Airline deregulation is sending CAB, the US regulator, to the scrap heap
Like some old appliance for which no one has any more use, the Civil Aeronautics Board is being put on the curb to be hauled away. Come Jan. 1, under a federal ''sunset'' law, there will be no more CAB. This government agency, built to determine airline fares and routes, is obsolete because of airline deregulation.
But it's not as if the CAB has been suddenly pushed out in the cold. Affairs there have been winding down for the last six years, as scheduled by the Airline Deregulation Act of 1978. The staff now numbers around 325, compared with 850 in '78. Likewise, the board's responsibilities have lessened. It used to keep an eagle eye on airline finances and routing, requiring detailed reports from carriers. Now it mainly enforces consumer travel rights, monitors competition, and negotiates international routes.
''The airlines no longer have to report financial data to us because we no longer have to approve fares and routes,'' says Wallace Stefany, spokesman for the CAB.
Because of an act passed by Congress this fall, consumer oversight of the CAB will be transferred to the Department of Transportation, along with the rest of what's left of the board. This means that consumer-protection rules will still be enforced and will stand as issued by the CAB. For instance:
* Airlines must insure checked baggage against loss or damage for at least $1 ,250. But the traveler may have to prove the worth of the bag's contents with receipts, and even then the airline may only provide compensation for the depreciated value of the contents.
* No-smoking rules are on: no cigars or pipes and a guaranteed no-smoking seat for anyone who checks in on time. Smoking is banned on commuter planes (30 seats or less).
* Carriers are still allowed to overbook flights. But they must seek volunteers to surrender seats on a full plane. To do so, airlines offer incentives - cash, free flights, or both - to passengers already on the plane. If, after this, not all the passengers with confirmed reservations have been accommodated, the airline must get these passengers to their destination as soon as possible, plus reimburse them for their tickets (up to $200 each) if the alternate flights are not expected to arrive within one hour of the original schedule.
Mr. Stefany says there will be little unfinished business shuttled over to the Department of Transportation and he expects the transition, already under way, to be smooth.
But some airlines, such as United, would have liked the shrunken CAB to be split between the Justice Department, to handle antitrust issues, and the Federal Trade Commission, to handle consumer issues. ''We're anxious to see it (the CAB) disappear, but we would have preferred a different alignment of functions,'' says Monte Lazarus, spokesman for United. ''If somebody, some misguided soul, would want to reregulate our industry, it's a lot easier to do when you have all the remaining supervisory authority vested in a single agency.''
An antitrust lawsuit has just been filed by 11 airlines against United and American Airlines. In August the CAB issued new rules saying that computerized reservations systems had to offer equal prominence to all carriers and to charge them equal fees. The market is dominated by United and American systems, and the complaint has been that these airlines were giving themselves prominence through their system, thus putting other airlines at a disadvantage. The airlines taking legal action are seeking damages for past competitive abuses and future economic hardship from the new set fee of $1.75 per booking - which in some cases is much greater than the old fees.
CAB is now reviewing its policy decision regarding the reservations systems. It appears that this issue, and a number of others, could be waiting for the Transportation Department. A check with other airlines, as well as travel organizations, shows that airline bankruptcy, passenger ticketing involving two or more airlines, and the new rules allowing anyone - not just travel agents - to issue airline tickets are areas that will likely need attention next year.