Ticket Subsidy Reform
On February 14, 2012, a major Committee initiative to improve the nation’s airport and aviation infrastructure, create jobs, modernize our antiquated pre-World War II air traffic control system, improve aviation safety, and save taxpayers money through significant reforms of the Federal Aviation Administration (FAA) was signed into law.
The FAA Modernization and Reform Act of 2012 (H.R. 658) sets the long-term federal policy for a vital segment of the nation's economy. This measure was introduced in the House by Transportation and Infrastructure Committee Chairman John L. Mica and Aviation Subcommittee Chairman Tom Petri (R-WI).
A key reform in the new law brings an end to outrageous ticket subsidies for air service to some small airports under the Essential Air Service (EAS) program.
EAS funding has skyrocketed over 10 years, from $50 million in 2001 to $200 million in FY 2010, an increase of 300 percent. The FAA Modernization and Reform Act includes the most significant reforms to the EAS Program in decades.
This common sense measure eliminates federal subsidies as high as $3,720 per ticket by capping subsidies at $1,000.
The law eliminates subsidies to communities with fewer than 10 enplanements per day that are located within 175 miles of a large or medium hub airport.
New communities are prohibited from joining the program under H.R. 658.
In addition, lower appropriations for the program reduce costs to the taxpayers.
EAS program reforms in the FAA Modernization and Reform Act will save millions of dollars annually.
