[Congressional Record Volume 145, Number 2 (Thursday, January 7, 1999)]
[Extensions of Remarks]
[Pages E38-E39]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                       THE TRUTH IN BUDGETING ACT

                                 ______
                                 

                         HON. JAMES L. OBERSTAR

                              of minnesota

                    in the house of representatives

                       Wednesday, January 6, 1999

  Mr. OBERSTAR. Mr. Speaker, I rise today to join my good friend and 
colleague, Bud Shuster, in introducing legislation to take the 
aviation, harbor maintenance, and inland waterways trust funds off-
budget. This legislation will ensure that all revenues contributed by 
users of our transportation system to develop and maintain those 
systems are spent for their intended purposes.
  For aviation, this legislation has a very simple, but critical, goal; 
ensuring that the American public continues to travel safely, securely, 
and efficiently in our nation's aviation system.
  The airline and aerospace industries are important contributors to 
the U.S. economy, providing highly skilled, high paying jobs. They 
directly employ approximately 1.5 million people, and generate more 
than $100 billion in wages. The total, worldwide economic impact of air 
transport was $1.14 trillion in 1994 and this is expected to increase 
to $1.7 trillion by the year 2010.
  However, these economic gains will only be achieved if we have the 
air traffic safety, security, and airport infrastructure to take 
advantage of them. Problems in the current system are already appearing 
and are projected to be even greater in the future. In 1987, the FAA 
estimated that there were 21 airports at which air carrier flights were 
delayed by a total of more than 20,000 hours; by 1997, there were 27 
airports, and that number is expected to grow to 31 by 2007. In 
addition, according to Delta Airlines, air traffic inefficiencies cost 
it approximately $360 million a year. Furthermore, FAA's lack of 
progress on air traffic control (ATC) modernization has led to 
suggestions in international forums that current U.S. management of 
oceanic ATC be taken away. And as the National Civil Aviation Review 
Commission found ``although 19 out of 20 of the busiest airports in the 
world are in the U.S., the nation can no longer claim that it has the 
world's most modern air traffic control system.''
  We tried to begin addressing these challenges in 1990, by passing 
legislation that would have increased investment in airports and air 
traffic modernization. Under that law, a plan was established to allow 
new revenues coming into the aviation trust fund to be fully spent and 
the trust fund surplus, that existed at the time, to be gradually drawn 
down. In a spirit of cooperation, the reported bill also eliminated the 
penalty clause that the then-House Committee on Public Works and 
Transportation used to limit funding of operations from the trust fund 
if capital development was insufficient. As the report accompanying the 
bill said at that time: ``We believe that we can best meet our common 
goals by working cooperatively, rather than relying on penalty clauses 
and other legal forcing mechanisms.''
  Unfortunately, that agreement was violated by the Office of 
Management and Budget and the Appropriations Committee. In 1990, we set 
out modest amounts of funding for facilities and equipment (F&E) and 
the airport improvement program (AIP), but they soon went by the 
wayside. By 1994, rather than spending $2.1 billion for AIP and $2.5 
billion for F&E, instead $1.69 billion was spent for AIP and $2.12 
billion for F&E. In fiscal year 1991, capital investment was 50 percent 
of the FAA budget, by FY1998, it was 42 percent. And rather than 
drawing down the trust fund balance, the uncommitted balance in the 
trust fund is now estimated to be $22 billion by 2004 and $53 billion 
by 2008.
  Additionally, the General Accounting Office has confirmed that 
airport capital needs are $10 billion a year. The present system of 
aviation financing provides about $6-7 billion a year, with the AIP 
program contributing less than $2 billion a year to those needs. 
Furthermore, funding for F&E is woefully inadequate. In fact, F&E is 
appropriated at $2 billion for FY1999, a level $400 million below an 
F&E level of $2.4 billion in FY1991. These inadequate levels of F&E and 
AIP funding contribute to delays for passengers and increased costs for 
airlines, and increased maintenance costs for FAA due to delayed 
replacement of obsolete equipment. these results are shameful, 
especially when money dedicated for investment in airports and air 
traffic equipment sits idle because of budget constraints unrelated to 
the needs of the aviation system. In effect, trust fund revenues are 
withheld to balance the rest of the budget.
  To remedy this, we need to build on last year's historic TEA 21 
legislation which established that revenues collected from users of the 
highway system for the Highway Trust Fund should be spent only for the 
purposes for which they are collected, the development of our highways 
and transit systems. The same principle should now be applied to the 
aviation system.
  The bill we are introducing today is the first step to reversing the 
unfortunate recent trends in aviation funding and ensuring that we 
invest sufficiently to protect an irreplaceable economic jewel: our 
nation's aviation system. With

[[Page E39]]

Members' support, we will again be able to make the kind of investments 
we need in airport development and air traffic control modernization. 
If we are to ensure an efficient safe aviation system, we must begin to 
use aviation revenues for their collected purposes: to maintain and 
enhance our nation's aviation system.
  In addition, historically, a general fund payment averaging about 30 
percent has been made to support our aviation system. This payment has 
been made in recognition of both the direct and indirect benefits of 
our aviation system to our nation's security and economic health. These 
benefits should be funded by the nation as a whole not exclusively by 
users of the aviation system. Any off-budget plan passed by this 
Congress must guarantee this general fund payment continues.
  We must also ensure that the money provided to the FAA is well-spent. 
Full implementation and validation of a cost accounting system, and 
effective use by FAA management, will be an important step forward. In 
addition, appointment of the Management Advisory Council--which has 
been delayed for two years--is absolutely essential. Other reforms will 
get my full consideration but we must ensure that the critical safety 
function of the FAA is not compromised or weakened.
  The other critical component of this legislation will allow the 
nation's waterborne transportation system to remain among the best in 
the world. The nation's coastal ports provide access to foreign and 
U.S. markets for virtually all international trade, while the inland 
system provides safe and efficient transportation for both domestic and 
foreign products.
  The contribution of the U.S. navigation system to the economy is 
impressive. The value of foreign trade exceeds $600 billion annually, 
creates 16 million jobs, and generates more than $150 billion in annual 
revenues for the Treasury. Yet, for all these benefits we continue to 
under invest in maintaining and improving this transportation system.
  The inland waterway system is in particular need of investment. By 
the year 2000, 40 percent of the locks on the inland waterway will be 
more than 50 years old; 26 locks will be over 100 years old; and, the 
Nation's two oldest locks opened in 1839. Unfortunately, because of 
budget constraints, only about 75 percent of the funds available for 
investment are actually used, and the surplus continues to grow.
  The Truth in Budgeting Act will change that.
  For coastal ports, the failure to spend receipts is even greater. As 
vessel drafts increase, there is a continuing need for maintaining and 
deepening channels. Unfortunately, budget constraints have forced 
expenditures from the Harbor Maintenance Trust Fund to little more than 
one-half of available revenues.
  The benefits of fully spending the trust fund extend beyond 
navigation. The Water Resources Development Act of 1996 expanded the 
uses of the fund to address critical needs related to disposal of 
dredged material. Environmental concerns dictate that increasing 
amounts of dredged material not be disposed of in open waters because 
of contamination of the sediment. Making the trust fund fully available 
not only benefits navigation, but the environment as well.
  In closing, I urge all Members to sign on as co-sponsors of this 
legislation. Your support will be critical to ensuring the safety, 
security, and efficiency of our nation's aviation system and waterways.

                          ____________________