I wanted to take a brief moment and share a couple pieces of information on this amendment.
-EAS was already reformed in the most recent FAA reauthorization and is further cut in this base bill.
-If your boss was here last year, he or she should have a record on this amendment from when it failed last year.
-This page links to the most recent list of EAS-eligible communities.
July 30, 2013
Support McClintock/Hudson/Bridenstine Amendment to FY14 THUD Appropriations
Save $100 million by eliminating funding to the Essential Air Service (EAS)
Our amendment will prevent the government from paying for empty and near-empty flights from selected airports in tiny communities that lack the market demand to make such flights affordable on their own. The amendment reduces EAS discretionary spending by $100,000,000 and transfers the savings to the spending reduction account.
EAS subsidizes regular, scheduled, commercial service that practically nobody uses, having been originally envisioned by the Carter Administration as a temporary means of preventing small airports from losing service overnight following the deregulation of the airline industry. The idea was to provide a small subsidy until the industry could identify economical service routes and phase out those destinations without sufficient traffic to merit scheduled service.
But the program lives on and has grown in size and scope. Since we last visited this issue, the FAA reauthorization bill made some minor reforms to the program. For example, we are no longer subsidizing air travel from communities that are within a 90 mile radius of a major airport and the per-passenger subsidy is being capped at $500 per passenger in the underlying bill. These minor reforms mean that one airport in Ely, Nevada has been dropped from the program and two more are about to be.
That’s a start, but still no excuse for shoveling another $216 million at this program.
National Taxpayers Union & Taxpayers for Common Sense support this amendment. Heritage Action for America will be key voting in SUPPORT of this amendment.
Jim Bridenstine Tom McClintock Richard Hudson
Propping up small-town airports with $200 million
By Editorial Board, Published: March 8
THE $85 BILLION in across-the-board budget cuts known as sequestration have begun to affect places like Garden City, the Kansas county seat (pop. 26,880) whose airport will lose $318,756 in Federal Aviation Administration funds that pay for four air traffic controllers. As The Post’s Stephanie McCrummen reported, Garden City Regional Airport’s control tower is one of 238 affected by sequestration, which will reduce total FAA spending in fiscal 2013 from about $16.7 billion to $16.1 billion. Small towns are lamenting the potential impact on air safety and local economies.
Another case of sequestration madness? The increased safety risk is likely to be marginal at worst. At Garden City, only two commercial jets take off and land per day — connecting to and from Dallas — and one already does so when the tower is closed. As for local economies, the federal government already spends many billions of dollars in pursuit of prosperity for rural America. Though undoubtedly nice for the folks who benefit, one might well question the national interest in subsidizing a couple of flights a day between Garden City and Dallas.
Garden City’s predicament does illustrate the senselessness of sequestration in a different way. Its airport is one of 120 in 49 states (not including Alaska) that receive federal support under the Essential Air Service (EAS) program. Established in 1978 as a 10-year measure to help small towns adjust to airline deregulation, EAS has mushroomed into a seemingly permanent $200 million-a-year subsidy, fiercely defended by rural lawmakers from both parties. EAS pays airlines to provide scheduled flights to and from places with so few passengers that it wouldn’t make sense to operate there otherwise. That is to say, it subsidizes inessential air service.
Garden City has had twice-a-day jet service to Dallas since April because EAS gave American Eagle Airlines a two-year contract, at $2.9 million per year, to provide it, according to the Congressional Research Service. That works out to $107 in taxpayer aid for each of 18,000 passengers in 2012. Such subsidy rates are typical under the program. State and local governments also chip in to keep Garden City going. Airport officials note that their plan is to use federal subsidies to establish a large enough customer base so that the airline can eventually provide service without a subsidy. But given the program’s history as “temporary,” we’re skeptical.
The point is not to vilify Garden City or any other small town but to note that EAS itself has long since outlived its ostensible purpose and now serves only to illustrate the federal government’s utter inability to establish sensible priorities. If the relative handful of people who choose to live in rural communities want scheduled air service, they should draw on the resources of their own states, or of the private sector, to provide it — or do without and content themselves with the compensating virtues of small-town life.
Ideally, EAS would be zeroed out, and the $200 million we waste on it devoted to a truly national purpose: perhaps deficit reduction, military readiness or the social safety net. Alas, if Congress and the White House were capable of making such choices, we probably never would have had sequestration in the first place.
Earlier this week, the Department of Transportation’s inspector general released a detailed review of the aviation industry from 2008 to 2011. Requested by Congress, the review concluded that while the airline industry remains one of the most important in the American economy, “significant and frequent challenges to the economic and operating environment appear to be the new norm for the airline industry, causing airlines to innovate and take drastic action to survive.” According to the report, some of the most significant trends of recent years, like a more consolidated industry with less competition or fewer flight options for small communities, “may continue for the foreseeable future as airlines further improve their adaptability to changing market forces.”
On the impact for small communities, the inspector general report states that the FAA Modernization and Reform Act of 2012 significantly altered the protection that small communities previously enjoyed under the Essential Air Service (EAS) program, making it “easier for airlines to reduce the number of communities they support, without advanced notice of withdrawal.” The roughly 50 small communities currently served by only one air carrier are particularly vulnerable, the report acknowledges.
“The [FAA Modernization and Reform] Act introduced new limits to the program by restricting eligibility and appropriations. Eligibility for communities in the lower 48 States to participate in the program is now restricted to only those that received subsidized service between September 30, 2010, and September 30, 2011 (no new communities in the lower 48 states are eligible for subsidy). Further, except at the limited number of subsidized communities, airlines are no longer required to provide advanced notice of their intention to terminate service.”
The report concludes its findings on the EAS program by pointing out that program appropriations will be steadily reduced from $195 million in FY 2011 to $93 million in FY 2015 and prior to these legislative changes, “EAS subsidies increased from $50 million for 115 communities in FY 2001 to $195 million for 162 communities in FY 2011, caused in part by higher fuel costs and lower ridership.” How this planned reduction in appropriations will affect the number of communities that can be funded in the future is “unknown.”
U.S. Department of Transportation
August 20, 2012
In 2002, DOT launched the Small Community Air Service Development Program to help address the challenges of securing local air service in communities that lacked access to air travel.
For these small markets, obstacles like high fares, insufficient levels of service, and lack of competition pose significant barriers. But during the past decade, SCASDP awards have helped more than 300 communities develop good projects that eliminate those barriers. From providing financial incentives to carriers to conducting studies of expanded service, DOT is helping smaller communities attract the air service they need.
And last week, we announced a new round of grants to 33 more communities.
From Culebra, Puerto Rico, to Corpus Chrsti, Texas, and on up to Casper, Wyoming, the $13.9 million we awarded will go a long way toward helping these communities maintain important access to our national air transportation system.
To make these awards go even further, most of the 2012 grant recipients have made their own financial commitments to their projects, and most of them have also teamed with local government and businesses in strategic partnerships that will deliver an even bigger boost to community air service efforts.
In fact, in one case a single grant will support two different communities more than 1,600 miles apart. $900,000 will establish the first non-stop air service between Culebra and San Juan International Airport. Culebra, in partnership with Block Island, R.I. submitted an innovative proposal that would provide revenue guarantees to Cape Air for new seasonal service at both airports. Under this first of its kind agreement, Cape Air would operate the Culebra-San Juan route in Puerto Rico between October and May and then fly a Block Island-Providence route in Rhode Island between May and October.
This will provide new air routes for two communities that currently have very limited service, and provide access to the national air transportation system via hub airports, which they do not have today. Even better, public and private partners in both communities have committed an additional $115,320 to the project.
Our air transportation network is a tremendous national asset. With the Small Community Air Service Development Program, DOT is working hard to make sure even more Americans have access to this important resource.
View the original article here.
Sequestration - the automatic spending cuts set to take effect January 2, 2013 – if implemented, is expected to reduce the Federal Aviation Administration (FAA) annual budget by approximately $1 billion for nine years. The exact results of this reduction are unclear, but recent reports point to detrimental economic impacts across the FAA, civil aviation industry, and national economy as a whole.
A new study released this week estimates the budget cuts to the FAA as a result of sequestration could cost up to 132,000 aviation jobs and sap $80 billion a year from the nation’s gross domestic product. The new study, released by the Aerospace Industries Association (AIA) and Econsult Corporation, claims annual economic losses could “amount to $80 billion annually by 2035, an annual decrease of 37 to 73 million in passenger enplanements and annual reductions of 1 to 2 billion pounds of transported air freight.” In response, AIA formed the Second to None campaign to head off sequestration and “preserve American leadership in Aerospace and Defense.”
“The stakes are too high not to take action,” said former Secretary of Transportation and Congressman Norman Mineta at a luncheon meeting of aviation leaders in Washington. “If sequestration is not stopped, it will be by far the most devastating budget cut to the FAA in its 54 years.”
Additionally, an article published by Senior Fellow Scott Lilly with the Center for American Progress states that as many as 106 U.S. airports could lose air traffic control service and effectively be shut down. Further, because FAA officials will likely be forced to cut air traffic service at “airports where they would have the least impact on the traveling public,” smaller airports face the greatest threat from sequestration.
In his article for the Center for American Progress, Scott Lilly writes:
[The FAA], which is responsible for the safety and efficiency of all aspects of civil aviation in the United States, has a $15 billion annual budget distributed among a range of activities. It provides nearly a fourth of those funds as grants-in-aid to local airports. That might be a place where the largest share of the cut could be taken, but the sequestration law won’t allow it. Nor will it allow a disproportionate whack to be taken at facilities and equipment, which accounts for another fifth of the agency’s budget. The required 9 percent to 10 percent cut in Federal Aviation Administration spending, about $1.35 billion, must be taken equally from all activities, and that includes operations—in other words, the control towers.
To minimize disruption at major airports, therefore, FAA officials will likely be forced to cut air traffic service at airports where they would have the least impact on the traveling public—the smaller airports.
The cuts to the FAA budget could also threaten Essential Air Service (EAS) funding. Todd Hauptli, Senior Executive Vice President, American Association of Airport Executives stated at the Washington luncheon, “Congress needs to act to avoid these devastating and indiscriminate cuts. This [AIA] study confirms that the entire aviation industry should be on high-alert in the weeks and months ahead as this process unfolds.”
Read Scott Lilly’s report for the Center for American Progress here.
Read the Aerospace Industries Association and Econsult Corporation study here.