7 - Airports

Summary

Created in 1970, the Airport and Airway (or Aviation) Trust Fund, like the Highway Trust Fund after which it was modeled, designates the proceeds of taxes collected from transportation users for transportation development programs. If the highway experience shows what happens when a preexisting trust fund structure is challenged by external political forces, the aviation case is the story of the tensions that arise when a trust fund is constructed to enforce conflicting promises.

From the very beginning there have been two diametrically opposed views of the Aviation Trust Fund's role. Program advocates on congressional authorizing committees, who have close ties to aviation clienteles, have viewed the trust fund primarily as a device for locking-in spending on aviation capital projects. In their view, the trust fund's earmarked revenues should be used to pay for airport development grants, procurement of high-tech navigation equipment, and other aviation capital improvements. Presidents and institutional budget guardians, in contrast, have argued that a large share of Aviation Trust Fund money should be used to finance the operating budget of the Federal Aviation Administration, including the enormous costs of running the nation's air traffic control system. Authorizers and aviation lobbyists insist that these routine bureaucratic costs should be paid substantially from general tax revenues. In one view, then, the Aviation Trust Fund is, or should be, a pure capital account; in the other, a true user pay system.