Monday, August 15, 2011

Spending cuts could ground rural air service.

WASHINGTON -- The federal program that for more than three decades has provided commercial air service to scores of remote communities across the country has routinely been in the bomb sights of Washington budget cutters -- and has always survived largely intact.

But the Essential Air Service (EAS) also has never faced the kind of fiscal pressures now roiling Washington.

Last year's election brought in a wave of lawmakers eager to slash any government program that seems faintly exorbitant or unnecessary. A bill the House passed earlier this year to reauthorize Federal Aviation Administration called for elimination of the program by 2014, but that's been stalled by Senate opposition.

More recently, a measure to keep the FAA fully operational while Congress negotiates a long-term reauthorization of the agency was held up for two weeks this summer as some lawmakers tried to kill EAS subsidies that provide service to more than a dozen airports. Rep. John Mica, a Florida Republican who is chairman of the House Transportation and Infrastructure Committee, referred to subsidies for those airports as "pork."

Given that backdrop, the $200 million a year program that serves about 150 communities and has grown 300 percent over the past decade is likely to be in the conversation when a special bipartisan committee of 12 lawmakers -- six each from the House and Senate -- begins meeting next month to examine ways of slicing as much as $1.5 trillion from the nation's debt over the next decade.

South Dakota Republican Sen. John Thune, whose state has two communities served by EAS-subsidized service, said the program may not glide through unharmed as it has in years past.

"It's like any other program. Nobody's going to get away from this thing scot-free," said Thune, who does not sit on the special committee but is a member of the GOP leadership in the Senate. "Everybody's going to have to bleed a little bit with all the fiscal decisions that are being made right now for the country."

The EAS program serves communities in more than 30 states and Puerto Rico. Excluding Alaska, which has the most communities served, subsidized flights carried more than 1.1 million passengers in 2009.

Supporters tout the subsidies as important lifelines to other communities, particularly in Alaska where planes are the only way to bring supplies to remote communities during harsh winters. Because of its unique situation, analysts believe Alaska would likely be spared even if the program were discontinued for everyone else.

Air service also is used as a marketing tool by local economic development officials hoping to lure prospective businesses.

"This is not an airline program. This is a program for communities so that they can maintain their connection to the global marketplace," said Roger Cohen, president of the Regional Airline Association, which counts EAS carriers among its members.

Unlike skeptics who point to high costs and near-empty planes, Cohen said the latest tussle over the program suggests how important EAS is viewed in Congress because lawmakers were "willing to go to the mat" to protect it.

Essential Air Service began in 1978 after airline deregulation to make sure rural communities that weren't profitable to serve were not abandoned. It has continued despite the fact that subsidies were supposed to end after a decade.

The program is paid for in two ways: fees paid by aircraft that fly over, but do not take off from, or land in, the U.S; and money from the Airport and Airway Trust Fund that's primarily funded through ticket fees. Supporters like Cohen say that's one reason EAS shouldn't be considered for elimination.

The program pays airlines to fly into airports that they otherwise wouldn't because there aren't enough passengers to cover the cost. A community's eligibility generally is based on two factors: the per-passenger cost to subsidize air service, and a community's distance from the nearest hub airport. The farther away, the higher the subsidy can be.

But some of those subsidies have gotten the attention of lawmakers. When Congress was debating a temporary extension of the FAA last month, EAS became a sticking point.

As a condition of passage, House Republicans demanded that subsidies to three communities be grounded because of their cost: Ely, Nev. ($3,720 per passenger), Alamogordo/Holloman Air Force Base, N.M. ($1,563) and Glendive, Mont. ($1,358). They also objected to aid for another 10 -- Morgantown, W.Va.; Athens, Ga.; Jamestown, N.Y.; Bradford, Pa.; Hagerstown, Md.; Jonesboro, Ark.; Johnstown, Pa.; Franklin/Oil City, Pa.; Lancaster, Pa.; and Jackson, Tenn. -- because of their proximity (within 90 miles) to a larger airport.

The impasse lasted two weeks and left thousands of FAA employees and construction workers on aviation improvement projects without pay. Lawmakers finally compromised earlier this month by agreeing to a plan that withholds the subsidies but gives Transportation Secretary Ray LaHood the authority to continue them if he chooses.

A Department of Transportation spokesman said Thursday that LaHood had not taken any action yet though no airport has stopped its air service.

Leon Baker, manager of the Dawson Community Airport in Glendive, said air service was particularly important this past winter when blizzards made roads impassible and long trips dangerous. Passenger traffic was up on the two flights (one departing, one arriving) that serve Glendive most days, so much so that the subsidy per passenger has dropped to about $932 from the $1,358 cited by lawmakers.

So what would happen if the subsidy ended and air service disappeared?

"People would adapt, persevere and overcome," he said. " If you go down the road and the bridge is washed out, you just find another road to get around it."

Glendive is familiar with that scenario having lost air service for about a year before the current carrier came in.

"We made do," Baker said. "We didn't die."

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