Growing Our Resources to Raise Our Voice on Capitol Hill

April 24, 2019

By Timothy Obitts, COO & General Counsel

As the 116th Congress convenes, NATA is hard at work
advocating on behalf of our diverse membership and
preparing for a busy 2019 legislative season with
multiple points of opportunity to raise our voice on Capitol
Hill. A historic class of 90 freshman, a broadly-expanded
Transportation committee, and new chairs and ranking
members on committees and subcommittees present NATA
with an opportunity to create new allies and become closer
with old friends in key committee and leadership positions
that can help carry out our policy agenda. Forming these relationships will ensure that NATA accomplishes its goals in
2019. But that takes resources, and one of NATA’s most important goals for 2019 is to grow our pool of resources. One
of our most important tools is NATAPAC, the Association’s
political action committee. A political action committee is
a group of individuals with a common interest who wish to
contribute to the advancement of common goals through
targeted, strategic relationships with Members of Congress.

NATA’s has served as “the voice of aviation business” for
nearly 80 years. Our policy agenda is driven by our membership. NATA’s committees, made up of aviation businesses,
help to identify both beneficial and harmful federal policy
issues around which the Association’s government relations
staff can create an agenda and strategy for the year ahead.
NATAPAC is a vital component of the NATA’s government
relations efforts and enables us to elevate the Association’s
voice during key policy discussions. It gives us a seat at the
table to educate lawmakers on the important contributions
that our industry makes to the nation’s aviation system.
Having a presence on Capitol Hill is critical when working
to promote our industry on a national level. Unfortunately,
the opposition is sometimes strong and well-funded, which
is why expanding NATA’s resources is crucial to our success.
The PAC allows us to effectively deliver our message
to Members of Congress, but is not buying influence.
The PAC also allows NATA to find champions of favorable legislation and assistance on regulatory issues, but
any kind of quid pro quo is strictly prohibited by ethics and campaign finance laws. Most general aviation
trade associations maintain PACs, but NATA is unique
in that we focus exclusively on contributing to policymakers who support our core membership’s priorities.

NATAPAC has always focused on supporting candidates for federal office that promote and advance policies
that bolster aviation business. The PAC’s primary focus
is to develop and maintain relationships that will work
in the interest of our policy agenda by electing and reelecting our friends to Congress. To that end, NATAPAC
is bipartisan and bicameral. The PAC is about promoting
policy, not personality or politics. We support candidates
on both sides of the political “aisle,” in both the House
and Senate. In evaluating which lawmakers to support,
NATA staff and the PAC Board evaluate a lawmaker’s
past record on issues that matter to our members, the
lawmaker’s responsiveness to our meeting requests, and
what committee or leadership assignments they hold.

I’m proud of NATA’s accomplishments in last year’s
landmark FAA reauthorization legislation. Later in this issue,
you’ll hear from NATA Vice President of Government and
Public Affairs, Jonathon Freye, who will discuss Congress’
agenda for the coming year. The coming year will be a
busy one in Washington, D.C. as Congress considers major
transportation-related legislation and the federal agencies
implement last year’s FAA bill. As that happens, NATA will
continue to focus on growing our resources to ensure aviation
businesses’ voices are heard loud and clear on Capitol Hill.

Shutdown, Showdowns, and the Road Ahead

April 10, 2019

By Jonathon T. Freye, Vice President of Government  and Public Affairs

Following the Congressional midterm elections on November 6th, the 116th Congress convened in the midst of the longest government shutdown in history. The elections resulted in a Democratic majority in the House of Representatives, while Republicans maintained their control in the Senate. In the House, Democrats picked up 40 seats, nearly double the 23 they needed to take the majority. Democratic leadership has telegraphed that they intend to consider a sweeping transportation infrastructure investment bill, with recent reporting putting the timeline for a possible consideration of such a bill before the House in early June. Republicans held their majority in the Senate, where 35 Senators were up for reelection, netting an additional two seats to bring their lead to 53-47. Similarly, senior Senators are already telegraphing their interest in an infrastructure package. And, in early March, the President introduced a budget proposal which, like last year, contained a $200 billion placeholder for infrastructure. It is clear that policymakers recognize the importance of making much-needed investments in infrastructure, while finding long-term funding solutions.
Unfortunately, disagreements between the White House and Capitol Hill over policies not related to transportation caused a 35-day government shutdown. In his article on page
73 of this issue, Colin Bane interviews a NATA member, Jet Logistics, whose clients were critically affected by the closure of the FAA. To Jet Logistics, the shutdown illustrated how the safety-critical nature of the FAA should justify exempting the agency from the effects of future shutdowns. NATA recently lent our strong support to a bill introduced by Representatives DeFazio (D-OR) and Larsen (D-WA). The Aviation Funding Stability Act, H.R. 1108, would protect FAA programs and personnel—and the U.S. aviation industry as a whole—from future shutdowns of the federal government by allowing the agency to spend any unobligated money in the Airport and Airway Trust Fund to continue all ongoing FAA programs, projects, and activities at the same annualized rate that they were receiving during the most recent appropriations that had lapsed. While the Trust Fund receives a modest contribution from the U.S. Treasury’s general fund, the FAA is almost entirely a self-funded agency. The Trust Fund currently has a balance sufficient to cover last year’s general fund share of the FAA, plus the ongoing Trust Fund share, in the unlikely event of a prolonged lapse of appropriations lasting several years.
As possible infrastructure legislation begins to take shape, NATA is working hard on several funding-related priorities. One example is an initiative to repeal an antiquated tax provision that the independent Government Accountability Office found has inappropriately diverted between one and two billion dollars of noncommercial jet fuel tax receipts to the Highway Trust Fund, instead of their rightful place in the Airport and Airways Trust Fund. NATA is also leading an industry coalition to support a recent Senate proposal to extend the biodiesel tax credit, which also applies to sustainable alternative jet fuels. This effort is a logical outgrowth of NATA’s active participation in the Sustainable Alternative Jet Fuels initiative.
Clearly, Congress intends to prioritize funding this year, but closer to home, NATA will also focus on raising the resources available to our government affairs efforts. Tim Obitts makes great points in his column on page 7: in order to maximize the effectiveness of our advocacy initiatives, NATA needs to hear from you, and we need your participation to successfully enact federal policies that support our industry in 2019.

FAA Reauthorization is Over…Now What?

October 22, 2018

By Rebecca Mulholland, NATA Director of Legislative Affairs

After many years of fighting attempts to privatize our nation’s air traffic control system, President Trump signed into law the FAA Reauthorization Act of 2018 (Public Law No. 115-254) on October 5, 2018. The newly enacted law reauthorizes the Federal Aviation Administration (FAA) and aviation taxes for five years and provides important policy guidance from Congress on numerous issues including those related to aviation businesses – click here for more information about the Act’s journey to enactment. NATA and its member companies secured many provisions important to aeronautical service providers, from aircraft certification reform and regulatory consistency to a review of the illegal charter hotline as well as financial support for aviation workforce development programs.

Now that Congress and President Trump have signed off on this massive deal, what is next? The focus now turns to the regulatory arm of the government to implement the many policy directive task forces, rulemaking committees, reports and analyses called for in the law, and work with industry stakeholders to complete the tasks by the congressionally mandated deadlines. In a press statement released following President Trump’s enactment of the Act, NATA President Gary Dempsey stated that the association looks forward to working with the federal agencies tasked with implementing key provisions and acknowledged that “it’s now time to get to work on executing these important initiatives that contribute to the safety and modernization of our nation’s air transportation system.” NATA worked hard to ensure many of its policy priorities were represented in the final legislation:

Section 515. Permissible Sharing of Flight Expenses: Requires the Department of Transportation (DOT) to issue advisory guidance on how pilots can share flight expenses with other passengers within the parameters of existing federal law. NATA supports the inclusion of this provision and agrees that pilots engaging in permissible sharing of expenses (in accordance with current rules at 14 CFR 61.113) may communicate with their passengers as they see fit, to include using internet-based communications, it is important to distinguish between private aircraft flights where expenses are shared by individuals with a common purpose and commercial flights where members of the public are transported by aircraft for remuneration. Initially proposed as an amendment to allow all flight sharing regardless of existing safety and security regulations, the association worked with its author and Congress to require the FAA to issue clearer guidance on permissible flight sharing and a related GAO study to provide private pilots with a greater understanding of such permissible flight sharing activities. For more information on NATA’s efforts to combat proponents of flight sharing language, click here.

Section 540. Rooting Out Illegal Charter Operators: Requires the Secretary to submit an analysis of reports filed during the preceding 10-year period through the FAA’s illegal charter hotline that includes follow-up action the Secretary or the Administrator can take when a report is received, how the DOT or the FAA decide to allocate resources, challenges the DOT and the FAA face in identifying illegal operators, and recommendations for improving efforts to combat illegal charter operations. NATA recommended the inclusion of Section 540 (thanks to the efforts of Senator Catherine Cortez Masto – D-NV) which directs the FAA to report on its efforts to combat illegal charter, helping the industry to understand the scope of the issue and what future steps might be needed to take to protect passengers and legitimate businesses. The language requires the FAA Administrator to submit an analysis of reports filed during the preceding ten-year period through the FAA’s illegal charter hotline, that includes follow-up action the FAA takes when a report is received, how the FAA decides to allocate resources, challenges the FAA faces in identifying illegal operators, and recommendations for improving efforts to combat illegal charter operations. NATA looks forward to working with the FAA, through the association’s Illegal Charter Task Force, to stamp out illegal operations.

Section 308. FAA and NTSB Review of General Aviation Safety: Currently neither the FAA nor the NTSB segments Part 135 incident data, making it difficult to accurately measure safety data and trends. Part 135 operations include a wide range of aircraft types and operations. The aircraft range from helicopters, to small single-engine piston airplanes to large globally capable passenger jets. Uses include transporting cargo, passengers, air tours, medical transfers, off-shore oil rig trips and others. Because the data is so non-homogeneous it is impossible to derive clear trends or identify areas for safety emphasis and direct resources to the safety enhancements that will result in the most improvement.  NATA supports the FAA/NTSB collaboration and encourages them to work with Part 135 industry stakeholders to determine what additional data points are appropriate to collect and report back to Congress on additional data that will be collected, the time-frame for implementation and any potential obstacles to implementation.

Section 625. Aviation Workforce Development Programs: The association also worked with other industry stakeholders to support provisions that will focus on providing opportunities for the next generation of aviation business professionals. This section requires the Secretary of Transportation to establish a program to provide grants for eligible projects to support the education of future aircraft pilots and the development of the aircraft pilot workforce; and a program to provide grants for eligible projects to support the education and recruitment of aviation maintenance technical workers and the development of the aviation maintenance workforce. NATA has continuously voiced its support of this important provision and looks forward to being part of the conversation on how to implement this program in schools across the country.

Section 315. Aviation Rulemaking Committee for Part 135 Pilot Rest and Duty Rules: While there were many victories for aviation businesses in the bill, there were also provisions that included regulatory implementation deadlines that were not possible. NATA was successful in altering language originally in the 2016 FAA bill related to Part 135 rest and duty rules. Initial language proposed last year would have mandated a rulemaking committee to recommend new Part 135 rest/duty rules on a very short timetable and require FAA to implement them. This section establishes a rulemaking committee comprised of industry representatives, labor organizations, and safety experts to review and provide recommendations on pilot rest and duty rules for operations in Part 135. This section, including NATA’s input, convenes a rulemaking committee and provides more time for the committee to conduct its work, guarantees charter operator representation, and requires consideration of small business issues and need to accommodate diversity of Part 135 operations.

As the regulatory agencies sift through the numerous tasks they are assigned with, including those listed above, NATA looks forward to being part of the conversation. Of the 119 new reports tasked by Congress to the Federal Aviation Administration (58), Department of Transportation (23 plus one joint with FAA), Government Accountability Office (24) and others, 26 of them directly impact general aviation businesses. NATA is already in touch with the federal agencies tasked with completing these reports, and will look to you, our members – the experts, to help us ensure the agencies have the information needed to accurately understand the industry and that we are well represented. There is still much to be done, and with your guidance, we can continue to work in an industry that runs for the benefit of all users.

Airports, FBOs and Users Role in Fostering Airport Health

March 29, 2018

Airports and their tenants provide essential services to keep general aviation healthy, sustainable and successful, as well as support the economic viability of local communities. In a recent Airport Business/ article, NATA Board Member Curt Castagna discussed pathways to maintain the sustainability of airports and to encourage stakeholders, including users, to collaborate on achieving a robust airport that supports both economic development and public access to aviation.

Is Your Airport Healthy?

BY CURT CASTAGNA, President and CEO of Aeroplex/Aerolease Group
Originally posted by Airport Business/ ON DEC 26, 2017

For managers of general aviation airports across the nation, the definition of sustainability is as diverse as the stakeholders whom they serve. However, most contend that maintaining both economic viability and social responsibility are vital to maintaining a healthy airport.

The Airport Cooperative Research Program (ACRP), which is funded by the Federal Aviation Administration (FAA) and undertakes research in a variety of aviation subject areas, defines airport sustainability as practices that ensure:

  • Protection of the environment, including conservation of natural resources
  • Social progress that recognizes the needs of all stakeholders
  • Maintenance of high and stable levels of economic growth and employment

There is no simple formula for achieving airport sustainability, as each facility has a unique operating environment, business structure, governance and market. In addition, airport management face diverse challenges in relation to meeting user needs in the areas of maintenance, modernization, budgeting, security, grant assurances, and local political and community initiatives.

This discussion is designed to encourage visionary thinking from airport, business and community leaders, as well as airport users, on how to collaboratively achieve a robust airport that supports both economic development and public access to aviation.

Navigating the Path to Self-Sufficiency

When it comes to maintaining the economic health of an airport, it is crucial to understand its unique operating environment. In broad terms, general aviation airports must comply with a host of federal regulations and requirements, while navigating local market forces and economic and environmental pressures.

General aviation airports traditionally generate revenue from lease rates, fees and charges collected from tenants and users who provide a broad range of aeronautical services to the aviation community including: aircraft sales and acquisitions, fuel, aircraft ground support, passenger and crew services, aircraft parking and storage, on-demand air charter, aircraft rental, flight training, aircraft maintenance and overhaul facilities, parts sales, and business aircraft and fractional ownership fleet management.

Development at general aviation airports often takes the shape of public-private partnerships, modeling the discussions currently underway at the nation’s commercial service airports. For example, an airport sponsor enters into a type of public-private partnership with a fixed based operator (FBO) that provides airport users with a wide range of aeronautical services. In return, the airport sponsor receives a fee for the land and the community receives the economic benefit, with minimal risk for the business enterprise that is created. An increased number of airports are also entering into agreements with private companies that provide renewable energy sources, such as solar panel installations, that can diversify revenue streams, significantly reduce energy costs and benefit the environment.

A third revenue stream at airports comes from specialty companies that serve aviation-related segments of the economy. Corporate and general aviation services are augmented by a diverse array of mixed-use facilities, including business parks and industrial centers, which make airports a powerful economic engine.

Finally, public-use airports benefit from grants provided by the FAA for vital infrastructure projects. Eligibility for these Airport Improvement (AIP) funds is specifically based on the airport’s ability to maintain a level and competitive playing field for leaseholders engaged in aeronautical activities. To maintain its grant assurances, airport sponsors are responsible for ensuring that its tenants provide services at prices that are fair, reasonable and non-discriminatory.

Competition, Not Regulation, Creates Healthy Airports

At some general aviation airports, as well as commercial airports with general aviation facilities, corporate aviation accounts for a disproportionate share of revenue generated compared to smaller general aviation aircraft. How then, do airports achieve economic sustainability while maintaining a healthy mix of jet, propeller and helicopter operations?

A proper mix of operations and aircraft cannot be achieved through increased federal regulation or market manipulation. Rather, airports must aggressively work to implement policies that maintain balance among the needs of diverse airport users, while extending the benefits of aviation to the local community.

This includes using a competitive selection process to attract tenants that make significant capital investment and offer quality services at reasonable prices. Airport sponsors must also establish fair and equitable lease rates and charges appropriate to the local market, as well as address mixed land use in their long-term master and business plans. When airport operators view their tenants as true business partners, they achieve mutual success and advance the airport’s mission to achieve both economic and social sustainability.

Case Study – The Airport Sponsor/Tenant Relationship

Currently, the Aircraft Owners and Pilots Association is calling for the FAA to regulate the price of aeronautical services provided by FBOs, such as fuel and ramp fees, to achieve unfettered airport access. While this suggests that private pilots would receive the lowest costs available, it actually constrains the airport’s ability to serve the aviation community and achieve its goals.

The investments made by aviation and FBO facilities not only serve local pilots, but are gateways to economic investment in the community. As leases come up for renewal, an increased number of airports are requiring FBOs to make significant capital investments which revert back to the sponsor at the end of the ground lease. Each airport and each market is different. Thus, based on local and regional knowledge, FBOs construct pricing that enables them to provide quality service at a reasonable rate of return.

The economics of airport business place great importance on master lease terms and available revenue streams to create viable airports. While FBOs frequently comply with guaranteed service levels and facilities dictated by airport minimum standards, their business model does not guarantee income. Sparing airports the risks of an open and volatile market, they provide a steady revenue stream in the form of rent. Ultimately, the rates and charges collected by the airport sponsor are reinvested to help create a healthier airport.

In circumstances where pilots feel they do not have access to the best prices for fuel and other FBO services, the situation is best mitigated locally through the airport sponsor, which is obligated by federal law to ensure access on fair and reasonable terms. This does not equate to the lowest prices, but does require FBOs to offer equal rates to similarly-situated pilots. If the situation is not resolved, a last resort is the formal FAA Part 13 or 16 complaint process.

Clearly, this does not remove responsibility for the fair and equal treatment of pilots and other airport users from the realm of the airport sponsor. Rather, airports are held accountable for supporting policies and programs that best serve the diverse needs of the entire aviation community.

At Van Nuys Airport, for instance, progress on a 30-acre development project dedicated to propeller aircraft is climbing full speed ahead. This site, still under construction, provides hangars, tie-downs and office facilities for up to 270 propeller aircraft and related businesses. It also features a self-serve fueling station for private pilots. By relocating approximately 85 portable hangars from other leaseholds, this facility enabled other development projects to move forward and generate substantial economic impact.

Practices to Achieve Economic Sustainability

Creating an environment where airport businesses can thrive provides benefits to airport sponsors, users and operators, while creating high-skilled, high-paying jobs in the community. A business-friendly environment also attracts public-private partnerships to the airport, including those that advance green technology and neighborhood compatibility.

The following are a few practices that can help propel an airport toward economic health and, in so doing, promote policies that are both responsive to business and responsible to the community:

  • Develop and enforce airport minimum standards that promote the highest levels of safety, security and service for all airport users.
  • Ensure the airport has a current business/redevelopment plan and schedule of rates and charges that reflect its overall vision and mission.
  • Consider a transparent RFP process to solicit business proposals for real estate that is designated for both aeronautical and FAA approved non-aeronautical uses.
  • Review and maintain compliance with all airport grant assurances and regulatory measures established by federal, state and local government agencies with jurisdiction over the airport and its users.
  • Think globally, but work locally with airport users and operators, public officials and prominent business, civic and community organizations to form an airport business support team.

Finally, aviation industry leaders and policymakers should take advantage of organizations throughout the world, such as ACRP, that contribute guidance and research on subjects of importance to airports. Many of their findings derive from the day-to-day challenges faced by airport managers and can lead to innovative solutions.

Curt Castagna, president and CEO of Aeroplex/Aerolease Group, is a member of the Los Angeles County Airport Commission, president of the Van Nuys and Long Beach Airport Associations, and a board member of the National Air Transportation Association. A certified private and instrument-rated pilot, he has instructed courses in aviation administration at Cal State Los Angeles for over two decades.

Trump Administration Sends Infrastructure and FY2019 Budget Proposals to Congress – What’s In It for Aviation?

February 16, 2018

By Rebecca Mulholland, Director, Legislative Affairs

This week was a busy one for Washington – President Donald Trump released his long-awaited $1.5 trillion infrastructure proposal and his fiscal year 2019 budget request on Monday, February 12th. Here is a look into each proposal, and what they mean for aviation:

Infrastructure Proposal:

President Trump’s infrastructure plan aims to invest $1.5 trillion into our nation’s infrastructure, including $200 billion in investment from the federal government and the remaining funds from states and the private sector. The proposal has been met with skepticism in Congress, with Republican frustrations on the $1.5 trillion price tag and Democratic concerns about the disproportionate federal government share. The proposal seeks to change existing infrastructure programs and creates pilot programs to incentivize, transform and finance state and local governments to make their own investments, allocating $50 billion of investment in rural America to states to prioritize their needs.

For aviation, the proposal:

  • Seeks to provide government agencies the ability to sell off federal assets, including airports, if it can be demonstrated that “an increase in value from the sale would optimize the taxpayer value for federal assets” (p. 19). This would include the potential sale of Reagan National Airport (DCA) and Dulles International Airport (IAD).
  • Aims to expand the streamlined passenger facility charge (PFC) application process, currently at non-hub airports, to small hub airports.
  • Calls for Congress to limit the FAA’s authority to manage and approve airport projects that are not related to “critical airfield infrastructure.” The proposal names hangars and terminals as examples of projects that the Administration says are not “critical airfield infrastructure projects.”
  • Encourages airports to offer incentive payments for Airport Improvement Program (AIP) projects and limits FAA oversight of AIP funds.

However, questions remain. For example, how much of the $1.5 trillion will go to each mode of transportation (given that some grant programs may be utilized for non-transportation fields, like broadband) or what the revised PFC process means for charter operators (will making the process easier for small airports increase the likelihood that PFCs will impact air charter operators more than they currently do?).  It is also unclear how interested Congress is in taking up this transformative proposal given the recent passage into law of a two-year fiscal 2018 budget bill.

Budget Proposal:

While Congress celebrates the passage of the Fiscal Year 2018 Budget, the Trump Administration has shifted gears to the next fiscal year, releasing its $4.4 trillion federal budget blueprint for Fiscal Year 2019. This budget blueprint aims to provide more details of how the proposed $200 billion from the infrastructure proposal discussed above will be divided up, department by department.

The budget request does not bode well for transportation, slashing the Department of Transportation’s (DOT) discretionary funding by 19 percent, to $15.6 billion, compared with what was enacted for Fiscal Year 2018. Here is a brief breakdown of how aviation is impacted by the budget request:

  • $16.1 billion allocated to FAA. This is down from the $16.3 billion that was enacted this year;
  • $3.35 billion allocated to AIP. That number is the level at which AIP has been flat-lined since fiscal year 2014; and,
  • $93 million for the Essential Air Service (EAS) program, down 38 percent from the $149 million provided in fiscal year 2018. The proposal also calls for reforms to who is eligible for the EAS program.

Also, it is important to note that, like last year, the budget proposal calls for privatizing our nation’s air traffic control system, beginning in 2022. NATA released a press statement in strong opposition to this addition, noting that privatization has continuously “been met with the collective resistance of NATA and hundreds of other leading general aviation organizations.” Also, a strong bipartisan and bicameral coalition in the House of Representatives and the Senate are not supportive.

Now that Washington has had time to absorb what is in the budget proposal, the legislative process begins. The House and Senate Budget Committees will review the numbers and supply budget resolutions to the House and Senate Appropriations Committees. The Appropriations Committees will markup the bills, send to the House and Senate chambers for approval and the President will sign each appropriation (or one omnibus) bill into law.

Note that the budget proposal is just that, a proposal, and Congress can accept or reject any cuts suggested. There is still a long way to go to a final deal, and a lot can happen, so follow NATA as the legislative process continues.

NATA Members Help Shape Debates in 2017, Build Strong Foundation for 2018

January 4, 2018

By Bill Deere, Executive Vice President of Government and External Affairs

This time last year, I warned that 2017 could be a wild one for the aviation business community. That turned out be a vast understatement. From proposals to corporatize air traffic control to price regulation of FBOs, this past year has been a constant challenge to the association and its members. As we head into the new year, challenges will remain but we are also hopeful that the work begun this year may result in significant progress in 2018.

No doubt the biggest debate in aviation in 2017 was the airline industry proposal to privatize the nation’s air traffic control system, an idea that was embraced by both the Trump Administration and the Chairman of the House Transportation Committee, Representative Bill Shuster (R-PA). Ultimately, the proposal was incorporated into the House version of the FAA reauthorization, H.R. 2997, the 21st Century AIRR Act. Following committee approval, it looked like the legislation was headed to the floor of the House of Representatives for a vote.

That is where the proposal met with the collective resistance of NATA and the rest of the general aviation community. NATA’s hundreds of Hill meetings, combined with the grassroots support of our members and countless others, were enough to introduce uncertainty in the House Republican leadership as to whether the corporatization proposal would survive a House floor vote. For that reason, the current FAA authorization was extended until March 30, 2018.

Significantly, the Senate FAA legislation contains no corporatization proposal. NATA members who participated in our annual Congressional Fly-In were the last general aviation group to visit the Senate before the bill was drafted and your direct advocacy efforts in opposition to corporatization benefited the entire general aviation community.

For 2018, you can expect the ATC corporatization battle to be fought one more time. At this writing, Congress is focused elsewhere, tax legislation, year-end spending bills, and immigration to name just a few issues. But as the calendar turns, and the next FAA authorization deadline approaches, you can expect our deep-pocketed opponents to make one more attempt to wrest control of the air traffic control system and turn it over to the airlines. We ask you to stand ready and be prepared to weigh in with your elected representatives. You are the aviation business community’s best voice.

While we expected the ATC corporatization battle, in 2017 we unexpectedly found ourselves in a debate with a national pilot organization that suggested to the FAA that FBOs are akin to public utilities and should be regulated along similar lines. This was a moment where our members were critical to our efforts to shape the debate. Thanks to the help of member companies, FBOs and Part 135 companies alike, we developed a report on the state of the FBO industry. The report, which is available on the front page of our website, is a comprehensive look at the industry and the many factors that impact the pricing of FBO services.

I am pleased that as 2017 progressed, more and more industry leaders turned to our report as the foundation for debate. It has also been gratifying to see the thoughtful approaches that have been taken to the issue by other groups, including the Experimental Aircraft Association, which featured an excellent article on the subject in its May edition of Sport Aviation.

So where do we go from here? As you will see in the article on our annual leadership conference (page 51), your association met the issue head-on with a panel that included pilots, FBOs, airports and fuelers. A dialogue started there that I hope will continue into 2018.

Finally, I don’t want to leave you with the idea that all we do at NATA is try and beat back bad ideas. We take seriously our responsibility to advance a positive, member-driven industry agenda. There are proposals in Congress and before the agencies across a range of issues, including taxes, addressing illegal charter, air carrier training and others that we hope to see implemented in 2018.

As we reflect on 2017 and look ahead to 2018, one thing is clearer than ever. We are in it together. To advance big ideas or defeat major threats, is a job that requires all of us to be engaged.

Republished from the 2017 Q4 Aviation Business Journal.

More Fixing of Things That Aren’t Broken

October 3, 2017

By Bill Deere, Executive Vice President of Government and External Affairs

The campaign to economically regulate FBO pricing took its latest step recently, when a national pilot organization filed informal complaints against aviation businesses at three airports. It is certainly reasonable for an association that represents pilots to act as a consumer ombudsman, just as NATA does on behalf of aviation businesses.

However, I very much agree with NATA’s President Marty Hiller who, pointing to the big picture noted, “This action is disappointing, coming at a time when the general aviation community is confronting a serious effort to privatize our nation’s air traffic control system. General aviation (GA) as we know it in this nation is under a real threat. We need to stand united right now and not be concerned with distractions like this.” Think Marty is exaggerating? I was on a recent call where the same national pilot organization was telling pilot groups from around the country the debate on ATC privatization has reached a point where the next seven days are critical to the future of GA in this nation.

To be clear, neither NATA nor its membership is afraid of a debate on FBO pricing. In fact, I am proud that NATA insists that viewpoints on controversial issues be aired directly with our members. On November 8th, NATA members will hear directly from AOPA General Counsel Ken Mead, who has agreed to join us at the 2017 Aviation Business Roundtable, to discuss pricing on a panel that will also include FBOs, airports and fuelers. I have assured Ken that no flak jacket is required.

The issue of FBO pricing is not new, and the pressure aviation businesses often face for more improvements and additional private investment can ignore the reality that these costs are ultimately paid for by the users. However, what is new, is the increasing lack of collaboration to address these issues. Historically, industry groups work in partnership on issues on behalf of their memberships, and in this case aircraft owners, aviation businesses and airports should be sitting down to address concerns and develop solutions, not looking for government regulation. This campaign to economically regulate FBOs began in secrecy, and ignores the fact the Department of Justice reviews FBO consolidations and requires adjustments if necessary to assure adequate competition continues. It seems reasonable that if a pilot organization felt its members were threatened at these locations, that their historic mission would have brought aircraft owners, aviation businesses and airports together, not pitted them against each other.

The commitment of the industry to work together on an unleaded avgas replacement exemplifies the potential of collaborative relationships. This effort provides users, businesses and airports opportunities to review incentives for alternative fuels as they hopefully become more readily available in the next several years.

While NATA does not take a position on pricing at individual FBOs, the association is providing important industry perspective, supplying both the FAA and local decisionmakers context as to the factors that go into FBO pricing. As you may recall, earlier this year NATA presented a state of the aviation business sector overview to the FAA. The overview, developed with the assistance of FBO and air charter members, discusses the costs of operating airport businesses and the many variables
that go into determining its pricing structure—including capital invested, lease duration, fuel volume, personnel expenses, hours of operation, and traffic types.

Press coverage of the informal complaints has been balanced and, most important, not accepting as axiomatic the assertion that FBO pricing is “egregious.” Especially gratifying to NATA are the comments that follow the related news stories. This would be a natural place for pilots to “pile on.” And while some do, there are also thoughtful comments from
writers who understand that FBO pricing is more complex than its glib portrayal in what is essentially an association’s membership renewal campaign. Some of the best discussion centers around the role of airports and the impact on FBO economics of a local airport or community’s desire for highend facilities, ways to most easily address security concerns or their own investment challenges. Federal requirements and local conditions can be managed together, and the industry has traditionally united to seek the necessary balance.

The FBO services market is and remains a very competitive industry. As the filings demonstrate, pilots, flight departments, charter companies, and fractional operators make a choice every day of what airports to fly into and which provider meets their requirements. Pilots have more technology than ever to create options to assist them in deciding where to land, purchase fuel, and remain overnight based on cost, convenience, reputation and services a fixed base operation provides. Currently, in the case of Jet A fuel there are no less than 26 providers of contract fuel (a method of payment offered by fuel suppliers and other transaction entities), most if not all posting weekly prices at most FBOs across the country. There are numerous websites that offer the piston and turbine pilots prices, with flight planning and other services, including, AirNav, and RocketRoute.

Those within the aviation industry fully understand that FBOs compete vigorously with each other on price, service, and quality of facilities. Often, an FBO’s primary competitor is not a competing operation on the same airport but rather another airport in close proximity, or the airport where the plane came from or its final destination.

Pilots, take some of the self-congratulatory back patting of organizations with a grain of salt. The reporting has a tendency to peter out when the news turns inconvenient. For example, taking credit for a second FBO at Jackson Hole has stopped. Why? Because the airport authority may buy out the existing operation in favor of a city-run FBO. How about prices at John Wayne Airport now that an incumbent FBO was turned out? Looks like the total user price for fuel, handling fees and rents are still about the same. Economic regulation of FBOs is no different than trying to privatize air traffic control, another example of trying to fix something that isn’t broken. (Visit to read NATA’s state of the aviation business sector overview.)

Republished from the 2017 Q3 Aviation Business Journal.