The Mood is Not Grim

ACI-NA's Greg Principato talks airports, reauthorization, AMT relief, and more


AUSTIN, TX — At meetings during the past year, comments Greg Principato, Airports Council International-North America president, the mood among airports was grim. During ACI-NA’s 18th Annual Conference & Exhibition here in October, respectable attendance levels and a less downbeat economic atmosphere helped restore some confidence and sense of direction. Says Principato, “The mood, it seems, is not grim. Six months or a year ago, the mood was grim. People still don’t think it’s great out there. But we’re getting our arms around it.” Plenty of issues remain, from system reauthorization to environmental regulations to customer service. One issue that found temporary relief was the alternative minimum tax (AMT), part of the D.C. stimulus package that saw billions in airport bonds sold almost overnight. During the ACI-NA meeting, Principato sat with AIRPORT BUSINESS to discuss airports. Here are excerpts ...

AIRPORT BUSINESS: To begin, should we even bother discussing FAA reauthorization and having industry operate under yet another continuing resolution?

Principato: I think the glass is more than half full; there’s a better than 50/50 chance this will be the last temporary reauthorization we’re going to have. Everybody wants a bill.

It’s disheartening for it to be seven or whatever extensions … and for reasons that aren’t aviation related. It’s explainable by other political forces.

One concern I have is I’m not sure how much the airlines really want a reauthorization bill. I think it’s in their best interests to have one.

AB: It seems what the airlines want is a total restructuring of how we fund the thing.

Principato: I think that’s right. Without making a judgement on their specific views, there are arguments to be made that we do need to look at how we fund the system. Those issues aren’t going to be resolved anytime soon, and we need a reauthorization bill long before those issues will be resolved.

The Obama Administration is probably not going to be ready to put forth its own reauthorization proposal for some time. So let’s bring some certainty; you have to be able to plan.

AB: Do you see any significant differences in dealing with this Congress and the new Administration?

Principato: The Congress has the same groups of folks we’ve been working with. The House has passed a bill twice. The Senate Commerce Committee has reported out a bill twice; the Finance Committee has been occupied by the health care issue.

I’ve been impressed with the Administration’s commitment on the stimulus-related issues. The FAA, Kate Lang, and all those folks just did a marvelous job of getting that stuff out the door. We didn’t have to wait long.

More important was the AMT relief; that’s the underappreciated success story of the stimulus. Last count, it generated $4.5 billion of airport bonds that have been sold that have led to construction and jobs. Remember, the credit market was frozen; even the highest rated airports couldn’t sell bonds.

AB: What do you think of the criticism of FAA’s handling of the stimulus funds?

Principato: I think it’s unfounded. They worked hard to get the money out the door.

AB: What are your thoughts on the new FAA Administrator?

Principato: If you were going to invent who a good Administrator would be, you’d draw up Randy Babbitt. He’s got the experience; he’s dealt with labor, airlines, airports. He’s assembling talented people around him.

AB: What’s the Senate’s problem with increasing the cap on passenger facility charges? The bill it’s considering again doesn’t allow for it, while the House version does.

Principato: I think the main issue right now is that Senators Rockefeller and Dorgan want to pass a bill that has as few as possible really controversial elements. Then let’s get to conference and work with the House on resolving some of these issues. There’s plenty of support in the Senate for PFCs and they understand what it’s done in their communities.

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