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GBTA Passenger Facility Charges 12 th Annual Legislative Symposium June 24, 2014

GBTA Passenger Facility Charges 12 th Annual Legislative Symposium June 24, 2014. About the PFC. Levels – $ 3.00 per enplanement ($12RT) in 1991, raised to $4.50 ($18RT) in 2001.

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GBTA Passenger Facility Charges 12 th Annual Legislative Symposium June 24, 2014

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  1. GBTA Passenger Facility Charges12th Annual Legislative SymposiumJune 24, 2014

  2. About the PFC • Levels – $3.00 per enplanement ($12RT) in 1991, raised to $4.50 ($18RT) in 2001. • Any public agency that controls a commercial service airport may impose PFC- can choose PFC levels of either $1, $2, $3, $4, or $4.50. • June 1, 2014- 390 locations (including 351 at $4.50) were approved to collect PFCs, including 98 of the top 100 airports. Only five applications have ever been denied.

  3. About the PFC • PFC projects must meet one or more distinct objectives: • Preserve or enhance safety, security, or capacity • Reduce or mitigate noise impacts • Furnish enhanced competition among air carriers • About $2.8B/yr

  4. Recent Developments 2012 4-year FAA Reauthorization - Kept PFC at $4.50 (proposals to increase to $7 blocked) FY2015 DOT Budget Request – Increase PFC to $8 FY2015 THUD – Blocks PFC increase request Airports, other travel associations

  5. Issues surrounding PFCs • Increased Traffic – FAA says air traffic will double in next 20 years. • Ancillary Fees – Airports complain the billions of dollars in ancillary fees are not subject to the 7.5 percent federal tix tax. If those fees were taxed, there would be more money for additional airport projects, the managers argue. • Airports are Badly Leveraged - Many airports’ future PFC collections are already committed to pay off debt for past projects, leaving them little future PFC collections for new development. At least 50 airports have leveraged their PFCs through 2030 or later, according to FAA data.

  6. Message on PFC Increases • Business travelers are acutely aware of the need for adequate air and ground infrastructure. • Other options exist than tax increases • U.S. airports enjoy access to a variety of sources of airport-project funding (for example parking and concessions). • Also, commercial retail and leisure enterprises, hotels and business centers, medical facilities, and specialized cargo handling and refrigerated storage facilities • Also, to construct, finance, operate, and maintain new terminals, private sector is providing financing in return for a share of the airport’s revenues.

  7. Message on PFC Increases, ctd. • GBTA supports a demand-focused approach to airport infrastructure - determine at the particular airport the development needs and then to establish the necessary funding levels. • An increased PFC is a system-wide and permanent tax.

  8. Questions?

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