It's not the biggest bird on this year's budgetary horizon, but a proposal to reduce a state tax on aviation fuel is gathering momentum, and stands to bolster and protect Buffalo's newly energized airline service.
The levy is part of New York's $10 billion petroleum business tax, though it accounts for no more than a tenth of a percent of that total. Two Erie County legislators -- Assemblyman Robin Schimminger, D-Kenmore, and Sen. Mary Lou Rath, R-Williamsville -- have introduced legislation that would eliminate the tax, which applied to flights that originate in New York, regardless of their destination. Flights arriving in New York from outside the state are not taxed.
New York is the only state with such a tax, Schimminger said, and it especially hurts intrastate flights -- which, by definition, means upstate -- since takeoff consumes a large amount of fuel. The shorter the flight, the higher the proportion of fuel used during takeoff, the greater the impact of the tax. We are hurting ourselves.
Gov. George E. Pataki this week proposed his own attack on the fuel tax. His approach would do less than the legislators', though, since his bill would affect only fuel used in flight, while continuing to tax the portion used during takeoff.
All flights originating in New York are taxed on takeoff fuel, the governor's office said, but only intrastate flights are taxed for in-flight usage, creating a competitive disadvantage. Nevertheless, a spokesman said Pataki would be willing to consider the broader plan.
Pataki's bill would cut the tax by $2 million, while the Schimminger-Rath proposal would lower it by $8 million to $10 million. The difference measures the disproportionate amount of fuel used on takeoff.
This tax affects all airlines, but it particularly hurts low-cost carriers like JetBlue. Those companies revived Western New York's comatose airline industry, but they operate on tighter margins and can suffer when the bigger, predatory airlines cut ticket prices. That's a separate issue -- one recently raised by Sen. Charles Schumer -- but eliminating the fuel tax would put the low-cost carriers on a more secure footing.
The hope, of course, is that airlines will pass any savings along to the public, and while there is no guarantee that will happen, all it takes is one or two to force the issue. That would be the best outcome, but this region's interest in protecting its aviation health is reason enough to support elimination of this tax.