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Tue, Feb 14, 2012

Obama Budget Hikes Aviation Fees, Cuts AIP Grants

Seeks $32 Billion In New Revenue Over 10 Years

The budget released by President Obama Monday contains dismal news for airline passengers, business aviation, and many larger airports. The budget calls for increases in airline passenger fees, and resurrects the $100 per flight fee on GA in an effort to raise $32 billion over the next ten years. The budget also calls for cuts in Airport Improvement Grants, suggesting that airlines should pay a higher portion of the cost of improving the airports they use.

Reuters reports that, among the fees proposed in the President's budget, the security fee passengers pay for screening themselves and baggage would increase 50 cents per ticket each year beginning in 2014, topping out a $7.50 per ticket by 2018. The move is expected to raise between $9 and $25.5 billion over the next 10 years. Homeland security could continue to increase the fee at its discretion through regulations.

Back in the budget is the $100-per-departure fee charged to airlines and many GA aircraft for the privilege of using the Air Traffic Control system. That fee would rake in $7.4 billion, according to the administration. It is strongly opposed by the NBAA and other aviation organizations.

And, the budget would cut guaranteed funding for improvements at medium and large airports by nearly a billion dollars. Airports would be allowed to raise their own revenue through ticket surcharges to make up the shortfall.

FMI: www.whitehouse.gov/omb

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