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Summary
National Air Transportation Association
4226 King Street
Alexandria, Virginia 22302
(703) 845-9000
before the
National Civil Aviation Review Commission
Washington D.C.
May 28, 1997

The National Air Transportation Association (NATA) represents the interest of aviation businesses nationwide. The Association’s nearly 2,000 member companies provide important aviation services to the airlines, military and business/corporate/ individual aircraft owners and operators. These include fueling, maintenance, aircraft storage, part and equipment sales, and flight instruction. In addition, many NATA members provide on-demand air charter and scheduled services under FAR Part 135.

Throughout the past 57 years, NATA has represented an industry that has grown to become a vital part of the American air transportation system. These small businesses employ over 35,000 individuals providing quality jobs and a safe workplace.

The following summary of the Association’s position was developed in conjunction with the members of NATA. It reflects the views of the Nation’s aviation businesses on the FAA, its funding sources, and associated safety and capital improvement programs.

Position Statement

• Prior to asking the aviation users to pay more for the FAA, the Agency must reduce its costs and develop a plan for modernizing the air traffic control system, an essential element to get the FAA’s escalating costs under control.
•  Federal Aviation Excise taxes, assessed on aviation users through fuel and transportation taxes, rather than user fees, are the most efficient and effective method for collecting revenues. The Federal Aviation Excise taxes should be extended for a minimum of five years to assure a consistent funding source for the Federal Aviation Administration and its capital improvement programs.
• All citizens benefit from a national transportation system, and, therefore, a portion of the FAA’s cost should be paid by tax revenue from the general fund of the United States.
• Fuel taxes are the fairest and most accurate method to determine system use and should be the major source of support for the FAA.
• The transportation tax should no longer apply to the operators of Part 135 on-demand air charter operations; instead these operators will pay the fuel tax. Elimination of this tax enhances safety, simplifies the collection of taxes from corporate and aviation businesses’ operations and will save the U.S. government in unnecessary oversight and audits and eliminate confusion associated with the application of the transportation taxes to on-demand (non-scheduled) operations conducted under FAR Part 135. To preserve tax revenue collections and make up for any revenue shortfall, the tax on jet fuel will need to be assessed at 24 cents per gallon.
• General aviation turbine aircraft, including Part 135 on-demand air charter operators, would pay its fair portion of FAA costs through a 24-cent per gallon fuel tax, and piston-engine aircraft would remain at the current 15-cent per gallon rate.
• The 4.3-cents per gallon deficit reduction tax on all aviation fuels should be deposited in the Aviation Trust Fund. This tax generates approximately $500 million annually that should be credited to the aviation user account.
• To better approximate use of the aviation system and strike a compromise between the airlines, they should pay the jet fuel paid by general aviation turbine aircraft and be assessed a reduced ticket tax and a reduced cargo-waybill tax.
• Federal funding for airport development is vital to increased safety and the well being and growth of our Nation’s airports. Support must be provided for general aviation and smaller air carrier airports to meet the needs for safety and capacity improvements.