Tour three airports in a minute
If your next airline ticket costs more than expected, check out the latest fees Congress wants you to pay.
The Passenger Facility Charge, a fee added to airline tickets to pay for airport improvements, is currently capped at $4.50 per leg.
That rate could nearly double as soon as Christmas week, under the federal budget now being crafted by Washington lawmakers.
Though Congress authorizes the rate, individual airports set the precise fee. Consumers rarely know it, since it is folded into airlines’ ticket rates.
Of the top 100 domestic airports, 96 collect the charge, according to the Federal Aviation Administration. Those that do not are Boise, Omaha, Memphis and Greenville, South Carolina. Of the 359 airports collecting the fee, 343 are charging the full $4.50.
“Passenger facilities are not adequate for today’s level of traffic. Of course, they’re going to ask passengers to pay for it. Who else? We wind up paying for everything,” said Douglas Kidd, executive director of the National Association of Airline Passengers, a nonpartisan passenger advocacy organization created in 2010.
The current $4.50 cap hasn’t been increased since 2001, thanks to aggressive lobbying by the airlines, who say adding the fee to ticket prices hurts their ability to keep fares low.
The fees can fund only FAA-approved capital-improvement projects “that enhance safety, security, or capacity; reduce noise; or increase air carrier competition.”
Airline officials argue airports have plenty of other funding sources for their projects, including the Airport Improvement Program, which gives federal grants for airport safety and efficiency updates.
Dallas/Fort Worth International Airport announced a $52 million project this week to update one of its seven runways, funded by that program.
Airport interests have fought hard for the fee increase, saying they desperately need that money to update technology and amenities at older airports. Most currently charge somewhere between $3 and $4.50, with DFW and Dallas Love Field at the top of that range.
Raleigh-Durham International Airport raised its rate from $3 to $4.50 in 2004. The airport collects about $22 million per year from the fee and it all goes to paying debt service on Terminal 2, said Michael Landguth, the chairman and CEO of the Raleigh-Durham Airport Authority.
“The consumer will actually pay for what they actually use. When they pay $4.50, just like a move theater, it’s a great way for the consumer to pay directly for the use of that facility,” Landguth said.
Landguth said airports won’t raise the fee immediately if granted the authority by Congress, but will instead “raise it when they have the need for a particular project.”
What gives airports hope this year, after many years of failing to get an increase, is a Senate bill that includes the higher fee cap.
The House’s spending bill did not include the higher fee. Lawmakers from both chambers will meet to consider the two approaches within the next few weeks, as Congress works to produce an end-of-year spending bill to fund the government. Funding runs out December 8.
House negotiators say the fee increase could be a contentious point in those negotiations.
“It’s highly controversial,” said Rep. Mario Diaz-Balart, R- Fla., who chairs the House transportation spending subcommittee. “Until we start negotiating we won’t really know.”
Kidd, the passenger advocate, suggested that a compromise around $6 seems likely.
Airlines spend big to lobby in Washington, and are working hard to stop the fee increase’s inclusion. They say it would cost airline travelers an additional $2.6 billion per year.
“If it’s in there, the traveling public wakes up to the very real threat of a tax hike they didn’t even know was under consideration,” said Vaughn Jennings, vice president of communications for Airlines for America which represents airlines including American Airlines, Southwest Airlines and United Airlines.
Airlines for America has spent $6.3 million on lobbying in 2017, according to the Senate’s lobbying database.
The airline industry commissioned a survey in October suggesting that the public is on its side on this issue. While most people were not aware of the fee, the survey said 78 percent opposed it after the pollster explained it. The airline group launched a website, www.stopairtaxnow.com, where the public can complain directly to lawmakers.
Airport interests, including DFW, have pushed back.
Speaking to the House Transportation Committee’s aviation subcommittee in March, DFW Airport CEO Sean Donohue said the airport relies on the fee program, and collected $127 million from it in 2016. It used the money to pay down debt on government-approved projects.
Dononue suggested changes to the program that would allow fee money to be used for more projects than the ones currently outlined, which exclude terminal services.
Airline officials said there are plenty of other ways to pay for airport updates.
“We keep asking the airport community to show us the project that needs to be done that’s not being done because you don’t have this new fee approved,” said Sharon Pinkerton, senior vice president of legislative and regulatory policy at Airlines for America. “They can’t. We’re finding all these other ways to finance projects and they’re getting done.”