Biden Administration Unveils Fiscal Year 2023 Budget Request
March 28, 2022
President Biden today unveiled a budget request for Fiscal Year 2023 that proposes to increase funding for the Federal Aviation Administration and the Transportation Security Administration while highlighting the upcoming investments made possible by the Bipartisan Infrastructure Law. Today's White House announcement kicks off what is expected to be a contentious and lengthy debate between Democrats and Republicans over spending priorities for the fiscal year that begins on October 1 as lawmakers gear up for the mid-term elections.
Highlights: From the airport perspective, the administration's FY23 budget request is a mixed bag. It proposes the usual $3.35 billion for the Airport Improvement Program, and it acknowledges the $5 billion in aviation spending that will occur in the next fiscal year as result of the BIL. But the White House plan does not include additional funding for supplemental discretionary grants, which lawmakers used in the FY22 appropriations process to fund more than $550 million in congressional earmarks and other airport infrastructure projects.
On the DHS front, the White House is proposing to fund more than 2,500 additional Transportation Security Officers to meet rising demand and to end the diversion of TSA passenger security fees as AAAE has long recommended. However, the budget request calls for transitioning TSA's responsibility for staffing TSA exit lanes to airports, a proposal that would save the agency more than $94 million next year. We will be urging Congress to reject that cost-shifting proposal.
What's Next: The House and Senate Appropriations subcommittees will soon hold hearings on the FY23 budget request, providing lawmakers with an opportunity to question administration officials about their plans before crafting their own spending measures. However, since this is an election year, it seems highly unlikely that Congress will finish its appropriations work by October 1.
We expect Congress will be forced to pass one or more short-term continuing resolutions to keep the federal government operating past October 1, through the mid-term elections, and possibly into 2023. Bottom line: the White House release of its FY23 budget request is the first step in what is expected to be a contentious and lengthy appropriations process that may not conclude until early next year. We will be reaching out to you shortly as we urge lawmakers to adopt airport priorities in the annual appropriations process.
Department of Transportation
The administration's FY23 budget request includes approximately $142.3 billion in total spending for the Department of Transportation in FY23 “ a $1.6 billion increase over the current level.
Federal Aviation Administration
The White House plan includes a total of $18.6 billion for the FAA 'to improve aviation safety, transform the Nation's aviation infrastructure, and improve cybersecurity.'
Airport Improvement Program
Traditional AIP Funding: The administration is proposing $3.35 billion for traditional AIP funding in FY23 “ the same as the current funding level. Of that amount, $137 million would go toward personnel costs, $15 million for the Airport Cooperative Research Program, and $41 million for Airport Technology Research.
Supplemental AIP Funding: The FY22 omnibus spending package, which the President signed into law earlier this month, included $554.2 million for supplemental AIP discretionary grants. Lawmakers fenced off $279.2 million of that among for congressional earmarks. However, the administration is not requesting any funding for supplemental discretionary grants in FY23. We will be urging Congress to provide another round of funding for supplemental discretionary grants in FY23.
Infrastructure Funding
As expected, the administration's budget request highlights the aviation funding in the BIL. As a reminder, the infrastructure package includes $25 billion for aviation over five years or $5 billion annually. That includes $3 billion annually for Airport Infrastructure Grants, $1 billion annually for a new Airport Terminal Program, and $1 billion annually for FAA facilities and equipment upgrades.
The administration's budget request indicates that, 'the resources provided through the Budget complement the $5 billion already provided by the Bipartisan Infrastructure Law for 2023 to upgrade the FAA's air traffic control facilities and to improve the safety, capacity, accessibility, and efficiency of the Nation's airports.'
Funding for Other FAA Programs
Operations: The White House proposal includes more than $11.9 billion for FAA operations -- almost $519 million above the current level. Under the administration's plan, more than $9.9 billion of that amount would come from the Airport and Airway Trust Fund.
Facilities and Equipment: The administration is proposing slightly more than $3 billion for FAA Facilities and Equipment in FY23 -- $122.1 million above the current level.
Research, Engineering, and Development: The White House is proposing $260.5 million for FAA's Research, Engineering, and Development “ a $12 million increase from the current level.
Small Community Programs
Contract Towers: As expected, the administration's budget does not include a specific requested funding amount for the Contract Tower Program. The final FY22 spending bill included $178 million in dedicated funding for the Contract Tower and Contract Tower Cost-Share programs.
Essential Air Service: The administration's budget request includes $368.7 million in appropriated funds for the EAS program “ up from the current level of $350 million. Coupled with an expected $81 million from overflight fees, total funding for EAS would rise to about $450 million in FY23.
Small Community Air Service Development: The administration is not requesting funds for the Small Community Air Service Development Program in FY23. Funding for the program traditionally comes from the AIP account.
Department of Homeland Security
The administration is proposing a discretionary budget of $56.7 billion for the Department of Homeland Security in FY23, including funding for the Transportation Security Administration, U.S. Customs and Border Protection, and for critical infrastructure cybersecurity efforts. This request is approximately $1 billion below the level provided in the final FY22 spending bill.
Transportation Security Administration
The administration is proposing a total discretionary appropriation of $9.73 billion to support TSA, which is $1.24 billion above the FY22 enacted level. After factoring out fees, TSA's net discretionary appropriations request is $5.68 billion. Key funding items include:
Transportation Security Officers (TSOs): The budget requests $243 million for 2,540 additional TSOs to meet increasing demands of passenger travel volume, earlier than originally projected, while ensuring adherence to passenger wait time expectations and maintaining security effectiveness. Also, this funding will be used to continue workforce recruitment and retention efforts.
TSA Staffing of Exit Lanes: The budget proposes to transition staffing of exit lanes from TSA to airports, saving the agency $94.1 million and 1,090 FTEs. The budget explains that 'staffing exit lanes is not a screening function but rather falls under the purview of access control.' The budget further states that 'this proposal is not expected to impact TSA's screening functions and risk-based security measures. Exit lanes are effectively secured by non-TSA workforce personnel at three quarters of all airports.' TSA currently monitors exit lanes at 109 airports. 'This change will standardize the process throughout all locations.' For this transition to occur, the administration will need to provide legislation for Congress to approve because the Bipartisan Budget Act required TSA to continue its responsibility to monitor airport exit lanes from the sterile area of the airport at those locations where TSA monitored them on December 1, 2013. This legislation was not submitted with the budget request.
Workforce Pay and Policy Modernization: The administration requests a total of $992 million to modernize its workforce pay and policies. Within this total, the budget recommends $871 million to compensate TSA employees, including TSOs, at rates comparable to their peers in the Federal workforce. An additional $121 million is requested to expand the TSA workforce's access to labor benefits, such as collective bargaining and merit systems protections. Pay equity, collective bargaining, and merit systems protections are priorities for DHS Secretary Mayorkas and TSA Administrator Pekoske.
Aviation Passenger Security Fee: The budget assumes the collection of $4.012 billion from the aviation passenger security fee to offset increased TSA costs. This proposal presumes Congress will terminate the deficit reduction contribution mandated by the Bipartisan Budget Act of 2013, and all the fees collected will be used for TSA security technology and personnel needs. However, the House and Senate authorizing committees, which have jurisdiction over fee collections, must enact this change into law before the Appropriations Committees can act on this budget assumption. Efforts in Congress to end the diversion of aviation security fees have been unsuccessful to this point due to the problem of finding an offset to replace the fee revenue. This budget proposal will face the same challenge.
Law Enforcement Officer (LEO) Reimbursement Grants: The budget recommends $46.1 million for LEO reimbursement grants, similar to the current funding level for this program, similar to the current funding level for this program.
Checkpoint Property Screening System (CPSS): The budget recommends $105.4 million to procure, deploy, and test CPSS systems, including computed tomography machines, for use at airport checkpoints. This funding level would procure approximately 108 CPSS (11 base, 33 mid-sized, and 64 full sized systems). However, the request notes that deviations in airport needs and final contract award pricing may result in changes to the request quantity estimates and total quantities TSA may procure.
Checked Baggage Reimbursements: The budget requests $13.94 million to reimburse airports for legacy purchases of in-line explosive detection systems.
On-Person Algorithm Development: The budget requests $19 million for on-person screening algorithm development to achieve lower false alarm rates for the current Advanced Imaging Technology equipment, reducing physical contact between the passengers and the TSOs, permitting gender neutrality, improving throughput, and reducing overall passenger wait times.
On-Person Detection/ Next-Generation AIT: Within the research and development budget, TSA is seeking $5 million to develop, demonstrate and eventually acquire modularized walk-through or walk-by passenger screening systems. These systems will allow TSA to detect emerging threats without increasing the frequency of physical searches.
Mobile Driver's License (mDL): On average, over two million travelers were processed through TSA checkpoints pre-pandemic. Over the next 10 years, industry projections predict that more than 50 percent of travelers will have acquired a mDL in the United States. The budget request includes $4.3 million for TSA to conduct activities so that the agency has the capability to accept digital identities at the Nation's airport checkpoints.
Screening Partnership Program (SPP): The budget proposes $239 million for the 22 SPP airports that receive screening services through private companies.
REAL ID: The management of the REAL ID program has been moved from DHS to TSA. The budget notes that TSA is 'the most appropriate agency to manage and administer the REAL ID program' due to the agency's acceptance and enforcement efforts at security checkpoints when the REAL ID mandate begins on May 3, 2023. The budget supports $20.1 million for the rollout and enforcement of REAL ID, to oversee states' implementation of mobile driver's licenses digital identify solutions, for public advertising, to engage with stakeholders to help states prepare in adopting REAL ID, and for other compliance and regulatory efforts.
U.S. Customs and Border Protection
In total, the administration is proposing $15.3 billion in net discretionary funding for CBP to strengthen border security, combat illicit drugs, and impede illegal border crossings, an increase of $500 million above the FY22 enacted level. Notable items include:
CBP Officers: The budget does not provide any funding for additional CBP officers at airports or other ports-of-entry locations even though international travel is rebounding from the pandemic. The budget fully funds officers currently working at these locations and includes a request for 50 new officers to specifically target and combat forced labor violations.
Overtime: The White House proposes to continue the per person overtime cap at $45,000 in FY23, consistent with prior years' limitations.
Biometric Exit: The administration assumes remittance of $47 million in new fees for biometric exit, reflecting an increase in fee collections as compared to FY22, which had a dramatic decline in collections from various visa fees that support this program.
User Fee Revenues: Due to the impact of COVID-19, CBP's user fee revenues were significantly reduced with the decline in international travel. While collections are improving, the FY23 budget request still assumes a continued reduction from historical levels. Prior to the pandemic, these fees funded about one-third of the agency's CBP officers' salaries, benefits, and overtime. The request does not ask for additional emergency appropriations to offset the loss in fee revenue but states that the agency 'will continue to update and monitor fee projections as real-world impacts of COVID-19 continue to evolve.'
Environmental Protection Agency
PFAS: The administration's FY23 budget request addresses pollution caused by Per- and Polyfluoroalkyl Substances (PFAS). Its discretionary request includes approximately $126 million for EPA to: increase the understanding of PFAS impacts to human health, as well as its ecological effects; restrict use to prevent PFAS from entering the air, land, and water; and remediate PFAS that have been released into the environment. This is about $57 million over the current enacted level and reflects the priority that the Biden administration continues to place on remediating PFAS contamination.
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