NavCanada Raises Rates

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NavCanada, the private, non-profit company that supplies air traffic control and other aviation services in Canada, is raising its rates an average of 6.9 percent in August. The company announced Thursday that the ongoing airline slump, coupled with the war in Iraq and SARS, and an unpaid $43 million debt owed by Air Canada, now in bankruptcy protection, has combined to create a shortfall of about $176 million. "We've exhausted our ability to help ease the burden of the downturn on our customers," CEO John Crichton told a news conference. The company took over the services from the government in 1997 and, as it chopped overhead, rates were reduced. But after 9/11, rates were hiked and the latest increase will push them to their highest level. It's still a bargain, according to Crichton ... and some basic math. "... our charges [will] still be 28 percent below the old Air Transportation Tax they replaced," he said. The increase translates to about 65 cents on the price of a ticket between Ottawa and Toronto. South of the border, the rate hikes in Canada will undoubtedly become fodder for those fighting any chance that ATC could be privatized in the U.S. AOPA says a bill it's backing to privatization, and the fluctuating user fees that come with it, is making headway through Congress. The House aviation subcommittee approved the proposed legislation but it has to go through both arms of government and be signed by the president to become law. "AOPA has argued insistently that control of the nation's airspace must remain under the direct control of the government," said AOPA President Phil Boyer. Earlier this year, the FAA declared ATC to be a "commercial function," thus potentially open to privatization. But FAA officials, including administrator Marion Blakey, have repeatedly stated there is no intention to privatize ATC.