News Article - March 21, 2008

  Ok, try and follow this -- back in September, the Township of Tinicum, Pa, located on the edge of Philadelphia International Airport, gets into a pissing match with the city of Philly on overdue property taxes. You can click here to see a Google satellite map of the area. So the township decides to get its money by imposing a "privilege fee" based on landing weights on airlines flying in and out of Philadelphia International Airport. Now is a good time to point out that the township does not own or operate any portion of the airport.

   Understandably, the airlines -- represented by IATA, the Air Transport Association (ATA) and the Air Carrier Association of America (ACAA) -- cried foul, saying that the township's fees are not allowed under the Anti-Head Tax Act, which prohibits the imposition of taxes, fees and charges by state and local jurisdictions on airlines and other airport users.

   So the issue went before the Dept. of Transportation (DOT) for review, and it agreed with the airlines, which I covered in the March 21 issue (subscribers only) of Aviation Daily. “The privilege fee, accordingly, amounts to a prohibited landing fee because it imposes a charge indirectly on an individual traveling in air commerce, or a charge on the transportation of an individual traveling in air commerce, in connection with the landing of aircraft,” it said. Furthermore, the township cannot charge its fee because “only a state or political subdivision that owns or operates an airport may impose on aircraft operators a (reasonable) landing fee for the use of its airport,” DOT ruled.

   Both the airlines and airports applauded the DOT decision. "ACI-NA is pleased with the DOT's Declaratory Order issued in the Tinicum Township Privilege Fee Proceeding. As its Comments and Reply Comments filed in this proceeding reflected, and as the DOT's ruling indicates, the Anti-Head Tax Act (AHTA) prohibits fees like the privilege fee implemented by Tinicum Township," said the association in a statement. "The underlying federal policy reflected in that Act was to guard against multiple taxation on air passengers and burdensome taxes on airlines by local jurisdictions that neither own nor operate airports. This ruling thus recognizes that only the owner/operator jurisdicition is authorized to impose reasonable landing fees for the use of its airport."

Source - Aviation Week