It’s Infrastructure Week. Does Washington know where to start on an infrastructure overhaul?
Fixing America’s infrastructure is an oft-repeated goal of the Trump administration, and an element of his agenda with the potential to rally bipartisan cooperation. Transportation Secretary Elaine Chao has said an outline of the administration’s infrastructure plan is coming “in the next several weeks.” While we hope for a balanced approach that achieves many necessary fixes to our country’s transportation framework, there’s one place we believe the administration should start to achieve broader momentum: airports.
Over 900 million passengers passed through American airports in 2016, according to the Bureau of Transportation statistics. That number will soon swell to over one billion per year, which could be an economic boon nationwide, if our airports were able to accommodate that kind of increase. Adequate gate space for more flights and expanded terminals, for example, would particularly benefit communities around airports that welcome international visitors. Those travelers spent $246 billion during trips to the U.S. last year (at an average of $4,460 per traveler per trip), supporting 1.2 million U.S. jobs and generating $157.8 billion in tax revenue.
But the cold truth is that airports are not presently equipped to get the job done. The FAA predicts that travel demand will exceed capacity at many of the nation’s largest airports within the next 15 years—and 39 of the top 50 U.S. airports will experience Thanksgiving-like conditions at least once a week by the end of President Trump’s term. Right now, terminals at the busiest airports seem eternally packed, and making a tight connection can be harrowing. And as U.S. Travel economists have previously reported, frustration with the flying experience, exacerbated by our overwhelmed airports, caused passengers to avoid 38 million plane trips per year, costing the U.S. economy $35.7 billion.
America’s airports create economic opportunity in every corner of the country, but all that could be lost if we don’t update them now. Thankfully, fixing America’s airports is a problem that comes with a ready funding solution, one that achieves the Trump administration’s aim of spending both private and public funds on infrastructure: let major airports raise their own building capital through the Passenger Facility Charge (PFC), rather than forcing them to rely on our flawed system of taxpayer subsidies.
As a user fee, the PFC is only charged to passengers who use a given airport, and it goes to fund projects at that airport only. Airport authorities can decide where its revenue goes—and they can raise and lower it as needed. A tax, on the other hand, hits everyone just the same, and those funds may never see the airports that many flyers use. Unfortunately, Congress has capped the PFC at $4.50 since 2000, so airports currently have very little ability to fund infrastructure projects as they need to.
However, there has never been a more politically opportune time to tackle widespread airport improvements, and use the PFC to do so. There is broad support across the ideological spectrum for this kind of local control for airports, from the free-market intelligentsia at the Cato Institute and Heritage Foundation to the former Obama administration, which proposed a PFC bump in every annual budget submitted to Congress from 2012-2016.
There’s never been a greater need for a PFC increase as well. The PFC was created in the 1990s to fund infrastructure projects, such as terminal expansions and new gates, which enhance competition among airlines—and in a time where 74 U.S. airports are dominated by one airline, that kind of competition is needed more than ever.
To that end, U.S. Travel will release in the coming weeks an aviation blueprint to assist Congress in considering any incoming infrastructure plan, not to mention upcoming FAA reauthorization legislation and the upcoming debate around air traffic control reform.
U.S. Travel’s plan outlines steps Congress can and should take to implement lasting infrastructure fixes, both in the sky and on the ground—including exactly how they can raise or uncap the PFC without extra costs on consumers, as many critics have worried.
While some in Congress have largely focused on air traffic control reform to tackle air travel woes, it is not the stand-alone solution. It’s hard to overstate how crucial proper airport infrastructure will be for addressing the problems that have plagued air travel in the U.S. for years: shrinking competition, decreased connectivity, declines in customer service, delays, and crowding in terminals.
Airports are a critical pillar of the $2.3 trillion U.S. travel economy. Lawmakers need to commit to fixing our airports, and securing long-term funding for those fixes, to help them realize their full economic powerhouse potential.