Federal Aviation Administration--Authority to Auction Airport Arrival and Departure Slots and to Retain and Use Auction Proceeds

This responds to a Congressional request for our legal opinion regarding the authority of the Federal Aviation Administration (FAA) to auction airport arrival and departure slots. As part of its efforts to reduce congestion in the national airspace, in April and May 2008, FAA issued proposed regulations to conduct such auctions at three New York-area airports--LaGuardia Airport (LaGuardia), John F. Kennedy International Airport (JFK), and Newark Liberty International Airport (Newark)--at some time in the future. In August 2008, FAA announced that it was proceeding to auction two specific slots at Newark on September 3, an action that has since been administratively stayed. On September 16, 2008, FAA announced that "[i]n accordance with rulemaking activity that is not yet complete" and "if the rule is adopted," it may auction slots at Newark, LaGuardia, and JFK starting on January 12, 2009. As agreed with your staff, this opinion addresses whether FAA has authority to auction slots and if it does, whether it may retain and use funds obtained through such auctions.