Passenger Facility Charges

2903 Words May 20th, 2013 12 Pages
The Passenger Facility Charge Program:
An Overview and an Examination of Increasing or Removing the Program’s Current Limits

Submitted by
Jim Halley
March 10, 2013

Presented in Partial Fulfillment of the
Course Requirements for
MGMT 533 Federal Regulations, Ethics, and the Legal System

Table of Contents | Executive Summary | ii | An Overview and History of the Passenger Facility Charge Program | 1 | Passenger Facility Charge Limits and the Arguments For and Against Raising the Limits | 2 | The Statutory and Regulatory Aspects of the PFC Program | 5 | A Recommendation Regarding PFC Limits | 6 | Works Cited | 7 |

Executive Summary
As established by the Aviation Safety and Capacity Expansion Act of 1990, the
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Part 158 – allows airports enplaning more than 2,500 passengers per year to charge passengers up to $4.50 per each flight segment but not more than $18.00 per round trip ticket (Price & Forrest, 2012). PFC funds are collected by the airlines, forwarded to the airports by the collecting airlines, and must be expended by airports for projects directly related to safety, security, capacity, noise reduction, and carrier competition enhancement (Price & Forrest, 2012).
The PFC program’s history dates back to the 1970s. Prior to 1973, some airports would impose a toll on enplaning or deplaning passengers, a practice known as per-head taxes (Wells & Young, 2004). A 1972 Supreme Court ruling upheld the constitutionality of this practice in Evansville-Vanderburgh Airport Authority District et al. v. Delta Air Lines, Inc. et al. (Wells & Young, 2004). However, in 1973, Congress passed the Anti-Head Tax Act that prohibited airports from imposing these per-head tolls on enplaning or deplaning passengers (Wells & Young, 2004). By 1978, efforts to remove these anti-head tax bans were moving forward, though this came with counter efforts to prohibit airports that impose per-head tolls from collecting any other federal funding (Wells & Young, 2004).
In 1990, then Secretary of Transportation Samuel Skinner asked Congress to allow the imposition of $3.00 PFCs in an extension of the Airport and Airway Improvement Act program (Wells &

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