Carrier Objects To The "Hub-And-Spoke" System ATA Endorses

JetBlue Airways split from the Air Transport Association Friday over the trade group's stance on financing the Federal Aviation Administration.

The ATA advocates taxing passengers based on the distance between original and final destination, disregarding actual flight miles on connecting flights.

JetBlue contends this is using a "hub-and-spoke" system and this is beneficial only to the largest airlines, since they would avoid paying taxes on potentially thousands of miles accumulated on those connections.

"The ATA's formula ... penalizes JetBlue's low cost business model that efficiently avoids hubs and relies primarily on nonstop, point-to-point service," said letters sent Friday by JetBlue President and Chief Executive Dave Barger to House and Senate leaders, reported the Associated Press.

Currently, the passenger tax is based on a percentage of the ticket price.

The plan the ATA proposes would also exempt airlines from paying any taxes on the first 250 miles of any domestic flight. The group says this is designed to help smaller communities -- which JetBlue agrees would be a help. What it objects to is including shuttles between New York City, Boston and Washington, D.C. in that exemption.

"Similarly, all flights between the large markets of Miami-Orlando, Dallas-Houston and Los Angeles-Las Vegas, despite the burden they place on the busiest air traffic control centers in the nation, would also be exempt from paying the distance-based fee under the ATA's proposal," Barger stated in his letter.

JetBlue said the ATA proposal will "mislead Congress into legislating which airlines using the (air traffic control) system pay their fair share and which airlines are provided statutory exemptions."

The AP said the ATA declined comment Friday afternoon.

Congress has until September 30 to reauthorize the FAA.

FMI: www.airlines.org, www.jetblue.com