Congress passes the Bipartisan Infrastructure Law
President Biden speech calls for Airport to improve
FAA issues guidance on these GRANTS
For decades, airlines and airports, and to a lesser degree public financiers, have debated about the funding of these essential facilities. Cost Per Enplaned Passenger, interest payments, accounting of the revenues supporting the debt and competition were the primary terms in these discussions.
Those micros focus was just changed by Congress in the Bipartisan Infrastructure Law (BIL) and the President’s speech at Boston Logan Airport. BIL added $15B to spend on airports and President Biden threw down the challenge that American airports should seek to be in the world’s top 25 airports. Perhaps the not-too-messages in both of these pronouncements is that airport construction means JOBS and greater employment is a national priority if not political/necessity.
As the Washington stimulation of these projects results in proposed new terminals, runways, lounges, high tech systems, etc., it will be interesting to see how the airlines react-will they lament the increased CPEP, or demur based on these two powerful pronouncements. Perhaps more telling, how will the sharp pencils of Wall Street assess the future demand of passengers in the post-pandemic period.
The FAA, soon after the BIL went into effect, issued comprehensive guidance on request for these grants (no mention of CPEP or demand forecasts?) The career staff produced some impressive visuals about the immediate impacts of the federal funding:
Tip of a Capitol Cap to AAAE as the ARP page notes that “$100M will be provided over 5 years starting in FY2022 through the FAA Contract Tower Competitive Grant Program. The purpose of the FCT Competitive Grant Program is to make annual grants available to eligible airports for airport-owned airport traffic control tower projects that address the aging infrastructure of the nation’s airports. Program information and applications instructions can be found on the grant program page.”
The guidance includes some interesting policy statements:
- This funding can be used to fund runways, taxiways, and aprons and other broad efforts like terminal, intermodal projects and roadway projects.
- Increase capacity and passenger access
- Encourage competition
- Improve Energy Efficiency (including LEED accreditation)
- Expand access for persons with disabilities
- Improving airport access for historically disadvantaged populations
- Further Environmental Justice efforts;
- Reduce air emissions;
- Reduce noise impacts to the community;
- Improve energy efficiency;
- Address resiliency
- Implementing guidance to airports that encourages workforce development and creates more opportunities for Small and Disadvantaged Businesses.
- FAA will conduct outreach to minority association and groups to make them aware of funding opportunities at airports.
President Biden has reprimanded the US air travel industry for falling behind the rest of the world.
President Joe Biden has pledged that many of the US’s largest airports will be improved. The pledge came during a speech at Boston Logan International Airport (BOS) on Monday, September 12th. The address was given to reaffirm the Biden administration’s resolve to improve the state of US airports as a part of a multi-billion dollar infrastructure bill passed last year.
The bill aims to improve airport conditions for travelers and reduce delays by adding enhanced services for passengers throughout the airports. The President cited reports that the US currently has no airports that rank in the top 25 airports in the world. The administration reminded the public that the bill is also anticipated to create thousands of jobs.
The President’s pledge came as an abrupt wake-up call to the US aviation industry. During his speech, he returned to the famous example of La Guardia Airport. When Biden was the Vice President, he was famously recorded comparing LaGuardia Airport to airports in Third World countries. Many saw the comment as outlandish at the time. The high delay rates, antiquated technology, and sub-par terminals were cited for this executive reproach.
During his recent speech, he used the airport as an example of how other US airports could change and improve. The airport has received technological advancements, updates to the terminals, and a reduction in flight delays since Biden first reprimanded it. During his speech, the President stated,
“The United States of America, not one airport ranks in the top 25 in the world… It means commerce. It means income. It means security. And we don’t even rank in the top 25.”
The President warned that America has fallen behind in many aspects, including air transit. This has allowed other nations, including China, to catch up and surpass the US in various ways. The administration’s plan to combat this includes funding multiple major US airports in accordance with their needs.
BOS, where the speech was given, will receive $62 million for improvements. This money will fund an expansion to Terminal E, which will include added international gates. It hopes that this will reduce overcrowding in the terminal. It will also improve the baggage claim and add ticket counters.
The US has historically been one of the most prominent leaders in the Aviation industry. In recent years it has slowly fallen behind many foreign nations. This underlying issue was manifested when pandemic travel recovery arrived. Airlines were left scrambling as demand soared while their fleets did not. Shortages from supplies to flight crews debilitated the airline’s capabilities to meet demand. This has not only led to a summer travel season filled with delays, but it has revealed the long-neglected issues of the industry.