Congress Fails to End FAA Shutdown

Posted on Aug 2, 2011

Flickr / hyku (CC-BY-SA)

Senate Majority Leader Harry Reid says the issue of funding the FAA is a problem that ultimately lies with Delta’s “non-union” stance.

While lawmakers managed to pass a bill raising the debt ceiling Tuesday, they failed to extend the power of the Federal Aviation Administration to regulate tax funding, leaving thousands of airline employees out of work while Congress takes a monthlong holiday.

So while the government continues to lose out on $30 million in taxes on airline travel each day the FAA goes without official authority from the government ($900 million over 30 days), airline passengers were expecting a sort of tax holiday. Only it turns out it is the airlines that are getting the holiday and the revenue. Instead of passing the savings on to customers, airlines quickly ratcheted up their rates to reflect post-tax prices. —BF

NPR:

The issue, [Harry] Reid says, is Delta’s “non-union” stance. The bill to fund the FAA, as crafted by House Republicans, includes language that sets new rules for aviation workers’ votes on labor representation.

As Eyder reported earlier today, the FAA shutdown has already cost the government more money than the disputed $16.5 million in cuts approved by the House. In fact, he wrote, the federal government stands to miss out on “more than $1 billion in revenue from uncollected airfare taxes.”

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