On behalf of our member companies that provide 1 million jobs in the state and make the New Jersey Business & Industry Association the largest statewide business association in the country, please accept our testimony in opposition to Senate Bill No. 989, the “Healthy Terminals Act.”
If adopted, this bill will drive up the cost of airlines and other employers at airports at the worst possible time. The airline industry has taken a tremendous financial hit due to the COVID-19 pandemic. Airline travel and cargo deliveries are down sharply. At the height of the pandemic, passenger volumes were down a full 96%. The economic crisis faced by the airlines, as well as those airport businesses that depend on air traffic, necessitated Congressional action by providing billions of dollars in loans through the CARES Act in order for them to remain out of bankruptcy. It will take years for the industry to recover from this debt burden.
The road to recovery may not be soon or certain. We all know the uncertainty of COVID-19 and even with vaccines now being administered, new strains of the virus are being found. Travel restrictions are still in place, some being tightened, and passenger confidence remains shaky. It is very uncertain if and when the airline industry will recover, if they will ever fully recover at all. At the least, it is likely to take one to two years before air travel could even feasibly return to some level of normalcy with customer confidence returning. Most likely, given the proliferation of communication technology and lingering concerns about public health, we may never see air travel return to previous levels.
It is in this context that this committee is seeking to pass legislation that will drive up the cost of doing business at airports. We believe the Legislature should refrain from any actions that drive up costs to an industry so severely impacted by this pandemic. This bill should not at all be a priority and should not at all be considered at this time. Airline employees and those working at New Jersey airports are largely under union contracts subject to collective bargaining. This legislation singles these employees out for special treatment without any compelling reason to do so and seeks to benefit these employees at the expense of the public who will undoubtedly pay higher fares and costs as a result. This bill will also put New Jersey airports at a competitive disadvantage to Philadelphia International, already a less expensive option for many air travelers in this state.
We urge this committee to hold this bill. We should not be driving up costs on an airline industry that is suffering through a historic economic crisis and whose future outlook remains uncertain for the foreseeable future.
Thank you for your consideration.