TEMPE — Echoing Doug Parker’s plea for the government to “do no harm” to the airline industry, C. A. Howlett, US Airways’ top government affairs officer, outlined the challenges the industry — and US Airways in particular — face in the policy environment. His primary focus was the pending FAA reauthorization bill. Put off since 2007, the bill has been passed by the House but no action has been taken in the Senate. “We will maybe get this in calendar year 2009 but no one is betting anything heavy on that particular forecast,” he quipped.
Howlett is in no rush to get the House bill passed, because it has several provisions that give US Airways and other airlines pause. The bill increases the Passenger Facility Charge (PFC) from $4.50 to $7.00. PFCs are used to fund airport improvements but are levied by airlines when passengers buy tickets. This, Howlett said, would add $2 billion to the airline industry’s costs. “Airports have the ability to raise revenues by raising our landing fees and charges,” he added. “Not all airports are the same. . . . [Raising landing fees is]a better way to finance projects.” Besides, he said, airports got $1.1 billion in the stimulus bill, plus $1 billion for security improvements.
Also of concern in the House’s FAA bill are labor issues regarding collective bargaining procedures, the passenger’s bill of rights provisions, and limitations on foreign repair stations. Howlett said that there is a provision inserted at the behest of the firefighters’ union that would cost US Airways alone $15 million per year at their hubs.
Then, of course, there’s Jim Oberstar’s assault on airline alliances, which is now included in the House bill. This provision would limit antitrust immunity to three years, subjecting renewal to political interference. “Having the sort of ex post facto law that would undo this is a very disconcerting principle to have in the business community,” Howlett said. All told, increased PFCs, increased security charges, US VISIT costs, and climate change litigation would cost the airline industry $12.5 billion.
His overarching concern is that “our industry is not fully understood by the decision-makers in Washington and by many of our customers.” For example, he said, aviation got very little traction in the stimulus package.
Howlett did not speak much about the two “eight-hundred-pound gorillas here”: climate change and NextGen, which he said are interrelated. The airline trade group ATA is the primary venue for US Airways’ advocacy on these issues. More specific to US are the perimeters at LaGuardia Airport and Reagan National Airport, where it has focus city operations. “We are continuing to work on them,” he said, primarily through the FAA legislation. I talked with Howlett after the presentation about this issue and will be putting that interview together for a subsequent post.
Also in Howlett’s portfolio are state and local issues. He expressed concern about states trying to close deficits by raising taxes on aviation and especially about state attempts to chip away at federal preemption by interfering in issues like passengers’ bills of rights (New York) or greenhouse gas emissions (California). Howlett expressed frustration about how politicans have handled airspace redesign, especially the long-term process of redesign in the New York City area, where he said that members of Congress are still trying to “sabotage” the redesign while simulateously complaining about congestion!