Robbing Peter to Pay Paul?

Ever hear someone say, “We’re robbing Peter to pay Paul?” When it comes to the 2015 Obama Administration budget the meaning behind this old saying becomes crystal clear.

In a win for airports nationwide, the budget proposal calls for raising the cap on the Passenger Facility Charge (PFC) from $4.50 to $8, a move that will give airports more buying power when raising funds for capital improvement projects.

But this increase will come at a price—in exchange for reduced entitlement grants. The goal being the supposed elimination of “double dipping” by airports, who receive both AIP funds and PFCs to pay for their improvement projects. The proposed budget trims the federal grants available to airports through the Airport Improvement Program (AIP) by $450 million.

It is great news that the Obama Administration plans to support a PFC cap increase, but it also needs to continue its support of the AIP, a needed program that traditionally helps small- to mid-size airports enhance airport safety, capacity and security as well as address environmental concerns. Smaller airports, which bring in less revenue and have fewer revenue-generating activities on site, rely on these funds to help meet FAA standards; make airfield improvements to both pavement and lighting systems; increase airfield capacity; and modify, replace and construct terminal buildings to accommodate additional passengers, larger aircraft and new security requirements.

As the federal government moves to rob Peter to pay Paul, it’s critically important that all airports—no matter their size—begin looking under every rock and in every nook and cranny for potential revenue sources. There’s an estimated $71.3 billion in needed infrastructure improvements looming in the years ahead, and airports will need to pay for these updates somehow.

This issue Airport Business’ takes an in-depth look at the many ways airports are boosting their non-aeronautical revenues. From FBOs to general aviation facilities to commercial airports, all are taking a creative approach to increase revenue in uncertain times—an approach that will likely become a necessity rather than a luxury in the years to come.

Take a look inside and learn how DFW continues to boost its commercial development revenue, while seeing how general aviation airports are getting creative in the use of their lands in the name of making money, and finding out how one FBO focuses its efforts on a payoff in film-making.

Then take a hard look at your airport and your opportunities. Chances are there are more than a few money-making opportunities in your neck of the woods too!