The Congressional Budget Office issued a new estimate of the direct spending and revenue effects of the Aviation Innovation, Reform, and Reauthorization Act of 2016. The analysis is obviously not comprehensive, as it leaves out changes in discretionary spending. Despite this missing data, the Aircraft Owners and Pilots Association used the report to claim that the legislation would increase the deficit by nearly $100 billion. The legislation would reform the air traffic control (ATC) system by transferring those responsibilities from the Federal Aviation Administration (FAA) to an independent, non-profit corporation. Current aviation-related excise taxes, which would no longer be needed, would be reduced and there would be significant savings in the discretionary budget of the FAA – savings that were not reflected in CBO’s latest analysis. Moreover, there is good reason to question the assumption of whether the spending performed by a private non-profit is equivalent to government spending by FAA.
The chart above reflects the changes in direct spending in CBO’s latest report, with the changes in discretionary spending from its previous estimate of the legislation.
The table above reflects the revenue and user fees effects in the CBO’s analysis.
This proposal would reduce unnecessary outlays, eliminate unnecessary taxes, and provide much needed efficiency to our current ATC system. Moreover, since the activities of the new, independent entity are not inherently governmental, there is good reason to question whether it should be included in the budget at all.
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