Exam 1 Flashcards
Finance and Administration of Airports
What do you need to know about Revenue Diversion?
> Congress and the FAA restrict the use of airport revenue under the Airport and Airway Improvement Act of 1982 so that it can only be used to develop the assets of the airport.
> Grant Assurance 25 says that Airport Revenues restricts use of revenue made by the airport and taxes on AVfuel to be expended for the operating costs of the airport, its airport system, and other facilities owned or operated by the airport that relate to air transportation.
What are the two types of airport bonds?
> Airport Revenue Bond bonds areissued for a long period of time that are backed by the airport and do not require voter approval
> General Obligation Bond bonds are backed by the state or other government entity that require government approval and are issued at low interest rates
What are the five categories of airports?
Commercial
General
Cargo
Military
Private
What are the three airport charges?
> Passenger Facility Charges are levies placed on a passenger’s ticket collected by airlines and given to the airport. Money is used to preserve safety security, reduce noise, and increase competition between carriers
State Grant Programs are issued by the department of transportation for each state through relief from taxes
Customer Facility Charges are charges to rental car operators at airports. Money goes towards landside improvement and maintenance projects
What are the different types of airport revenue?
Aeronautical
Non-aeronautical
Non-operating
What is aeronautical airport revenue from?
Landing fees
Landing Leases
Terminal/hangar/tie-down rents
Ramp fees
Fuel tax
Fuel sales
What is non-aeronautical airport revenue from?
Land rent from airport park
Reservation centers
Catering facilities
Rental car operations
Parking
Concession sales
What is non-operating revenue?
Passenger facility charges
Property taxes
Interest income
Grants
What are the three methods of rate setting?
Residual
Compensatory
Hybrid
Explain the residual approach to rate setting?
Airlines assume financial risk in return for a negotiated limit on airport’s profits, which allows aeronautical users to receive a cross-credit of non-aeronautical revenues and assume part or all of the liability for non-aeronautical costs
Explain the compensatory approach to rate setting?
Airport assumes all liability for costs and retains all airport revenue for its own use according with federal requirements
Explain the hybrid approach to rate setting?
Users are charged for the aeronautical facilities with the aeronautical users assuming additional responsibility for airport cost in return for a share of the non-aeronautical revenue
What is the National Plan of Integrated Systems (NPIAS)?
NPIAS is a five-year projection published by the FAA every two years that…
1. Identifies airports considered by the FAA to be essential to civil aviation
2. Defines the roles each of these airports currently serve, and the level of development and funding they’re eligible for under the Airport Improvement Program (AIP)
3. Lays out the specific aiport development projects for those airports that the Secretary of Transportation deems necessary to maintain a safe, efficient, and integrated airport system
What are the ten steps of the Master Plan Process?
- Pre-planning
- Public Involvement
- Environmental Considerations
- Existing Conditions
- Aviation forecast
- Facility requirements
- Alternatives to development
- Airport layout plan
- Facilities implementation plan
- Financial feasibility analysis
What are the tail height values for the Airplane Design Groups?
Group I= <20ft
Group II= 20-30ft
Group III= 30-45ft
Group IV= 45-60ft
Group V= 60-66ft
Group VI= 66-80ft
What are the wingspan values for the Airplane Design Groups?
Group I= <49ft
Group II= 49-79ft
Group III= 79-118ft
Group IV= 118-171ft
Group V= 171-214ft
Group VI= 214-262ft
