U.S. Markets closed

Proposed bill would raise airport fees to improve nation's airports

Old airport infrastructure in the US is struggling to keep up with the increasing number of travelers. (AP)

A new bill was presented to Congress on Wednesday, which, if passed, could increase the fees passengers pay to airports.

Introduced by Reps Peter DeFazio (D-Ore.) and Thomas Massie (R-Ky.), the “Rebuilding America’s Airport Infrastructure Act” calls to modify the passenger facility charge (PFC) administered by the Federal Aviation Administration (FAA). Currently, travelers are charged a PFC of $4.50 on every plane ticket. This fee hasn’t been changed in 15 years and is used to fund FAA-approved projects intended to enhance the safety and quality of airports.

Only two PFCs can be charged on a one-way journey, and four can be charged on a round trip, making the maximum fee $18. The new bill would remove that cap, allowing for airports to charge whatever they deem appropriate.

“Airports need flexibility and local control to finance major construction projects. This market-driven reform will help modernize our nation’s airports and return power to local decision-makers,” Massie said in a statement.

While the new bill doesn’t directly call for an increase of the PFC, that would likely be the result. Back in 2015, the group Airports United argued that the PFC should be raised to $8.50 in order to help modernize airport infrastructure and keep up with increased passenger traffic. By giving airports control over the PFC, DeFazio and Massie predict that billions of dollars will be generated to improve airports, rehabilitate terminals, add runways and update taxiways—all without raising taxes.

“Those who don’t fly don’t have to pay. It’s not coming out of the general fund. Those who do fly benefit from the improvements, and they pay a little more for a better experience,” said DeFazio, who is also a House Committee on Transportation and Infrastructure Ranking Member.

LaGuardia Airport’s $4 billion Terminal B is currently under construction. (Photo AP)

The state of our nation’s airports has been a topic of conversation over the past couple of years, with politicians like Joe Biden calling major international airports like LaGuardia in New York City a “third world country.” Just last month, President Trump met with airline executives to discuss several issues facing the aviation industry. In that meeting, Trump reportedly said, “We need to rebuild America’s airports,” and vowed to help to find the money to get it done.

Kevin Burke, CEO of Airports Council International, was in that room and revealed to USA Today that Trump seemed opposed to raising the PFC. Still, Burke believes it’s a legitimate option to secure funding for services that passengers are using.

“In general he doesn’t like raising fees, and he referred to it as a fee,” he said. “To us, that’s a victory in terms of us explaining that this was a user fee paid for by people who use infrastructure.”

On the other side of the debate you have the airlines, which have consistently opposed removing the cap on PFCs. Airlines for America (A4A), a trade organization representing several US airlines, believes that the federal government has ample resources to secure money for improvements.

Saddling passengers with more taxes is not the solution, particularly given the abundance of funding resources already available to airports for capital improvement projects,” said Kathy Grannis Allen, an A4A spokesperson.

Louis Armstrong International Airport in New Orleans is set to open its new 30-gate terminal in 2018. (City of New Orleans)

Since 2008, Allen says that $100 billion in capital projects have been completed or are currently underway at 30 of the nation’s largest airports. All of this has been done, she reminds legislators, without raising the PFC.

In response, DeFazio says that it’s time to get past the self interest of airlines and look at the bigger picture. “What they [the airlines] are really worried about is that you might build more gates and expand your terminals and we might have some more competition,” he said. It’s time to to get past this and get real.”

The “Rebuilding America’s Airport Infrastructure Act” was introduced at a hearing on the State of American Airports, held by the subcommittee on aviation in preparation to reauthorize the FAA, whose whose legal authority expires in September.

Brittany is a writer at Yahoo Finance. 

More: 

Basic economy seats: Is the discomfort worth the savings?

Sign up for these credit cards now to help fund your summer vacation

Trump ban already cost business travel industry $185 million