24 May 2022

334

Basic Sources of Financing U.S. Airports

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There are more than 19,000 airports in the U.S. The national airport system is designated by the FAA, and the airports provide a network across the country. The national airport system is grouped into primary airports and non-primary airports. The primary airports handle nonhubs, medium hubs, small hubs, as well as large hubs. The non-primary airports comprise of general aviation airports, non-primary commercial service and reliever airports. The five basic sources that are available for financing airport improvement projects in the United States include state grants, capital contributions, passenger facility charges, net income generated from the airport and grants from the airport improvement plan. The state grants are used to provide the airport’s share of matching funds needed for AIP funded projects. Capital contributions comprise of the funds contributed by entities that use airports such as the tenants or airlines. AIP is used in funding the rehabilitation of aging airport infrastructure, accommodating growth in passenger activity, larger aircraft, or helping to meet FAA standards. 

The California State Aviation Plan is prepared with the goal of preserving as well as developing a system of airports in California to promote the development of a sustainable, efficient as well as safe air transportation system that meets California integrated mobility needs. Section 21702-21706 of the California Public Utilities Code requires the CASP to include Capital Improvement Plan (CIP) as one of its elements. CIP compiles a list of ten-year capital projects submitted to the California Department of Transportation (Caltrans) to be included in the CASP based on the general aviation airport master plans. The capital improvement plan allows the transportation department partners to assist as well as actively participate in the coordination of its project funding as well as aviation planning effort. 

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As shown in chart 1, a total of $3.21 billion were requested for the airport projects. The commercial service primary requested $ 1.84 billion (57.2%), forming the largest share. The general aviation airports requested $713.1 million (22.2%), while reliever airports followed closely with $ 557.0 million (17.4%). Commercial service non-primary and non-NPIAS had the lowest request of $74.6 (2.3%) and $ 27.3 (0.9%) respectively. A total of 2080 airport projects were requested. The General Aviation requested 1136 (54.6%), which is the highest chunk of the projects. 

Twenty-one airports in Washington were awarded $ 1.4 million during the first round of 2019-2021 grants. The total funding by WSDOT in the (2019-2021 Biennium) was $ 53,043,277.82. Local aid investment contributed $ 5,043,089.31 while the State funding and Federal funding were $ 1,439,539.17 (2.71%) and $ 46,560,649.33 (87.78%) respectively. More than 88 % of the $ 53 million in state, federal as well as local aid investment dollars will be allocated to the projects that either improve or preserve critical airport pavement. Over 8 % of the combined grant dollar is slated for two safety projects. The remaining three percent is slated for the planning projects. 

The exact amounts of grant allocated can change depending on the construction qualities as well as project bid totals. Thirty-six airports applied for more than five million grants for the round. The grant program of WSDOT is funded through an eleven cent-per gallon fee on aviation fuel, together with aircraft excise tax as well as the registration fees. WSDOT has made projections of lobbying applications for the second round of 2019-2021 biennium grants in March as well as February 2020. The notification for the round’s award is slated on May 11, 2020.

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StudyBounty. (2023, September 15). Basic Sources of Financing U.S. Airports.
https://studybounty.com/basic-sources-of-financing-u-s-airports-essay

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