The Federal Aviation Administration is preparing to partially shut down its operations and furlough up to 4,000 employees at midnight Friday after Congress could not agree on details in the legislation to extend the agency’s authority.

When the FAA’s authority expires, airlines will no longer be allowed to collect taxes on ticket sales. So while travelers could save about 20 percent on the price of airline tickets, about $200 million in tax revenue could be lost every week until the issue is resolved. –BF

Bloomberg:

The House on July 19 approved a bill to keep the FAA funded through Sept. 16. Written by Representative John Mica, a Florida Republican who chairs the House transportation committee, it includes a provision restricting subsidies to small airports that has drawn the ire of leading Senate Democrats.

The House bill would eliminate assistance for air service to 13 rural communities, including towns in Nevada, home state of Senate Majority Leader Harry Reid; West Virginia, whose senior senator is Mica’s counterpart, Commerce Committee Chairman Jay Rockefeller; and Montana, whose senior senator, Max Baucus, chairs the Finance Committee.

Rockefeller wrote to Mica on July 19 saying, “Your attempt to punish the Senate by hurting small community air service has backfired — this language only guarantees that the Senate will reject the FAA extension.”

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