Overview of Tracing the tax that's supposed to fund TSA
This NPR Indicator episode (from Planet Money) explains why TSA officers are going unpaid during a partial Department of Homeland Security funding impasse even though travelers continue to pay a U.S. passenger security fee on airline tickets. It traces the fee’s original purpose, the 2013 law change that rerouted the funds, and the operational and personal consequences for TSA workers and airport security.
Key points and main takeaways
- The U.S. passenger security fee (about a little over $11 round-trip) was created after 9/11 as a hypothecated tax to fund TSA and airport security directly.
- In 2013 Congress restructured the fees: airline monthly security payments were removed, the passenger fee more than doubled, and much of the fee revenue began flowing into the general fund to help pay down federal debt.
- Because the fees now go into the general fund, they aren’t automatically available to the TSA during appropriations disputes — leaving TSA workers unpaid during the partial shutdown.
- The result: thousands of TSA employees calling off work, hundreds leaving the agency, longer lines, donations and gift drives to support unpaid workers, and real financial harm to employees who live paycheck to paycheck.
- Reassigning the connection between the fee and TSA funding illustrates how erosion of hypothecation can produce unintended consequences for essential services.
Background: how TSA was supposed to be funded
- Original design: a dual funding model — a passenger security fee paid by travelers plus a monthly fee paid by airlines — earmarked for airport security and TSA salaries.
- Hypothecated (earmarked) taxes can work well when revenue and spending are tightly linked (example: gas tax for road funding).
What changed in 2013
- Bipartisan legislation eliminated the airlines’ monthly security fee and raised the passenger security fee.
- The revenue from the passenger fee was shifted into the federal general fund and used in part to reduce the deficit.
- Over time this weakened the direct funding link between the fee and TSA operations.
Immediate operational and human impacts
- Many TSA officers have not been paid for weeks during the funding standoff; back pay may be granted later but does not undo credit damage, late fees, childcare disruptions, etc.
- First-year TSA base salary in Washington, D.C. is under $50,000 — many agents live paycheck to paycheck.
- Thousands called off work, hundreds resigned or left the agency, causing staffing shortages and loss of institutional knowledge.
- Some airports organized donation drives (grocery and gas cards), which workers described as humbling but inappropriate because travelers already pay the passenger fee.
- Proposed measures such as deploying ICE agents to airports were criticized by TSA staff as unlikely to improve throughput and likely to generate resentment because those agents are being paid.
Economic and policy lessons
- Earmarked taxes lose their effectiveness if lawmakers repurpose those revenues; maintaining a clear link between revenue source and spending target is important for continuity of essential services.
- For essential public-sector work, relying on future back pay is insufficient protection for employees who suffer immediate financial harm.
- Policymakers should consider mechanisms to:
- Preserve funding continuity for critical public-safety functions during appropriations disputes;
- Avoid diverting hypothecated funds that created the expectation and financing for specific services;
- Provide short-term financial relief for essential workers during funding lapses.
Notable quotes
- “You are the only ones that can answer that question... We deserve to have a paycheck.” — TSA officer Angela Grana
- “They're already paying that 9-11 tax... It's not their responsibility. This is the politicians' responsibility to take care of it.” — Angela Grana
- “The bad guys... they just have to get it right once.” — expressing concern about security vulnerability during staffing shortfalls
Who produced this episode
- Produced by Cooper Katz McKim; engineered by Maggie Luthar; fact-checked by Sierra Juarez; edited by Kate Kincannon. The Indicator is a production of NPR.