With the nation immersed in the debt-ceiling crisis for the past month, not much attention was placed on the action by Congress to allow the reauthorization of the Federal Aviation Administration (FAA) to expire at midnight on Jul. 22. This has led to a suspension of non-essential activities of the FAA.
Without funding, the FAA has had to furlough close to 4,000 employees and issued stop orders on 253 airport construction projects (as of Aug. 3) around the country. One of those projects halted is the building of the new air traffic control tower at Oakland International Airport.
The stoppage of projects is where the full impact of this inaction by Congress is being felt.
The Association of General Contractors estimated that as many as 70,000 construction workers have been affected by the stop orders. According to KCBS, 60 workers on the Oakland project have been furloughed.
The 253 projects would improve aviation infrastructure and amount to nearly $10.5 billion. Every day that goes by, the costs of the projects will increase.
Congress hasn’t found a long-term solution to fund the FAA since 2007. But it has kept the agency running by extending the reauthorization 20 times.
However, the 21st extension proved to be impossible.
At the heart of the stalemate is the proposed cuts by Rep. John Mica (R-Fla.) to the Essential Air Service program, which was designed to provide subsidies to airlines to continue serving smaller airports – routes that otherwise might not be profitable - after airlines was deregulated in 1978. The $16.6 million in cuts would eliminate subsidies to 13 rural airports.
The bill passed in the Republican-led House, but the Democratic-led Senate did not consider it because of the cuts.
Sen. Jay Rockefeller (D-W.Va.) has argued that the cuts were used as leverage for the ultimate goal of the Republicans, which is to overturn the National Mediation Board ruling last year that makes unionizing easier for airlines and railroads employees.
This partisan clash has caused thousands of FAA employees and tens of thousands of construction workers to be out of work, causing hardships for them and their families. Furthermore, their situations won't be resolved anytime soon. Congress has been recessed until September, despite pleas from President Barack Obama and Transportation Secretary Ray LaHood to get a compromised deal done before they do.
"It’s another Washington-inflicted wound on America and Congress needs to break that impasse now so these folks can get back to work," Obama said.
“Don’t race to your departure gate while leaving America’s air transportation system grounded," LaHood said. "With one act - with a vote that you’ve already cast 20 times - you can put almost 75,000 people back to work immediately.
"There is absolutely no reason that Congress can’t pass another temporary fix while it works out the details of a longer-term vision for the future of America’s air transportation system.”
Until Congress reauthorizes the FAA, there is a minuscule benefit for air passengers. Passengers will not have to pay the federal air transportation excise taxes usually found when purchasing a ticket. However, some airlines have increased their fares to offset this “tax break”.
The Internal Revenue Service (IRS) has announced that for those passengers who bought tickets before Jul. 22, and travelling until Congress reauthorized the FAA, may be entitled to a refund of the federal taxes.
The IRS has asked airlines to process the refunds to those who are eligible. On Monday, Delta Air Lines announced it will do just that, becoming the first airline to do so. Delta is currently working on the details with the IRS.
Other airlines have not followed Delta and are referring inquiring customers to the IRS. If customers are unable to get a refund from the airline, they might submit a claim with the IRS. Details on this are also being finalized.
According to the Associated Press, the government stands to lose over $1 billion in revenue from these taxes.
