The Government’s Role in Maintaining Airport Infrastructure

By Annie Russo

During the keynote address at a forum hosted by the U.S. Chamber of Commerce on rebuilding American’s transportation through a national infrastructure bank, Pennsylvania Governor Edward Rendell spoke of the transportation infrastructure needs of our country.

Governor Rendell advocated that “the maintenance of American infrastructure has to be done by the government itself” and suggested investing $400 billion in transportation infrastructure. Often when politicians and experts talk about infrastructure they speak to the need for additional infrastructure, however, Governor Rendell makes an important point about maintaining current infrastructure. Airports rely on the federal Airport Improvement Program (AIP) for funding maintenance projects primarily for airside projects. A large need remains, however, for the funding of maintenance related landside projects.

Many airports turn to funding sources other than AIP for these projects such as Passenger Facility Charges (PFC) and private activity bonds (PAB’s). These are not government programs, but rather funds generated by the airport itself through a user fee in the case of PFC’s and through the sale of bonds. Airports are not asking for a government handout for the maintenance of these facilities, but there is something the federal government — and specifically Congress — can do to help airports with both PFC’s and PAB’s to maintain our infrastructure. Congress can raise the PFC from the current cap of $4.50 to the $7 proposed in the House-passed FAA Reauthorization bill, and it can also pass legislation to provide permanent exemption of interest earned on PAB’s from the Alternative Minimum Tax. If Congress approved both of these proposals it would go a long way in helping airports do our part in maintaining our facilities and thus helping maintain our national infrastructure.

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