Turbulence Expected Over Fee Proposal to Ease Airport Delays
Seeking solutions for air travel gridlock, federal policymakers and officials at some of the busiest airports are moving closer to a controversial fix: hefty congestion premiums for landing at peak travel hours.
Proponents of the idea say that increasing the landing fees--by as much as tenfold at some airports--would force airlines to spread out their flights and encourage a return to bigger planes instead of using the small commuter jets that increasingly are crowding the airways. Critics warn that it could cut off service to smaller communities and raise ticket prices for corporate travelers who prefer flights at the beginning and end of the business day.
At a recent forum that drew representatives from across the industry, Federal Aviation Administration chief Jane Garvey signaled that congestion pricing may soon be an integral part of an overall strategy to reduce flight delays.
“There will be a limited number of airports where this has to be considered,” Garvey said, and at those, it may prove “critical.” Many in the industry expect New York’s La Guardia Airport to be the first to experiment with congestion fees later this year, when a temporary FAA limit on flights expires.
LAX Court Cases May Pave the Way
Traditionally, the formula for a successful airport has been to land as many planes as possible. Airports kept fees low, aiming to cover their basic costs. Landing fees for a Boeing 737-300 range from $599 at La Guardia to $194 at Los Angeles International to $45 at Hartsfield Atlanta International.
On a per-passenger basis, the fees remain low. For example, at the 10 most congested airports, they average about $2.75 per occupied seat. The calculation is based on a Boeing 737-300 with 90 of its 128 seats occupied--a typical load.
That’s less than a hot dog and a soft drink in most places.
Even at La Guardia, it works out to about $6.65 a seat.
In the 1990s, Los Angeles Mayor Richard Riordan fought to increase the landing fees at LAX to help defray costs, beating back several lawsuits from the airlines. Some aviation lawyers say those court decisions may now serve as precedents to usher in congestion fees.
Airport fees are set by local authorities, and some aviation lawyers say localities already have the legal right to institute congestion fees. But airport operators are looking to Washington for policy guidance, hoping to avoid expected litigation by the airlines. That guidance could come in the form of a Transportation Department policy or explicit legal authority from Congress. Whether to charge a gridlock premium, and how high to go, would be a local decision.
The first step from the federal government may come soon. The FAA is preparing to release a study that will establish benchmarks for the number of flights major airports can handle. Some say it could be used as a pricing tool.
Steven A. Morrison, an economist at Northeastern University in Boston, said the current fees encourage airlines to schedule more flights than the system can handle, helping create an imbalance between demand and a limited supply of runways.
“When demand and supply for electricity are out of balance, you get blackouts,” Morrison said. “When demand and supply for air travel are out of balance, you get delays.”
Obstacle Course of Airport Delays
Delays have transformed flying from a soothing interlude for most travelers to an unpredictable obstacle course. Most experts say there is no single, simple answer, and a combination of measures must be pursued, including more runway construction and improvements to navigation technology used by air traffic controllers and pilots.
Congestion fees have come to the fore because delays are highly concentrated in a few airports. According to FAA statistics, just five airports--La Guardia, Chicago’s O’Hare, New Jersey’s Newark, Atlanta and San Francisco--accounted for 49% of the delays last year.
When one such major airport backs up, the ripple effects are felt across the country. An FAA reconstruction of a typical day last summer illustrated the phenomenon. The reconstruction determined that a five- to 10-minute delay for 15 jets approaching Newark one evening in June affected 250 planes within 20 minutes, some as far west as Minneapolis.
Higher fees could reduce some of the excess traffic, proponents argue.
“Prices should be set at a rate that more properly reflects the value of having access to the runways,” said William DeCota, aviation director for the Port Authority of New York and New Jersey, and steward of two of the three most delay-prone airports, La Guardia and Newark. “Airlines were deregulated in 1978, now airports deserve that same degree of latitude to price their product.”
However, critics are promising a political counteroffensive to limit or entirely head off a nationwide scheme of congestion fees.
“It is likely to eliminate service from small communities that may not have other options,” said Deborah McElroy, president of the Regional Airline Assn., which represents 47 small carriers. Because fees are calculated using aircraft weight, small planes pay less than big jets, though they tie up the runways about the same.
“Many congressmen and senators whose districts depend on regional airlines would not be pleased if the answer to delays was to disenfranchise a number of small communities from the national transportation system,” McElroy added.
Larger airlines are also likely to oppose higher fees. “It just seems to be a quick, short-term fix to a long-term, complicated problem,” said Michael Wascom, a spokesman for the Air Transport Assn.
Other critics say congestion pricing could backfire by taking pressure off the FAA to modernize air traffic control technology and by allowing airports to limp along for a few more years without building new runways.
“It doesn’t do anything to add capacity, so it doesn’t get at the systemic problem,” said Kevin Mitchell, chairman of the Business Travel Coalition, which represents large corporate travel departments. “[And] there’s a definite concern that the airlines would use peak pricing to lock in even higher prices for business travel.”
Proponents say the objections can be addressed.
Steeper landing fees need not translate into higher ticket prices, according to some experts. “Everybody assumes the fares would go up but that’s not necessarily the case,” said Frank Berardino, president of GRA Inc., a Pennsylvania-based economic consulting firm for the transportation industry. “Airline operating costs other than the cost of landing would be lower.”
And DeCota said a compromise would have to be crafted so small communities are not cut off from access to major airports. “There needs to be some consideration of small communities and new entrant airlines,” he said. “Airports need to be available to all elements of the public because people have a fundamental right to fly.”
Advocates also say it’s unlikely that runway construction and technological improvements would come to a halt. Even such critics as McElroy concede that congestion pricing appears to have picked up enough support to be politically viable in some form. “It does have legs,” she said.
San Franciso Airport Is Considering, LAX Isn’t
In California, San Francisco International would probably be the most likely to try congestion pricing. “It’s been considered and it continues to be a subject that is brought forward by our director,” airport spokesman Ron Wilson said. “We’d like the airlines to spread out their schedule to avoid the peaking problem that does create congestion. It parallels autos on the freeway.”
Industry consultant Berardino said congestion pricing also could help Los Angeles International achieve its long-term goal of becoming primarily an international hub by shifting many regional and domestic flights to nearby airports, where landing fees would be lower.
However, despite the growing interest in congestion fees, officials say they are not under consideration at LAX.
“Congestion pricing does make sense from an economic point of view,” said Scott Lewis, a Boston lawyer who represents airports. “In the long run, most major airports are going to have to do something to respond to the fact that demand is growing much faster than capacity.”
