Connecticut may sell its airports

AuntPeggy

AuntPeggy

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Several alphabet organizations testified before the Connecticut legislature last week in response to bills to investigate the feasibility of selling Bradley International Airport (BDL), Waterbury-Oxford (OXC), Hartford Brainard (HFD), Groton (GON), Danielson (LZD), and Windham as a short-term fix for the projected budget deficit.
http://www.aopa.org/whatsnew/region/2009/090225ct.html
 
AuntPeggy said:
Several alphabet organizations testified before the Connecticut legislature last week in response to bills to investigate the feasibility of selling Bradley International Airport (BDL), Waterbury-Oxford (OXC), Hartford Brainard (HFD), Groton (GON), Danielson (LZD), and Windham as a short-term fix for the projected budget deficit.
http://www.aopa.org/whatsnew/region/2009/090225ct.html
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“Given the current economic and credit conditions in the United States, it is unlikely an investor could profit from the purchase of a small- to medium-sized general aviation airport,” Dotlo said in his submitted testimony. As a result, a private owner may be inclined to raise fees on GA aircraft to maintain profitability.

Interesting. The AOPA rep seems to be saying, "Yeah, we're pretty sure the airports can't carry their own weight, so we should just let the taxpayers keep carrying the burden."


Trapper John
 
"carry their own weight" is not the same as make a profit.

So, no, that's not what the AOPA rep seems to be saying.
 
Trapper John said:
Please explain the difference.


Trapper John
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"For profit" = make more than spent.

"Carry own weight" = cover operating costs.

Now, in all this chatter about "bearing of costs," do we intend to levy a user fee on anyone who benefits from an airport?

Cause the guy that drives the tractor at Connellsville owes his job to the airport.

Oh -- and the rental car place -- they benefit.

Oh yeah -- and hotels.

Wait -- how about the sprint dirt racers that buy 100LL?
 
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dmccormack said:
"For profit" = make more than spent.

"Carry own weight" = cover operating costs.
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Shouldn't there be some kind of IRR calculated for these kind of facilities?

Now, in all this chatter about "bearing of costs," do we intend to levy a user fee on anyone who benefits from an airport?
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Well, we do it to airline passengers...

Cause the guy that drives the tractor at Connellsville owes his job to the airport.
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An employee, mowing the grounds?

Oh -- and the rental car place -- they benefit.
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And they pay rent, and usually other fees, too.

Oh yeah -- and hotels.
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On, or off the airport grounds?

Wait -- how about the sprint dirt racers that buy 100LL?
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They'd be paying the fuel tax, too, wouldn't they? Or they could just buy Sunoco 260 and be done with it...


Trapper John
 
Trapper John said:
An employee, mowing the grounds?
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Yes -- he pays no special tax of fee for the benefit he derives from the airport.

Trapper John said:
And they pay rent, and usually other fees, too.
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Nope --not a cent. Not on airport property.

Trapper John said:
On, or off the airport grounds?
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All off airport.

Trapper John said:
They'd be paying the fuel tax, too, wouldn't they? Or they could just buy Sunoco 260 and be done with it...
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The fuel tax they pay for 10 gal 100LL doesn't pay for the fuel guy to get up from his desk and walk over to fill the can.
 
flyingcheesehead said:
You do realize that the airlines don't pay fuel taxes, right? That's what the per-pax fees are covering.
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Last I knew, the airlines paid 4.3 cents/gal federal fuel tax, plus whatever the state rate. Has that changed recently?

And here's a cost study from FAA about GA's cost and contribution:

The allocation found that GA drives approximately 16 percent of the costs of air traffic services. Nearly 10 percent is related to high performance GA aircraft such as corporate jets, while 6 percent is related to piston GA aircraft. These figures do not include flight service stations, which largely serve the GA community.
In contrast, GA currently contributes just over 3 percent of the taxes that flow into the Airport and Airway Trust Fund.

The last adjustment to the GA fuel tax rate was in 1990. Simply adjusting the fuel tax rates for inflation would result in rates of roughly $0.36 per gallon for jet fuel and $0.32 per gallon for aviation gasoline.

http://www.faa.gov/news/fact_sheets/news_story.cfm?newsid=8747


Trapper John
 
Trapper John said:
Last I knew, the airlines paid 4.3 cents/gal federal fuel tax, plus whatever the state rate. Has that changed recently?
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Okay, 25 percent of what everyone else pays then, whatever.

The point is, it's not like airline passengers are getting the raw end of the deal. They're paying fees so that the airlines don't have to charge them the $ for fuel taxes instead. Good for the airlines, because when the plane is nearly empty, they save a boatload of money on taxes so it hurts them a little less.

I would suggest that a large bizjet that uses a comparable level of services is probably paying just as much as an airliner if not more.

And here's a cost study from FAA about GA's cost and contribution:

The allocation found that GA drives approximately 16 percent of the costs of air traffic services. Nearly 10 percent is related to high performance GA aircraft such as corporate jets, while 6 percent is related to piston GA aircraft. These figures do not include flight service stations, which largely serve the GA community.
In contrast, GA currently contributes just over 3 percent of the taxes that flow into the Airport and Airway Trust Fund.
Click to expand...

IIRC, AOPA found some fundamental flaws in some of the assumptions made in that report, but...

The last adjustment to the GA fuel tax rate was in 1990. Simply adjusting the fuel tax rates for inflation would result in rates of roughly $0.36 per gallon for jet fuel and $0.32 per gallon for aviation gasoline.
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Even AOPA advocated a fuel tax increase last year. Kenny is the only person who doesn't seem to want that, but frankly it needs to be done. If it were a percentage, then it should stay the same but effectively our tax has been going down since 1990.

I'm all for a reasonable fuel tax increase. User fees would simply lead to more government waste due to the necessary bureaucracy involved in collecting them.
 
flyingcheesehead said:
OkayEven AOPA advocated a fuel tax increase last year. Kenny is the only person who doesn't seem to want that, but frankly it needs to be done. If it were a percentage, then it should stay the same but effectively our tax has been going down since 1990.

I'm all for a reasonable fuel tax increase. User fees would simply lead to more government waste due to the necessary bureaucracy involved in collecting them.
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Kent, I'm not opposed to paying for the cost of doing business. I'm opposed to paying for the cost of government business when the government is so poorly run and wasteful in spending.

The theory is I'll be charged for services that are provided for my benefit and relieve the cost provided to the airline at a higher rate but yet benefiting me. Who honestly believes the airline will then pay less because I'm now paying a higher cost?
 
flyingcheesehead said:
Even AOPA advocated a fuel tax increase last year. Kenny is the only person who doesn't seem to want that, but frankly it needs to be done. If it were a percentage, then it should stay the same but effectively our tax has been going down since 1990.

I'm all for a reasonable fuel tax increase. User fees would simply lead to more government waste due to the necessary bureaucracy involved in collecting them.
Click to expand...

Sure, I agree that upping the fuel tax is fine for paying our own way. I suppose we could make an exception for Kenny, he's special. You know, protecting us from the magenta line of death and ourselves... :D


Trapper John
 
Trapper John said:
Last I knew, the airlines paid 4.3 cents/gal federal fuel tax, plus whatever the state rate. Has that changed recently?

And here's a cost study from FAA about GA's cost and contribution:

The allocation found that GA drives approximately 16 percent of the costs of air traffic services. Nearly 10 percent is related to high performance GA aircraft such as corporate jets, while 6 percent is related to piston GA aircraft. These figures do not include flight service stations, which largely serve the GA community.
In contrast, GA currently contributes just over 3 percent of the taxes that flow into the Airport and Airway Trust Fund.

The last adjustment to the GA fuel tax rate was in 1990. Simply adjusting the fuel tax rates for inflation would result in rates of roughly $0.36 per gallon for jet fuel and $0.32 per gallon for aviation gasoline.

http://www.faa.gov/news/fact_sheets/news_story.cfm?newsid=8747


Trapper John
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So, if I am reading that right. Pilots are subsidized by the government for air services. That subsidy is about 81% of the cost. IOW when we use an airport, ATC facility, navaids etc. we are only paying for 19% of that service. Pretty good deal!

Without that subsidy aviation business that derive their income from GA would have to charge a heck of lot more to pay their fair share of the cost. Say a flight school charging $100/hr to teach really should be charging $181/hour if it were paying its fair share.

I can see why the non-flying pilot thinks of us as welfare pilots driving our expensive airplanes. That the air traffic system is a real benefit to all is lost on them. Just as the costs of many things the government spends money on i.e. roads, bridges, rail, R&D, GPS, foreign investment, etc is lost on others. As we saw in the FY2009 budget aviation is also getting a lot of the pork type earmarks too!

Hmmm glass houses...hmmm.
 
Trapper John said:
“Given the current economic and credit conditions in the United States, it is unlikely an investor could profit from the purchase of a small- to medium-sized general aviation airport,” Dotlo said in his submitted testimony. As a result, a private owner may be inclined to raise fees on GA aircraft to maintain profitability.

Interesting. The AOPA rep seems to be saying, "Yeah, we're pretty sure the airports can't carry their own weight, so we should just let the taxpayers keep carrying the burden."


Trapper John
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You don't know how "lease" this goes.

Chicago just sold it's "unprofitable" $2.00/hour Mon-Sat 7AM to 9PM parking meters to a company that made them $6.00 an hour 24 hours a day.

The private company knows how to use financial calculator to figure how much they gotta squeeze the public to get the money back by the 5th year of the 50 year "lease."

You should look for the "rich pilots" to see fees go up 500%.
 
Trapper John said:
And the government seized a lot of airlines' planes and took them overseas for WWII, so I guess it works both ways...


Trapper John
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I think they also did something similar during GW1 to get the troops and equipment to Saudi Arabia. I seem to recall NWA having a conniption that they could not meet their schedule since the US gov. had directed them to support the deployments which was the gov's right per their subsidy payments.
 
By the "profit" measure, there should be no aviation business at all. Including (most) airlines. Though even Southwest probably wouldn't be profitable if airports were fully privatized with no subsidy.

Then again, the NFL, MLB, and MLS (and probably others) would also not be profitable were it not for stadium subsidies.
 
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