LosAngelesCountyMetrc:JMohopolltooT""'P•'''"""A"thocltyDecember8,2015Mr.JamesT.BrownFinanceManagementFederalAviationAdministration800IndependenceAvenueSWWashington,DC20591OneGatewayPlaza,LosAngeles,CA90012-2952PhillipA.WashingtonChiefExecutiveOfficer213-922.7555Tel213.922.7447Faxwashingtonp@metro.netRe:TheLosAngelesCountyMetropolitanTransportationAuthority'sActionPlaninResponsetoFAAPolicyChange79FR66282-01;DocketFAA-2013-0988DearMr.Brown:TheLosAngelesCountyMetropolitanTransportationAuthority(Metro)respondstotheFAA'samendmentofitsPolicyandProceduresConcerningtheUseofAirportRevenuewiththefollowingactionplan.TheFAAinterpretsrestrictionsontheuseof"localtaxesonaviationfuel(excepttaxesineffectonDecember30,1987)in49U.S.C.§47107(b)and49U.S.C.§47133(a)toincludelocalsalestaxrevenuederivedfromaviationfuelinadditiontolocalaviationfuelexcisetaxes.Accordingtothepolicy,theportionofstateandlocalsalestaxrevenuesderivedfromaviationfuel(excepttaxesineffectonDecember30,1987)shouldbesenttoaviationprograms,noisemitigation,andairportcapitalandoperatingcosts.ThepolicysaysthatstateandlocalgovernmentsthatimposesuchsalestaxesshouldsubmittotheFAAanactionplantocomplywiththepolicychangebyDecember8,2015,andimplementtheactionplanbyDecember8,2017.Determiningcompliancewiththepolicyisinherentlydifficult.Metrohasenactedtwodistricttaxes,oneofwhichisrestrictedtospecificexpenditures,sinceDecember30,1987thatwillbeineffectonDecember8,2017:•0.5%rateenactedbyLosAngelesCountyvotersin1990(Ordinance#49)•0.5%rateenactedbyLosAngelesCountyvotersin2008andrestrictedtospecificprojects(Ordinance#08.01)Metrodoesnotsegregatedistricttaxrevenuederivedfromaviationandjetfuelfromothertaxablesales.Oursalestaxauditcontractor,MuniServices,preparedaroughestimateof$18millionannuallyofreceiptstoMetrofromjetfuelsales.WecautionthatthisestimateisstillbeingrefinedasitiscomplicatedbecausemanytaxpayerscominglesalestaxreportingoftheirretailgasstationsNOTatanairportandtheirjetfuelsalesattheairport.Theinternalprocesstoundertakethiseffort-whichistoidentifY,trackandsegregatetherevenue,isextensive.Weareassessingwhatisrequiredtodevelopaprocesstomeetthereportingrequirementsandtrackingsystemsfordiscreteinformationonaviationfueltaxrevenues.WewouldappreciatetheFAAprovideadescriptivedefinitionoftherequirementsforthemandated"trackingsystem."Metrodevotessignificantpublictransportationresourcesto15airportsinLosAngelesCountyincludingLosAngelesInternationalAirportandBurbankjBobHopeAirport.Expendituresinsupportofaviationprogramsinclude,butarenotlimitedtoaccesstoandfromtheairportsthroughpublictransportationandhighways.MetrobelievestheseexpenditureswillexceedthedistricttaxrevenuesderivedfromaviationfuelandthatMetroisincompliancewithfederallaw.Overthenexttwoyears,Metrowillcontinuetoworkwithtaxingauthoritiesandotherentitiestocoordinatecollectionofdatatorefine(1)estimatesofdistrictsalestaxrevenuesderivedfromaviationfueland(2)estimatesofexpendituresonandinvestmentinlocalpublicuseairports,toconfirmMetrocomplieswithfederallaw.If,contrarytocurrentestimates,Metrodeterminesthatitsexpendituresonairportcapitalandoperatingcostsdonotexceedgeneralsalestaxrevenuesderivedfromaviationfuel,itwillactaccordingly,includingconsideringlegislativesolutions,tocomplywithapplicablefederallaw.Sincerely,PhillipA.WaingtonChiefExecutiveOfficer