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CBO: Air Traffic Control Privatization Plan Would Increase Deficit by $20 Billion

Mar 9, 2016
Press Release

Washington, D.C. – Today, the Congressional Budget Office (CBO) released its cost estimate of H.R. 4441, the “Aviation Innovation, Reform, and Reauthorization Act of 2016” (AIRR Act). It determined that the Republican plan to privatize the United States air traffic control (ATC) system would increase the deficit by nearly $20 billion over ten years.

 

“Today, the Congressional Budget Office landed yet another blow to the flawed Republican plan to privatize our nation’s air traffic control system. The CBO determined that the Republican plan would increase the deficit by $20 billion over the next ten years, and billions more in subsequent decades. This proposal is risky, it erodes aviation safety, and now the CBO confirmed it will add tens of billions in debt that will be passed down to the next generation. There are too many unanswered questions about this proposal. Congress should ground the Republican air traffic control privatization plan and the Committee should go back to the drawing board and hold comprehensive hearings, listening to a range of stakeholders regarding how to deal with the acknowledged problems within the FAA for personnel, procurement, and budget stability,” said Ranking Member of the House Committee on Transportation and Infrastructure Peter DeFazio (D-OR).

 

According to CBO, over the next 10 years, H.R. 4441 increases mandatory spending (or direct spending) by $89.0 billion and increase revenues by $69.2 billion. As a result, the bill increases the deficit by $19.8 billion over the next 10 years, and billions more in subsequent decades. 

 

CBO also specifically determined that the user fees should be classified as Federal revenues. Under H.R. 4441, the ATC Corporation, a private monopoly, would have complete discretion to set revenue policy for use of the air traffic control system. Congress would have no control over the level of fees charged on passengers and the amount of revenue collected.

 

The AIRR Act passed the House Committee on Transportation and Infrastructure on February 11, 2016 by a final vote of 32-26, with bipartisan opposition from every Democrat and two Republicans. The CBO estimates can be found here.

 

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