Trump Administration Continues Infrastructure Privatization Push, Starting with the FAA

atc-sstock“The President wants to fix the problem.”

The Washington Post reported yesterday that, in an effort to kick off Infrastructure Week (and perhaps refocus his Administration from a few outside distractions), President Trump will submit a proposal to Congress next week calling for handing over control of the nation’s air control system to a non-profit corporation.  Long a pet issue by some lawmakers, support for this idea largely (but not totally) falls along party lines.  The idea had even received some serious bipartisan consideration, although no legislation ever gained serious traction.

From the Washington Post:

President Trump will seek to put a spotlight on his vows to privatize the nation’s air traffic control system and spur $1 trillion in new investment in roads, waterways and other infrastructure with a week-long series of events starting Monday at the White House.

It’s an idea that has been tried many times before, dating back to the Clinton administration and, most recently, last year in legislation championed by Rep. Bill Shuster (R-Pa.), chairman of the House Transportation Committee. His bill never made it to the Senate, where several key GOP members resisted the idea of transferring government assets to a corporation.

But perhaps the most interesting part of this proposal is it actually includes a pay-for:

From Bloomberg News (emphasis added):

Trump’s air-traffic control plan will be based largely on legislation introduced in 2016 by Representative Bill Shuster, the Pennsylvania Republican who chairs the House Transportation and Infrastructure Committee, according to a White House official. The official said there would be some changes from Shuster’s plan, which stalled in the face of opposition in the Senate and among some leading House Republicans, but declined to say what they would be.

While providing few specifics, Cohn said Trump’s proposal would create a new user fee to replace current taxes on aviation fuel and airline tickets. He also said there would be unspecified protections for rural airports; critics of the air-traffic plan have said it would jeopardize small airports by giving too much power to airlines and large hubs.

It’s hard to know exactly whether identifying a pay-for this early in the game helps or hurts this proposal with Congress (I suspect it probably doesn’t help, at least initially.) Also, it isn’t clear this proposal will result in net new revenue or just a reshuffling of taxes and fees (add one here while another one is eliminated.)  But the fact that there’s discussion about it this early in the process could mean this proposal is moving quickly behind the scenes.

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