From: Travel Weekly (subscription site so quoting here)
Airlines to FAA: Stay away from LaGuardia slots (01/08/2007)
By Andrew Compart
Most of the country's major airlines are drawing a line in the sand, or at least they're trying to, over what they consider an attempt by the Federal Aviation Administration to reregulate the U.S. airline industry.
The battleground is a rule the FAA proposed in late August for alleviating present and future congestion at New York's LaGuardia Airport and to promote competition there.
The deadline for filing comments on the proposal was Dec. 29, and the airlines came out firing.
"The proposed rule represents governmental micromanagement and interference in market forces to an extent not seen since the airline industry was deregulated in 1978," complained the Air Transport Association, which represents all the major U.S. carriers and a few more.
"The premise for the proposed rule -- preventing congestion at LaGuardia -- does not give the FAA carte blanche to reregulate the airline industry."
Delta argued: "The FAA is overstepping, by a wide margin, its statutory authority by injecting itself into fundamental, economic business decisions, which the Congress has reserved solely to the airlines as part of deregulation."
Delta, Northwest and others blasted some aspects of the proposal not only as ill advised but also as being illegal and unconstitutional. At various points in its response, the ATA called the proposal incoherent, convoluted, over-reaching, overly complex and nearly incomprehensible.
What has airlines in such a fighting mood? Primarily, their ire is focused on two elements in the FAA's proposal.
• Aircraft size. The FAA is proposing a preferred average aircraft size at LaGuardia ranging from 105 to 122 seats, depending on whether the FAA also adopts its proposal to exempt a limited amount of service to nonhub and small-hub airports from the size requirement. That's seven to 24 more seats per aircraft than the current average.
The requirement effectively would begin in 2008, because airlines would lose some of their LaGuardia landing and takeoff rights in 2009 if they don't meet it. The FAA said the size requirement was justified for the sake of efficiency, because small jets were causing congestion and LaGuardia could accommodate more travelers but not more flights.
• Periodic confiscation and redistribution of slots, which are the rights the airlines have obtained for landing and taking off from the airport at specified times.
The FAA, which under its proposal renames "slots" to "operating authorizations," would confiscate 10% of them each year and redistribute them in an as-yet undetermined way. The newly allocated authorizations would last 10 years before being reconfiscated.
The FAA asserted this would encourage airlines to use, sell or lease their authorizations and provide a way for new competitors to obtain them.
The FAA is making the proposal now because the high-density rule, in place at LaGuardia since 1969 to alleviate congestion and delays, expired Jan. 1. The high-density rule, which also was used at four other airports but remains in place only at Washington National, caps the number of takeoffs and landings during an airport's busiest hours. A carrier needs a reservation, commonly called a slot, to land or take off during those times.
The Transportation Dept. amended the high-density rule in 1985 to allow airlines to buy and sell their slots but also to authorize the FAA to take slots away from airlines if they were underused. Changes in the law allowed some exemptions for new-entrant airlines or for service to smaller communities using jets of 70 seats or less.
The result of the exemptions at LaGuardia was a flood of small jet flights in 2000 that caused congestion and delays so bad that the FAA felt compelled to step back in. It capped the number of hourly scheduled service flights at 75 and allocated the slots by lottery, but it still allowed exemptions.
The FAA, asserting the right to make sure the air space is used safely and efficiently, extended the cap while it considers a better long-term solution. The proposed rule is what has emerged as that "better solution," though most airlines are arguing that it's actually much worse.
Delta and Northwest went so far as to contend that the confiscation of operating authorizations would be unconstitutional, because the Fifth Amendment prohibits the government from seizing property for public use without just compensation, and courts have acknowledged slot holdings at LaGuardia as property rights. Delta also argued that annual confiscation would make services unstable and subject to "the heavy hand of government intervention."
JetBlue, which flies no aircraft with fewer than 100 seats, was the only airline that said it could endorse a size requirement, with modifications to allow more exemptions and more new-entrant service. JetBlue said a size requirement was a justifiable way to maximize scarce resources.
But the ATA and many of the major airlines argued there was good reason to use smaller jets to serve smaller communities that don't generate enough demand for larger aircraft or to provide the flight frequency that business travelers demand in larger markets. And the ATA cited statistics showing regional jets were used to a greater extent at many other airports.
Major airlines are not the only ones opposing the proposal. The Regional Airline Association, whose members fly those smaller aircraft, also blasted the proposal, and more than a dozen small and midsize communities weighed in against it, fearing that the size requirements would force airlines to drop flights from their communities to LaGuardia.
The American Association of Airport Executives criticized the proposal as a "scheme which will result in the increase of service to fewer and larger communities at the cost of service to smaller communities." And the Airports Council International-North America accused the FAA of trying to usurp an airport's authority to manage congestion in its own way.
The Port Authority of New York and New Jersey, which operates LaGuardia, argued that the FAA's proposal "infringes upon the Port Authority's domain and is not necessary because the Port Authority is developing a fair, efficient and effective alternative."
Its alternative would have the FAA continue to impose an hourly cap on aircraft operations and let the authority manage the rest through restrictions on gate usage.
The authority would allocate one airfield operation per hour to each of the airport's 73 gates, create a minimum gate utilization standard based upon the size of aircraft and number of passengers the gate can accommodate and allocate gates for small community air service.