ACI-NA 1999 Priorities

ACI_NA 1999 Priorities Topping the list is working to create a less regulated, more business-oriented environment for airports, says David Plavin BY John F. Infanger, editorial director Januray / February 1999 ORLANDO, FL...


ACI_NA 1999 Priorities

Topping the list is working to create a less regulated, more business-oriented environment for airports, says David Plavin

BY John F. Infanger, editorial director

Januray / February 1999

ORLANDO, FL — Airports Council International - North America represents the interests of commercial airports and their sponsoring authorities out of its Washington, D.C. offices. During its recent annual convention in Orlando, ACI-NA president David Z. Plavin sat down with AIRPORT BUSINESS magazine to discuss issues facing the industry and his association's priorities in the coming year.

Following is an edited transcript of that interview.

AIRPORT BUSINESS: What do you see as your top priorities in near-term?

Plavin: The first priority is, if we can, to finally get folks to understand that airports are actually businesses, and it's time to stop making them walk around with a tin cup in their hands — whether it's to the Feds for AIP or PFCs or LOIs. It's a construct that's left over from regulation days, and it's hard to convince people of that. In an era when deregulation and privatization are fashionable, the notion of regularly increasing the regulations being laid on top of airports is fundamentally wrong. It puts the brakes on what could be an even more rapidly growing sector of the economy.

AB: Do you have any particular thoughts on the pilot program FAA is currently examining related to the privatization of airports?

Plavin: I guess I have two reactions to it. One, I don't think it's going to prove anything one way or another. It's not really a pilot program, because it doesn't really fundamentally change how airports are financed or run. Second, the only reason it's different and why anyone is paying attention to it, is because it's waived the one principle that we all think is important and that is you shouldn't be allowed to divert revenue.

I see the privatization program as basically a bribe to local officials to allow them to put a public asset in private hands. The way it's bribing them is by saying, even though in every other case we would never allow this, we're going to allow you to long-term lease or sell off your property, and then you can take the profits to use however you want to use it.

My sense of privatization is that there are situations and places where it makes sense, and we ought to make it possible to make it happen.

The question ought to be: Are there some things that the private sector does better, and, if there are, should we figure out a way to allow that to happen?

The notion that privatization is a panacea is a problem.

AB: Do we ever get to the point of actually selling an airport outright?

Plavin: I guess I'm not really sure why somebody needs to sell an airport.

The Canadians did a version in which they, in effect, have taken something that was run by the federal government (i.e., the airports) and created independent local companies. The only thing that makes them not fully private is they don't have equity or shareholders. They function as if they were private companies, but they're not for profit, so that means when they do earn net income they have to put it back into the company. I think it's a good model that would work well in the United States, and in some ways a more useful model than the notion of just selling off airports.

Ultimately, the public still has an interest in the airport and what happens to it. You want to make sure that the investment gets made and that it's being managed in the business interests of the community.

AB: One of the interesting things about the Canadian exercise is that, by way of the transfer, there is a justification process taking place for each airport in the system.

Plavin: Absolutely.

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