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White House Ratchets Up Heat on User Fees

The Obama Administration has issued an official response to the user fee petition you signed. You're not going to like it.
By Stephen Pope / Published: Jan 16, 2012

Remember that online petition asking the White House to abandon its $100 per flight user fee proposal? More than 9,000 of you signed it, prompting the government to consider the issue and write a response. Authored by Dana Hyde, a Washington bureaucrat with the bureaucratic-sounding job title Associate Director for General Government Programs for the Office of Management and Budget, the official White House rejoinder, made public last week, is called: “Why We Need Aviation User Fees.”

Oh, brother.

Just when it appeared the Obama Administration had backed off of its misguided plan to start charging owners of turbine-powered airplanes operating on IFR flight plans $100 per flight, we instead receive an official White House document spelling out why we “need” aviation user fees.

The reasons why we most certainly do not need user fees have been properly stated time and again by aviation advocates in the last several months, and so there’s no point rehashing that argument here. Instead, let’s take a closer look at the White House counter-argument to see if it holds water.

First, we all know that Washington bureaucrats and politicians rarely call anything that could draw political flak by its proper name. That’s why spending increases that are smaller this year than they were last year are referred to as “cuts.” And when a president talks about “investments” for the future, what he really means is more spending. The term “aviation user fee” is the industry's term. The White House has never used that phrase, preferring instead to tell us in eloquent Washington-speak that corporate jet owners must “pay their fair share.”

But in her missive, Ms. Hyde writes “aviation user fees” – right in the title, no less. This might be construed as refreshing candor – except that it isn’t. My guess is Dana Hyde chose the starightforward title for her response because she doesn’t really care very much about this issue. In all likelihood, a superior dropped this assignment in her lap after the petition received more than the 5,000 signatures triggering a response (which, by the way, has since been bumped to 25,000). Hyde probably felt that typing up a response to an online petition signed by a bunch of pilots was well beneath her. So what to do? Dash off a memo in about the time it takes to gulp down a cup of coffee, and get on with other “important” matters.

Otherwise, how do you explain the failure of logic and, worse, mathematical error in the response? Stating the White House case that private aircraft must pay an "equitable" share for ATC services, Hyde writes: “For example, under current law, a large commercial aircraft flying from Los Angeles to San Francisco pays between twenty-one and thirty-three times the fuel taxes paid by a corporate jet flying the same route and using the same FAA air traffic services.”

You don’t even have to reach for a calculator to see the error in this assertion. A corporate jet pays 21.9 cents per gallon in fuel taxes, while the airliner pays just 4.4 cents a gallon. No matter how you crunch the numbers, the corporate jet will almost always end up paying more in fuel taxes than the airliner, and certainly not 21 to 33 times as much. Ms. Hyde never mentions passenger ticket taxes, only fuel taxes. Hence, there is a fundamental flaw in her shoddily crafted response. I chalk it up to sloppiness, begot by the fact that Ms. Hyde probably afforded very little of her time to this assignment.

But let’s continue with our dissection of the Hyde memo. In it she also writes: “In a challenging budget environment, the Obama Administration believes it’s essential that those who benefit from our world-class aviation system help pay for its ongoing operation.” We do too – that’s what the aviation fuel tax is for.

Next she writes: “All piston aircraft, military aircraft, public aircraft, air ambulances, aircraft operating outside of controlled airspace, and Canada-to-Canada flights would be exempted.” Can the White House guarantee this will always remain the case, I wonder? And what exactly is “controlled airspace,” in the White House’s view?

Then we have this final gem: “We appreciate your petition's acknowledgment that there needs to be an increased user contribution to aviation system funding in the current fiscal climate, and we recognize that some would prefer to raise the tax rate on aviation fuel. At the same time, we have concluded that a $100 per flight user fee is an equitable way for those who benefit to bear the cost of this essential service.”

This one should make us all want to tear our hair out. But you at least have to hand it to Ms. Hyde: It’s pure Wasington-speak at its Inside-the-Beltway finest. It says absolutely nothing, and it gets its point across perfectly.

She may as well have written: “We hear what you’re saying, and we’re still not listening.”

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stuart_d_buchanan's picture

I'm not sure there's such a mathematical error. Presumably the airliner is using more fuel than the corporate jet?

If it used (say) 5 times the fuel of the corporate jet, it would be paying more in fuel taxes in absolute terms.

I've no idea what the example aircraft they used for the statement of 21-33 times more fuel tax, but that would need to equate to the airliner burning (5x21) 105x the gas of the corporate jet over the course of the flight. Seems unlikely, but not impossible.

It seems pretty clear to me. I don't think it's "We hear what you're saying, but we're still not listening", but instead "We hear what you're saying, but we disagree.".

I agree that user fees are a bad idea, but demonizing someone because you don't agree with them doesn't help promote a civilized debate.

-Stuart

DigDug's picture

I just ran a quick calculation comparing a Boeing 737 with a Learjet 45, which seem like good choices for the leg we're talking about.

I used average fuel consumption of 800 gal/hr for the 737 and 200 gal/hr for the Learjet, which is ballpark.

Based on these assumptions, the 737 would pay $35.20/hr in fuel taxes and the Learjet $43.80/hr.

Here's an extreme example: a Cessna CJ1 vs. an Airbus A380. Assuming fuel burns of 135 gal/hr vs 4,000 gal/hr, the A380 would still pay only about six times the fuel taxes of the CJ.

The White House is saying, at a minimum, the "large commerical aircraft" would pay 21 times as much. Maybe they're running their calculations using Concorde's fuel burn. or maybe their math is wrong.

TheAir_UpThere's picture

How many tax payers "use" the airspace while crossing the United States in a corporate jet? 2-14 maybe? Clearly depending on the plane used.

How many tax payers "use" the airspace while crossing the United States in an airliner? 150-300 maybe?

Seems the numbers may be proportional to the fuel burn, if not easily giving the airliner the advantage as it sheds the fuel tax onto its ticket prices.

pjsowe's picture

Can you think of any more reasons to get rid of Obama?
His little jet and it's associated fleet of support planes and copters get paid for by you and I.
One more sign of his class warfare battle against the 'fat cats' to try to garner votes.
If he does this in an election year, just imagine what he'll do if re-elected!!??

erikseifert's picture

In my humble opinion, the fairness of the user fee is not the central, or most effective, argument.

Instead, a per-flight-using-ATC fee would incentivize pilots not to use ATC in situations where they otherwise would, and where society's cost of their using it would be zero (in the absence of "crowding" on the controller's time). Society's cost of their non-usage is a perhaps even greatly increased risk of mid-air accidents for payers, non-payers, and innocent bystanders on the ground alike.

The US system was put in place to avoid precisely these grave accidents, and it works fantastically well. The Obama administration clearly is trying to copy Europe without understanding the underlying economics and human consequences (besed on the response posted at the WH website).

jstarter's picture

There are some things to consider in this issue. The first is the fact that this will impact small business owners who have turbine aircraft more than larger corporations. They may decide to fly below the flight levels and not file and use onboard radar or XM to avoid storms and they may just switch off the transponder while up there too. Hmmm...sounds good for safety doesn't it? I wouldn't do it but you know there will be those that do.

The other is that biz jet sales will also be dinged with people wanting to buy a piston twins or turboprops which work better down low and burns less fuel while avoiding the fees when not filing IFR.

This is also going to be a moot point when NextGen kicks in and we are going to be more responsible for position and traffic avoidance without the need for a controller.

ATTENTION WASHINGTON: Quit trying to get votes by destroying an already injured industry that is trying to hang on. Keep the fuel taxes and stop burdening GA for revenue generation that will only hurt our economy even more. Stop and do you what you were elected to do. Represent the people not your own selfish agendas!!!

Mserrano's picture

I think the White House response clearly signals that they hear us but don't really care what we think. Unfortunately 9,000+ people signing the petition was good enough to force an official response but not a significant enough number to make the idea untenable as far as the Administration is concerned. We all know the best course to generate the needed revenues is through the fuel tax. We all know these fees stand an above average chance of compromising safety. The White House, however, knows its not a problem until its a problem. 9,000 signatures is not a threat to their plans! The Administration is very good at making people afraid. I strongly recommend AOPA, NBAA, and every other organization representing GA do the same. Let the public know the risks associated with this plan. Media outlets love fear because it leads to viewers, website hits, and copy sold. Leverage the media as effectively as the Administration knows how to and we stand a chance at staving off the fees. We cannot let Obama put out bogus numbers without immediately countering him with the truth. This effort must be undertaken using major media outlets. I have no doubts CNN, Fox, etc would love to run the headline "Obama Administration Plan Compromises Aviation Safety." We try to be noble, take the high road and hope the truth will shine through. That does not work in today's politics! In my humble opinion it is time to get nasty!

N714JG's picture

I HOPE THAT EVERY PILOT, AIRCRAFT OWNER AND CLEAR THINKING AMERICAN REMEMBERS THIS ARTICLE WHEN THEY GO TO VOTE NEXT NOVEMBER , TO EITHER KEEP OUR CURRENT CROP OF IDIOTS IN WASHINGTON IN POWER OR TO CHANGE THEM STARTING AT THE TOP.
OUR PRESIDENT AND HIS ADMINISTRATION HAVE PROVEN TO BE LIKE A BABIES DIAPER AND NEED TO BE CHANGED FOR THE SAME REASON.

gunman1f16's picture

The government is looking at this only from the controller side, i.e. one controller and one aircraft. The services the controller provides isn't to one aircraft, it's to all of the passengers flying the airways. User fees? OK, charge by the number of people using the airway.... But if you're going to do that, you might as well stick with fuel taxes because the fuel used will usually be commensurate with the size of the airplane and the number of passengers.
I'm surprised that no one has raised that as an issue....

femanvate's picture

Mr Pope, journalism needs a certain modicum of professionalism to be effective, and you blew that out the water in your first paragraph ridiculing the job and title of Ms. Hyde. You rapidly follow up with criticism of the president, both man and office, and Washington in general.
Anyone already on your side will obviously be comforted by your words, but to the majority of Americans who do not understand how aviation works, your credibility and persuasiveness would have the door slammed in its face before getting to paragraph 2. You will win people over with fact-based reasoning and winning people over to oppose this bill is the only way to get it killed.
Just remember, the public at large tend to see this issue as a filthy-rich exec flying a jet that burns a thousand bucks an hour in fuel trying to get the cattle-car public flying commercial airliners to foot his $100/flight ATC bill.
Inaccurate as this may be, perception is reality in a democracy.

darkart1's picture

I was very upset reading Dana's letter, even though it really don't affect me...yet. If they enact this how long will it be before they include all aircraft so they can pay for they're inefficient bureaucracy? Another thing that's very disturbing to me in her letter is this fair share crap that keeps being said. This administration is constantly talking about everyone paying they're fair share. Everyone that is except the government! There is so much wasteful spending, funding of useless programs, study's etc. there is a list on Tom Coburn website. 
This Christmas we saw the obamas on a $4 million dollar vacation, several more throughout the years, how many millions spent of our taxpayers money? 10-20 million.  While most citizens cant afford to even take a vacation. If they seriously want to continue talking this fair share crap, let's start with the entire government, lead by example. Shink government, quit wasting and start listening to the people. After all they work for us!

Also if they start this will they continue the fuel tax? I'm sure they will and may even raise that.

WhiteLake1's picture

We always have to hear from some self appointed critic who misses the whole point of the author. We have elected officials in Washington and our employees who are supposed to be serving us not themselves. However, since there is no real accountability in Washington we are served up this piece of nonsense by "What's her Face" Hyde with the title of "Associate Director of Knotheadism".

We have to do something to get the bureaucrats to recognize they are public servants not lords over us which is their current perception of their role in society.

We can skip the hog wash about democracy as we have an aristocracy run by the 545 self acclaimed aristocrats who are supposed to be public servants.

w5cdt's picture

Correct me if I'm wrong but the top airlines have already negotiated lower fuel taxes than GA aircraft currently pay. That could be part of our problem here.

sbethune's picture

It's pretty standard MO by law makers. Create a case for a crisis, threaten large changes, and negotiate an intermediate compromise. That way we all marvel at their negotiation skills!

With historic levels of societal interconnection, do we really need such a massive bureaucracy? Perhaps there are simpler ways to save a few bucks.

jimwrey's picture

This approach fits the current administrations playbook (Saul Alinksky, Rules for Radicals- that Obama used to teach as a professor).

Demonize and polarize ...

13. Pick the target, freeze it, personalize it, and polarize it. In conflict tactics there are certain rules that [should be regarded] as universalities. One is that the opposition must be singled out as the target and 'frozen.'...

"...any target can always say, 'Why do you center on me when there are others to blame as well?' When your 'freeze the target,' you disregard these [rational but distracting] arguments.... Then, as you zero in and freeze your target and carry out your attack, all the 'others' come out of the woodwork very soon. They become visible by their support of the target...'

"One acts decisively only in the conviction that all the angels are on one side and all the devils on the other." (pps.127-134)

Saul Alinksky, Rules for Radicals, Vintage Books, New York, 1989.

jheiner's picture

Wow. That last paragraph. That's some serious unveiled condescension. What a slap in the face to aviation. For her or his or her sake I hope Dana Hyde is a pseudonym. I wonder if Mr./Ms. Hyde's supervisor knows what he/she wrote. I guess ultimately if you go up the chain of command that supervisor is Obama if it's the OMB from the White House. Of course, the irony is that as a government plane the 747 that Obama uses to commute to vacations in Hawaii is exempt from the user fee. I guess if Air Force One had to pay the fee they'd just have to raise my taxes. This administration has got to go.

jheiner's picture

With the implementation of this user fee the government will have to create a bureaucracy to track the system use and collection of the fee. Of course, being a government program, the cost of a bureaucracy to administer the tracking and collection of the fees will be more than the fees collected.

Recordo's picture

Why we [really] need aviation user fees…

• Someone's got to put the brakes on this out-of-control industry before it becomes a federally financed debt bubble...
• Encourage competing countries to develop subsidized alternatives to Cessna, Piper, Beech et. al. so we can share our remaining wealth...
• Free avionics engineers to create video games...
• Move manufacturing away from US labor markets who don’t want those jobs anyway...
• Save the environment by making flying totally virtual...
• Convert airport real estate to much needed federal housing...
• Clear the skies of those pesky GPS signals that interfere with cell phones...
• Clear the way for Homeland Security to co-opt the FAA (for our own good).

barrettjet's picture

This is only the "foot in the door" move. When this does't generate the "fair share" the system will be expanded to include all sizes, types and altitudes. When I was in Australia every movement was charged a fee, even a C150 making touch and goes in the pattern. That is where this administration would like to take us. Only a solid conservative vote against these liberals will change anything. Take one flight fee and give it to a Conservative cause or candidate. Encourage conservative democrats to run against liberals where possible (if you can find one). Give to the conservative effort or you are just blowing smoke out your tailpipe. VOTE

smerrick's picture

Another user fee problem is the new bureaucracy it would take to enable it. Who would track and collect the fees? A good portion of the new revenue raised would go to maintaining the Dept. of User Fee Collections which would have to be created. All other arguments aside, just for efficiency and simplicity a fuel tax makes so much more sense.

Mooney9242V's picture

Along with the all the inaccuracies used by the government in its analysis, what about normalizing for the number of souls on board. The airlines fall infinitely short of carrying their "fair" load. This is very similar to the truckers not paying their "fair" share of highway maintenance. More important, when will the government begin to address the spending side? Let's see, most of us drive our automobiles (in the same capacity as private pilots) without the questionable service of the federal government attesting to our physical help. The frequency of medically induced accidents (drugs and alcohol don't count) is virtually zero. Given the positive selection that most likely takes place in the decision to become a licensed pilot, the frequency of a medically induced aviation accident is expected to be even lower. Yet, the FAA, without a shred of empirical evidence, supports and infrastructure that adds virtually no value to general aviation. Perhaps the need for assessing a $100 per flight surcharge could be eliminated by reducing $100 spending. As an afterthought, if a $100 per flight would help the Federal Govenment in its inability to even produce a budget, I suggest that we promote a $10,000 surcharge per flight, that should cure the lack of revenue problem. And if that is not enough, why not a million? At that level, we could simply do away withthe FAA!

sellontv's picture

As H.L. Mencken once wrote (forgive the paraphrase) Government is nothing but ordinary men practicing extortion.

Given the fact that roads are paid for primarily by the fuel tax, do you believe this administration will make the "green" cars they are subdizing (both in upfront tax credits as well as the reduction in tax revenue per mile paid in fuel) will be hit with "user fees" as they are not paying their "fair share" for the use of the roads? Given the fact that the owner of a Nissan Leaf will pay zero direct taxes for the use of the public roads, does one think that the Obama Administration will impose user fees on them?

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