Jacob Ogles
Legislation eliminating an aviation tax in Florida flew through its first committee vote, but not without any turbulence.
The Senate Commerce and Tourism Committee voted 4-1 in favor of the bill (SB 1192). But multiple members said they want more financial data before it lands on the floor.
State Sen. Joe Gruters, the bill’s sponsor, said Florida needs to stop charging taxes of jet fuel. It only makes airlines fill their tanks in other states.
Fred Baggett, a lobbyist for Airlines for America, asserted as much in a committee hearing. He said a number of airlines right now fly planes from Charlotte to Miami and will manage fuel so they only refill in North Carolina. The reason? That state a charges 0.0025 cent-per-gallon tax and Florida charges 4.27 cents.
That’s something that affects airline decisions on where to place hubs.
“You may say its only a couple of pennies per gallon, but when you have millions of gallons used in a hub, it’s a lot of money,” Baggett said.
Airline executives also showed up in favor of nixing the tax.
But many airport officials expressed concern eliminating a tax on jet fuel would hurt infrastructure funding in Florida.
Luis Olivero, with the Greater Orlando Aviation Authority, said airports work on five-year plans for capital investment. The loss of revenue could indirectly affect whether projects could move forward.
Notably, revenue from the aviation tax in Florida goes into the State Transportation Trust Fund. Gruters’ bill has yet to be scored by state economists, but previous projections suggested the tax would generate $17 million this year.
Baggett noted that’s just a small portion of the $7.5-billion transportation fund. By law, 15% of that revenue gets re-distributed to state airports, seaports and spaceports.
Gruters said eliminating the tax should attract airlines to direct more routes to Florida — not to mention fueling with Florida fuel sellers. He noted that since the state started slashing its fuel tax — it went from 6.9 cents to 4.27 cents last year — there’s been an increase in passenger growth.
“This is a consumer-friendly bill,” he said. “Anything we can do to incentivize the airlines to open more routes and more hubs, anything to drive more economic activity to Florida and provide consumers with more options is the way to go.”
State Sen. Linda Stewart, an Orlando Democrat, voted in favor of advancing the legislation. But when it comes in front of an appropriations committee, she said she will want to see more data on how many aviation projects in the state rely on bonding.
The same sentiment was voiced by state Sen. Tom Wright, a Port Orange Republican. “We need to move this to the next step,” he said. “But between now and then we need to do a little work and make sure the Ts are crossed and Is are dotted.”
The lone no vote on killing the jet fuel tax came from state Sen. Victor Torres, a Kissimmee Democrat. Vice chair of the committee, he represents an area served by two airports— in Orlando and in Kissimmee.
“To be honest, some of the airlines have cut routes providing service to our consumers,” he said.
But he also represents one of the state’s largest Puerto Rican community, and said airlines need to show themselves to be good citizens before seeking significant tax relief. He noted distresisng recalls his office received after the island nation suffered an earthquake.
“I had folks call from Puerto Rico saying the airlines had raised their prices,” Torres said. “I had to make calls to some of you out there (airline executives) to help me. I don’t mind a tax break, but I look at families facing a situation where they need to get out of the island right now. I’m a no vote on this. I could be swayed.”
The bill heads now to the Senate Finance and Tax Committee before going to Appropriations.
State Rep. Spencer Roach, a North Fort Myers Republican, has sponsored companion (HB 6061) legislation in the state House. That legislation has been referred to the House Ways and Means Committee.
