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GENERAL AVIATION AND THE AIRPORT AND AIRWAY SYSTEM: AN ANALYSIS OF COST ALLOCATION AND RECOVERY

Since 1967 it has been the policy of the National Business Aircraft Association that all beneficiaries of the nation's airways system have an obligation to pay a share of its costs. As airport and airway user charges are taken up in the 97th Congress in 1981, the questions are, What is the fair share of system costs that should be recovered from general aviation, and how much of that share was recovered under the 1970 legislation, which has expired? This study addresses these questions and finds that between 58 and 73 percent of general aviation's fair share was recovered in FY 1978 (used herein as the study year) by the taxes enacted in 1970. This does not take into account any public (nonuser) benefit that Congress may assign to general aviation activities. Costs of federal expenditures on the airport and airway system allocable to general aviation amounted to $368.8 million, 13.2 percent of the total system cost, based on data in a Federal Aviation Administration cost-allocation and recovery report for FY 1978. Other allocated cost shares were $1400.5 million for air carriers, 50.3 percent of the total; $281.2 million for military and government aviation, 10.1 percent of the total; and $735.0 million for the public (nonusers), 26.4 percent of the total. Recovery of costs by taxes depends on federal policies that are based on the efficient allocation of national resources, maintaining fair competition among the several modes of transportation, and fair taxation. Absent a cohesive national transportation policy, applying a consistent policy for percentage of costs recovered for like transportation activities to the general aviation primary use categories results in general aviation's fair share of costs that should be recovered to lie within the range of $126.1-$157.5 million for the study year. A comparison, therefore, of the fair share of costs that should be recovered from general aviation, with recovery from the taxes imposed by the Airport and Airway Development and Revenue Acts of 1970, which amounted to $91.5 million in the FY 1978 study year, shows that between 58.1 and 72.6 percent of general aviation's share was recovered by that tax structure. The fourfold increase in petroleum prices since 1974 and the enactment of the Airline Deregulation Act of 1978 emphasize the increasing role of general aviation in the air taxi, executive, and business primary-use categories as a vital and unique transportation resource in the United States. (Author)

Media Info

  • Media Type: Print
  • Features: References; Tables;
  • Pagination: pp 27-35
  • Monograph Title: Airport Landside Operations and Air Service
  • Serial:

Subject/Index Terms

Filing Info

  • Accession Number: 00362356
  • Record Type: Publication
  • ISBN: 0309033179
  • Files: TRIS, TRB
  • Created Date: Nov 30 1996 12:00AM