Debt Standoff May Cost SoCal FAA Contractors $400M
LOS ANGELES (CBS) — Local businesses stand to lose hundreds of millions of dollars as lawmakers in Washington remain deadlocked in efforts to avoid a U.S. default on its debt.
The Federal Aviation Administration is currently not being funded after Congress failed to agree on a stopgap budget plan, resulting in a partial shutdown of the agency and leaving several firms across the nation losing out on much-needed revenue.
KNX 1070′s Charles Feldman reports two contractors here in the Southland are feeling the effects of the political stalemate.
The FAA has stopped an estimated $370 million in contracts with an engineering firm that handles the design of air traffic facilities.
In Palm Springs, a $24 million project to construction a new airport tower has also been put on pause until the debt limit issue is resolved.
Transportation Secretary Ray LaHood criticized some of the nation’s biggest airlines for pocketing revenue that used to be earmarked for federal taxes.
“They should not be treating customers and passengers in a way that looks like they’re collecting money — which is the tax — that should not be collected,” LaHood said.
An estimated 4,000 FAA employees have been furloughed — many of them here in California.