Dizel8
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Airlines at La Guardia Fight Bush Administration Proposal to Auction Off Landing Rights
Published: February 18, 2007
WASHINGTON, Feb. 17 — The Bush administration wants to auction off all landing rights at La Guardia Airport, hoping to use the free market to improve sharing of a scarce resource. But the airlines that land there say the plan amounts to government expropriation of their property and will lead to higher ticket prices.
The debate resembles a dispute over rent control, with the airlines arguing that they should be allowed to continue to buy, sell or sub-let to each other their landing rights, known as slots. They will probably fight the plan in Congress.
But the federal government says that the slots are a public resource, and that regulations should not give too much advantage to the airlines that have had them for years. The Federal Aviation Administration asserts that auctioning the slots will ensure that they are distributed in a way that will be better for consumers.
The dispute has been developing since 2000, when Congress passed a law intended to gradually lift decades-old limits on traffic at La Guardia and other busy airports, by phasing out so-called slot rules.
But when the Transportation Department began approving new flights to La Guardia in 2000, the airlines added 300 a day, on top of the existing 1,100, causing the average delay for all arriving flights to grow to 38 minutes from 16 minutes. And planes leaving La Guardia late arrived at their destinations late, so the delays rippled through the national system.
“It’s insane, the demand out there,” said Pasquale DiFulco, a spokesman for the Port Authority of New York and New Jersey, which operates the airport.
La Guardia handled 400,000 flights last year, compared with 378,000 for Kennedy International, although La Guardia is 560 acres, compared with 5,000 acres at Kennedy. Kennedy has two sets of parallel runways; LaGuardia has two runways, and they cross each other, so they cannot be used simultaneously.
To fix the problem in 2000, the government stepped in with a series of “temporary” limits on flights into La Guardia, which have changed slightly but are still in force. But last week, the administration proposed maintaining a cap on the total number of flights and auctioning the slots, as part of a complicated bill on a new national financing mechanism for air traffic control.
Marion Blakey, the F.A.A. administrator, said the purpose of the auction was “using the market to ensure we’re making the most of this very popular resource in New York.”
The language in the administration’s bill is not specific, but Nancy D. LoBue, the deputy assistant administrator for aviation policy, said that the auction would be done in a way that gives new competitors a chance of getting slots at La Guardia.
The bill calls for the Port Authority to run the auction. Mr. DiFulco said his agency might also try writing provisions into the gate leases or instituting congestion charges, requiring airlines to pay more at peak periods. La Guardia, however, has very few off-peak periods; most of the day it is near its limit, defined as 75 scheduled flights per hour, plus 6 nonairline flights. The airlines dislike the nonairline flights, and argue with the precise overall limit.
And they dispute the authority of the F.A.A. to tinker with control of the slots.
For example, last August the F.A.A. said it wanted a rule at La Guardia that would prevent airlines from obtaining monopoly power over certain routes.
But the airlines say that since their business was deregulated in 1978, the F.A.A. should not be in that business. The F.A.A.’s role should be limited to safety and efficiency, the airlines say.
They also assert ownership rights. Delta, for example, says it paid Pan Am for slots when Pan Am ceased operations, and then upgraded the Marine Air Terminal at La Guardia to handle its planes.
But the airlines are not united in this view. The Air Carrier Association of America, which represents small carriers, complained that at the moment, small carriers have only 20 slots, while “many legacy carriers have that many slots in single markets.” The group also complained that some big carriers were hogging slots, by flying many small planes to major hubs, when they should be making fewer trips with bigger planes, opening slots to their competitors.
At the F.A.A., Nan Shellabarger, the director of aviation policy and plans, said there was broad consensus that some controls were necessary, and that Congress had “tolerated” the F.A.A. stepping in to reimpose landing quotas in 2000, and thus was likely to approve some system now. She said that the Secretary of Transportation had authority beyond the F.A.A. administrator to regulate flights.
An auction, F.A.A. officials say, would not allocate landing rights on a purely economic basis. Just as the current system does, it would probably include provisions to encourage service to rural areas, since companies flying small planes to those places might be less able to compete in bidding against airlines flying bigger planes.
Sametta Barnett, the director of government affairs for Delta, said that when that provision was first enforced, “we weren’t thrilled with it.” But now, she said, “Our bread-and-butter is small communities. We’re glad to do it.”
The F.A.A.’s proposal is a small section of a huge bill introduced by the Bush administration to change the way travelers pay for air traffic control. That proposal faces tough questioning in Congress, but some action is likely, because the existing taxes expire on Sept. 30.
Published: February 18, 2007
WASHINGTON, Feb. 17 — The Bush administration wants to auction off all landing rights at La Guardia Airport, hoping to use the free market to improve sharing of a scarce resource. But the airlines that land there say the plan amounts to government expropriation of their property and will lead to higher ticket prices.
The debate resembles a dispute over rent control, with the airlines arguing that they should be allowed to continue to buy, sell or sub-let to each other their landing rights, known as slots. They will probably fight the plan in Congress.
But the federal government says that the slots are a public resource, and that regulations should not give too much advantage to the airlines that have had them for years. The Federal Aviation Administration asserts that auctioning the slots will ensure that they are distributed in a way that will be better for consumers.
The dispute has been developing since 2000, when Congress passed a law intended to gradually lift decades-old limits on traffic at La Guardia and other busy airports, by phasing out so-called slot rules.
But when the Transportation Department began approving new flights to La Guardia in 2000, the airlines added 300 a day, on top of the existing 1,100, causing the average delay for all arriving flights to grow to 38 minutes from 16 minutes. And planes leaving La Guardia late arrived at their destinations late, so the delays rippled through the national system.
“It’s insane, the demand out there,” said Pasquale DiFulco, a spokesman for the Port Authority of New York and New Jersey, which operates the airport.
La Guardia handled 400,000 flights last year, compared with 378,000 for Kennedy International, although La Guardia is 560 acres, compared with 5,000 acres at Kennedy. Kennedy has two sets of parallel runways; LaGuardia has two runways, and they cross each other, so they cannot be used simultaneously.
To fix the problem in 2000, the government stepped in with a series of “temporary” limits on flights into La Guardia, which have changed slightly but are still in force. But last week, the administration proposed maintaining a cap on the total number of flights and auctioning the slots, as part of a complicated bill on a new national financing mechanism for air traffic control.
Marion Blakey, the F.A.A. administrator, said the purpose of the auction was “using the market to ensure we’re making the most of this very popular resource in New York.”
The language in the administration’s bill is not specific, but Nancy D. LoBue, the deputy assistant administrator for aviation policy, said that the auction would be done in a way that gives new competitors a chance of getting slots at La Guardia.
The bill calls for the Port Authority to run the auction. Mr. DiFulco said his agency might also try writing provisions into the gate leases or instituting congestion charges, requiring airlines to pay more at peak periods. La Guardia, however, has very few off-peak periods; most of the day it is near its limit, defined as 75 scheduled flights per hour, plus 6 nonairline flights. The airlines dislike the nonairline flights, and argue with the precise overall limit.
And they dispute the authority of the F.A.A. to tinker with control of the slots.
For example, last August the F.A.A. said it wanted a rule at La Guardia that would prevent airlines from obtaining monopoly power over certain routes.
But the airlines say that since their business was deregulated in 1978, the F.A.A. should not be in that business. The F.A.A.’s role should be limited to safety and efficiency, the airlines say.
They also assert ownership rights. Delta, for example, says it paid Pan Am for slots when Pan Am ceased operations, and then upgraded the Marine Air Terminal at La Guardia to handle its planes.
But the airlines are not united in this view. The Air Carrier Association of America, which represents small carriers, complained that at the moment, small carriers have only 20 slots, while “many legacy carriers have that many slots in single markets.” The group also complained that some big carriers were hogging slots, by flying many small planes to major hubs, when they should be making fewer trips with bigger planes, opening slots to their competitors.
At the F.A.A., Nan Shellabarger, the director of aviation policy and plans, said there was broad consensus that some controls were necessary, and that Congress had “tolerated” the F.A.A. stepping in to reimpose landing quotas in 2000, and thus was likely to approve some system now. She said that the Secretary of Transportation had authority beyond the F.A.A. administrator to regulate flights.
An auction, F.A.A. officials say, would not allocate landing rights on a purely economic basis. Just as the current system does, it would probably include provisions to encourage service to rural areas, since companies flying small planes to those places might be less able to compete in bidding against airlines flying bigger planes.
Sametta Barnett, the director of government affairs for Delta, said that when that provision was first enforced, “we weren’t thrilled with it.” But now, she said, “Our bread-and-butter is small communities. We’re glad to do it.”
The F.A.A.’s proposal is a small section of a huge bill introduced by the Bush administration to change the way travelers pay for air traffic control. That proposal faces tough questioning in Congress, but some action is likely, because the existing taxes expire on Sept. 30.
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