A Brief History of FAA Airport Grant Obligations

Many of you are familiar with, or at least aware of, the Federal Aviation Administration’s Airport Improvement Program (AIP), which was established as part of the Airport and Airway Improvement Act of 1982. The AIP was not a brand new program, but represented the latest iteration of a series established in 1946 with the Federal-Aid Airport Program (FAAP) and continued under the Airport and Airway Development Act of 1970 (AADA).

Following World War II the federal government, during the process of returning airports to their host communities via the Surplus Property Act of 1944, recognized the critical importance of promoting the development of an airport system adequate to meet the growing needs of the country as well as the rapid post-war expansion of the civil and commercial aviation industry.

The FAAP was authorized under the Federal Airports Act of 1946 and financed by the general fund of the U.S. Treasury, thus the fed’s commitment to maintaining and promoting aviation in the U.S. became solidified. Through the FAAP, a program of grants-in-aid to state and local governments, airports applied for and received the funding necessary to improve and expand operations, technology, and safety.

The 1970 Airport and Airway Development Act was more comprehensive and provided grants for airport planning and development under the Planning Grant Program (PGP) and the Airport Development Aid Program (ADAP), respectively. These programs were funded by the Airport and Airway Trust Fund (AATF, aka the Aviation Trust Fund), also newly-established under the same legislation. The Trust Fund still operates today and it receives revenues from all segments of aviation operations through excise taxes levied on fuel sales, passenger fares, and air freight.

To give you an idea of the magnitude of the funding provided to airports by AADA, its 11-year run resulted in the award of more than 8,800 individual grants totaling $4.5 billion before its authorization expired in September 1981.

Which brings us to today. The current AIP took effect in 1982 and has been amended several times, most recently under the FAA Reauthorization Act of 2018.

The establishment of the Trust Fund marked a shift in the philosophy of the federal government toward the aviation industry. The imposition of excise taxes on users of the system made airports and their governing bodies give greater consideration to operational and fiscal efficiency: airports applying for grant funds knew that grants were awarded based on numerous factors, one of which was fiscal sustainability. Thus they had become more responsible for bringing in revenues to help feed the Trust Fund whose dollars in turn went right back into the system – and their own airport – by way of the grant programs.

The preceding serves to lead up to what many of you already know: federal grant awards come with strings attached. These strings are referred to as grant assurances, and in fact, the FAA spells out in minute detail all the rules and regulations surrounding the operation of airports receiving grant funding.

One of these assurances is that individual airports are obligated to operate as self-sufficiently as possible, within the limitations dictated by the specific circumstances at each airport. In addition, they must comply with a number of other assurances established by the FAA as outlined in guidance documents available here.

The FAA also publishes an entire library of policy and guidance documents in its airport compliance program, which details everything surrounding airport operations including compatible land use, planning, design and engineering, construction and maintenance of all aviation assets, proper use of airport revenue, setting lease and rent rates, and many other elements. Specifics of the program are updated when necessary to account for new technologies or other factors that may come into play.

This is but a short description of one element of the AIP. In future installments we’ll examine in more detail the guidance documents the FAA has published regarding other aspects of airport compliance.

 

Mike Straka, PhD
HN Contributing Author & Technical Support
Executive Director, Colorado Aviation Business Association

Sources
1. Overview: What is AIP? FAA website. https://www.faa.gov/airports/aip/overview/

2. Airport Improvement Program History. FAA website. https://www.faa.gov/airports/aip/grant_histories/annual_reports/media/AIP-Program-History.pdf

3. Grant Assurances (Obligations). FAA website. https://www.faa.gov/airports/aip/grant_assurances/

4. Airport and Airway Trust Fund. FAA website. https://www.faa.gov/about/budget/aatf/media/AATF_Fact_Sheet.pdf

5. Airport Compliance. FAA website. https://www.faa.gov/airports/airport_compliance/

6. Airport Compliance Program. FAA website. https://www.faa.gov/airports/airport_compliance/overview/