A controversial US Senate bill that would have sweeping effects on the US airline and airport industry is winning widespread support among politicians who are concerned about air service to small and medium sized communities.

Although the Aviation Bill, introduced by Senator John McCain, chairman of the Senate Commerce Committee, was temporarily stalled on 9 July because of a time limit on how long the committee could sit, it was expected to be reintroduced for markup the following week. Indications are that much of the bill will gain the support it needs despite lobbying by most of the US major carriers.

The bill contains six key provisions aimed at improving competition. They include requiring the Department of Transportation to establish a five-year pilot aviation development programme, beginning in 1999, in which the DOT would have to report annually to Congress on the availability of air transport services in small communities and identify factors that inhibit quality and affordable services. The DOT would also have to review airlines' marketing practices.

The bill would give the DOT 90 days to approve or deny applications for slot exemptions to provide nonstop jet service between a nonhub or small hub airport and the four high-density airports. Priority would be given to carriers which have had slots withdrawn in favour of foreign carriers, and to those that hold fewer than 20 slots at a particular airport. Some 100 unused military slots at O'Hare would be converted to commercial use over three years.

The bill would also ease the perimeter rule at Washington/National by allowing 12 new slots to be created specifically for long-haul flights. A proposed amendment would require a major to enter into a joint fares and interline agreement with a carrier operating in an underserved market.

However, another amendment that would have raised the cap on airport passenger facility charges by $1 to $4 has already been quashed. Airport lobbyists, who are campaigning to increase funds, are disappointed that the cap is likely to remain at $3 for at least another year. McCain, who voted against the amendment, said he could not support another tax hike on passengers when some of the wealthiest Americans, travelling in business jets, continue to pay no PFC at all.

'We need to address the underlying system,' says McCain. 'It is the inequity that deserves to be addressed.' He is also concerned that a 'good portion' of money raised by PFCs goes into the Aviation Trust Fund, and can be diverted to non-aviation uses.

The bill also reauthorises the Federal Aviation Administration until 2002, allocating $7.7 billion to the agency and $2.4 billion to the Airport Improvement Programme for 1999.

Source: Airline Business