In a previous millennium, the Fee Detective was offered a position with the SAS Institute in Cary, North Carolina. Although I could still envision living in the Raleigh-Durham region, I ended up in another area with a great mid-sized airport (Nashville) instead. Our trip to Raleigh-Durham is on a momentous occasion, the FAA's conditional approval of RDU's Airport Layout Plan (ALP) called Vision 2040, including a new consolidated rental car facility.
Wheels once in Raleigh will have a fee.
Why FAA Approval?
Air travelers pay multiple taxes and fees while using airports and the proceeds of those fees can only be used for aviation-related projects. In addition, the FAA has a regulatory role in approving any project that relates to the safety of air traffic (including ground activities near airports). And the FAA's approval of the buildings is still conditional, as the airport now has to complete environmental assessments on the "approved" projects and re-seek FAA approval. So RDU's really only approved to seek the next FAA approval.
Why the Fee Detective?
The Fee Detective is excited about the new consolidated rental car facility (CONRAC)! Instead of taking shuttles to various remote rental car lots, the new center will be located within walking distance of Terminals 1 and 2!
Planning work has also begun on a new rental car center, to be built just north of the airport’s parking garage, between Terminals 1 and 2. It would replace a series of rental car lots on the south end of the airport that travelers can only reach from the terminals on shuttle buses and vans.
Then there are the ... well ... fees. And that's where the Fee Detective's smile turns upside down. The Avis example below shows how a renter can already expect an approximately 50% tax and fee burden on a one-week rental car transaction.
The taxes and fees are of the type we've seen elsewhere.
Concession Recovery Fee -- The 11.1% is how the airport gets their cut of 10% of the rental car company's revenue. Rather than the rental car company taking 10% out of their basic revenue, they add 11.1% to make the total "111.1%" and then give the airport 10% of the larger number. The rental car company still keeps "100%" of the base rate and renters suffer (pay or don't rent).
Gross Receipts Tax -- The county needs their slice, so they add another 1.5%.
Transit Tax -- The region makes rental car users pay for transit for local residents (because taxing local residents would be unpopular), so they add another 5%. You can read all about that fee here, on page 34 of 36 (not that the fee's hidden or anything).
Vehicle Licensing Fee -- Want to make AutoSlash founder Jonathan grumble? Mention the vehicle licensing fee. Many states allow the rental car companies to collect an extra fee for licensing their vehicles when licensing and registering vehicles is a basic function of a rental car company.
Customer Facility Charge -- Want to make the Fee Detective grumble? Mention a daily Customer Facility Charge. We've joked in the past that fees of this type could save both the U.S. Postal Service and Amtrak. It's a fee that punishes users for not using a service.
- A renter who gets a car, leaves, returns the car in one day? Pays the $5 CFC once.
- A renter who gets a car, leaves, returns the car in seven days? Pays the $5 CFC seven times!
- A renter who gets a car, leaves, returns the car in fifteen days? Pays the $5 CFC fifteen times!
The Customer Facility Charge is the exact opposite of a parking fee. A parking fee charges a user for the amount of time space is used. Even though a renter picks up a car once, leaves the CONRAC once, and returns the car just once, the CFC scales to charge a renter for the amount of time the rental car facility is not used. And airports wonder why -- with spiking parking fees and additional rental car taxes -- travelers are increasingly relying on ride-hailing services and friends/co-workers for transportation. If only simple economic principles like supply and demand applied to airports, the local airport authorities might have a way of discerning the implications of taxes and other disincentives.
Visitors to RDU get another kick while they're down -- the "nice" $5 per day CFC is for a new center that's going to be within walking distance. Five dollars per day for each day away from the airport and there isn't even the need for the Airport Authority to pay for shuttles buses or shuttle drivers! With figures like that, the CONRAC should be paid for in no time, unless ...
Fees, facility charges, and taxes got you confused and/or down? The Fee Detective can explain. Send your query to email@example.com and we may feature your question in an upcoming post.