FAA Wants Views on Use of Fuel Taxes

Executive Summary: The Federal Aviation Administration (FAA) is extending the public comment period for 30 days until March 3, 2014. The FAA proposes to amend the Policy and Procedures concerning the Use of Airport Revenue to clarify FAA's policy on Federal requirements for the use of proceeds from taxes on aviation fuel.

Link to Federal Register notice: http://www.gpo.gov/fdsys/pkg/FR-2014-01-31/pdf/2014-02033.pdf.

Who is Impacted: All airport operators that have accepted Federal assistance.

Suggested Airport Actions: Airports should review the proposed changes and submit comments on the proposed policy clarification to FAA no later than March 3, 2014. ACI-NA has been working with a taskforce comprised of both legal and finance committee members to develop comments on member input. 


FAA proposes to make the following amendments:

  1. All state or local taxes on aviation fuel are considered to be airport revenue subject to the revenue-use requirement.
  2. Proceeds from taxes on aviation fuel may be used for any purpose for which other airport revenues may be used, and may also be used for a state aviation program.
  3. Airport sponsors have agreed to ensure that the proceeds from a state or local government tax on aviation fuel will be used only for aviation related purposes.
  4. The Federal limits on use of aviation fuel tax proceeds apply at an airport that is the subject of Federal assistance, whether or not the airport is currently subject to the terms of an AIP grant agreement, and regardless of the state or local jurisdiction imposing the tax.
  5. The limits on use of aviation fuel tax revenues apply to a tax imposed by either a state government or a local government taxing authority; and also apply to any tax on aviation fuel, whether the tax is imposed only on aviation fuel or is imposed on other products, as well as aviation fuel.
  6. Tax ordinances are grandfathered only if the collection of the tax revenues on the sale of aviation fuel was in effect before December 30, 1987 or within a relatively short period after that date.

The Notice requests that an airport operator must provide assurance that revenues from state and local government taxes on aviation fuel are used for certain aviation-related purposes.

ACI-NA Contact: Liying Gu (202-861-8084) or Matt Cornelius (202-861-8097)

This notice has been distributed to the Finance and Legal Affairs Committee