Federal Register / Vol. 78, No. 225 / Thursday, November 21, 2013 / Proposed Rules 69789 

The Proposed Amendment 

Accordingly, pursuant to the 

authority delegated to me, the Federal 

Aviation Administration proposes to 

amend 14 CFR part 71 as follows: 

PART 71—DESIGNATION OF CLASS A, 

B, C, D AND E AIRSPACE AREAS; AIR 

TRAFFIC SERVICE ROUTES; AND 

REPORTING POINTS 

■ 1. The authority citation for 14 CFR 

part 71 continues to read as follows: 

Authority: 49 U.S.C. 106(g), 40103, 40113, 

40120; E.O. 10854, 24 FR 9565, 3 CFR, 1959– 

1963 Comp., p. 389. 

§ 71.1 [Amended] 

■ 2. The incorporation by reference in 

14 CFR 71.1 of the Federal Aviation 

Administration Order 7400.9X, Airspace 

Designations and Reporting Points, 

dated August 7, 2013, and effective 

September 15, 2013 is amended as 

follows: 

Paragraph 6002 Class E airspace 

Designated as Surface Areas. 

* * * * * 

AAL AK E2 Sitka, AK [Modified] 

Sitka Rocky Gutierrez Airport, AK 

(Lat. 57°02′50′′ N., long. 135°21′42′′ W.) 

Within a 4.1 mile radius of Sitka Rocky 

Gutierrez Airport, and within 3.5 miles each 

side of the airport 209° radial extending from 

the 4.1-mile radius to 10.5 miles southwest 

of the airport, and within 3 miles each side 

of the airport 313° radial extending from the 

4.1-mile radius to 11.1 miles northwest of the 

airport. This Class E airspace is effective 

during the dates and times established in 

advance by a Notice to Airmen. The effective 

date and time will thereafter be continuously 

published in the Airport/Facility Directory, 

Alaska Supplement. 

Paragraph 6005 Class E airspace areas 

extending upward from 700 feet or more 

above the surface of the earth. 

* * * * * 

AAL AK E5 Sitka, AK [Modified] 

Sitka Rocky Gutierrez Airport, AK 

(Lat. 57°02′50′′ N., long. 135°21′42′′ W.) 

That airspace extending upward from 700 

feet above the surface within a 6.6-mile 

radius of Sitka Rocky Gutierrez Airport, and 

within 4 miles each side of the airport 209° 

radial extending from the 6.6-mile radius to 

14.5 miles south of the airport, and within 4 

miles east and 8 miles west of the airport 

313° radial extending from the 6.6-mile 

radius to 29 miles northwest of the airport; 

and that airspace extending upward from 

1,200 feet above the surface within a 40-mile 

radius of lat. 56°51′34′′ N., long. 135°33′05′′ 

W.; and that airspace extending upward from 

5,500 feet MSL within an 85-mile radius of 

lat. 56°51′34′′ N., long. 135°33′05′′ W.; 

excluding that airspace that extends beyond 

12 miles from the coast. 

Issued in Seattle, Washington, on 

November 13, 2013. 

Clark Desing, 

Manager, Operations Support Group, Western 

Service Center. 

[FR Doc. 2013–27858 Filed 11–20–13; 8:45 am] 

BILLING CODE 4910–13–P 

DEPARTMENT OF TRANSPORTATION 

Federal Aviation Administration 

14 CFR Chapter I 

[Docket No. FAA–2013–0988] 

Policy and Procedures Concerning the 

Use of Airport Revenue; Proceeds 

From Taxes on Aviation Fuel 

AGENCY: Federal Aviation 

Administration (FAA), DOT. 

ACTION: Notice of Proposed Clarification 

of Policy; Request for Comments. 

SUMMARY: This action proposes to 

amend the Federal Aviation 

Administration (‘‘FAA’’) Policy and 

Procedures Concerning the Use of 

Airport Revenue published in the 

Federal Register on February 16, 1999 

(‘‘Revenue Use Policy’’) to clarify FAA’s 

policy on Federal requirements for the 

use of proceeds from taxes on aviation 

fuel. Under Federal law, airport 

operators that have accepted Federal 

assistance generally may use airport 

revenues only for airport-related 

purposes. The revenue use requirements 

apply to certain state and local 

government taxes on aviation fuel as 

well as to revenues received directly by 

an airport operator. This notice 

publishes a proposed clarification of 

FAA’s understanding of the Federal 

requirements for use of revenues 

derived from taxes on aviation fuel. 

Briefly, an airport operator or state 

government submitting an application 

under the Airport Improvement Program 

must provide assurance that revenues 

from state and local government taxes 

on aviation fuel are used for certain 

aviation-related purposes. These 

purposes include airport capital and 

operating costs, and state aviation 

programs. In view of the interests of 

sellers and consumers of aviation fuel, 

and of state and local government taxing 

authorities in limits on use of proceeds 

from taxes touching aviation fuel, this 

notice solicits public comment on the 

proposed policy clarification. This 

notice also solicits comments about 

whether there are other reasonable 

interpretations regarding local taxes that 

are not enumerated here and should be 

considered by the FAA. Finally, this 

proposed policy clarification, if 

finalized, would apply prospectively to 

use of proceeds from both new taxes 

and to existing taxes that do not qualify 

for grandfathering from revenue use 

requirements. 

DATES: Comments must be received by 

January 21, 2014. Comments that are 

received after that date will be 

considered only to the extent possible. 

ADDRESSES: To read background 

documents or comments received, go to 

http://www.regulations.gov at any time 

or to Room W12–140 on the ground 

floor of the DOT West Building, 1200 

New Jersey Avenue SE., Washington, 

DC, between 9 a.m. and 5 p.m., Monday 

through Friday, except Federal holidays. 

You may also send written comments 

by any of the following methods. 

• Federal eRulemaking Portal: Go to 

http://www.regulations.gov and follow 

the instructions for sending your 

comments electronically. Docket 

Number: FAA 2013–0988. 

• Mail: Docket Management Facility, 

U.S. Department of Transportation, 1200 

New Jersey Avenue SE., West Building 

Ground Floor, Room W12–140, 

Washington, DC 20590–0001. 

• Hand Delivery: Deliver to mail 

address above between 9:00 a.m. and 5 

p.m. EST, Monday through Friday, 

except Federal holidays. 

• Fax: (202) 493–2251. 

Identify all transmissions with 

‘‘Docket Number FAA 2013–0988’’ at 

the beginning of the document. 

FOR FURTHER INFORMATION CONTACT: 

Randall S. Fiertz, Director, Office of 

Airport Compliance and Management 

Analysis, Federal Aviation 

Administration, 800 Independence 

Avenue SW., Washington, DC 20591, 

telephone (202) 267–3085; facsimile 

(202) 267–5257. 

SUPPLEMENTARY INFORMATION: 

Authority for the Proposed Policy 

Clarification 

This notice is published under the 

authority described in Subtitle VII, part 

B, chapter 471, section 47122, and the 

Federal Aviation Administration 

Authorization Act of 1994, section 

112(a), Public Law 103–305, 49 U.S.C. 

47107(l)(1) (Aug. 23, 1994). 

Background 

The Airport and Airway Improvement 

Act of 1982, now codified at 49 U.S.C. 

47101 et seq. (AAIA), establishes the 

Airport Improvement Program (AIP) for 

awarding Federal grants to airports in 

the United States. The AAIA requires 

that an airport sponsor accepting a grant 

under the AIP give assurances that any 

revenues received by the airport will be 

used for the capital and operating 


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1Title 49 of the U.S.C., section 40116(e), permits 

states and political subdivisions to levy or collect 

certain taxes, including property taxes, net income 

taxes, franchise taxes, and sales or use taxes on the 

sale of goods or services. Title 49 U.S.C. 40116(b), 

states and political subdivisions may not levy or 

collect a tax on (1) an individual traveling in air 

commerce; (2) the transportation of an individual 

traveling in air commerce; (3) the sale of air 

transportation; or (4) the gross receipts from that air 

commerce or transportation. The FAA 

Authorization Act of 1994 Section 112(e), amended 

the Anti-Head Tax Act, 49 U.S.C. 40116(d)(2)(A) to 

prohibit State, political subdivision, or an authority 

acting for a State or political subdivision from 

collecting a new tax, fee, or charge which is 

imposed exclusively upon any business located at 

a commercial service airport or operating as a 

permittee of the airport, other than a tax, fee, or 

charge utilized for airport or aeronautical purposes. 

expenses of the airport, the local airport 

system, or other local facilities owned or 

operated by the airport owner or 

operator and directly and substantially 

related to air transportation. The 

purposes of the revenue use 

requirements are to prevent a ‘‘hidden 

tax’’ on air transportation, and to ensure 

that Federal airport grants are used to 

supplement funding for airport projects 

and are not simply used to substitute 

funds diverted to support local nonairport programs. 

In the years following the 1982 

enactment of the AAIA, there were 

several instances of new state taxes 

being imposed on the sale of aviation 

fuel at AIP-funded airports. The 

application of the AAIA revenue use 

requirements to these new taxes was not 

entirely clear.1 In response, Congress 

adopted an amendment to the AAIA in 

1987 to bring state and local taxes on 

aviation fuel within the scope of the 

airport revenue use requirements of the 

AAIA. The amendment also provided 

that revenues from a state fuel tax could 

be used for state aviation programs, in 

addition to the uses permitted for 

revenue received by the airport sponsor. 

Specifically, 49 U.S.C. 47107(b), as 

amended in 1987, requires that 

recipients of airport grants under the 

Airport Improvement Program provide 

the FAA with written assurances on use 

of revenue that local taxes on aviation 

fuel (except taxes in effect on December 

30, 1987) and the revenues generated by 

a public airport will be expended for the 

capital or operating costs of the airport; 

the local airport system; or other local 

facilities owned or operated by the 

airport owner or operator and directly 

and substantially related to the air 

transportation of passengers or property. 

This revenue use limitation does not 

apply if a provision enacted not later 

than September 2, 1982, in a law 

controlling financing by the airport 

owner or operator, or a covenant or 

assurance in a debt obligation issued not 

later than September 2, 1982, by the 

owner or operator, provides that the 

revenues, including local taxes on 

aviation fuel at public airports, from any 

of the facilities of the owner or operator, 

including the airport, be used to support 

not only the airport but also the general 

debt obligations or other facilities of the 

owner or operator. The statute does not 

prevent the use of a State tax on aviation 

fuel to support a State aviation program 

or the use of airport revenue on or off 

the airport for a noise mitigation 

purpose. 

However, the 1987 amendment itself 

was open to interpretation on the 

application of use requirements to 

different taxes on aviation fuel. The 

conference report on the 1987 

amendment to the AAIA did not clearly 

resolve all of these issues. The report 

stated: 

The assurance requiring that local taxes on 

aviation fuel must be spent on the airport is 

intended to apply to local fuel taxes only, 

and not to other taxes imposed by local 

governments, or to state taxes. Similarly, this 

provision is not intended to modify 

subsequent provisions in the bill which 

clarify that a state may commit the proceeds 

from state aviation fuel taxes to state aviation 

agencies and that an airport may apply 

airport revenues for airport noise abatement 

on or off the airport. 

(1987 U.S.C.C.A.N. vol. 5, pp. 2613– 

2614 (H.R. Rep. No. 100–123(II)); 2638– 

2639 (H.R. Rep. No. 100–484)) 

In 1996, Congress enacted 49 U.S.C. 

47133 to extend substantially the of 49 

U.S.C. 47107(b) identical requirements 

for use of airport revenue and state and 

local taxes on aviation fuel to all 

airports that have been the subject of 

Federal assistance, regardless of 

whether the airport is currently subject 

to an FAA grant agreement. 

The conference report for the FAA 

Reauthorization Act of 1996, which 

added section 47133, noted that 

‘‘revenue diversion burdens interstate 

commerce even if the airport is no 

longer receiving grants,’’ and that the 

new § 47133 would remove the 

‘‘perverse incentive’’ for airports to 

refuse AIP grants in order to avoid 

Federal policies on use of airport 

revenue. 

The FAA Reauthorization Act of 1994, 

Section 112(a), codified at section 

47107(l) directed FAA to establish 

policies and procedures to assure the 

prompt and effective enforcement of 

illegal diversion of airport revenue. 

Accordingly, to implement Sections 

47107(b) and 47133, FAA has issued a 

comprehensive Revenue Use Policy on 

the use of revenues received by an 

airport sponsor. The Revenue Use 

Policy, at Section II.b.2., includes state 

or local taxes on aviation fuel in the 

definition of airport revenue: 

2. State or local taxes on aviation fuel 

(except taxes in effect on December 30, 1987) 

are considered to be airport revenue subject 

to the revenue-use requirement. However, 

revenues from state taxes on aviation fuel 

may be used to support state aviation 

programs or for noise mitigation purposes, on 

or off the airport. 

On the subject of noise mitigation, 

section 47133(c) states: ‘‘Rule of 

construction.—Nothing in this section 

may be construed to prevent the use of 

a state tax on aviation fuel to support a 

state aviation program or the use of 

airport revenue on or off the airport for 

a noise mitigation purpose.’’ While the 

statute does not expressly state that 

aviation fuel tax proceeds can be used 

for noise mitigation, those proceeds 

could be used for any purpose for which 

an airport operator’s revenue could be 

used, and that expressly includes noise 

mitigation. 

Aviation Fuel 

As background, aviation fuel includes 

two general categories of fuel used in 

aircraft: aviation gasoline, or ‘‘avgas,’’ 

used in reciprocating engines; and 

kerosene jet fuel used in turbine 

engines. The American Society for 

Testing and Materials (ASTM) has 

issued separate standards for aviation 

fuel: ASTM D910 and D6227 for avgas 

and ASTM D1655–13 and D6615–11a 

for civil jet fuel. Both avgas and jet fuel 

are high-quality petroleum products that 

are refined, delivered, and stored 

separately from other fuels, such as 

vehicle gasoline, which can be refined 

to lower standards. Since aviation fuel 

and other fuels are distinct products, it 

should not be difficult for state and 

local government to identify the tax 

revenues attributable solely to aviation 

fuels. 

The Case for Clarification 

The FAA believes that general 

clarification is needed of the Revenue 

Use Policy and agency interpretation of 

Sections 47107(b) and 47133 for 

reference by all state and local taxing 

authorities. 

Prior FAA Opinions 

The FAA has issued five opinions on 

particular state or local aviation taxes on 

aviation fuel since 1987: 

In 1990, Senator Slade Gorton sought 

clarification on whether the State of 

Washington or a locality within the state 

could impose a sales tax on aviation fuel 

and use the proceeds for a non-aviation 

purpose. FAA concluded that if the 

State and its localities imposed a direct 

tax on aviation fuel and used it for nonVerDate Mar<15>2010 14:11 Nov 20, 2013 Jkt 232001 PO 00000 Frm 00013 Fmt 4702 Sfmt 4702 E:\FR\FM\21NOP1.SGM 21NOP1

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aviation purposes, it would be contrary 

to revenue use restrictions under 49 

U.S.C. 47107. The FAA advised that a 

local tax on aviation fuel after December 

1987 can only be expended for the 

capital and operating costs of the 

airport. The FAA further advised that 

the state tax on aviation fuel could only 

be spent on the local airport system or 

a state aviation program or noise 

mitigation measures on or off the 

airport. The opinion explained that 

Congress, by expressly permitting 

specific uses of aviation fuel tax 

revenue, necessarily excluded other 

non-airport related uses. 

In 1992, Senator Christopher Bond 

sought clarification on the limitations 

on the imposition of a use tax on 

aviation fuel. The FAA response 

acknowledged that states are permitted 

to impose a use tax on aviation fuel, but 

that the AAIA limits the use that a state 

may prescribe for taxes collected at 

Federally-funded airports. The FAA 

concluded that the collection of the 

proposed tax at Federally-funded 

airports in the state would be in conflict 

with Federal grant assurance 

requirements, because the state’s tax 

statute provided for unlimited use of tax 

proceeds. The tax at issue in Missouri 

was a general sales tax, not a specific tax 

on aviation fuel. 

In 2000, the Tennessee Legislature 

considered diverting funds designated 

for the Tennessee Transportation Equity 

Fund (Equity Fund) or allocating funds 

already in the Equity Fund to the state 

general fund. The proceeds in the 

Equity Fund came from a 4 1/2% tax on 

the sale of aviation fuel on Federally 

obligated airports. The FAA advised 

that such action would be contrary to 

Federal law. In addition, FAA explained 

that the State of Tennessee could not 

rely on the fact that its 1986 state 

aviation fuel tax was grandfathered to 

enact new measures to divert, directly 

or indirectly, revenue previously 

allocated to aviation use. The FAA 

further advised that passage of the 

legislation to permit general use of the 

proceeds from the aviation fuel tax 

would place in jeopardy continued 

Federal funding of airport and noise 

abatement projects at Federally-assisted 

airports throughout the State of 

Tennessee. 

In 2009, the State of Nebraska had a 

statewide general sales tax upon retail 

sales of products and services, but at 

some point had exempted the sale of 

aircraft fuel from the sales tax. The 

Nebraska Legislature considered 

repealing that exemption and proposed 

to make the aircraft fuel tax proceeds 

payable to the state general fund. An 

opinion was sought on whether the 

proposed sales tax upon aircraft fuel 

would violate 49 U.S.C. 40116, 49 

U.S.C. 47107, or other Federal statutes, 

rules, or regulations. The FAA advised 

that if the State Legislature imposed a 

sales tax on aviation fuel sold on an 

airport, the use of the proceeds from the 

tax to support non-aviation activities 

would be inconsistent with Federal law. 

Monies from such a tax would have to 

be spent to support either (1) the capital 

or operating costs of the airport, the 

local airport system, or other local 

facilities owned or operated by the 

airport owner or operator and directly 

and substantially related to the air 

transportation of passengers or property; 

or (2) a state aviation program. The FAA 

advised that the enactment of the 

legislation to permit general use of the 

proceeds from the aviation fuel tax 

could jeopardize continued Federal 

funding of airport and noise abatement 

projects at Federally-assisted airports 

throughout the State of Nebraska. 

In 2010, a state senator from Hawaii 

wrote to the General Counsel of the 

United States Department of 

Transportation and FAA Chief Counsel 

requesting a legal opinion concerning a 

proposed broad state tax on petroleum 

products that would have applied to 

aviation fuel as well as to other fuels. 

The Hawaii Attorney General took the 

position that because the tax law did not 

use the term ‘‘aviation fuel’’ and was not 

limited to aviation fuel, the 

requirements of Sections 47107(b) and 

47133 would not apply. The FAA, 

responding for both FAA and DOT 

General Counsel, disagreed, and 

concluded that the proposed tax would 

be invalid under Federal law unless the 

proceeds from the sale of aviation fuel 

were used consistently with the revenue 

use statutes, or unless aviation fuel was 

expressly exempted from the tax. 

Interpretation of Sections 47107(b) and 

47133 

In each of FAA’s five opinions since 

1987, the agency interpreted the 

provisions of Sections 47107(b) and 

47133 to apply to any state or local tax 

on aviation fuel, whether the tax was 

specifically targeted at aviation fuel or 

was a general sales tax on products that 

included aviation fuel without 

exemption. Also, FAA interpreted these 

statutes to make no distinction between 

taxes imposed by a local government or 

state government agency. The FAA 

continues to see this interpretation as 

the most reasonable construction of 

these statutes, in view of the letter and 

intent of the statutes. At the same time, 

the agency also understands that there 

can be alternate views of the 

interpretation of a facially ambiguous 

statute. The agency is also aware that 

any interpretation of this statute will 

have substantial practical consequences 

both for state and local government 

agencies and for industry consumers of 

aviation fuel. 

Any question of statutory 

interpretation begins with looking at the 

plain language of the statute to discover 

its original intent. To discover a 

statute’s original intent, courts first look 

to the words of the statute and apply 

their usual and ordinary meanings. 

‘‘[T]he meaning of a statute must, in the 

first instance, be sought in the language 

in which the act is framed, and if that 

is plain . . . the sole function of the 

courts is to enforce it according to its 

terms.’’ Caminetti v. U.S., 242 U.S. 470, 

485 (1917). If the meaning is clear, the 

agency must ‘‘give effect to the 

unambiguously expressed intent of 

Congress.’’ Barnhart v. Walton, 535 U.S. 

212, 217–218 (U.S. 2002), citing 

Chevron v. Natural Resources Defense 

Council, Inc., 467 U.S. 837, 842–843 

(1984). This principle is called ‘the 

plain meaning rule.’ The rule ‘‘generally 

means when the language of the statute 

is clear and not unreasonable or illogical 

in its operation, the court may not go 

outside the statute to give it a different 

meaning.’’ 2A Sutherland Statutory 

Construction section 46:1 (7th ed.) (Nov. 

2012). 

If after looking at the language of the 

statute the meaning of the statute 

remains unclear (e.g., the statute is 

silent or ambiguous), courts attempt to 

ascertain the intent of the legislature by 

looking at legislative history. 3A 

Sutherland Statutory Construction 

section 66:3 (7th ed.) (Nov. 2012). 

‘‘Where, as here, resolution of a 

question of Federal law turns on a 

statute and the intention of Congress, 

we look first to the statutory language 

and then to the legislative history if the 

statutory language is unclear.’’ Blum v. 

Stenson, 465 U.S. 886, 896–897 (1984). 

When a Federal agency interprets a 

statute, the primary focus is to 

determine the intent of Congress. Where 

different interpretations are possible, a 

court must look to reasons for the 

enactment of the statute and the 

purposes to be gained by it and construe 

the statute in the manner which is 

consistent with the law’s purpose. Dole 

v. United Steelworkers of America, 494 

U.S. 26, 35 (1990). Where a statute ‘‘is 

silent or ambiguous with respect to the 

specific issue,’’ an agency’s 

interpretation must be sustained if it is 

‘‘based on a permissible construction’’ 

of the Act. Chevron, 476 U.S. at 843. 

The U.S. Supreme Court has ‘‘long 

recognized that considerable weight 

should be accorded to an executive 


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department’s construction of a statutory 

scheme it is entrusted to administer . . . 

.’’ Chevron at 844. ‘‘[T]he well-reasoned 

views of the agencies implementing a 

statute ‘constitute a body of experience 

and informed judgment to which courts 

and litigants may properly resort for 

guidance.’ ’’ Bragdon v. Abbott, 524 U.S. 

624, 642 (1998), citing Skidmore v. Swift 

& Co., 323 U.S. 134, 139–140 (1944). 

While the plain language of these 

statutes is not precise and could be 

subject to alternate interpretations, FAA 

believes that there are compelling 

reasons for the agency’s past reading of 

the statutes. Alternate interpretations, 

while possible, tend to be inconsistent 

with the basic purposes of the 

legislation, including the need to avoid 

‘‘hidden taxation,’’ and may not 

adequately account for language in 

legislative history indicating intent for a 

broader reach of the revenue use 

requirements. 

Statutory construction, however, is a 

holistic endeavor. A provision that may seem 

ambiguous in isolation is often clarified by 

the remainder of the statutory scheme 

because the same terminology is used 

elsewhere in a context that makes its 

meaning clear . . . or because only one of the 

permissible meanings produces a substantive 

effect that is compatible with the rest of the 

law. United Savings Association of Texas v. 

Timbers of Inwood Forest Associates, Ltd., 

484 U.S. 365, 371 (1988). 

Courts harmonize the various parts of 

a statute if possible, reconciling them in 

the manner that best carries out the 

overriding purpose of the legislation. 3B 

Sutherland Statutory Construction 

section 75:2 (7th ed.) (Nov. 2012). 

Reasons for FAA’s interpretation of 

Sections 47107(b) and 47133, and for 

the clarification of policy on use of 

aviation fuel tax proceeds proposed in 

this Notice, include: 

Local taxes. The term ‘‘local taxes’’ is 

reasonably interpreted to include both 

local government and state government 

taxes. ‘‘Local’’ refers to the geographic 

locale where the tax is collected, not to 

local government. This interpretation is 

supported both by the statutory 

language and by legislative intent (see 

1987 U.S.C.C.A.N. vol. 5, pp. 2613–2614 

(H.R. Rep. No. 100–123(II)); 2638–2639 

(H.R. Rep. No. 100–484)): 

• The provisions permitting certain 

uses of a ‘‘state tax’’ in sections 

47107(b)(3) and 47133(c) would be 

unnecessary and meaningless unless 

state taxes were included in the 

requirements of sections 47107(b)(1) 

and (2) and 47133(a), which refer only 

to ‘‘local’’ taxes. 

• There is no apparent rationale for 

distinguishing between local 

government and state government taxes 

for accomplishing the purposes of the 

Federal airport revenue use 

requirements, i.e., the prohibition on 

airport revenue diversion and avoidance 

of hidden taxes on aviation. Under the 

statutory framework, state governments 

are allowed slightly broader use of 

proceeds from aviation fuel taxes—i.e., 

support of state aviation programs—but 

otherwise all state and local government 

taxes on aviation fuel are treated 

identically. 

• Requiring aviation use of local 

government proceeds but not state 

proceeds from taxes on aviation fuel 

would substantially undermine the 

purpose and effect of Sections 47107(b) 

and 47133, and would be inconsistent 

with the congressional intent behind the 

1987 amendment regarding taxation of 

aviation fuel. 

• The AAIA uses the term ‘‘political 

subdivisions of the state’’ elsewhere in 

the statute where the intent is to refer 

to local government. 

The FAA seeks comment on whether 

there are other reasonable 

interpretations regarding local taxes that 

are not enumerated here and should be 

considered by the FAA. 

Taxes on aviation fuel. Given the 

basic purpose of the revenue use 

statutes, the term ‘‘taxes on aviation 

fuel’’ cannot reasonably be construed to 

mean only taxes specifically on aviation 

fuel, and not to include taxes on 

petroleum products generally or general 

sales taxes on all goods that touch on 

aviation fuel. It seems to us that the 

most reasonable test is whether payment 

of the tax is required for sale of aviation 

fuel, not what the tax is called or 

whether other products are also subject 

to the tax. For a number of reasons, FAA 

has to date interpreted sections 47107(b) 

and 47133 to apply to all taxes that 

touch the sale of aviation fuel, 

regardless of whether the taxes are 

specific or general. These reasons 

include: 

• Limiting the application of sections 

47107(b) and 47133 only to taxes 

specifically imposed solely on aviation 

fuel would substantially defeat the 

legislative purpose of these statutes. If 

revenues from taxes on aviation fuel 

could be used for any purpose simply 

because the tax also applied to other 

products, then state and local 

governments could easily structure 

taxes to circumvent the effect of sections 

47107(b) and 47133. 

• The amendment as originally 

adopted by Congress in 1987 referred to 

‘‘any local taxes on aviation fuel.’’ The 

word ‘‘any’’ was removed in the 1994 

recodification of the AAIA, but Congress 

made clear in adopting the 

recodification that changes in wording 

would not make any change in the 

meaning or construction of the statute. 

See Public Law 103–272, section 1 (July 

5, 1994). In our view, ‘‘any’’ connotes 

broad applicability and without 

restriction. 

• Legislation enacted in 1994 and 

1996 adopted increasingly stringent 

requirements for use of airport revenue 

and added sanctions for violations of 

revenue use requirements, including 

civil penalty authority for violations of 

47107(b) and 47133. This indicates 

congressional support for the most 

effective administration of the revenue 

use requirements, and argues against an 

interpretation that effectively leaves 

aviation fuel tax proceeds subject to 

potentially unlimited state taxation. 

The FAA seeks comments on whether 

there are other reasonable 

interpretations of the phrase ‘‘taxes on 

aviation fuel’’ that are not enumerated 

here and should be considered by the 

FAA. 

Other taxes. The conference report on 

the 1987 amendment to the AAIA states 

that: 

The assurance requiring that local 

taxes on aviation fuel must be spent on 

the airport is intended to apply to local 

fuel taxes only, and not to other taxes 

imposed by local governments, or to 

state taxes. (1987 U.S.C.C.A.N. vol. 5, 

pp. 2613–2614 (H.R. Rep. No. 100– 

123(II)); 2638–2639 (H.R. Rep. No. 100– 

484)) 

While this could be read out of 

context to appear to exempt all state 

taxes, including taxes on aviation fuel, 

from the statute, the report states in the 

next sentence that: 

* * * a state may commit the proceeds 

from state aviation fuel taxes to state aviation 

agencies * * * (H.R. Rep. No. 100–4844, p. 

2638–2639) 

Because this second sentence 

expressly refers to a permitted but still 

limited use of state aviation fuel tax 

revenues, it is clear that Congress 

intended for the statute to apply to such 

revenues. In our view, the reasonable 

reading of both provisions together is to 

take the term ‘‘other taxes imposed by 

local governments, or to state taxes’’ to 

mean taxes collected from sale of 

products other than aviation fuel. In 

other words, simply because a general 

tax collects revenues from sales of both 

aviation fuel and other products, the 

total revenues from the tax are not 

considered airport revenue. Only the tax 

collections from the sale of aviation fuel 

are subject to the statutory revenue use 

requirements. ‘‘Other taxes’’ means tax 

revenues collected from sale of products 

other than aviation fuel. 

Grandfathered taxes. Sections 

47107(b) and 47133 both contain a 


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Federal Register / Vol. 78, No. 225 / Thursday, November 21, 2013 / Proposed Rules 69793 

‘‘grandfather’’ exception for taxes in 

effect on December 30, 1987. By itself 

the term ‘‘in effect’’ could mean enacted 

but not imposed, or enacted and 

actually being collected. The conference 

report to the Federal Aviation 

Reauthorization Act of 1996 clarifies 

congressional intent toward the scope of 

this exception: 

The conferees want to clarify that if a local 

fuel tax was enacted or adopted before 

December 30, 1987, but for which collections 

were not made until some significant period 

of time after December 30, 1987, it shall not 

be grandfathered pursuant to this section and 

all proceeds of such a tax must be used for 

the capital or operating costs of the airport, 

the local airport system, or pursuant to 

paragraph (3) of subsection (a). 

Accordingly, the fact that an 

ordinance permitting taxes on aviation 

fuel existed in 1987 is not sufficient to 

exempt the tax from the revenue use 

requirements. A tax ordinance is 

grandfathered only if collection of the 

tax revenues on the sale of aviation fuel 

was initiated before December 30, 1987 

or within a relatively short period after 

that date. If tax collections begin later, 

then the proceeds must be used for the 

purposes in sections 47107(b) and 

47133. 

Compliance 

Airport sponsors. An airport sponsor 

applying for an AIP grant agrees to 

comply with a number of standard grant 

assurances, which are published on 

FAA’s Airports Web site. See http://

www.faa.gov/airports/aip/grant_

assurances/. Grant Assurance no. 25, 

Airport Revenues, incorporates the 

provisions of 49 U.S.C. 47107(b) in each 

AIP grant agreement. So, executing a 

grant application involves assuring FAA 

that fuel taxes collected on aviation fuel 

will only be used for certain aviation 

purposes. Neither section 47107(b) nor 

section 47133 limits this requirement to 

taxes imposed by the airport sponsor; 

the assurance applies to any state or 

local government tax on aviation fuel. 

As FAA noted in a 2009 letter to the 

Hall County Airport Authority, 

Nebraska, regarding proposed state 

legislation to tax aviation fuel: 

* * * enactment of the [state] legislation to 

permit general use of the proceeds from the 

aviation fuel tax could jeopardize continued 

federal funding of airport and noise 

abatement projects at Federally-assisted 

airports throughout the [state]. 

Non-sponsor state and local 

governments. Title 49 U.S.C. 47133 

contains a prohibition on use of aviation 

fuel tax proceeds for general purposes. 

This is a direct and self-implementing 

statutory requirement, and does not rely 

on contract terms, as does section 

47107(b). Congress has provided two 

means for Federal enforcement of the 

terms of section 47133: Civil penalty 

authority in 49 U.S.C. 46301(a), and 

application to U.S. district court for 

judicial enforcement pursuant to 49 

U.S.C. 47111(f). 

Prospective application. In 

determining that a clarification of 

agency policy on use of aviation fuel tax 

proceeds is warranted, FAA is mindful 

that entities affected by this policy may 

not have fully understood the scope of 

Federal requirements in the past. 

Accordingly, it is FAA’s intention to 

apply any final clarification of policy 

adopted in this proceeding 

prospectively, and to allow affected 

parties a reasonable time to bring state 

and local government taxes into 

compliance. 

Request for comments. The 

clarification of policy proposed in this 

notice is intended to clarify FAA’s 

interpretation of statutory requirements 

for use of airport revenue. In view of the 

potential interests of aircraft operators, 

aviation service providers, the aviation 

fuel industry, state and local taxing 

authorities and others in the Federal 

requirements applicable to aviation fuel 

taxes, this notice requests public 

comment on the proposed policy 

clarification. 

Clarification of the Revenue Use Policy 

on Use of Proceeds From Taxes on 

Aviation Fuel 

In consideration of the foregoing, FAA 

proposes to amend the Policy and 

Procedures Concerning the Use of 

Airport Revenue, published in the 

Federal Register at 64 FR 7696 on 

February 16, 1999, as follows: 

1. Section II, Definitions, paragraph 

B.2, is revised to read: 

State or local taxes on aviation fuel (except 

taxes in effect on December 30, 1987) are 

considered to be airport revenue subject to 

the revenue-use requirement. However, 

revenues from state taxes on aviation fuel 

may be used to support state aviation 

programs, and as airport revenue can be used 

for noise mitigation purposes, on or off the 

airport. 

2. In Section IV, Statutory 

Requirements for the Use of Airport 

Revenue, renumber paragraphs D and E 

as paragraphs E and F, and add a new 

paragraph D to read as follows: 

D. Use of Proceeds From Taxes on Aviation 

Fuel. 

1. Federal law limits use of the proceeds 

from a state or local government tax on 

aviation fuel to the purposes permitted in 

those sections, as described in IV.A. of this 

Policy. Proceeds from tax on aviation fuel 

may be used for any purpose for which other 

airport revenues may be used, and may also 

be used for a state aviation program. 

2. Airport sponsors that are subject to an 

AIP grant agreement have agreed, as a 

condition of receiving a grant, that the 

proceeds from a state or local government tax 

on aviation fuel will be used only for the 

purposes listed in paragraph 1. This 

commitment is not limited to taxes on 

aviation fuel imposed by the airport operator, 

and includes taxes on aviation fuel imposed 

by state government and other local 

jurisdictions. 

3. The Federal limits on use of aviation 

fuel tax proceeds apply at an airport that is 

the subject of Federal assistance (as defined 

in Section II.b.2 of this Policy), whether or 

not the airport is currently subject to the 

terms of an AIP grant agreement, and 

regardless of the state or local jurisdiction 

imposing the tax. 

4. The limits on use of aviation fuel tax 

revenues established by section 47107(b) and 

section 47133: 

a. Apply to a tax imposed by either a state 

government or a local government taxing 

authority; 

b. Apply to any tax on aviation fuel, 

whether the tax is imposed only on aviation 

fuel or is imposed on other products as well 

as aviation fuel. However, the limits on use 

of revenues apply only to the amounts of tax 

collected specifically for the sale, purchase or 

storage of aviation fuel, and not to the 

amounts collected for transactions involving 

products other than aviation fuel under the 

same general tax law; 

c. apply to taxes on all aviation fuel 

dispensed at an airport, regardless of where 

the taxes on the sale of fuel at the airport are 

collected; and 

d. apply to a new assessment or imposition 

of a tax on aviation fuel, even if the tax could 

have been imposed earlier under a statute 

enacted before December 30, 1987. 

Issued in Washington, DC on November 14, 

2013. 

Randall S. Fiertz, 

Director, Office of Airport Compliance and 

Management Analysis. 

[FR Doc. 2013–27860 Filed 11–19–13; 11:15 am] 

BILLING CODE 4910–13–P 

CONSUMER PRODUCT SAFETY 

COMMISSION 

16 CFR Part 1115 

[CPSC Docket No. CPSC–2013–0040] 

Voluntary Remedial Actions and 

Guidelines for Voluntary Recall 

Notices 

AGENCY: Consumer Product Safety 

Commission. 

ACTION: Notice of proposed rulemaking. 

SUMMARY: In this document, the 

Consumer Product Safety Commission 

(Commission, CPSC, or we) proposes an 

interpretive rule to set forth principles 

and guidelines for the content and form 

of voluntary recall notices that firms 

provide as part of corrective action 


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