's Authority To Collect Taxes

by Glen Shapiro, LawAndTax-News.com, New York

24 September 2008

The US House of Representatives has passed another short-term extension to the Federal Aviation Authority's (FAA) mandate to collect aviation taxes as part of its ongoing funding commitments.

The bill (H.R. 6984), which was approved by the House on September 23, provides a six-month extension of aviation programs and taxes, through March 31, 2009.

The aviation excise taxes collected by the FAA are used to support the Airport and Airway Trust Fund, which in recent years has provided about 80% of the FAA’s budget.

Rep. James L. Oberstar (D - Minn.), Chairman of the full House Committee on Transportation and Infrastructure, warned that, with an uncommitted cash balance of USD1.4bn, estimated as of the end of fiscal year 2008, any lapse in the aviation taxes could put the solvency of the Trust Fund "at risk."

"I strongly urge my colleagues to join me in supporting H.R. 6984," he remarked in a floor statement.

In addition to extending the aviation taxes, the bill extends the FAA’s authority to make expenditures from the Airport and Airway Trust Fund, through March 31, 2009. The legislation also provides USD1.95bn in contract authority for the Airport Improvement Program (AIP). This money is intended to be used by airports so that they can move forward with important safety and capacity projects. The bill also authorizes appropriations for FAA Operations, Facilities and Equipment (F&E), and Research, Engineering, and Development (RE&D) programs.

Congress has been forced to pass a series of short-term FAA extension acts because the Senate has been unable to complete action on a long-term FAA reauthorization bill. The current authority for aviation programs and taxes is due to expire on September 30.

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