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| FOR IMMEDIATE RELEASE |
| State Rep. Peter J. Daley |
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Daley stands up for job creation
HARRISBURG, Jan. 24 – During a Capitol news conference today, state Rep. Peter J. Daley II, D-Fayette/Washington, talked about how Pennsylvania could become a leader in the field of aviation and create family-sustaining jobs.
Daley and others spoke about legislation, H.B. 1100, which would eliminate the sales and use tax on fixed-wing aircraft sales, parts, maintenance and repair in Pennsylvania, allowing the state to create jobs while it gains a stronger foothold in the aviation and aeronautics industry.
“Plain and simple, this bill is about creating jobs,” Daley said. “If it is enacted, it would open the door for the aviation industry to set up shop at Pennsylvania’s airports, with businesses that service aircraft, sell parts, perform routine inspections and even build and sell aircraft. We are looking at the creation of thousands of jobs right here in Pennsylvania.”
According to Daley, the goal of the legislation is to ensure that Pennsylvania remains competitive with its neighboring states and regionally, as well as creating good-paying jobs. When a similar measure was passed for helicopters, a company in West Chester added 412 jobs. Because of that, Pennsylvania collects six times more revenue in personal income and local wage taxes, as it was through the sales and use tax. If Pennsylvania can catch up to Ohio in terms of employment, the return to the General Fund could be $8.2 million, alone.
Pennsylvania stands as the only northeastern state not to enact some form of meaningful tax reform on fixed-wing aviation. The SUT puts the Commonwealth at a distinct disadvantage over states like New York and Ohio. The industry employs about 9,400 people in New York and 8,300 in Ohio, to Pennsylvania’s 2,900.
Joining Daley at the news conference were several individuals from the industry, including Craig Stephan, vice president and quality manager of Cheyenne Air Service Inc. of Washington, Pennsylvania. The firm employs highly skilled and trained individuals to deal with the repair and installation of complex aircraft communication and navigation equipment, but has been forced to lay off a significant portion of its personnel due to declining sales of avionics equipment installation.
“Pennsylvania does not have any franchised aircraft service centers due to the current tax policy,” Stephan said. “This allows travel for service, repair and maintenance to more tax friendly locations justifiable for the corporate flight department.”
Stephan said that should the legislation be enacted, Cheyenne Air would reduce its unemployment rolls and hire additional personnel. He anticipates that annual sales volume would increase by 25 percent.
Jim DeLong, manager of Bun Air Corporation of Bedford, a Cessna Aircraft Authorized Service Facility and the only multi-engine Cessna Service facility in the Commonwealth, also spoke about how the repeal of the tax would help to grow the industry and create jobs.
Taking a different look at the issue, John Graham III, President and CEO of the Pittsburgh Institute of Aeronautics talked about Pennsylvania’s brain drain. The institute has trained aviation technicians since 1929. Starting average salary for graduates in aviation-related jobs is between $50,000 and $55,000.
“A look at our graduating classes since 2005 tells us that 80 percent of graduates who took aviation jobs left the state,” Graham said. “Last fiscal year alone, only 5 percent of our Pittsburgh aviation graduates got aerospace related jobs in Pennsylvania. There is an even greater impact than is represented in these statistics since many of those who chose less ideal, sometimes lower paying, non-aviation jobs, approximately 10 percent of our graduates did so because they wanted to remain in the state or immediate area.
“Pennsylvania shouldn’t be chasing talent away to other industries and other states over a tax that generates so little revenue.”
According to Daley, there is a large potential for aircraft maintenance businesses to relocate and open new operations in Pennsylvania should the legislation become law. Approximately 7,000 airplanes are based in Pennsylvania and all require federally mandated maintenance and repair. This means that the customer base for airplane maintenance and repair already exists in Pennsylvania.
“This is about jobs – from pilots to computer technicians, attendants and skilled aviation mechanics to maintain aircraft, to making Pennsylvania a competitive place to start or relocate a company that relies on aircraft in our global marketplace,” Daley said. “With new jobs comes an uptick in wage tax, a healthier and more robust economy, and the wherewithal to address some of the budget cuts to important programs, such as education.”
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