Bipartisan Bill Would Pay Air Traffic Controllers During Future Shutdowns by Tapping $2.6B Insurance Fund

Lawmakers from both parties introduced bipartisan legislation this week that would ensure air traffic controllers continue to be paid during federal government shutdowns. The proposal was prompted by the recent 43-day shutdown, which led to widespread flight delays, thousands of cancellations and an unprecedented order limiting flights at 40 busy airports.

The bill would finance controller salaries, FAA operating costs and related aviation programs by drawing from a little-used insurance fund that currently holds about $2.6 billion. That fund was created to compensate airlines if the government temporarily requisitions commercial aircraft and they are damaged — a rare event. Sponsors say using the fund could make the plan more politically viable because it limits additional appropriations and caps potential fiscal exposure.

Leading the effort are Rep. Sam Graves (R-Mo.), chair of the House Transportation and Infrastructure Committee, along with Reps. Rick Larsen (D-Wash.), Andre Carson (D-Ind.) and Troy Nehls (R-Tex.), who chairs the committee's aviation subpanel.

"We all saw that the system can be vulnerable when Congress can’t get its job done," Graves said. "This bill guarantees that controllers, who have one of the most high-pressure jobs in the nation, will get paid during any future funding lapses and that air traffic control, aviation safety, and the traveling public will never again be negatively impacted by shutdowns."

The measure includes a safeguard that would halt withdrawals if the insurance fund falls below $1 billion. Committee staff estimate that, with that floor in place, the fund could support FAA operations for roughly four to six weeks.

Other proposals in Congress take a different approach. Sen. Jerry Moran (R-Kan.) has repeatedly backed the Aviation Funding Stability Act, which would allow the FAA to draw on the Airport and Airway Trust Fund — a move the Congressional Budget Office has said could carry a higher price tag than tapping the insurance fund.

The urgency behind these proposals stems from chronic staffing shortages and the operational ripple effects when controllers and FAA technicians face unpaid furloughs. During the recent shutdown, increasing numbers of controllers called out of work or took outside jobs to cope with lost pay, straining the system and prompting the FAA to temporarily limit airline schedules to reduce pressure on the remaining staff.

Background on the insurance fund: it was established to reimburse carriers when the government uses their aircraft for official purposes. The last major claim was filed after the U.S. withdrawal from Afghanistan in 2021. The account has continued to grow through interest and largely sat unused after Congress let the government’s broader airline insurance authority lapse at the end of 2014.

The bill was introduced ahead of a scheduled Senate subcommittee hearing examining the shutdown’s aviation impacts. Its prospects for passage before the next short-term funding deadline at the end of January remain uncertain, as lawmakers weigh competing fixes and budgetary constraints.