Airports at a Crossroad

In late September, airports from across the U.S. and Canada convened for the annual Conference & Exhibition of the Airports Council International-North America. Top of the mind concerns at this year's meeting were loosening restraints on how airports operate financially, the funding debate just now beginning to brew in Washington, how to fund and expedite the installation of security screening systems, and the need to modernize the U.S. air traffic control system. In addition, FAA Administrator Marion C. Blakey opened the show with a call for system funding reformation, as well as an emphasis on airfield safety in light of the August airline crash at Lexington, KY. One other hot topic: the decision to split up the joint lobbying effort with the American Association of Airport Executives.

Regarding the funding reauthorization debate, outgoing chairman Steve Grossman, director of aviation for Oakland International Airport, related in a pre-show press briefing that the battle which is just now beginning among industry groups and Congress, is "probably the most important one in a generation."

ACI-NA president Greg Principato comments, "Compromise is not common in Washington these days, but we live in a time with issues that demand it."

FAA HOT BUTTONS

The FAA Administrator says there's a "real resurgence" going on in aviation, led by advances in technology. At the same time, she says that medium and large hub airports have recovered financially since 9/11, while smaller airports remain heavily dependent upon the federal government for support.

On funding, Blakey says the Administration is still putting together its proposal on how to best fund the U.S. air transportation system in the future, particularly the ATC modernization. "Bottom line: We need a stable revenue stream," she says. "The need to modernize is upon us."

Blakey also called on airports to focus heavily on airfield safety, particularly during periods of construction.

FUNDING THE SYSTEM

Blakey reiterated her call of recent times for new funding mechanisms, cautioning that the current system is inadequate to meet future needs. Air Transport Association President James May echoes that message and, in Reno, he again put forth ATA's plan for modernizing the air traffic control system. ATA seeks to get ATC out from under congressional purview with an oversight body that would have funding authority and mechanisms and increased industry input, particularly from the airlines. ATA also seeks a new user fee system for business aviation.

Ed Bolen, president of the National Business Aviation Association, was on hand to dispute ATA claims that business aviation doesn't pay its fair share for its use of the system. He again called for a continuation of the current funding formula which charges general aviation a fuel excise tax, although he does leave the door open for a possible increase in the fuel tax.

Regarding ATC modernization, Bolen maintains that the U.S. is "well on our way" to achieving that goal, led by the enactment of reduced aircraft separation minimums last year. "Where we are today is starting from a very large base," he says.

Bolen and May, however, are in agreement that the general fund of the federal government needs to continue to contribute significant monies to fund the system.

ATC MODERNIZATION

Despite Bolen's assertions, others here express serious concerns that a revolution needs to occur in how air traffic control is managed in the U.S. NAV CANADA president/CEO John W. Crichton was on hand to relate the successes Canada has had in its ATC modernization efforts. Implemented in 1996, NAV CANADA has reduced the ATC workforce from 6,300 employees under Transport Canada to some 5,300 today. "If you want to control costs in our business, you have to control the number of employees," he says.

Crichton asserts that the creation of NAV CANADA has allowed Canadian ATC system to have decision-making authority independent of government interference, improved customer service and efficiency, and helped facilitate modernization. Canada is currently in the process of transferring to an ADSB surveillance system. "We may have bought our last radar," Crichton says.

Neil Planzar, who heads Boein air traffic management, is one of the industry's strongest proponents for change in how the U.S. ATC system is managed. "The tools are in place now that allows us to implement a revolutionary change," Planzar asserts.

Planzar maintains that the U.S. air traffic system is currently at 97 percent of capacity and that new enroute systems now being put into operation are having an impact, but not enough. "We're going to have to change, folks," he comments.

He explains that Boeing's interest in modernizing air traffic control is twofold: 1) to sell aircraft - "if the industry doesn't grow because of capacity issues, we don't grow;" and 2) to promote a worldwide system that is compatible - "the ATC system globally must be interoperable."

FINANCING EDS - THE JACOBS STUDY

One of the central sessions of interest at this year's ACI-NA was focused on finding ways to fund the far from complete baggage screening systems mandated by congress just after 9/11. The center of attention was a recent Baggage Screening Investment Study by Jacobs Consultancy (formerly Leigh Fisher Associates), completed in September and endorsed by the joint industry/government Aviation Security Advisory Committee.

Cindy A. Nichol, director for Jacobs, points out that the costs of baggage handling systems and infrastructure far outweigh the cost of screening equipment. She claims that under the current process it will take until 2024 to get full screening systems in place nationwide.

The study was conducted in response to directives in the Intelligence and Terrorism Prevention Act of 2004. The directives require the Department of Homeland Security and TSA to expedite the installation of EDS machines for checked baggage screening, and to complete a cost-sharing study in collaboration with industry stakeholders.

Nichol says that Jacobs looked at "a huge number of alternatives" and agreed that TSA needs to be respon sible for obtaining the EDS machines. One thing taken off the table for consideration was the use of Airport Improvement Program dollars to fund the equipment. "It's needed for other things," Nichol says.

Among the Jacobs study recommendations:

  • Create a voluntary $3 billion tax credit bond program under which airports could issue tax credit bonds to fund security infrastructure;
  • Continue federal appropriations of at least $435 million per year for purchase and installation of EDS equipment;
  • Enhance passenger facility charge eligibility to include tax credit bond sinking fund payments and exclusive-use outbound baggage handling systems; and
  • Implement a formal cost management process that focuses on active engagement of and coordination with stakeholders that includes publishing screening investment guidelines; implementing an enhanced design and funding approval process; increasing TSA program management resources; and, setting an Integrated National Deployment Team and Integrated Local Deployment Teams.

Nichol says adoption of the study's findings could move total implemention up to 2013 while saving the industry some $1.2 billion.

NEW LOBBYING APPROACH

In recent years, ACI-NA and AAAE have lobbied Washington under a joint legislative initiative. According to ACINA's Principato, under the arrangement the association contracted with AAAE for its lobbying services - AAAE did the work and the ACI-NA Board of Directors approved policies, he explains.

Principato says the change is being made due to a concern by ACI-NA members that they were not having the degree of input on the lobbying process that they felt was necessary to have their interests fully represented. He says that having two separate airport lobbying initiatives will provide a "force multiplier."

ACI-NA plans to put out a request for proposals, seeking to team up with a lobbying firm under contract. The two associations will continue to coordinate activities, says Principato, to develop joint strategies. Comments chair Grossman, "It will be one message with many messengers."

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