Printed headline: Nickels and Dimes
The European Aviation Safety Agency (EASA) is taking a look at the fees and charges it imposes on certification and approval applicants. According to a memo distributed in conjunction with a survey request to industry stakeholders, EASA maintains that revenues derived from applicants did not cover the cost of services provided in 2016 or 2017. The agency proposes increasing fees by as much as 35% for “loss-making” services, including certification of a derivative or major change, and initial and continuous maintenance organization approvals. Fees imposed for the acceptance of Part 145 and 147 approvals under bilateral agreements will remain unchanged at €1,800 ($2,089) for initial approvals and €900 annually thereafter.
Industry fees make up 64% of the agency’s €161 million ($187 million) annual budget. EU subsidies account for another 23%, while the remaining funds come from third-party contributions and earmarked funds. The current fee structure is dictated through EASA Basic Regulation, which the agency says needs modernization to take into consideration emerging technologies, continuing staff education, retention and recruitment of the best talent, and coverage of staff pension contributions previously financed by the European Union.
The EASA memorandum communicates proposed changes to fees and costs, largely based on the type of approval and complexity (i.e., agency resources required). Price tables reflecting current and proposed costs are provided for all EASA approval services, including major and minor repairs, maintenance organization approvals and surveillance.
EASA made mention of several price-increase options that it declined to propose. Creation of a fast-tracked service was deemed inappropriate since it would disproportionately affect smaller companies not in the position to pay higher fees for expedited services. EASA concluded that those applicants would likely see slower processing times. An across-the-board increase was considered but rejected, given potential threats to financial viability due to applicant volume volatility and the variation in revenue from service to service.
In June, the FAA and European Commission (EC) signed a decision paving the way to reduce the fees EASA charges U.S. manufacturers to validate design approvals. The agreement dictates changes to Technical Implementation Procedures to include language that “accepted” approvals do not require application or any associated fees. The agreement also puts a cap on the time the validating authority may spend on type certificate and supplemental type certificate “streamlined validation” approvals.
EASA and the European Union will reference stakeholder feedback while finalizing the proposed revisions to the cost and fees structure. Once amended, the regulation is expected to take effect in 2020.