U.S. airlines and the nation’s airports are locked in battle this summer over a proposed $4 fee increase airports want to impose on fliers.
Airports are asking Congress to let them increase the “passenger facility charge” that fliers pay when they purchase a ticket. Airport representatives say it’s needed to improve aging and outmoded aviation facilities, such as New York’s LaGuardia, the airport that President Donald Trump famously called “third world” last year.
Airlines, though, are lobbying hard against the proposal, characterizing it as a “massive tax hike, crafted in secret.”
“Choosing to increase this tax is a completely unnecessary poke in the eye and wallet of air travelers,” the Airlines for America group said in a press statement opposing the bill. That group represents Southwest, United, American and JetBlue, among others.
Under federal rules, airports are allowed to charge fliers a facility-use fee of up to $4.50 per flight. Airports want Congress to increase that maximum or cap to $8.50 per ticket. Airports Council International-North America, which represents major airports, says the increase will help fill a $100 billion gap for needed airport improvements.
“Improving terminals to accommodate more gates, bigger seating areas and modern security checkpoints will result in shorter lines, lower airfares and a better passenger experience,” the group said in a press statement last week.
It also took a shot at the airlines, suggesting they are the ones gouging fliers with add-on fees for checked baggage and other services. “Let’s look at the skyrocketing amount of revenue that airlines continue to generate from ancillary fees,” the airports group wrote.
Several traveler activists oppose the increase, saying passengers would shoulder more of the burden for fixing airports without having a strong enough voice in the process.
“It’s a very big increase,” said Paul Hudson, president of flyersrights.org. “It will increase the cost for air travel ... and (fliers) have no say in how the money is spent.”
Sacramento International Airport’s chief executive John Wheat is among airport executives who say new funds are needed to upgrade the nation’s airports.
Sacramento, the airport serving California’s capital region, stretched itself thin a decade ago during an industry recession to finance a $1 billion expansion, including a new terminal. At the time, airport executives had fingers crossed Congress would agree to raise the passenger fee to at least $6. When that didn’t happen, the airport had to cut its expansion budget, eliminating a parking garage and a hotel atop the new terminal.
Wheat estimates the proposed cap increase would mean nearly $19 million more annually the airport could use to pay off some debt and to finance airfield improvements, including a runway redo. He said that would be good for the airlines serving Sacramento as well as passengers.
The passenger facility charge has existed nationally since 1990. Airports individually decide how much they will charge, up to the current $4.50 cap. That cap has not increased since 2000, airports said.
The current proposal is part of a larger transportation funding package in the Senate. It passed the Senate appropriation subcommittee on Transportation, Housing and Urban Development last week. A separate transportation spending proposal in the House of Representatives, notably, does not include an increase in the passenger facility charge.
The facility fee is one of several sources of revenue that airports tap for airfield improvements. Other sources include federal grants, fees and rents that airlines must pay each airport, as well as fees and rents paid by car rental companies and airport concessionaires. Airports also get revenue from parking.
If Congress were to increase the facility charge cap, each airport would decide whether to raise its passenger fee and by how much. Sacramento airport executive Wheat said it is uncertain how far beyond $4.50 he would seek to go.