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03/07/2017

More Details on DeFazio/Massie PFC Bill

More Details on DeFazio/Massie PFC Bill
March 2, 2017

Rep. Peter DeFazio (D-OR), the Ranking Member of the House Transportation and Infrastructure Committee, and Rep. Thomas Massie (R-KY) introduced a bipartisan bill to eliminate the federal cap on local PFCs. The two lawmakers unveiled the PFC legislation on the same day that airports executives testified before the House Aviation Subcommittee.

"If we want to restore our aging airports to their former glory - not to mention help them keep up with increasing demand - we must give them the tools to improve and expand their terminals, runways, and taxiways," DeFazio said. "The FAA is already hard at work modernizing the airways to increase airspace capacity, but airports need the runways, taxiways, and terminals to support all that traffic on the ground."

 H.R.1265, the Investing in America: Rebuilding America's Airport Infrastructure Act

 PFCs: H.R.1265 would eliminate the PFC cap and allow airports to impose PFCs of any amount. It also includes an airport-backed proposal to do away with the "significant contribution" requirement for large and medium hub airports. The FAA reauthorization bills that the Senate and the House Transportation and Infrastructure Committee approved last year both include similar provisions to eliminate the requirement.

 AIP: In exchange for an unlimited PFC, the DeFazio-Massie bill proposes to cut annual AIP funding from the current $3.35 billion to $2.95 billion through Fiscal Year 2021. And it would eliminate AIP entitlements for large hub airports that impose PFCs above $4.50. Under current law, large and medium hubs already turn back 75 percent of their entitlements for imposing a $4 or $4.50 PFC.

"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," said Massie. "This legislation reduces airports' dependency on federal funds because some of the major airports will raise their PFC above the current cap of $4.50 and forego federal AIP grants."

The proposed $400 million cut and elimination of entitlements for large hub airports is similar to a bill that former Rep. David Jolly (R-FL) and Rep. Massie proposed last year. The concept is also similar to an Obama Administration plan to raise the PFC cap to $8 and cut AIP by $450 million annually.

The new House bill would protect entitlements for smaller airports by reducing the AIP "trigger" from the current $3.2 billion level to $2.95 billion - the same amount as the overall funding level contained in the bill. Under that funding scenario, passenger entitlements would remain doubled, the minimum entitlement would remain at $1 million, and the non-primary entitlement would stay intact at $150,000.

Our Take: Airports would obviously prefer an unlimited PFC cap and an increase in AIP funding. But having the top Democrat on the Transportation Committee introduced a bipartisan bill to completely eliminate the PFC cap is a big development. The fact that Massie joined him to make it a bipartisan initiative should also help our efforts on Capitol Hill.

AAAE President and CEO Todd Hauptli yesterday commended both lawmakers for spearheading the PFC effort:

"We are gratified to see two leaders on opposite ends of the political spectrum stand up on a bipartisan basis to give local airport authorities the tools they need to address their pressing infrastructure investment needs through the elimination of the antiquated federal cap on local airport user fees," Hauptli said. "We believe strongly that this straightforward, bipartisan legislation offers a blueprint for expediting critical airport infrastructure improvements, and we thank Representatives DeFazio and Massie for their leadership and strong support for the nation's airports and the traveling public."

Request: We urge you to reach out to your own Representative and ask him or her to cosponsor the bipartisan DeFazio-Massie bill to eliminate the PFC cap. Doing away with the cap would provide airports with additional resources they need to finance critical infrastructure projects.

Additional Resources

A copy of H.R. 1265 may be viewed here.

A copy of the press release from Ranking Member DeFazio and Rep. Massie may be viewed here.

A two-page fact sheet prepared by DeFazio's staff may be viewed here.


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