Washington Wire - 1996-06-10

<H1>Washington Wire</H1><H2>'no' to Departure tax </H2><H3>By Stan Barouh and Barbara Cook</H3>The Clinton Administration last week proposed levying an extra $10 departure tax on international airline and cruise passengers to help fund a planned education tax credit.

The program, entitled America's Hope Scholarships, would provide students a $1,500 tax credit for the first two years of college. The administration-which also supports renewal of the expired $6 international departure charge for the aviation trust fund-proposed that the program be implemented in fiscal year 1997. The proposal requires congressional approval, and so far reaction has been highly negative.

The National Business Travel Association last week fired off formal letters to the President, vowing to "fight this measure in the Congress with great resolve." The statements, which also went to other key decision makers around town, said they "recognize the value of a college education," but note that "it is unwarranted to pick the pocket of business travelers" to achieve that end.

Air Transport Association president Carol Hallet vowed to fight the initiative, saying the result of a combined $16 international departure charge would "sink the economic recovery that's finally under way in this industry." She also warned that it would lead to "a new round of airline bankruptcies and major layoffs among aircraft manufacturers. Charles Barclay, president of the American Association of Airport Executives, said the federal government "should first look to meet airport needs with aviation system revenues" rather than fund unrelated education programs. And William Norman, president of the Travel Industry Association, said the industry opposes the new levy, noting "our industry and our customers should not have to shoulder a disproportionate part of the investment in education."

DOT Official's Comments Draw Ire

Department of Transportation Inspector General Mary Schiavo drew fire from several aviation organizations for making disparaging remarks about low-fare and commuter airlines.

In the aftermath of the ValuJet crash, Schiavo wrote a column for Newsweek magazine that included statements such as, "I go out of my way to stay off commuter planes" and "I have skipped conferences because I would not fly on marginal airlines." The comments also appeared on several television programs.

In response, the Regional Airline Association, the American Association of Airport Executives and the Airport Operators Council-North America jointly sent a letter to President Clinton, asking him to "make clear to the American public that the DOT Inspector General does not speak for the administration on aviation safety policy." The associations expressed concern that Schiavo was offering "official advice" to the public without any evidence supporting her remarks. The letter also cited the exceptional safety record of regional and commuter airlines and the fact that many communities would lose their connection to the national aviation system without commuter carriers.

France, U.S. Ink Safety Pact

The United States has signed an aviation safety accord with France, the third such agreement the Federal Aviation Administration has negotiated with European countries in recent months to improve the system of inspecting aircraft and maintenance. Similar agreements exist now between the Netherlands and the United Kingdom. The FAA said it is attempting to improve cooperation with other countries toward a more easily understood code of standards and rules.