Airport Alert: House Democrats' Infrastructure Plan to Call for PFC Increase

 

House Democratic leaders are preparing to release "high-level principles" for their long-awaited infrastructure plan tomorrow, and their proposal is expected to call generally for raising the federal cap on local Passenger Facility Charges and indexing it for inflation. Airports have been urging Congress to raise the outdated cap to help airports repair aging facilities and build critical infrastructure projects.

 

"The call from Chairman DeFazio and House Democrats to update the antiquated PFC cap is exactly what's needed to spur investments in terminals and other critical airport facilities," AAAE President and CEO Todd Hauptli said. "The entirely predictable airline opposition that will surely follow should do nothing to slow the House and Senate from quickly turning these 'principles' into public law."

PFCs: The Democrats' infrastructure plan will call for raising the PFC cap and indexing it for inflation. But their proposal is not expected to include a specific dollar amount for the PFC increase.

 

Transportation and Infrastructure Committee Chairman Peter DeFazio (D-OR) - a longtime PFC proponent - proposed eliminating the PFC cap in the previous Congress. However, in the past year he has gravitated toward a more modest approach with indexing instead.

 

The RAND Corporation earlier this month released a congressionally mandated report that calls for raising the PFC cap to $7.50 for originating passengers and indexing it for inflation. The report noted that the value of the PFC today has eroded significantly because of inflation in the past twenty years.

 

High-Level Principles: The House Democrats' plan is expected to include sections dedicated to airports; surface transportation; ports and harbors; and water projects. It is our understanding that the proposal will also focus heavily on climate change - a big concern to members in the Democratic caucus.

 

The Democrats' initiative is expected to represent "high-level principles" or a "broad topline framework" as opposed to a comprehensive and detailed legislative proposal. Although a PFC increase would allow airports to use more local revenue for airport infrastructure projects, the measure will likely avoid saying how lawmakers plan to pay for other proposed infrastructure investments.

 

From what we have learned so far, the infrastructure plan will likely incorporate some free-standing bills that House Democrats have already proposed or ushered through their chamber. The Transportation and Infrastructure; Ways and Means; and Energy and Commerce Committees are apparently spearheading the infrastructure initiative.

 

What's Next: House Democrats are planning to officially announce their infrastructure plan tomorrow. The Ways and Means Committee is also scheduled to hold a hearing tomorrow afternoon on "funding and financing infrastructure investments." We will have more to report as soon as details become available.