Regulatory Burden

Airports today face a high-degree of regulatory burdens, such as new environmental and security regulations.  But each new regulation adds to an airport’s costs. 

This cost burden by this “regulatory creep” places Canadian airports at a competitive disadvantage compared to other forms of transportation, as well as with other airports, as gateways to regional and international trade.
 
The CAC seeks steps that would alleviate the regulatory burden on airports without compromising safety, and create a more level playing field for airports competing with other transportation modes.

Background

Since devolution of airports in 1992, the federal government has gradually increased the regulatory burden on Canadian airports.  The costs associated with examining regulations in a wide array of subject areas, as well complying with them, has steadily added to airports’ operating costs over the years.

Meanwhile, airports compete with other modes of transportation that don’t have such a high regulatory burden.  Particularly for short-haul travel, overzealous regulation simply adds to the cost disadvantage airports suffer compared to rail and highway modes of transportation.

With limited budgets already stretched by operating costs, capital expenditures, and in the case of National Airports System (NAS) airports – federal rent tax, many of the CAC’s member airports cannot afford to assume the additional costs.  For Canada’s smaller airports, limited traffic numbers limit their ability to raise revenue or cut costs sufficiently to make up for the financial burden posed by increased regulation.

The federal Standing Committee on Transport, in its May 2005 Interim Report, noted what it termed the “regulatory creep,” of Transport Canada regulations that have placed a heavy burden on airports in examining and complying with new regulations imposed in a wide range of areas.  The committee recommended that the federal government cover the increased costs associated with additional regulations placed on small and regional airports.

The CAC continues to support the SCOT Interim Report recommendation that the government cover any increase in costs associated with additional Transport Canada regulations being placed on small and regional airports.