Document Headings

                    Document headings vary by document type but may contain                    the following:                  
                -                       the agency or agencies that issued and signed a document                    
                -                       the number of the CFR title and the number of each part                      the document amends, proposes to amend, or is directly                      related to                    
                -                       the agency docket number / agency internal file number                    
                -                       the RIN which identifies each regulatory action listed in                      the Unified Agenda of Federal Regulatory and Deregulatory                      Actions                    

                    See the                                          Document Drafting Handbook                                        for more details.                  

###### Department of Transportation

###### Federal Aviation Administration 

# AGENCY:

Federal Aviation Administration, DOT. 

# ACTION:

Notice. 

# SUMMARY:

                        The current taxes and fees paid into the Aviation Trust Fund, which provide funding for the National Aviation System, are only authorized through September 30, 2007. Since there is only a small and declining balance in the Trust Fund, it is critical that the financing not be allowed to lapse. The new financing structure should generate stable and predictable revenue, maintain the appropriate levels of service, and enable FAA to make long-term investments and tie revenues raised for the system to the infrastructure and operational costs of the system. The FAA has developed a series of data packages in examining FAA costs, paid for through the Trust Fund, from a managerial reporting standpoint. These packages will advance everyone's understanding of FAA costs and what the Agency faces as it considers a range of future funding options. They are available at                         *http://www.faa.gov/​about/​office_​org/​headquarters_​offices/​aep/​aatf/​.*

# FOR FURTHER INFORMATION CONTACT:

Robert E. Robeson, Manager, Systems and Policy Analysis Division, Office of Aviation Policy and Plans, Federal Aviation Administration, 800 Independence Avenue, SW., Washington, DC 20591. 

# SUPPLEMENTARY INFORMATION:

 

## Background 

In April 2005, the FAA hosted a Trust Fund Forum with major aviation stakeholders. A variety of ideas on options to fund the FAA were discussed. At the Trust Fund Forum, FAA began the dialogue on the need to reauthorize the Airport and Airway Trust Fund. The current taxes and fees are only authorized through September 30, 2007 and since there is only a small and declining balance in the Trust Fund, it is critical that financing not be allowed to lapse. 

The new financing structure should generate stable and predictable revenue, maintain the appropriate levels of service, and enable the FAA to make long-term investments not only in modernization but also in the Next Generation Air Transportation System. The funding mechanism chosen should tie revenues raised for the system to the infrastructure and operational costs of the system. It should also create incentives for the FAA to become increasingly productive. 

The FAA spent the last several months analyzing cost and activity data as well as funding options. While this analytical work has reached a fairly mature level, it is expected to continue through the fall. FAA is examining the contributions of various stakeholder groups to the Trust Fund under the current tax structure, as well as the impact of different funding mechanisms on the FAA, the flying public, and those stakeholder groups. 

One major component of this work is an ongoing study that would allocate FAA's air traffic control costs to users of the system. This ongoing study uses cost accounting data from fiscal year 2004, which is the best available data at this time. While the FAA's cost accounting system will provide detailed source data in this effort, fiscal year 2004 cost reports apply allocation rules to this data to produce managerial reports so that ATO management can understand costs at the national and facility levels. It is important to note that the cost accounting system continues to improve, so that fiscal year 2006 managerial reports will be based on more refined allocations. Another set of allocation rules would be required to support analysis to determine the most viable proposal to fund the system. In developing these allocation rules, the FAA seeks stakeholder input in order to fully consider principles such as marginal system use, use of congested space and scarce resources, aircraft weight, distance, and other criteria. The allocation rules, of course, must be applied with transparency and would need to be validated by the user community. 

In addition, the FAA's Safety and Airports organizations have identified areas where services can be matched to the revenue needed for those programs. Because the FAA cost accounting system will not deliver such reports for these organizations until the middle of 2006, the FAA will use data from its Labor Distribution Reporting system, annual budgets, and grants issued to help develop options for future funding in the meantime. 

The Administration's intention is to develop a proposal that has stakeholder support. On September 6, 2005, the FAA Administrator sent a package to key stakeholders. Besides a cover letter that contained the information summarized above, the package also contains questions for stakeholders and the data packages developed to use in examining FAA costs from a managerial reporting standpoint. These packages will advance the understanding of FAA costs and what the Agency faces as it considers a range of future funding options. 

The stakeholder package available on the FAA's Web site contains data packages on the Air Traffic Organization including technical background and supporting detail, Airports, Aviation Safety, and International Aviation. Also included are questions regarding: 

1. Providing the Right Types of ATC Services. 

2. Revisions to Current Tax System. 

3. Other Funding Alternatives for Cost Recovery of ATC Services and Cost Allocation. 

4. General Fund Questions. 

5. Airport Related Issues. 

6. Charging for Certification and Other FAA Services. 

7. Lessons Learned from Other Countries. 

      ( print page 54101)    
Issued in Washington, DC, on September 7, 2005. 

Robert E. Robeson, 

Manager, Systems and Policy Analysis Division, Office of Aviation Policy and Plans. 

[FR Doc. 05-18145 Filed 9-8-05; 2:45 pm] 

BILLING CODE 4910-13-P