‘Star Marianas wants CPA to waive passenger tax for Tinian and Rota’

Star Marianas, the sole airline that provides interisland commute among the islands of the CNMI, continues to argue that the Passenger Facility Charge imposed by the Commonwealth Ports Authority should be waived for them.

In an interview with CPA board chair Kimberlyn King-Hinds, she said this is on top of the millions of dollars Star Marianas owes in fees. She said Star Marianas argues that PFCs should be waived for its to lessen the burden of interisland commuters.

“Star Marianas, for a long time, has been arguing that Tinian and Rota should be waived as far as the collection of those PFCs [is concerned] to basically lessen the burden of interisland commute. Which I don’t disagree with,” she said.

Essentially, PFC is a tax that the Federal Aviation Administration authorizes CPA to impose on all airlines doing business in the CNMI in order to fund improvements to the Francisco C. Ada/Saipan International Airport, Tinian International Airport, and Rota International Airport.

The board chair explained CPA also makes improvements to its terminals through AIP, or Airport Improvement Program, funds from the FAA. However, these grants do not cover 100% of the cost and, like other federal grants, there is a local match.

Although she does not disagree with the argument, King-Hinds said it would be unfair to other airlines if the tax is waived specifically for Star Marianas.

“I can’t just think of Tinian and Rota. I have a duty and obligation to the entire Commonwealth and when you only tax a certain group of people, it’s unfair,” she said.

On top of it being unfair, CPA depends on taxes like PFCs in order to make the necessary improvements on Tinian and Rota since it isn’t subsidized by the CNMI government.

“Where am I going to get the money for the improvements that are needed to be made to Tinian and Rota? Everybody basically has to share in this burden. CPA does not get any funding, at all, from the government. We rely on our ability to charge and assess fees to be able to cover for these costs, so that’s why we charge PFCs,” she said.

Currently, CPA isn’t imposing PFCs as their authorization to collect these fees have expired. King-Hinds said CPA is still working on the application to
get regain authorization from the FAA to impose these fees.

“We issued a notice to all carriers that our authorization to collect those fees has expired and we have submitted a letter to the FAA requesting to reauthorize us to continue charging the $4.50,” she said.