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Businessweek Archives

Weighing In On The Faa

Readers Report


"How to end the free ride at the FAA" (News: Analysis & Commentary, May 6) contains a number of misleading statements. Most of the Federal Aviation Administration's funding (nearly 75%) comes directly from charges on users--not general taxpayer revenues. Since 1970, the users of air transportation have paid a variety of taxes to fund the FAA. Persons who do not use FAA services do not pay such levies.

The portion of FAA funding that come from general-taxpayer revenues largely reimburses the FAA for the military's use of the system (estimated at 15%) and the federal government's use--such as border-control operations. It also reflects the public benefit inherent in a strong air-transportation system.

The article also states that "calls to bring bottom-line business practices to the Federal Aviation Administration have been thwarted, largely thanks to the corporate- and business-plane lobby."

Nothing could be further from the truth. It was this very group that helped lead the charge to bring the FAA's cumbersome personnel and procurement practices in line with those in the private marketplace. If necessary, Congress should increase user taxes and look for ways to maximize this important revenue stream. GAMA has supported increases in the aviation-fuel tax to fund the FAA. But let's not, as you seem to suggest, replace established user taxes with European-style fees. That would only lead to bigger and less efficient government, reduced aviation activity, and possibly a declining safety record.

Edward W. Stimpson


General Aviation Manufacturers Assn.


Instead of taking advantage of huge potential cost savings, the FAA has pandered to an entrenched bureaucracy, coddled overpaid employee unions, and wasted billions on gold-plated "customized systems" that rarely live up to their hype. If FAA employees met the same productivity standards that are widely expected through the aviation industry, there would be no need for additional taxes or more user fees.

James K. Coyne


National Air Transportation Assn.

Alexandria, Va.Return to top


As counsel to Landmark International Equities, we want to point out that your article misled readers into believing that the two public offerings by Landmark were "both money-losers for investors" ("Ollie North goes gunning for investors," News: Analysis & Commentary, Apr. 29).

You state that "shares of GreenMan Technologies Inc. hit 8 3/8 after going public in October but traded on Apr. 17 at only 5." In fact, the public offering consisted of one share of common stock and one common-stock purchase warrant. Clients of Landmark purchased securities for an aggregate price of $5.10. An Apr. 17, the aggregate price was $6.9375. You also state that R.F. Management Corp. "went public in July at 7 3/4 a share; on Apr. 17, it was at 3 3/4." In fact, the combined (stock and warrants) offering price was $5.70. On Apr. 17, the combined price was $5.375.

Anthony M. Collura

Silverman, Collura & Chernis

New York

Editor's note: The article did not differentiate between Landmark's customers, who invested at the offering price, and others who invested later. We did not intend to leave the impression that all investors lost money.Return to top


It's sad to see Apple Computer Inc. in financial difficulties. Amelio's plan to rescue Apple seems risky ("Apple: Tick, tock. Tick, tock," News: Analysis & Commentary, Apr. 29). I wish Amelio and Apple the best of luck, but with computers being sold like fast food, the Mac is just another hamburger.

Thomas C. Zebovitz

Colonia, N.J.Return to top

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