PFC Cap Debate: Airports vs. Airlines on Infrastructure Funding

US Airports seek to raise the Passenger Facility Charge (PFC) cap to fund infrastructure, facing strong airline opposition. The current $4.50 cap is insufficient, leading to debt and hindering development. Key players ACI-NA and A4A clash on financial needs.

The FAA should authorize every PFC-funded project. The 100 busiest airports in the united state by enplanements all gather PFCs. United state airports collected an overall of $3.7 billion in PFCs in 2024 and are expected to accumulate $3.8 billion in 2025, according to FAA data. In 2001, the first full year the $4.50 cap remained in place, airports gathered $1.6 billion in PFCs.

Airlines strongly oppose any kind of PFC boost. Airline Companies for America (A4A) has a dedicated website called “Stop Air Tax Currently” focused on stopping the $4.50 PFC cap from climbing. “There’s a hidden tax obligation on your airline tickets and flight terminals want to raise it even higher,” A4A states on the site.

Airline Opposition to PFC Hikes

The 100 busiest flight terminals in the U.S. by enplanements all collect PFCs. U.S. airport terminals gathered a total amount of $3.7 billion in PFCs in 2024 and are anticipated to collect $3.8 billion in 2025, according to FAA stats. In 2001, the very first complete year the $4.50 cap was in place, airports gathered $1.6 billion in PFCs.

Burke claimed he believes airline company opposition to a PFC cap increase stems from significant service providers desiring “to keep control” over hub airport terminals. “You have particular airports that are citadel centers, and airlines have actually spent greatly in those airport terminals since it is necessary for them,” he explained. “They don’t truly respect their competitors.”

PFCs: Funding Airport Projects

To fund infrastructure tasks, flight terminals can collect PFCs from travelers through airline companies, with a maximum for every passenger of $4.50 per trip sector, $9 per one-way journey (if a passenger has a flight modification) and $18 per roundtrip.

“If you damage that down by year, it’s $35 billion a year,” ACI-NA Executive Vice President Matt Cornelius claimed throughout a panel conversation at the current Paths’ Launch North America conference in Tallahassee, Florida. There’s a substantial space.”

Airports had actually highly backed your house variation of AIR 21 elevating the PFC cap to $6. When the $4.50 PFC cap concession was gotten to, airports saw it as a moderate triumph, believing it would certainly be a precursor to more boosts, especially since a big Home bulk had backed the $6 PFC cap.

ACI-NA counters that airport terminals have actually had to take on a great deal of debt to finance those projects. The company estimates U.S. flight terminals have $173.9 billion in framework growth needs over the next five years.

Infrastructure Needs vs. PFC Cap

If the entrances are utilized by the center carrier, Burke said airline companies are happy with entrance growth at their centers. “Yet if you’re generating an Avelo Airlines, if you’re generating a low-cost carrier to load those gates or, God forbid, you are able to relocate an airline to an entrance based upon what the flight terminal requires versus what the airline requires, then you encounter difficulty [with center carriers] However facilities is most likely our No. 1 issue in regards to the future.”

The cap was last increased with the passage of the 2000 FAA reauthorization regulation authorized by then-President Expense Clinton, raising the optimum PFC from $3 to $4.50 per flight section, adhering to a controversial dispute in Congress. ACI-NA has long said on behalf of united state airport terminals that the $4.50 cap has stopped working to maintain rate with climbing building prices.

Historical Context of PFC Cap

Burke said he thinks airline opposition to a PFC cap increase stems from major service providers desiring “to maintain control” over hub airport terminals. “You have specific airports that are fortress centers, and airline companies have actually invested heavily in those airports due to the fact that it’s vital for them,” he explained.

Your House of Representatives elected 245-183 to increase the PFC cap from $3 to $6 per trip section, but the Senate stopped, firmly insisting the cap remain unmodified. Eventually, the two chambers reached a concession, raising the cap to $4.50 in the last AIR 21 regulations authorized by Clinton in April 2000.

“I’m a pretty positive guy,” ACI-NA chief executive officer Kevin Burke told Aeronautics Week in an interview. “We have been functioning quietly with the Trump administration, with DOT [Transportation Division] and the FAA.”

Trump Administration and PFC Boost

Burke claimed ACI-NA has actually been meeting united state Transport Assistant Sean Duffy’s team concerning a potential PFC cap increase. “What we have actually discovered in collaborating with this management is if this is going to assist them, and it makes great sense politically for them, we can obtain their assistance,” he claimed. “We’re taking it one meeting at a time with them. We have consulted with the plan individuals that are encouraging Secretary Duffy … PFCs are not mosting likely to cost the feds anything, and it’s not a large cost. However yet, if you were to boost it by just $2-$ 3, then you’re talking about a dreadful great deal of money that’s mosting likely to pertain to a flight terminal they really did not have previously.”

Burke claims if the Trump management could be encouraged to back a PFC cap boost, Congress might be encouraged to take action. “The method we have actually explained it to them is PFCs do not cost the federal government anything,” he claimed. “In fact, it helps them in regards to just how much cash they have to buy airport terminals. While we have no eco-friendly light supporting a PFC boost, we have not obtained a no either.”

From springtime 1999 to spring 2000, Congress spent a year wrangling over an FAA reauthorization bill called the Aeronautics Financial investment and Reform Substitute the 21st Century, popularly called AIR 21. PFCs– originally produced by Congress in the 1990 FAA reauthorization costs– was among the extra controversial concerns in the AIR 21 discussion.

With a new presidential management taking office earlier this year, Airports Council International-North America (ACI-NA) is once again making the situation that the PFC cap should be boosted, pointing out a major space in between flight terminal infrastructure requirements and the financing resources to pay for upgrades. The organization states the PFC– a trip ticket cost collected by airlines and handed down to airports to pay for FAA-approved construction projects– is a vital system to money infrastructure advancement in a nation in which most airports are publicly owned and taken care of by communities.

Airports’ Financial Strain

A4A states it supports airport terminal financial investment, yet indicate various airport facilities projects across the united state that have actually been completed over the last few years, including Pittsburgh International Airport’s new $1.7 billion incurable collection to open Nov. 18. “Airports are flush with cash,” A4A contends, noting that greater than $200 billion has actually been invested in renovation tasks at U.S. flight terminals given that 2008 with no PFC cap boost.

, leaving airport terminals unable to fully leverage this source for required enhancements. Offered the significant financial obligation burden lots of airport terminals currently have actually incurred due to inadequate income streams, there is an urgent demand for greater versatility in funding mechanisms.”

“We proceed to work on this,” he stated.