House Approves Bill Extending FAA Authority To Collect Aviation Taxes

by Mike Godfrey, Tax-News.com, Washington

22 February 2008

The United States House of Representatives has approved a bill to extend the Federal Aviation Administration’s authority to collect aviation excise taxes and disburse funds from the Aviation Trust Fund.

The agency’s current authority under an existing temporary extension is due to expire at the end of this month, as a multi-year reauthorization bill awaits action in the Senate. The new legislation would extend the authorization for aviation programs and taxes through 30th June, 2008.

Jim Oberstar, Chairman of the House Committee on Transportation and Infrastructure, made the following statement to the House in support of the bill (known as H.R. 5270):

"Such an extension is urgently needed to address significant budget problems facing the Federal Aviation Administration (FAA) due to the current lapse in Airport Improvement Program (AIP) funding, and the upcoming expiration of both the aviation excise taxes and the authority to make expenditures from the Aviation Trust Fund."

"These current and upcoming lapses in FAA's authorities have occurred despite repeated efforts by the House to pass legislation to extend them. The House has acted on three separate occasions to extend the authorization for FAA programs. The Senate has yet to act on any of these bills, or on any other FAA reauthorization legislation."

"I strongly support the extension of the aviation excise taxes, as proposed in H.R. 5270. These taxes are necessary to support the Aviation Trust Fund, which in recent years has provided about 80% of the FAA's budget. With an uncommitted cash balance of approximately USD1.5 billion, any lapse in the aviation taxes could put the solvency of the Trust Fund at risk."

"In addition to extending the aviation taxes, a second key provision of H.R. 5270 is the extension of the FAA's authority to make expenditures from the Trust Fund. Without this authority, the FAA will face a partial shut-down beginning March 1st, as it will be unable to pay approximately 4,000 of its employees."

"The third key provision of H.R. 5270 is that it provides USD2.76 billion in contract authority for the AIP. Because the previous FAA authorization act, Vision 100, expired on September 30, 2007, there is currently no contract authority in place for the AIP in FY 2008, and no new airport grants can be made. It is our intent that the full USD2.76 billion provided by H.R. 5270 be made available, without regard to any previously enacted rescission."

"It is imperative that we reinstate the AIP program immediately. Unless we do so, we will lose the Spring construction season, and will not be able to do much construction this year, even if the program is reauthorized at a later date."

"According to the FAA, a continued lapse in AIP funding will affect important safety and capacity projects, including runway safety area projects, letter of intent disbursements, runway safety action team projects, enhanced taxiway and centerline marking projects, and aircraft rescue, firefighting and snow removal equipment. We must act now to extend this important program."

"H.R. 5270 also extends several other provisions of Vision 100 so that, until a long-term FAA reauthorization bill is enacted, aviation programs may be continued under the same terms and conditions as were in effect during the previous authorization period."

"But this is only the first step. We need to enact a long-term FAA reauthorization bill, which will permit us to go forward on modernization of the air traffic control system, and improvement of our airports, to combat the ever-increasing inadequacies of the current system. Last year, our aviation system had the worst delay record in its history. With the number of air travelers predicted to surpass 1 billion per year by the year 2015, the system is rapidly approaching gridlock. I strongly urge the other body to bring their reauthorization bill to the floor, so we can go to conference and pass a long-term reauthorization of aviation programs."

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