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"Legislators push change for airport funding"

Monday, April 23, 2007

Legislators push change for airport funding
The Press of Atlantic City (NJ)

Some of the taxes you pay when flying out of airports like Atlantic City
International Airport help fund airports you may never use, unless you're a
crop duster or have a Lear jet. But a bill in Congress may change the way
all airports receive federal funds, as well as how they can allocate them.

Atlantic City International Airport received about $4.4 million over the
past two years, according to FAA documents, from the agency's Airport
Improvement Program, or AIP. By comparison, Teterboro Airport, a small
airport in Bergen County with no scheduled commercial flights, received more
than $35 million over that period. But Tom Rafter, airport director for the
South Jersey Transportation Authority, which operates the airport, isn't
worried about Atlantic City getting its fair share of federal funds.

Because Atlantic City is designated as a primary airport, it will receive
more entitlement funds than Teterboro, Rafter said Friday. Airports such as
Atlantic City and Newark Liberty International Airport receive an average of
about $3 million per year in entitlement funds, according to Rafter and FAA
documents, while non-primary airports such as Teterboro receive no more than

Discretionary funds, however, are open for all airports to compete for.
Discretionary funds are allocated based on demand, need and emergency
necessity, Rafter said. Atlantic City historically has received "quite a
bit" in discretionary funds, including about $14 million recently, Rafter
said, which may not immediately show up in federal documents.

The $3 billion Airport Improvement Program provides grants primarily to
public agencies for the planning and development of public-use airports,
according to the FAA's Web site. That money comes from a $17 billion general
aviation trust fund, which is funded by eight different streams. One stream
is the money collected from passenger taxes and surcharges for all flights -
whether it's a Spirit Airlines flight from Atlantic City, Donald Trump's
Lear jet from Teterboro or a crop-dusting plane from Hammonton Municipal
Airport. For years, lawmakers have argued that monies from commercial
flights should only fund primary airports, while monies from non-commercial
flights should only fund non-commercial airports.

Federal lawmakers, including Rep. Frank A. LoBiondo, R-2nd, also favor
expanding allowable projects at the airport for which certain AIP funds can
be used. Currently, the FAA forbids the use of AIP discretionary funds for
terminal projects, Rafter said, which is a major issue among airports like
Atlantic City that are looking to expand. Airports like Teterboro and South
Jersey Regional Airport in Mount Holly are designated as reliever airports,
which relieve larger airports such as Newark Liberty and Philadelphia
International Airport when they are overcrowded with air traffic. Rafter
contends that if Atlantic City's terminal were larger, "we could relieve
congestion (at other airports) by processing passengers" like small airports
often have done.

Bills in both the House and Senate would expand the use of discretionary
funds for projects like terminal expansion, and some lawmakers have proposed
legislation that would replace many taxes paid by commercial airline
passengers with higher fuel taxes and user fees. Critics of that plan point
to the already large disparity in fees between commercial flights and other
flights, such as charter flights.

Commercial passengers pay a $3.40 tax for every segment they fly - a flight
from Atlantic City to Los Angeles that connected in Cincinnati, for example,
would be considered two segments - a $15 tax for departures and arrival and
a tax of 7.5 cents for using frequent flyer miles. Meanwhile, the crop
duster pays 19.3 cents per gallon in jet fuel taxes, and the owner of the
corporate jet pays 21.8 cents per gallon in taxes when filling up a
10,000-gallon tank. Critics also say that commercial airports can easily
sustain themselves with concessions, parking, souvenir shops and other
sources of income not available at smaller airfields.

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