UNITED STATES DEPARTMENT OF TRANSPORTATION

FEDERAL AVIATION ADMINISTRATION

WASHINGTON, D.C.

AIR TRANSPORT ASSOCIATION OF 

AMERICA, INC. d/b/a AIRLINES FOR 

AMERICA, ALASKA AIRLINES, INC., 

AMERICAN AIRLINES, INC., ATLAS 

AIR, INC., FEDERAL EXPRESS 

AIRLINES, HAWAIIAN AIRLINES, INC., 

HORIZON AIR, JETBLUE AIRWAYS 

INC., SOUTHWEST AIRLINES CO., 

UNITED AIR LINES, INC., UNITED 

PARCEL SERVICE CO., and AIR 

CANADA,

Complainants,

v.

PORT OF PORTLAND, OREGON,

Respondent.

 

FAA Docket No. 16-16-04

COMPLAINANTS’ MOTION TO SUPPLEMENT RECORD TO 

INCLUDE FAA LETTER DATED NOVEMBER 17, 2016

AND RELATED PETITION FOR REVIEW

Designated for service of process:

David Berg

Vice President & General Counsel

Doug Mullen

Associate General Counsel

Air Transport Association of America, Inc. 

d/b/a Airlines for America

1275 Pennsylvania Avenue, N.W.

Suite 1300

Washington, D.C. 20004

(202) 626-4234

Email: dberg@airlines.org

dmullen@airlines.org

Counsel for Complainants

Dated: February 21, 2017

Roy Goldberg

Steptoe & Johnson LLP

1330 Connecticut Avenue, N.W.

Washington, D.C 20036

(202) 429-8028

Email:rgoldberg@steptoe.com
1

Pursuant to 14 C.F.R. § 16.23(j), Complainants Air Transport Association of America, 

Inc., d/b/a Airlines for America (“A4A”), Alaska Airlines, Inc., American Airlines, Inc., Atlas 

Air, Inc., Fedex Express Airlines, Hawaiian Airlines, Inc., JetBlue Airways, Inc., Southwest 

Airlines Co., United Airlines, Inc., United Parcel Service Co., and Air Canada (the 

“Complainants”) respectfully move for leave to supplement their Complaint and Reply in this 

case to include: (1) a letter from FAA Chief Counsel Reginald C. Govan, Esq. dated November 

17, 2016, attached as Exhibit 1 hereto (the “Govan Letter”); and (2) a Petition for Review filed 

January 13, 2017 in the U.S. Court of Appeals for the Eleventh Circuit challenging the Govan 

Letter - Clayton County, Ga. et al.. v. FAA, No. 17-10210 (11th Cir.) (the “Eleventh Circuit 

Petition”), and the correspondence attached as Exhibit 2 hereto.

Good cause exists for inclusion of the Govan Letter and the Eleventh Circuit Petition into 

the record of this proceeding. None of these documents existed when Complainants filed their 

Complaint and Reply, respectively, on February 10, 2016, and May 25, 2016. The Govan Letter 

was not issued until six months after Complainants filed their Reply, and only came to the 

Complainants’ attention after the filing of the Eleventh Circuit Petition last month.

The Govan Letter is highly relevant to this Part 16 proceeding because it acknowledges, 

on behalf of FAA, that one of the key statutes prohibiting diversion of aviation-generated 

revenues – 49 U.S.C. 47133 – applies not only to airport operators and governmental sponsors, 

but also to local governments which do not own or operate an airport, including the City of 

Portland, Oregon. The Govan Letter states:

The FAA disagrees with [the] contention that the federal prohibition on the 

diversion of aviation fuel tax revenue for non-aviation purposes only applies to 

state or local governments who received federal airport improvement grants 

or are an airport sponsor. We believe federal law prohibits all state and local 
2

governments from diverting aviation fuel tax revenues for any non-aviation 

related purpose. (Letter, at 2) (emphasis added)

The Govan Letter is consistent with statements in the Federal Register notice regarding 

revenue diversion issued by FAA on November 7, 2014 (79 Fed. Reg. 66282), including that: (1) 

“§ 47133 imposes an obligation on entities that are not airport sponsors”; and (2) although the 

“FAA established policy on revenue use refers to airport sponsors, . . . that fact alone does not 

deal with the breadth of § 47133, which imposes a federal statutory obligation on certain nonsponsors.” 79 Fed. Reg. at 66,285.

In a letter dated December 6, 2016, FAA Administrator Michael Huerta attached and 

incorporated by reference the Govan Letter, and stated:

The FAA believes that Federal law prohibits all state and local governments from 

using aviation fuel tax revenue for any nonaviation related purpose. The FAA is 

enforcing Congress’ mandate requiring aviation fuel tax revenues be used 

exclusively for aviation-related purposes.

The FAA does not prohibit states or localities from imposing a direct tax on 

aviation fuel. However, the revenue use restriction under title 49 United States 

Code (U.S.C.), §§ 47107 and 47133, require the tax revenues to be expended for 

capital and operating costs of an airport or state aviation programs.

(Letter from Michael P. Huerta to Rep. David Scott, attached to Eleventh Circuit Petition). 

The Eleventh Circuit Petition is relevant because it provides context to the significance, 

meaning of and circumstances relating to the issuance of the Govan Letter. Although the 

Eleventh Circuit Petition does not recite the grounds for the appeal, it attaches a letter from the 

petitioners to the FAA dated September 13, 2016 which stated that the FAA, in its November 7, 

2014 Federal Register notice, “could not have intended . . . to apply airport revenue diversion 

principles described in 49 U.S.C. § 47133 to taxes imposed by local government entities . . . that 

are not project grant recipients and have no ability to spend aviation fuel tax revenues for a 
3

purpose specified in 49 U.S.C. § 47133.” (Letter, at 1) However, the Govan Letter makes clear 

the FAA’s position that airport revenue diversion principles do in fact apply to state and local 

governments that do not own or operate an airport.

In the pending Part 16 case involving PDX, a primary issue has been raised by the 

preliminary FAA determination (by FAA official Randy Fiertz) that the City of Portland fees for 

offsite stormwater maintenance and Superfund cleanup do not constitute unlawful revenue 

diversion because they are “operating costs” of PDX. In characterizing the Portland fees as

“operating costs,” Mr. Fiertz stated that the fees arise “as a legal obligation incident to the 

airport’s possessory interest in land necessary for the provision of aeronautical services.” July 

30, 2015 Letter, at 1. In other words, according to Mr. Fiertz, the City of Portland obligates the 

Airport to pay the fees, so they are therefore an operating cost. 

Complainants’ Complaint and Reply in this proceeding challenge Mr. Fiertz’ conclusion 

that the fees constitute an “operating cost.” Complainants’ three expert witnesses concluded that 

the Portland fees cannot be “operating costs” of PDX because, among other things, the term 

“operating costs” is subject to the following restrictions:

Kirk Shaffer: The fees must be for services or facilities provided to the 

Airport.

Woody Jackson: Under the current version of OMB A-87, the costs that 

are the subject of fees must be incurred in order to keep 

the Airport in “an efficient operating condition.”

Joan Stern: Utility costs which the Airport may seek to fund under 

the PDX bond ordinance are limited to costs “for 

operating, maintaining and repairing the Airport.”

In addition, FAA cannot take the position in this proceeding that the Portland fees are 

“operating costs” merely because they are imposed on PDX by the City of Portland. Such a 

position cannot be reconciled with the Govan Letter, which recognizes that state and local 
4

governments are subject to the federal prohibition against diversion of airport revenue. FAA’s 

acknowledgement that the ban against airport revenue diversion applies to non-airport sponsors 

(such as the City of Portland) means that the FAA cannot absolve an airport (such as PDX) 

paying airport-generated revenues to a municipality (such as the City of Portland) merely 

because the municipal government demands the payment of the airport-generated revenues.

Stated otherwise, because the City of Portland must itself comply with the prohibition 

against revenue diversion, it is untenable, and arbitrary and capricious, for the FAA to take the 

position in this case that the payment of airport-generated revenues to Portland is an “operating 

cost” of the airport merely because the City requires that the money be paid. The Port’s defense 

– that the City is making it pay the fees – cannot be sustained given that the City is violating 

federal law in requiring the Airport to remit the fees to be used for non-airport purposes.

Section 47133(a), 49 U.S.C. states:

“(a) Prohibition.—Local taxes on aviation fuel (except taxes in effect on 

December 30, 1987) or the revenues generated by an airport that is the subject 

of Federal assistance may not be expended for any purpose other than the 

capital or operating costs of—

(1) the airport;

(2) the local airport system; or

(3) any other local facility that is owned or operated by the person or entity that 

owns or operates the airport that is directly and substantially related to the air 

transportation of passengers or property.” (Emphasis added)

This statutory provision makes clear that neither revenue derived from aviation fuel taxes nor

airport-generated revenue may be diverted from airports. Accordingly, the language quoted 

above from the Govan Letter could just as easily have stated:
5

The FAA disagrees with [the] contention that the federal prohibition on the 

diversion of airport-generated revenue for non-airport purposes only applies 

to state or local governments who received federal airport improvement grants or 

are an airport sponsor. We believe federal law prohibits all state and local 

governments from diverting airport-generated revenue for any non-airport 

related purpose. 

Consequently, it is clear that since the City cannot divert airport-generated revenues for a nonairport purpose, the FAA cannot absolve PDX of liability for remitting airport-generated 

revenues to the City merely because the City has obligated PDX to engage in the revenue 

diversion.

For the reasons stated above, Complainants request that the record in his case be 

supplemented with the enclosed Govan Letter (Exhibit 1) and the Eleventh Circuit Petition and 

attached correspondence (Exhibit 2).

Respectfully submitted,

/s/ David Berg

David Berg

Vice President & General Counsel

Doug Mullen

Associate General Counsel

Air Transport Association of America, Inc. 

d/b/a Airlines for America

1275 Pennsylvania Avenue, N.W.

Suite 1300

Washington, D.C. 20004

(202) 626-4234

Email: dberg@airlines.org

dmullen@airlines.org

Dated: February 21, 2017

/s/ Roy Goldberg

Roy Goldberg

Steptoe & Johnson LLP

1330 Connecticut Avenue, N.W.

Washington, D.C 20036

(202) 429-8028

Email: rgoldberg@steptoe.com
CERTIFICATE OF SERVICE

I hereby certify that on the 21st day of February, 2017, I caused the foregoing Motion to 

Supplement of Complainants Air Transport Association of America, Inc. et al. to be served 

electronically by or via email on the following:

Pablo O. Nuesch, Esq.

Spiegel & McDiarmid LLP

1875 Eye Street, N.W.

Suite 700

Washington, D.C. 20006

Email: Pablo.nuessch@spiegelmcd.com

Counsel for Respondent Port of Portland

Roy Goldberg
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UNITED STATES COURT OF APPEALS

FOR THE ELEVENTH CIRCUIT

ELBERT PARR TUTTLE COURT OF APPEALS BUILDING

56 Forsyth Street, N.W.

Atlanta, Georgia 30303

David J. Smith

Clerk of Court 

January 18, 2017

For rules and forms visit

www.ca11.uscourts.gov

L'Erin Frances Barnes

Fincher Denmark & Minnifield, LLC 

8024 FAIROAKS CT

JONESBORO, GA 30236-2528

William Hollis Buechner Jr.

Freeman Mathis & Gary, LLP 

100 GALLERIA PKWY SE STE 1600

ATLANTA, GA 30339-5948

Steven M. Fincher

Fincher Denmark & Minnifield, LLC 

8024 FAIROAKS CT

JONESBORO, GA 30236-2528

Jack Reynolds Hancock

Freeman Mathis & Gary, LLP 

661 FOREST PKWY STE E

FOREST PARK, GA 30297

Arash Ali Sabzevari

Freeman Mathis & Gary, LLP 

661 FOREST PKWY STE E

FOREST PARK, GA 30297

Appeal Number: 17-10210-A

Case Style: Clayton County, Georgia, et al v. Federal Aviation Administratio

Agency Docket Number: FAA 2013-0988

This Court requires all counsel to file documents electronically using the Electronic Case 

Files ("ECF") system, unless exempted for good cause.

Pursuant to Rule 15(c) of the Federal Rules of Appellate Procedure, you are hereby served with 

the following document which has been filed in this court:

Case: 17-10210 Date Filed: 01/13/2017 Page: 1 of 2 
Petition for Review

Every motion, petition, brief, answer, response and reply filed must contain a Certificate of 

Interested Persons and Corporate Disclosure Statement (CIP). Appellants/Petitioners must file a 

CIP within 14 days after the date the case or appeal is docketed in this court; 

Appellees/Respondents/Intervenors/Other Parties must file a CIP within 28 days after the case or 

appeal is docketed in this court, regardless of whether appellants/petitioners have filed a CIP. See 

Fed.R.App.P. 26.1 and 11th Cir. R. 26.1-1. 

On the same day a party or amicus curiae first files its paper or e-filed CIP, that filer must also 

complete the court's web-based CIP at the Web-Based CIP link on the court's website. Pro se 

filers (except attorneys appearing in particular cases as pro se parties) are not required or 

authorized to complete the web-based CIP.

Please use the appellate docket number noted above when making inquiries. See Fed.R.App.P. 

16 and 17 as to the composition and time for filing of the record.

Attorneys who wish to participate in this appeal must be properly admitted either to the bar of 

this court or for this particular proceeding pursuant to 11th Cir. R. 46-1. In addition, all attorneys 

(except court-appointed counsel) who wish to participate in this appeal must complete and return 

an appearance form within fourteen (14) days. Application for Admission to the Bar and 

Appearance of Counsel Form are available on the Internet at www.ca11.uscourts.gov. The clerk 

may not process filings from an attorney until that attorney files an appearance form. See 11th 

Cir. R. 46-6.

Clerk’s Notes: Certified List or Agency Record is due forty-four (44) days from the date of 

this letter to this court.

Sincerely,

DAVID J. SMITH, Clerk of Court

Reply to: Denise E. O'Guin, A

Phone #: (404) 335-6188

Enclosure(s) 

DKT-8 Agency

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