i. What are the exceptions to the revenue diversion prohibition: There are five exceptions to the prohibition – two grandfather exceptions and three special purpose exceptions. They are described below.
(1) Airport Revenue Grandfather Exception: A Sponsor may use airport revenue for general purposes to the extent that covenants or assurances in debt obligations or governing statutes controlling the Sponsor’s financing that were in effect prior to September 3, 1982 provide for the use of airport revenue to support the Sponsor’s general debt obligations or other facilities. The grandfather exception applies only to arrangements that were in effect on September 3, 1982. For example, if a Sponsor’s governing statute in effect on September …show more content…
Resources and References
Airport Compliance Manual, Order 5190.6B, Chs. 15, 16, Appendix E
Airport Revenue Policy, 64 FR 7696 (February 16, 1999); https://www.gpo.gov/fdsys/pkg/FR-1999-02-16/pdf/99-3529.pdf
Policy and Procedures Concerning the Use of Airport Revenue; Proceeds From Taxes on Aviation Fuel, 79 FR 66282 (November 7, 2014); https://www.gpo.gov/fdsys/pkg/FR-2014-11-07/pdf/2014-26408.pdf
Air Carrier Incentive Program Guidebook: A Reference for Airport Sponsor (September 2010); http://www.faa.gov/airports/airport_compliance/media/air-carrier-incentive-2010.pdf
FAA Compliance Guidance Letter 12-01, FAA Implementation of Public Law 112-95 Section 813 – Use of Mineral Revenue at Certain Ariports; http://www.faa.gov/airports/airport_compliance/mineral_revenue/
FAA Airport Sponsor and Airport User Rights and Responsibilities Guidebook; http://www.faa.gov/airports/airport_compliance/media/airportSponsorAndUserRightsBrochure.pdf
ACRP LRD 2 Theory and Law of Airport Revenue Diversion May 2008); …show more content…
19
AC 150/5100-19D, Guide for Airport Financial Reports Filed by Sponsors (06-23-2011); http://www.faa.gov/documentLibrary/media/Advisory_Circular/150_5100_19d.pdf Grant Assurance 27, Use by Government Aircraft
Grant Assurance 27 requires a Sponsor to make the airport facilities funded with AIP grants and the aircraft operations area (AOA) available to federal government aircraft at no charge, unless the government aircraft use is substantial. If there is substantial use, the Sponsor may charge a reasonable share, proportional to the government’s use, of the O & M costs of the AOA and other facilities used. Substantial use consists, on a monthly basis, of the following:
Five or more based aircraft on or adjacent to the airport;
300 or more landings; or
Total landed weight of government aircraft exceeding 300 million pounds.
The FAA does not assume the role of negotiator between the Sponsor and the federal government entity using the airport. Also, this Assurance does not apply to rates and fees charged for the use of land for facilities such as hangars, operations centers, fuel farms, etc., unless those facilities are financed with AIP grants. Based on well-settled principles of federal appropriation law, it is highly unlikely that facilities like these would be funded with AIP grants. Federal facilities that are not covered by Grant Assurance 27 are governed by Grant Assurance 24, Fee and Rental Structure.
(1) Airport Revenue Grandfather Exception: A Sponsor may use airport revenue for general purposes to the extent that covenants or assurances in debt obligations or governing statutes controlling the Sponsor’s financing that were in effect prior to September 3, 1982 provide for the use of airport revenue to support the Sponsor’s general debt obligations or other facilities. The grandfather exception applies only to arrangements that were in effect on September 3, 1982. For example, if a Sponsor’s governing statute in effect on September …show more content…
Resources and References
Airport Compliance Manual, Order 5190.6B, Chs. 15, 16, Appendix E
Airport Revenue Policy, 64 FR 7696 (February 16, 1999); https://www.gpo.gov/fdsys/pkg/FR-1999-02-16/pdf/99-3529.pdf
Policy and Procedures Concerning the Use of Airport Revenue; Proceeds From Taxes on Aviation Fuel, 79 FR 66282 (November 7, 2014); https://www.gpo.gov/fdsys/pkg/FR-2014-11-07/pdf/2014-26408.pdf
Air Carrier Incentive Program Guidebook: A Reference for Airport Sponsor (September 2010); http://www.faa.gov/airports/airport_compliance/media/air-carrier-incentive-2010.pdf
FAA Compliance Guidance Letter 12-01, FAA Implementation of Public Law 112-95 Section 813 – Use of Mineral Revenue at Certain Ariports; http://www.faa.gov/airports/airport_compliance/mineral_revenue/
FAA Airport Sponsor and Airport User Rights and Responsibilities Guidebook; http://www.faa.gov/airports/airport_compliance/media/airportSponsorAndUserRightsBrochure.pdf
ACRP LRD 2 Theory and Law of Airport Revenue Diversion May 2008); …show more content…
19
AC 150/5100-19D, Guide for Airport Financial Reports Filed by Sponsors (06-23-2011); http://www.faa.gov/documentLibrary/media/Advisory_Circular/150_5100_19d.pdf Grant Assurance 27, Use by Government Aircraft
Grant Assurance 27 requires a Sponsor to make the airport facilities funded with AIP grants and the aircraft operations area (AOA) available to federal government aircraft at no charge, unless the government aircraft use is substantial. If there is substantial use, the Sponsor may charge a reasonable share, proportional to the government’s use, of the O & M costs of the AOA and other facilities used. Substantial use consists, on a monthly basis, of the following:
Five or more based aircraft on or adjacent to the airport;
300 or more landings; or
Total landed weight of government aircraft exceeding 300 million pounds.
The FAA does not assume the role of negotiator between the Sponsor and the federal government entity using the airport. Also, this Assurance does not apply to rates and fees charged for the use of land for facilities such as hangars, operations centers, fuel farms, etc., unless those facilities are financed with AIP grants. Based on well-settled principles of federal appropriation law, it is highly unlikely that facilities like these would be funded with AIP grants. Federal facilities that are not covered by Grant Assurance 27 are governed by Grant Assurance 24, Fee and Rental Structure.