A congressional battle that blocked passage of a new stopgap Federal Aviation Administration bill has caused the FAA to issue stop-work orders on about 80 airport engineering and construction contracts, totaling more than $790 million, around the country.
The failure to pass a new authorization bill before the old one expired on July 22 has also tied up an additional $2.5 billion in infrastructure funds, as FAA put a hold on awarding new grants from its Airport Improvement Program (AIP). Moreover, the agency furloughed about 4,000 of its 47,000 workers.
The closing of the AIP grant window is a bigger problem for smaller airports than for large hubs, which have greater capacity to tap the bond market to fund capital projects.
Also cut off was FAA authority to collect the passenger ticket tax, whose proceeds flow into the Airport and Airway Trust Fund. Administrator J. Randolph Babbitt says FAA can tap the trust fund's balance for a while, but notes, “The problem we have right now is, the deposits have stopped,” costing FAA $30 million a day.
Jane Calderwood, Airports Council International, North America, vice president for government and political affairs, says one airport director told her, “I'm really worried, if this continues for very long, [that] this is going to have such a huge, negative impact on the trust fund. And is the FAA going to have money to help me fund future projects?”
For more than three years, the House and Senate have been unable to agree on a long-term FAA authorization. Since Sept. 30, 2007, when the last multiyear aviation statute expired, they have kept AIP and other FAA programs running through 20 short-term extensions. Those measures generally have been non-controversial, “clean” bills that merely extended authorizations and aviation taxes.
But a partisan squabble over stopgap No. 21 erupted between House Transportation and Infrastructure Committee Chairman John Mica (R-Fla.) and Senate Commerce Committee Chairman Jay Rockefeller (D-W.Va.).
Mica drafted an extension through Sept.16 that included provisions to trim the Essential Air Service (EAS) program, which subsidizes flights to rural airports. His bill, which the House passed on July 20, would cap EAS subsidies at $1,000 per flight, which would drop three airports from the EAS list: Ely, Nev., whose subsidy, is $3,720 per passenger; Alamogordo/Holloman Air Force Base, N.M., whose subsidy is $1,563; and Glendive, Mont., whose subsidy is $1,358, Mica says. He also claims the cap would save an annualized total of $4.1 million.
Rockefeller, a strong EAS backer, wants a clean stopgap. He blames the House for the standoff, saying, “I am disappointed and stunned by their failure.”
Mica blames the Senate, saying, “In light of the nation's pending financial disaster and soaring deficits, they couldn't find a way to cut even a few million dollars by accepting this minor request to reduce outlandish subsidies.”