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Tue, Mar 21, 2017

Trump Budget Blueprint: Impact On Aviation

Cuts DOT, Increases Funding For TSA

President Trump has released his fiscal year 2018 budget blueprint to Congress. The plan, named “America First: A Budget Blueprint to Make America Great Again,” requests $16.2 billion for the Department of Transportation’s budget, a 13 percent decrease from the 2017 annualized CR level. It also requests $44.1B for the Department of Homeland Security’s budget, a 7 percent increase from the 2017 annualized CR level.

In a news release, the National Association Of State Avition Officials (NASAO) reports that the budget outline does not include President Trump’s $1 trillion infrastructure investment plan to repair roads, bridges, airports and other projects. The White House has said the infrastructure plan will be released at a later date.

Notably, the plan eliminates funding for the Essential Air Services (EAS) program, initiates a multi-year reauthorization proposal to privatize Air Traffic Control (ATC), and increases the TSA passenger security fee.

Elimination of EAS funding would result in a discretionary savings of $175 million from the 2017 annualized CR level. The blueprint states, “EAS flights are not full and have high subsidy costs per passenger. Several EAS-eligible communities are relatively close to major airports, and communities that have EAS could be served by other existing modes of transportation.”

This proposed cut will encounter significant opposition from state delegations that have rural airports because of the detrimental impact it would have on those communities. NASAO will continue to support funding of the program at its current fully authorized level while simultaneously examining ways to improve the integrity of the program.

ATC privatization was included in President Trump’s budget. The inclusion of this policy comes after the president met with airline executives last month. Congressman Bill Shuster, Chairman of the House Transportation and Infrastructure Committee, and staunch advocate for ATC privatization, has also met with the president on multiple occasions. Chairman Shuster’s effort to privatize ATC was halted last year amongst questions and concerns from Appropriators and tax writers.

The same opposition and concerns about spending, accountability, technology, and national security are prevalent this year. NASAO has also expressed concerns on the Hill that the yet to be released tax title for the ATC proposal could potentially rebalance aviation excise taxes in a way that jeopardizes the future health and sustainability of the Airport and Airways Trust Fund (AATF) and Airport Improvement Program.

The President’s plan proposes to raise the TSA passenger security fee to recover 75 percent of the cost of TSA aviation security operations. The blueprint also states that $80 million will be saved in the TSA budget by reducing funding for the Visible Intermodal Prevention and Response (VIPR) program and eliminating funding for the Behavior Detection Officer program.

In fiscal year 2016, aviation security collections covered well under 50 percent of the total TSA aviation security operations. The current passenger security fee is $5.60 per one-way trip for all flights departing from a US airport and cannot exceed $11.20 for a roundtrip ticket. There have been reports that the Trump Administration is considering increasing the security fee by 1 dollar per one-way ticket. However, this specific fee increase was not mentioned in the blueprint.

It is important to note that the president’s budget serves a guideline for federal spending. After the president submits his budget request, the House and Senate Budget Committees each write and vote on their own budget resolutions. Those bills may or may not reflect the president’s priorities.

After that, the Appropriations Committee in both chambers receive a single 302(a) allocation for all of its programs. Those committees decides on their own how to divide this funding among its 12 subcommittees, creating what are known as 302(b) sub-allocations.  Individual appropriations bills are then debated and voted on in each chamber in a process known as “regular order.”

However, in recent years, Congress has moved away from regular order, and omnibus spending bills have become the norm. This is largely due to increased partisanship and political animosity. Omnibus bills package many of the smaller regular appropriations bills into one larger single bill that can be passed with only one vote in each chamber.

(Source: NASAO news release)

FMI: www.nasao.org

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