DOT Defies GAO – Plans to Proceed With Slot Auctions

Amid the greatest economic downtown in two-thirds of a century, defying a recommendation by the General Accountability Office, the Bush Administration is moving ahead anyway with plans to auction off take-off and landing slots at a trio of New York airports. In response, the Air Transport Association (ATA), the trade group representing the airline industry, appears ready to challenge the action in court.

Labeling the Department of Transportation’s move “illegal,” James C. May, ATA President and CEO says the government’s move is “forcing a costly and protracted legal challenge over an ideological experiment.”

That “experiment” is premised on Transportation Secretary Mary Peters’ belief that by auctioning off take-off and landing slots at, specifically, Newark Liberty International Airport (EWR) that will induce airlines to solve chronic congestion problems in the New York area through “market forces,” by allocating assets based on price.

GAO has already said the government has no right to do so. “FAA (a DOT agency) may not auction off slots under its property disposition authority, user fee authority, or an other authority,” wrote GAO General Counsel Gary Kepplinger in a letter to federal lawmakers.

To be sure, on-time performance at Newark, Kennedy (JFK), and LaGuardia (LGA) continues to be anemic even after airlines cut their flight schedules. The issue is, will “market forces” solve the problem?

An administration with less than four months left on the job asserts it will, and seems to be willing to go to court in order to try to prove the point.

© Cheapflights Ltd Jerry Chandler