User Fees for All

Highway at night

I’ve been flying sixteen years now, and the specter of user fees has haunted the general aviation community the entire time. Longer, in fact.

The history of these proposals has been summarized by AOPA if you care to know the full background, but one thing not many of us remember is that these taxes were first proposed to Congress nearly two decades ago by… who was it again? Oh, that’s right: the industry itself. Yes, it was the airlines who first urged the adoption of user fees “as a mechanism to fund the FAA in a balanced federal budget.”

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We Pay, They Don’t

Yesterday we alighted in San Francisco to drop off a few passengers. Despite the fact that we were only on the ground for about twenty minutes and used no services, the FBO (fixed base operator) there still charged us $1,100 for the privilege.

Contrast that with the U.S. government, which took over the office of a Boulder City FBO for four days, ran wiring, installed phone lines, confiscated his entire operation for a full day in support of a visit by President Obama, and then balked at the $50/day discounted rate that the owner asked the federal government to pay.

First they refused to pay anything, later relenting and adding that they’d never use his facility again.

“The one client I have today wants it for free,” Fahnespock. “It’s really baffling how they can comprehend not being charged for this.”

His FBO has no ramp or tiedown fees for the day, so there was no charge for Marine One, but he regularly charges clients for use of his facilities. Normally, Fahnespock said, he would charge a customer $500 total for a similar setup to what he proposed at $200 for the government.

Fahnespock received a plaque for his business’ hospitality, and he said the officials and enlisted servicemen based at his office were “very cordial and nice, very professional.” But, he still had a beef with the government: “I probably wouldn’t have as much heartburn” if general aviation weren’t facing user fees.

The Government Accountability Office estimated in 2000 that Marine One cost approximately $56,518 per hour to operate. That’s $70,834 per hour in today’s dollars. Yet the White House cannot abide providing a small business owner even a fraction of the normal revenue he’d receive for allowing his facility to be used by a customer.

We pay, they don’t. Your government at work.

Non-Commercial Landing Fees

Hilton Head Island Airport

As Ronald Reagan famously uttered with a shake of his head, “there you go again…”. I’ve noticed that more and more airports are starting to charge landing fees for non-commercial aircraft. Hilton Head Airport was in the news today as the latest to announce a levy for private aircraft landing at a small general aviation field.

The article notes this as the first airport in South Carolina to charge such a fee, but you can bet it won’t be the last.

During the same meeting, officials learned the state’s top aviation official objected to a related proposal that would charge private pilots to fly to the airport. Money collected under the proposal would also be used to pay for future construction, including runway lengthening.

The fee is expected to generate more than $100,000 a year.

Paul Werts, executive director of the state’s aeronautic commission, sent an email July 15 to Andres stating the fee could also be seen as discriminatory, which could jeopardize state and federal grant money for airport improvements.

“The South Carolina Aeronautics Commission is chartered to promote aviation and air commerce,” Werts wrote. “Landing fees (are) a practice that will discourage users and have a direct impact on operations” and hurt the island economy.

Hilton Head would be the first airport in the state to charge such a fee, a minimum of $10 or up to $1.65 per 1,000 pounds, whichever is greater, to private aircraft.

Currently, the airport charges commercial flights a landing fee of $1.31 per 1,000 pounds.

Private aircraft based at the airport that pay fees for permanent tie-downs or that rent a county hangar would be exempt since they already contribute to the airport’s operations, board members said.

The fee would apply to aircraft based elsewhere that fly in and out and do not pay the long-term fees.

Some members warned that air traffic at Hilton Head has declined because of the struggling economy and Delta Air Lines’ departure last fall. Imposing a landing fee could cause numbers to fall even more, they said.

Neither fee would apply to the Beaufort County Airport on Lady’s Island, where there is no commercial service and general aviation traffic is much lighter.

The landing fee doesn’t require FAA approval. The board will vote on the landing fee Oct. 20 for recommendation to County Council.

Some airport board members argue not imposing the landing fee would be short-sighted.

“We are in the black, but we’re not in the black because we have liabilities. And (we) are embarking on projects requiring the county to come up with substantial sums,” said board member and Hilton Head resident Will Dopp.

Airport revenues exceeded operating costs by about $170,000 for the fiscal year ending June 30, according to unaudited numbers. The airport, though, owes the county general fund about $1.5 million on a loan for prior construction projects.

“A $10 fee won’t drive someone away,” Dopp said.

In the past, this sort of levy was virtually unheard of in the United States. Over the years, such fees became common at the largest international airports (LAX, San Francisco International, etc). Then some “specialty” airports such as Catalina Island, which is owned by a non-profit conservancy, began charging landing fees. Catalina is a public-use field, but the airport is privately-owned.

Hilton Head Island Airport

Landing fees then progressed to popular publicly-owned airports like Santa Monica, Jackson Hole, and Aspen. With the economy hurting and governments deep in hock, I anticipate landing fees popping up more and more as municipalities demand that the local airport turn a profit to help the general fund. I can’t help but wonder why we aren’t doing the same thing with our roads. How about a per-mile tax applied every time you get in your car?

The inverse relationship between aviation’s cost and its vibrancy are well documented. Once a critical mass of landing fee airports is reached, that’s it. The fee becomes de rigueur, and we become Europe or Asia, where landing fees are high and omnipresent, and aviation activity is extremely low.

In fact, it seems the airport authority is hip to that fact, because they’ve estimated the landing fee will only bring in $100,000 per year. At $10 a pop, that’s 10,000 aircraft per year, or 27 landings per day. As a vacation spot with only 80-some aircraft based at the field, it seems they are anticipating a big drop in transient traffic. That should be great for the local economy, wouldn’t you say?

According to the FAA, in 2007 Hilton Head averaged 159 operations (takeoffs or landings) per day. As of July, 2010, that number was down to 109 per day. Traffic has dropped by a third in just three years. Will a $10 landing fee for a small private aircraft put a further dent in those numbers? Who knows. But I think it’s safe to say once the fee is established, it’s unlikely to stay at $10 for long. If you can hit those “rich guys” for ten bucks, why not $20 or $30? Just think of all the stuff they could pay for!

Mr. Werts was correct when he stated the fee was discriminatory. Did you notice that the charge for a non-commercial aircraft ($1.65/1000 lbs) is higher that levied on a for-profit business ($1.31/1000 lbs)? The flat rate for an average GA single-engine aircraft is well over $3.00 per 1000 lbs, more than twice the rate charged for an airliner.

The bottom line is that this is just another user fee, no different that the ones being proposed for flying in controlled airspace, receiving a weather briefing, flying an instrument approach, or filing a flight plan. Talk about killing the goose! Non-commercial pilots already pay for aviation infrastructure via fuel taxes, possessory tax on hangars, property tax on aircraft, and fees for parking, overnight stays, ramp usage, tiedowns, service charges, security, and more.

If it wasn’t for all that, perhaps the concept of a landing fee wouldn’t be nearly so objectionable.

Better or Worse?

That’s what my optomotrist is always asking me as I peer through the phoropter during my annual eye exam. It’s also what I ask myself in the never-ending battle which pits two schools of thought against one another on the state of general aviation in the United States.

On one shoulder stands a little guy who points out how flying is becoming less accessible due to escalating costs and regulatory burdens. He says, look at the number of active pilot falling each year, see how airports have become unwelcoming barbed wire fortresses, and notice how even the best primary flight schools are struggling just to survive.

His nemesis on the other shoulder, however, points out things like this article heralding the availability of a instrument rating for French pilots and and says “remember how good you’ve got it here in the U.S., buddy!”. Today it’s this perspective which is winning the fight.

It’s 2011. People have been flying on instruments for 82 years! How is it possible that France’s general aviation community hasn’t had an instrument rating available until now? It may be a perfectly sensible history for pilots on the other side of the Atlantic, but to most aviators on this continent it will engender serious puzzlement. What did they do when Instrument Meteorological Conditions (IMC) were present?

The answer is most likely: nothing. They’d stay on the ground and wait until the sky cleared. Hard to imagine that as the only viable option for a GA pilot in the 21st century, but there you have it. You see, French pilots did technically have access to an instrument rating prior to today. I say technically because it was so expensive and onerous to obtain that very few of Europe’s non-professional pilots even attempt it. Known as the JAA instrument rating, this is how the AOPA article describes it:

To earn an instrument rating under pan-European rules, pilots must enroll in a professional flight training school, spending more than 20,000 euros and studying such topics as the hydraulic systems of airliners and calculations of Mach number, according to AOPA France.

Twenty thousand euros is approximately $30,000 U.S. dollars at today’s exchange rates. And note that the article says “more than” 20,000 euros, so who knows what a real-world number would be for a typical non-professional European pilot. Beyond the financial cost, there’s also the time investment. The ground study course for the JAA instrument rating is several hundred hours long and covers items of no use to a GA instrument pilot such as the aforementioned heavy metal hydraulic systems and Mach number computations.

The presence of these study topics mystifies me. Some would claim that the JAA instrument rating simply makes no distinction between the professional and non-professional instrument pilot and trains every student to the same standard. But we do the exact same thing here in the United States. Once you’ve received a U.S. instrument rating, that’s as much official instrument training as you’ll receive up to and including your type rating for that airline gig. Items like Mach computation and hydraulic systems are placed in the aircraft-specific training, which is as it should be. If your airplane is not capable of achieving high airspeeds and/or does not have hydraulic systems, why should you be studying those things when pursuing an instrument rating?

Suddenly I have a lot more respect for the FAA. Or at least, for those who designed our rating and certificate programs, as our path from neophyte to instrument-capable pilot is a much shorter and effective one. As they say, people vote with their wallets, and you’ll find far more European pilots with U.S. instrument ratings than Europeans with the JAA equivalent.

As if this isn’t enough, there are also instrument ratings of various types for individual European countries, each varying in their requirements and privileges. The United Kingdom has one. France’s new instrument rating is another example. The problem is that those ratings are only valid when flying in that one country’s airspace. Oh, and you have to be flying an aircraft registered in that country. European countries are akin to American states in geographic size, so if you’re an American, imagine having your instrument privileges limited to your home state. Doesn’t make flying very convenient, does it?

This is why most GA airplanes in Europe are registered in the United States. Pilots can then fly throughout Europe using the U.S. instrument rating. In fact, this practice is so common that there are even organizations like N-Flyers which exist to defend this work-around as the only viable way for European GA pilots to legally fly on instruments throughout the Continent. It also reduces cost because aircraft maintenance can also be performed using U.S. standards.

Assuming you surmount the JAA instrument rating hurdles or fly an N-registered aircraft using a U.S. instrument rating, Europe still leaves you with a few other surprises of a financial nature. Flying in Europe is extraordinarily expensive. Avgas is far more pricey, the landing fees for even small airports can be $100 or more, and you will find yourself the recipient of a bill for air traffic services called “Eurocharges”. This sort of thing has been proposed for the United States by various administrations under the neutral-sounding name “user fees”.

Eurocharges are levied based on distance flown and aircraft weight, and the future may not be a bright one when it comes to these fees. PPL/IR Europe has an article detailing how Eurocharges are computed, and notes:

Recent developments, however, are much worse for GA. The UK CAA (strongly supported by the airlines – or is it the other way round?) have suggested abandoning the weight formula altogether, meaning that a light aircraft would cost the same as a 747! With current basic rates, that would come to around £1 per NM in UK airspace, but the basic rate would have to go up in order to compensate for the relative loss of revenue from larger aircraft, bringing the cost per NM closer to £2. The average across all Eurocontrol airspaces would then be around Euro 1.80 (£1.20) per NM. That’s one way of doing away with all those small bills. The few GA aircraft left flying would each generate huge bills!

To add insult to injury, the 2-tonne threshold is also under threat, so if the airlines get their way, you could end up paying £2 per NM to fly your Cherokee IFR in the UK!

The author may be positing at worst-case scenario, but just for reference, £2 is $3.21 US at today’s exchange rate. If we had that sort of thing here, a one way flight from Los Angeles to Las Vegas would cost $642 in air traffic fees alone.

So while the news of France’s new instrument rating is good, and hopefully the start of better things to come for pilots in the Eurozone, it doesn’t take much research on the state of general aviation around the world to realize that things don’t seem so bad here at home. Our challenge here in the U.S. is to avoid complacency, because user fees and bureaucracy are a perpetual threat, and I’ve no doubt they can turn our aviation system into Europe’s faster than any of us care to admit.