1994-04-13                     Senate Journal                      Page 3639
HB 406                                                                       
SENATE CS FOR CS FOR HOUSE BILL NO. 406(RLS) was read                          
the third time.                                                                
                                                                               
Senator Sharp moved and asked unanimous consent that the                       
following Finance Committee Letter of Intent be adopted as a Senate            
Letter of Intent.  Senator Duncan objected, then withdrew his                  
objection.  There being no further objections, the Senate Letter of            
Intent was adopted.                                                            
                                                                               
                                Letter of Intent                               
                                      for                                      
                  SENATE CS for CS for HOUSE BILL NO. 406(RLS)                 
                                                                               
It is the intent of the Legislature to define the                             
powers of municipalities to tax commercial aviation                            
activities in a manner consistent with federal                                 
aviation law.                                                                  
                                                                               
Municipalities may not levy taxes, directly or                                
indirectly, on passengers and air freight carried by                           
commercial air service companies holding Federal                               
Aviation Administration certificates.                                          
                                                                               
Municipalities may levy other taxes, currently                                
permitted under federal law, such as landing taxes,                            
fuel flowage fees, property taxes, and taxes on the                            
sale of goods and services which are incidental to                             
air transportation such as food provided to airline                            
passengers.                                                                    
                                                                               
Federal taxes on passengers and air freight, paid by                          
airport users, are returned to the States through the                          
Airport and Airways Trust Fund for the construction                            
of new airport facilities.  This was one reason for                            
federal limitation on the rights of states and                                 
municipalities to tax air transportation.