AIRPORT IMPROVEMENT PROGRAM
The Airport and Airways Improvement Act of 1982 established The Airport Improvement Program (AIP), which continues to fund airport development today. The program originated from the Federal Airport Act of 1946, which was the first serious effort designed to create a system of national airports similar to the National Highway System. According to the FAA, today’s AirportImprovement Program seeks to provide safety and efficiency upgrades to airports through the use of federal grants.
Across the United States, the FAA awards Airport Improvement Program grants directly to large airports based on passenger use. At the same time, grants for public-use General Aviation (GA) and Reliever Airports are issued at the state level based on FAA guidelines. According to the FAA, to be eligible for a grant an airport must be included in the National Plan of Integrated Airport Systems, or NPIAS.
AIP grants are based on the need for airport planning, further development, adding capacity, or to ensure noise compatibility. These grants are typically given based on the need for projects aimed at improving individual airport or state-wide efficiency and maintenance. According to the FAA, AIP funds can be used on most capital improvements at an airport or necessary repairs and in some cases on terminals, hangars, and nonaviation related facility developments.
Funding for AIP grant comes from almost entirely from The Airport and Airways Trust Fund. The fund derives revenue from taxes and fees levied on airplane operations, which include taxes on airplane tickets as well as fuel used by general aviation aircraft. Under AIP funding, 90 percent of the cost comes from Federal sources, with 10 percent being split between state and local governments.
For example, according to the FAA, in 2007 (a typical year for AIP funding allocation) the FAA awarded $3.3 billion in funding to 2,610 airports across America. The amount included funding to 1,121 general aviation and reliever airports, which received more than $830 million in funds, averaging $740,000 per airport. An additional $310 million in funding was distributed through state block grant programs, going to a mix of airports.
ESSENTIAL AIR SERVICE
Established in 1978, the Essential Air Service (EAS) was created by an act of Congress to guarantee commercial air service to small airports across the United States. The program provides federal funding to certified airlines operating flights in and out of remote community airports across the United States. Presently, approximately 140 rural communities rely on subsidizes to ensure continued commercial airline service.
EAS funding is used to subsidize the cost of tickets to passengers, while still allowing carriers to offer flights to smaller cities, which might otherwise struggle to maintain commercial airline service. The program remains a necessity for remote communities relying on air service through their local airport as a vital link to the outside world.
Since it’s establishment, the EAS program has changed several times as airlines costs and air travel have fluctuated. The latest implemented change, as part of the Surface and Air Transportation Programs Extension Act of 2011, allocated funding to EAS directly from the Airport and Airway Trust Fund. The 2011 bill arranged for $150 million to be spent from this fund January-April 2012, with $50 million from the fund annually thereafter. In addition, $2 million was made available for the Transportation Department to offer grants to small cities which currently lack established air carrier service.
In June 2012, some members of Congress attempted end the direst taxpayer subsidies for air service to isolated smaller cities and towns as part of EAS. The provision was voted on, but did not pass – EAS was renewed in a 238-164 vote as part of the newest transportation spending bill.
The EAS program’s new budget was increased to $214 million and will take affect beginning October 1st, 2012.
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