### R iverside CountyTransportation Commission December 8, 2015 Mr. JamesT. Brown Finance Management Federal Aviation Administration 800 Independence Avenue SW Washington, DC 20591 4080 Lemon Street, 3rd Floor • Riverside, CA Mailing Address: 

### P. 0. Box 12008 • Riverside, CA 92502-2208 (951) 787-7141 • Fax (951 ) 787-7920 • www.rctc.org

Subject: Compliance with a Federal Aviation Administration Requirementfor a Submitted "Action Plan" Due by December 8, 2015: FAA Policy and Procedures Concerning the Use ofAirport Revenue; Proceeds from Taxes on Aviation Fuel 79, Fed

. Reg 66282, November 

### 7, 2014. Revenue Implications, Concerns with Implementation Requirements and OtherIssues. SuggestedAction Consideration Dear Mr. Brown: The Riverside County Transportation Commission (Commission) wishes to express its concerns regarding the abovereferenced rule. As a county transportation commission, we are not regularly notified of Federal Aviation Administration (FAA) rulemaking and only found out about this one after itsfinal adoption and via a private party. The Commission is concerned and impacted by this ruling because ofthe one-half cent sales tax approved by Riverside County (County) voters for local transportation purposes in November 2002, which became effective July 1, 2009, for a 30-year period. Measure A provides many benefits to the airports in Riverside County, including local and regional road projects and public transit services, which provide safe, reliable access to airports. This infrastructure provided by Measure A ensures airports remain economicallyviable and meetthe needs of the communities thatairports serve. As previously mentioned, this was a voter-approved sales tax measure that imposes a transaction and use tax on all taxable sales with the County. County voters did not consider, nor support, special consideration ofthe collection of nor the allocation of revenue from any specific source. The revenues collected are dedicated to transportation projects throughoutthe County, and tax-exempt bonds have been issued and are backed by a pledge ofthe Measure A revenues. Executive Order 13132 (Federalism) establishes the principles and criteria that apply to regu lations, legislative comments, and other policy statements that have a substantial effect on sta1 tes. The Commission is concerned with the FAA's position/belief that "Federalism implications (if any) are substantially mitigated because of the prior legislative intent." The final policy amendment does impose substantial direct requirement costs on state and local governments and should have been subjected to Federalism implications. The FAA adoption of the ruling caught our entire stakeholder community by surprise

. The cost, loss of revenues, and current and future workload involved as a result of this unforeseen ruling is substantial. The following serves as the intent to comply with the ruling based on the Commission's understanding of what is required ofany "action plan" submitted:Mr. James T. Brown Page 2 December 8, 2015 Action Plan Requirement: Applicable Law 

### • Local: Measure A, a one-half cent transaction and use tax to fund transportation improvements originally approved in 1988 and again in 2002 as a 30-year extension commencing in 2009 through 2039, is the local revenue source for which the Commission serves as the tax authority and implementation agency. Al location of funding for this tax program is governed by a voter-approved expenditure plan that can be amended only through a number of actions- none of which are under the direct control of any of Riverside County's airport owners oroperators. 

### • State: California's Department of Finance (DOF) will provide guidance on any laws, regulations, and procedures that may need amending. The Commission has seen the state-prepared action plan dated November25, 2015. Action Plan Requirement: Tracking System • The Commission, in conjunction with its sales tax consultant, commenced trying to identify sales and use tax revenue to comply with the requirement. For implementation purposes, there is going to be an issue with some of the taxpayers that comingle sales tax reporting of their retail gas station locations not at an airport and/or non-fuel related sales and theirjet fuel sales. The internal process to undertake this effort, which is to identify, track and segregate the revenue, is extensive; a process is being developed for the reporting requirements and tracking systems for discrete information on aviation fuel tax revenues. The Commission would appreciate the FAA providing a descriptive definition ofthe requirements forthe mandated "tracking system." Acton Plan Requirement : Transition Period • It is the Commission's intent to comply with the requirements set forth and will notify the FAA if a reasonable transition period, notto exceed threeyears, is needed to become compliant with the rule. In consideration ofthe broader concerns outlined above, the Commission also requests the FAA consider a re-evaluation or immediate sunset of the ruling and commence an open and full public process discussion with all stakeholders to ensure full participation by impacted parties

. The Commission appreciates the FAA's consideration of this request and looks forward toworking with yourteam and others impacted bythis ruling. Sincerely,

By email: James

.T.Brown@faa.gov.
c: The Honorable Barbara Boxer The Honorable Ken Calvert The Honorable Diane Feinstein The Honorable Duncan Hunter The Honorable Raul Ruiz The Honorable MarkTakano