White House mulls market approach in effort to ease air-traffic congestion
May encourage airports to charge premium for prime slots

By Stephen Power
THE WALL STREET JOURNAL

WASHINGTON, Aug. 22 - The Bush administration, in a surprise move that could
rankle the major airlines, said it will consider encouraging airports to
charge carriers a premium for scheduling flights at busy travel hours as a
way to ease air-travel gridlock. The idea has been embraced by airport
executives and some economists as a market-based way to get airlines to
spread out the timing of flights at crowded hubs.

Critics say it could threaten air service to smaller communities and raise
ticket prices for business travelers, who tend to prefer flights at the
busiest times - the beginning and end of the business day.

Federal regulators have never endorsed such a concept, and under the Bush
administration, the Transportation Department instead has emphasized
construction of more runways as a long-term strategy for reducing flight
delays.

But the department announced Tuesday that it was seeking public comment on
various "market-based approaches" to reducing air-traffic congestion, such
as forcing airlines to bid on takeoff and landing slots at crowded airports.
The announcement, which calls for comments within the next 90 days, doesn't
specify which airports could impose peak-hour fees for landing or taking
off, or how money raised from such fees should be spent.

Industry reaction to the announcement was guarded as officials studied the
matter.

Tom Donahue, a Delta Air Lines spokesman, said the Atlanta carrier is
convening an in-house working group to review the request and consider the
implications.

John Meenan, a lobbyist for the Air Transport Association, the main trade
group for major U.S. carriers, said his group is studying the announcement,
too. "It has the potential for significantly altering the nature of air
transportation in the U.S. and significantly increasing the cost of air
travel," he said, adding that charging airlines extra for flights during
peak travel hours is "not good for the economy and the public at large."

The Federal Aviation Administration said in the spring of last year that
airlines have scheduled so many flights at certain airports that it is
impossible for all those planes to take off or land on time. Since then,
there has been some easing. The Transportation Department recently said 77%
of flights on major airlines were on time during the first six months of
2001, up from 74% during the year-earlier period.

Airline-industry representatives blame the bottlenecks on a shortage of
runways and an out-of-date air-traffic-control system. Transportation
Secretary Norman Mineta said some form of "market-based pricing" by airports
may be needed "in the near term."

The FAA already is considering various market-based mechanisms for easing
delays at New York's La Guardia Airport, which had a higher percentage of
delays than any U.S. airport in 2000.

A spokesman for a group representing U.S. airport executives said many
airports could use the extra money to upgrade their facilities to help meet
the increased demand for air service. They also note that some airports don'
t have the land or local support needed to build new runways, so flight
management is the only way to handle crowding.

Currently, airport fees are set by local authorities and are calculated
using aircraft weight. Some aviation experts say the facilities already have
the legal authority to charge carriers extra for flights at peak-travel
hours. But, many airport operators are looking to the Transportation
Department for guidance on how to implement such fees.

"This would really get us there," said Steve Van Beek, senior vice president
of the Airports Council International. "Otherwise [airports] are going to
get into lawsuit after lawsuit over this."

- Martha Brannigan in Atlanta contributed to this article.


Copyright © 2001 Dow Jones & Company, Inc.
==========
**NOTICE:  In accordance with 17 U.S.C. Section 107, this material is
distributed without profit to those who have expressed a prior interest in
receiving the included information for research and educational purposes.**
==========