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113th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES
 2d Session                                                     113-554

======================================================================



 
                    TRANSPARENT AIRFARES ACT OF 2014

                                _______
                                

 July 24, 2014.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______
                                

 Mr. Shuster, from the Committee on Transportation and Infrastructure, 
                        submitted the following

                              R E P O R T

                        [To accompany H.R. 4156]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Transportation and Infrastructure, to whom 
was referred the bill (H.R. 4156) to amend title 49, United 
States Code, to allow advertisements and solicitations for 
passenger air transportation to state the base airfare of the 
transportation, and for other purposes, having considered the 
same, report favorably thereon without amendment and recommend 
that the bill do pass.

                                CONTENTS

                                                                   Page
Purpose of Legislation...........................................     2
Background and Need for Legislation..............................     2
Hearings.........................................................     2
Legislative History and Consideration............................     2
Committee Votes..................................................     2
Committee Oversight Findings.....................................     3
New Budget Authority and Tax Expenditures........................     3
Congressional Budget Office Cost Estimate........................     3
Performance Goals and Objectives.................................     4
Advisory of Earmarks.............................................     4
Duplication of Federal Programs..................................     4
Disclosure of Directed Rulemakings...............................     4
Federal Mandate Statement........................................     4
Preemption Clarification.........................................     4
Advisory Committee Statement.....................................     5
Applicability of Legislative Branch..............................     5
Section-by-Section Analysis of Legislation.......................     5
Changes in Existing Law Made by the Bill, As Reported............     5

                         Purpose of Legislation

    H.R. 4156, the ``Airfare Transparency Act of 2014,'' 
clarifies that it is not an unfair or deceptive practice to 
state in an advertisement or solicitation the base fare for 
passenger air transportation as long as the government-imposed 
taxes and fees and the total cost of the air transportation are 
clearly and separately disclosed in the advertisement or 
solicitation.

                  Background and Need for Legislation

    Virtually all consumer products are sold at a base price, 
with taxes added on at the point of purchase. However, in 
January 2012, the United States Department of Transportation 
(DOT) fundamentally changed U.S. airline advertising practices 
by implementing a rule that prohibits air carriers and ticket 
agents from providing full disclosure of government imposed 
taxes and fees in advertised prices. DOT's previous advertising 
rules had been in effect for 25 years. The DOT's 2012 
advertising rule requires air carriers and ticket agents to 
include all government imposed taxes and fees in the advertised 
price of a ticket. As a result, government imposed taxes and 
fees may not always be apparent to the traveling public.
    H.R. 4156 will allow air carriers and ticket agents to 
display the actual cost of air travel in a clear and 
transparent way--enabling passengers to see the base airfare as 
well as the government-imposed taxes and fees. It does this by 
amending section 41712 of title 49, United States Code, to 
clarify that it is not an unfair or deceptive practice to 
display, in an advertisement or solicitation, the base fare for 
the air transportation as long as the taxes, fees and total 
cost are clearly and separately disclosed in the advertisement 
or solicitation.

                                Hearings

    No hearings were held on H.R. 4156.

                 Legislative History and Consideration

    On March, 6, 2014, Rep. Bill Shuster introduced H.R. 4156, 
along with original cosponsors Representatives Peter DeFazio, 
Tom Graves, Rick Larsen, Frank LoBiondo, and Nick Rahall.
    On April 9, 2014, the Committee on Transportation and 
Infrastructure met in open session and ordered the bill 
reported favorably to the House by voice vote with a quorum 
present.

                            Committee Votes

    Clause 3(b) of rule XIII of the Rules of the House of 
Representatives requires each committee report to include the 
total number of votes cast for and against on each record vote 
on a motion to report and on any amendment offered to the 
measure or matter, and the names of those members voting for 
and against. There were no record votes taken in connection 
with consideration of H.R. 4156 or ordering the measure 
reported. A motion to order H.R. 4156 reported favorably to the 
House was agreed to by voice vote with a quorum present.

                      Committee Oversight Findings

    With respect to the requirements of clause 3(c)(1) of rule 
XIII of the Rules of the House of Representatives, the 
Committee's oversight findings and recommendations are 
reflected in this report.

               New Budget Authority and Tax Expenditures

    Clause 3(c)(2) of rule XIII of the Rules of the House of 
Representatives does not apply where a cost estimate and 
comparison prepared by the Director of the Congressional Budget 
Office under section 402 of the Congressional Budget Act of 
1974 has been timely submitted prior to the filing of the 
report and is included in the report. Such a cost estimate is 
included in the report.

               Congressional Budget Office Cost Estimate

    With respect to the requirement of clause 3(c)(3) of rule 
XII of the Rules of the House of Representatives and section 
402 of the Congressional Budget Act of 1974, the Committee has 
received the enclosed cost estimate for H.R. 4156 from the 
Director of the Congressional Budget Office:

                                     U.S. Congress,
                               Congressional Budget Office,
                                    Washington, DC, April 18, 2014.
Hon. Bill Shuster,
Chairman, Committee on Transportation and Infrastructure,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 4156, the 
Transparent Airfares Act of 2014.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Megan 
Carroll.
            Sincerely,
                                              Douglas W. Elmendorf.
    Enclosure.

H.R. 4156--Transparent Airfares Act of 2014

    H.R. 4156 would require the Department of Transportation 
(DOT) to promulgate a rule related to how prices for certain 
types of air transportation are advertised. Under current 
policies, DOT requires that advertised prices for air travel 
reflect the total price per passenger to be paid by customers, 
including government-imposed taxes and fees. Under H.R. 4156, 
sellers of air transportation could instead advertise base 
airfares, provided that advertisements also disclose the amount 
of additional government-imposed taxes and fees that customers 
would pay.
    CBO estimates that enacting H.R. 4156 would have no 
significant effect on the federal budget. Based on information 
from DOT we estimate that any costs incurred to complete the 
proposed rulemaking, which would be subject to the availability 
of appropriated funds, would be insignificant. H.R. 4156 would 
not affect direct spending or revenues; therefore, pay-as-you-
go procedures do not apply.
    H.R. 4156 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act and 
would impose no costs on state, local, or tribal governments.
    The CBO staff contact for this estimate is Megan Carroll. 
The estimate was approved by Theresa Gullo, Deputy Assistant 
Director for Budget Analysis.

                    Performance Goals and Objectives

    With respect to the requirement of clause 3(c)(4) of rule 
XIII of the Rules of the House of Representatives, the 
performance goal and objective of this legislation is to 
restore transparency to airline advertising by clarifying that 
it is not an unfair or deceptive practice to display, in an 
advertisement or solicitation, the base fare for the air 
transportation as long as the taxes, fees and total cost are 
clearly and separately disclosed in the advertisement or 
solicitation.

                          Advisory of Earmarks

    Pursuant to clause 9 of rule XXI of the Rules of the House 
of Representatives, the Committee is required to include a list 
of congressional earmarks, limited tax benefits, or limited 
tariff benefits as defined in clause 9(e), 9(f), and 9(g) of 
rule XXI of the Rules of the House of Representatives. No 
provision in the bill includes an earmark, limited tax benefit, 
or limited tariff benefit under clause 9(e), 9(f), or 9(g) of 
rule XXI.

                    Duplication of Federal Programs

    Pursuant to section 3(j) of H. Res. 5, 113th Cong. (2013), 
the Committee finds that no provision of H.R. 4156 establishes 
or reauthorizes a program of the Federal government known to be 
duplicative of another Federal program, a program that was 
included in any report from the Government Accountability 
Office to Congress pursuant to section 21 of Public Law 111-
139, or a program related to a program identified in the most 
recent Catalog of Federal Domestic Assistance.

                   Disclosure of Directed Rulemakings

    Pursuant to section 3(k) of H. Res. 5, 113th Cong. (2013), 
the Committee estimates that enacting H.R. 4156 would require 
the Secretary of Transportation, not later than 120 days after 
enactment, to issue final regulations to carry out the 
amendment made to section 41712 of title 49, United States 
Code.

                       Federal Mandate Statement

    The Committee adopts as its own the estimate of Federal 
mandates prepared by the Director of the Congressional Budget 
Office pursuant to section 423 of the Unfunded Mandates Reform 
Act (Public Law 104-4).

                        Preemption Clarification

    Section 423 of the Congressional Budget Act of 1974 
requires the report of any Committee on a bill or joint 
resolution to include a statement on the extent to which the 
bill or joint resolution is intended to preempt state, local, 
or tribal law. The Committee states that H.R. 4156 does not 
preempt any state, local, or tribal law.

                      Advisory Committee Statement

    No advisory committees within the meaning of section 5(b) 
of the Federal Advisory Committee Act are created by this 
legislation.

                  Applicability of Legislative Branch

    The Committee finds that the legislation does not relate to 
the terms and conditions of employment or access to public 
services or accommodations within the meaning of section 
102(b)(3) of the Congressional Accountability Act (Public Law 
104-1).

               Section-by-Section Analysis of Legislation


Section 1. Short title is the ``Transparent Airfares Act of 2014''

Section 2. Full fare advertising

    Subsection (a) amends section 41712 of title 49, United 
States Code to clarify that it is not an unfair or deceptive 
practice to state in an advertisement or solicitation for 
passenger air transportation the base fare for the air 
transportation as long as the government imposed taxes and fees 
and total cost are clearly and separately disclosed in the 
advertisement or solicitation. This subsection also sets forth 
how the disclosure should be accomplished and defines the terms 
``base airfare'' and ``covered entity''.
    Subsection (b) clarifies that air carriers and ticket 
agents must still disclose the total cost of the air 
transportation, including government imposed taxes and fees, 
prior to the purchase of the ticket.
    Subsection (c) requires the Secretary of Transportation to 
issue final regulations carrying out the amendment in 
subsection (a) not later than 120 days after enactment.
    Subsection (d) sets forth the effective date of the 
amendments and Act.

         Changes in Existing Law Made by the Bill, as Reported

  In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (new matter is 
printed in italic and existing law in which no change is 
proposed is shown in roman):

TITLE 49, UNITED STATES CODE

           *       *       *       *       *       *       *



SUBTITLE VII--AVIATION PROGRAMS

           *       *       *       *       *       *       *


PART A--AIR COMMERCE AND SAFETY

           *       *       *       *       *       *       *


SUBPART II--ECONOMIC REGULATION

           *       *       *       *       *       *       *


CHAPTER 417--OPERATIONS OF CARRIERS

           *       *       *       *       *       *       *



SUBCHAPTER I--REQUIREMENTS

           *       *       *       *       *       *       *



Sec. 41712. Unfair and deceptive practices and unfair methods of 
                    competition

  (a) * * *

           *       *       *       *       *       *       *

  (d) Full Fare Advertising.--
          (1) In general.--It shall not be an unfair or 
        deceptive practice under subsection (a) for a covered 
        entity to state in an advertisement or solicitation for 
        passenger air transportation the base airfare for the 
        air transportation if the covered entity clearly and 
        separately discloses--
                  (A) the government-imposed taxes and fees 
                associated with the air transportation; and
                  (B) the total cost of the air transportation.
          (2) Form of disclosure.--
                  (A) In general.--For purposes of paragraph 
                (1), the information described in paragraphs 
                (1)(A) and (1)(B) shall be disclosed in the 
                advertisement or solicitation in a manner that 
                clearly presents the information to the 
                consumer.
                  (B) Internet advertisements and 
                solicitations.--For purposes of paragraph (1), 
                with respect to an advertisement or 
                solicitation for passenger air transportation 
                that appears on an Internet Web site, the 
                information described in paragraphs (1)(A) and 
                (1)(B) may be disclosed through a link or pop-
                up, as such terms may be defined by the 
                Secretary, that displays the information in a 
                manner that is easily accessible and viewable 
                by the consumer.
          (3) Definitions.--In this subsection, the following 
        definitions apply:
                  (A) Base airfare.--The term ``base airfare'' 
                means the cost of passenger air transportation, 
                excluding government-imposed taxes and fees.
                  (B) Covered entity.--The term ``covered 
                entity'' means an air carrier, including an 
                indirect air carrier, foreign carrier, ticket 
                agent, or other person offering to sell tickets 
                for passenger air transportation or a tour or 
                tour component that must be purchased with air 
                transportation.

           *       *       *       *       *       *       *