Study Guide
for
Airport Compliance Webinar
Part B
Prepared for:
National Association of State Aviation Officials
Prepared by:
ACS Firm, LLC dba Aviation Career Services
March 31, 2017
Table of Contents
Introduction ....................................................................................................................... 3
Topic #1 – Exclusive Rights ................................................................................................ 4
Grant Assurance #23: Exclusive Rights .......................................................................... 4
Topic #1 – Typical Questions from Sponsors: ............................................................ 5
Topic #2 – Revenue Diversion ............................................................................................ 7
Grant Assurance #25: Airport Revenues ........................................................................ 7
Topic #2 – Typical Questions from Sponsors: ............................................................ 8
Topic #3 – Through-the-Fence ........................................................................................... 9
Grant Assurance #5: Preserving Rights and Powers ...................................................... 9
Topic #3 – Typical Questions from Sponsors: .......................................................... 10
Topic #4 – Hazard Mitigation ........................................................................................... 11
Grant Assurance #20: Hazard Removal and Mitigation................................................ 11
Topic #4 – Typical Questions from Sponsors: .......................................................... 12
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Introduction
Thank you for taking the time to download this document. Due to our one hour time block
for this webinar and large amount of information to share, we wanted to provide you the
basics of the information in advance. Our plan is to save the time of going over the basics of
the Grant Assurances and repurpose that time to go through the questions listed and
answering any additional questions you might have.
Suggestions:
• Please review the four topics and their associated exercises
• If you have any questions on each section, please come ready to submit them during
the webinar or send them to us in advance at:
o [email protected]
Thank you for your time in advance and we look forward to the presentation on:
Wednesday, April 12, 2017
at 12PM PDT / 2PM CDT / 3PM EDT
All the best,
The ACS Team
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Topic #1 – Exclusive Rights
Grant Assurance #23: Exclusive Rights
[The Sponsor] will permit no exclusive right for the use of the airport by any person providing, or
intending to provide, aeronautical services to the public. For purposes of this paragraph, the
providing of the services at an airport by a single fixed-based operator shall not be construed as
an exclusive right if both of the following apply:
a. It would be unreasonably costly, burdensome, or impractical for more than one fixedbased operator to provide such services, and
b. If allowing more than one fixed-based operator to provide such services would require the
reduction of space leased pursuant to an existing agreement between such single fixedbased operator and such airport. It further agrees that it will not, either directly or indirectly,
grant or permit any person, firm, or corporation, the exclusive right at the airport to
conduct any aeronautical activities, including, but not limited to charter flights, pilot
training, aircraft rental and sightseeing, aerial photography, crop dusting, aerial
advertising and surveying, air carrier operations, aircraft sales and services, sale of aviation
petroleum products whether or not conducted in conjunction with other aeronautical
activity, repair and maintenance of aircraft, sale of aircraft parts, and any other activities
which because of their direct relationship to the operation of aircraft can be regarded as
an aeronautical activity, and that it will terminate any exclusive right to conduct an
aeronautical activity now existing at such an airport before the grant of any assistance
under Title 49, United States Code.
FAA Order 5190.6B – Airport Compliance Manual
8.2. Definition of an Exclusive Right. An exclusive right is defined as a power, privilege, or
other right excluding or debarring another from enjoying or exercising a like power, privilege
or right. An exclusive right may be conferred either by express agreement, by imposition of
unreasonable standards or requirements or by another means. Such a right conferred on one
or more parties, but excluding others from enjoying or exercising a similar right or right,
would be an exclusive right.16
Legislative History – The exclusive rights provision is the oldest federal obligation affecting
federally funded airports. The legislative background for the exclusive rights provisions
began in l938. The prohibition against exclusive rights was first contained in section 303 of
the Civil Aeronautics Act of 1938 (Public Law (P.L.) No. 75-706, 52 Stat. 973 recodified at 49
United States Code (U.S.C.) 40103(e)) and applies to any airport upon which any federal funds
have been expended.
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Duration of Prohibition Against Exclusive Rights. – Once federal funds have been expended
at an airport, including through a surplus property conveyance, the exclusive rights
prohibition is applicable to that airport for as long as it is operated as an airport.
Aeronautical Operations of the Sponsor. – The exclusive rights prohibition does not apply to
services provided by the sponsor itself. The airport sponsor may elect to provide any or all of
the aeronautical services at its airport, and to be the exclusive provider of those services. A
sponsor may exercise – but may not grant – the exclusive right to provide any aeronautical
service. This exception is known as the airport’s “proprietary exclusive” right. See paragraph
8.9.a of this chapter.
The sponsor may exercise a proprietary exclusive right provided the sponsor engages in the
aeronautical activity as a principal using its own employees and resources. The sponsor may
not designate an independent commercial enterprise as its agent. In other words, the
sponsor may not rely on a third party or a management company to provide the services
under its proprietary exclusive right. These airport sponsors must engage in such activities
using their own employees.
Airports Having a Single Aeronautical Service Provider. – Where the sponsor has not entered
into an express agreement, commitment, understanding, or an apparent intent to exclude
other reasonably qualified enterprises, the FAA does not consider the presence of only one
provider engaged in an aeronautical activity as a violation of the exclusive rights
prohibition.21. The FAA will consider the sponsor's willingness to make the airport available
to additional reasonably qualified providers.
Additional Guidance
•
Advisory Circular (AC) 150/5190-6, Exclusive Rights at Federally Obligated Airports
o Provides airport sponsors with the information they need to comply with their
federal obligation regarding exclusive rights.
Topic #1 – Typical Questions from Sponsors:
1. FBO B wants to start operations here and I don’t want them to steal business from FBO A.
How do I stop them?
2. XYZ Skydiving wants to start operations here. I think its unsafe. How do I stop them?
3. FBO A is leaving and I want to provide fuel services. Can I do it myself? How do I keep
someone else from coming in and stealing the business?
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Topic #1 – Case Study
A City Commissioner has received a call from a “friend” that they want to start a second FBO
at your sponsors airport. The airport is small and has limited opportunity for additional sales.
Yet, the second FBO group is adamant. They believe they can provide better service at a
lower price.
1. How do you recommend the sponsor proceed with the matter?
2. What questions do you ask to determine if the sponsor is prepared for the discussion
and pending agreement for a second FBO?
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Topic #2 – Revenue Diversion
Grant Assurance #25: Airport Revenues
a. All revenues generated by the airport and any local taxes on aviation fuel established
after December 30, 1987, will be expended by it for the capital or operating costs of
the airport; the local airport system; or other local facilities which are owned or
operated by the owner or operator of the airport and which are directly and
substantially related to the actual air transportation of passengers or property; or for
noise mitigation purposes on or off the airport.
FAA Order 5190.6B – Airport Compliance Manual
It is the responsibility of the FAA airports district and regional offices to identify unlawful
revenue diversion, to seek sponsor compliance informally before initiating formal
investigation, and to monitor corrective action plans.
Legislative History – Airport and Airway Improvement Act of 1982 (AAIA). The AAIA
established the general requirement for use of airport revenue which directed public airport
owners and operators to use all revenues generated by the airport for the capital or operating
costs of the airport, the local airport system, or other local facilities which are owned or
operated by the owner or operator of the airport and directly related to the actual
transportation of passengers or property.
In the Federal Aviation Administration Authorization Act of 1994 (1994 Authorization Act)
(Public Law (P.L.) No. 103-305), Congress strengthened the revenue use requirement by
adding a new assurance requiring airport owners or operators to submit an annual report
listing all amounts paid by the airport to other units of government, and required the FAA to
issue a policy on the use of airport revenue.
In the FAA Reauthorization Act of 1996 (1996 Reauthorization Act) (P.L. No. 104-264),
Congress broadened the revenue use requirements by adding a new section, 49 U.S.C. §
47133. Title 49 U.S.C. § 47133 broadened the applicability of the revenue use prohibition to
cover any airport that is the subject of federal assistance, including both public and privately
owned public use airports, and airport sponsors that have accepted real property
conveyances from the federal government.
Statute of Limitations on Enforcement. – The 1996 Reauthorization Act included a statute of
limitations that prevents the recovery of funds illegally diverted more than six years after the
illegal diversion occurs.
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Additional Guidance
•
This power point was prepared by the New England Region of the FAA and contains
some helpful information.
o https://www.faa.gov/airports/new_england/airport_compliance/media/revenu
e-diversion.pdf
Topic #2 – Typical Questions from Sponsors:
1. The City wants me to pay for Procurement/Legal/Engineering Services. Is that revenue
diversion?
2. The City wants to put a structural unit in the Airport Fire Station (City Fire Department) that
will respond to emergencies on and off airport. Is that revenue diversion?
3. My state collects an aviation fuel tax. It goes to the General Fund. Is that revenue diversion?
Topic #2 – Case Study
1. The Port Authority of New York and New Jersey “blends” funds between its airport, tunnels
and bridges, and road divisions. Why are they not cited by the FAA for revenue diversion?
2. Hypothetical Situation: A city used airport funds for additional police patrols in
neighborhoods that bordered the airport. Was this revenue diversion? Why or Why not?
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Topic #3 – Through-the-Fence
Grant Assurance #5: Preserving Rights and Powers
Through-the-Fence is a term for allowing access to the airport by aircraft based on land
adjacent to the airport. It also includes businesses that are on property adjacent to the airport
and need airport access as part of their normal business (aircraft repair shops and others).
While not specifically a Grant Assurance, it is covered by Grant Assurance 5 – Preserving
Rights and Powers, which states “It will not take or permit any action which would operate to
deprive it of any of the rights and powers necessary to perform any or all of the terms,
conditions, and assurances in this grant agreement without the written approval of the
Secretary, and will act promptly to acquire, extinguish or modify any outstanding rights or
claims of right of others which would interfere with such performance by the sponsor.”
Through-the-Fence is often viewed as a granting of a right to a person that has no interest in
the airport.
Chapter 12.7 of the FAA Order 5190.6B – Airport Compliance Manual
There are times when the sponsor will enter into an agreement that permits access to the
airfield by aircraft based on land adjacent to, but not a part of, the airport property. This type
of an arrangement has frequently been referred to as a “through-the-fence'' operation even
though a perimeter fence may not be visible. “Through-the-fence” arrangements can place
an encumbrance upon the airport property and reduce the airport’s ability to meet its federal
obligations. As a general principle, the FAA does not support agreements that grant access
to the public landing area by aircraft stored and serviced offsite on adjacent property. Thus,
this type of agreement is to be avoided since these agreements can create situations that
could lead to violations of the airport’s federal obligations.
Residential Through-the-Fence is the granting of through the fence privileges to a residential
“airpark” where hangars and homes are intermixed. Under no circumstances is the FAA to
support any “through-the-fence” agreement associated with residential use since that action
will be inconsistent with the federal obligation to ensure compatible land use adjacent to the
airport.
The federal obligation to make an airport available for the use and benefit of the public does
not impose any requirement to permit access by aircraft from adjacent property. The
existence of such an arrangement could conflict with the sponsor’s federal obligations unless
the sponsor retains the legal right to require the off-site property owner or occupant to
conform in all respects to the requirements of any existing or proposed grant agreement.
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It is important to remember that users having access to the airport under a “through-thefence” agreement are not protected by the sponsor’s federal obligations to the FAA. This is
because the federal obligation to make the airport available for public use on reasonable
terms and without unjust discrimination to all types, kinds, and classes of aeronautical
activities without granting an exclusive right does not impose any requirement to permit
access by aircraft from adjacent property. In fact, the airport sponsor may simply deny
“through-the-fence” access if it so chooses. The airport may also charge any fee it sees fit to
those outside the airport.
Additional Guidance
•
ACRP Report 114 Guidebook for Through-the-Fence Operations
o http://www.trb.org/main/blurbs/170955.aspx
Topic #3 – Typical Questions from Sponsors:
1. There is an industrial park adjacent to the airport and an avionics shop has work space
there. They want to cut through the fence and allow customers to taxi to their shop. Can
you allow this?
2. A housing development going up next to the airport wants to sell hangar homes and allow
their residents to use the airfield. If we authorize this can we charge a fee?
3. An existing through-the-fence operator wants an additional access point. Do we have to
allow this?
Topic #3 – Case Studies
1. Bell Vertol at Amarillo.
a. Amarillo International Airport is a commercial service airport that occupies
what used to be an Air Force Base. Bell-Vertol has a manufacturing facility off
airport, but adjacent to the airport where they manufacture the V-22 Osprey.
Does putting in a gate for them to access the runways constitute a violation of
the through -the-fence policy?
2. John Travolta’s 707 in Florida.
a. John Travolta keeps his 707 at his home near Ocala in Florida. He uses the
runways at a nearby privately owned public use airport. Is this a violation of the
through-the-fence policy?
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Topic #4 – Hazard Mitigation
Grant Assurance #20: Hazard Removal and Mitigation
[The sponsor} will take appropriate action to assure that such terminal airspace as is required
to protect instrument and visual operations to the airport (including established minimum
flight altitudes) will be adequately cleared and protected by removing, lowering, relocating,
marking, or lighting or otherwise mitigating existing airport hazards and by preventing the
establishment or creation of future airport hazards.
Grant Assurance 20, Hazard Removal and Mitigation, requires airport sponsors to protect
terminal airspace. Accordingly, the sponsor must protect instrument and visual flight
operations, including established minimum flight altitudes. Adequate protection includes the
clearing, removing, lowering, relocating, marking, lighting, or mitigating of existing airport
hazards. It also includes protecting against establishment or creation of future airport
hazards, including wildlife hazards.
Airports developed by or improved with federal funds are federally obligated to prevent the
growth or establishment of obstructions in the aerial approaches to the airport. (See Grant
Assurance 20, Hazard Removal and Mitigation.) The term “obstruction” refers to natural or
manmade objects that penetrate surfaces defined in 14 CFR Part 77, Objects Affecting
Navigable Airspace, or other appropriate citations applicable to the agreement applied to
the particular airport.
In many cases, uncontrolled growth of trees and vegetation can be a hazard. These hazards
must be dealt with in conjunction with any applicable local or state requirements. The
airspace allocated for protecting the airport will vary from airport to airport.
At such airports where these obstructions in the approach area cannot feasibly be removed,
relocated, or lowered but are declared hazardous, the FAA may consider approving a
displacement or relocation of the threshold. Threshold displacement requires FAA approval.
Additional Guidance
•
AC 150/51904A – A Model Zoning Ordinance to Limit Height of Objects Around Airports
•
FAA Order JO 7400.2G - Procedures for Handling Airspace Matters
•
AC 70-7460-1K - Obstruction Marking and Lighting
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Topic #4 – Typical Questions from Sponsors:
1. A developer wants to build a high-rise condo five miles from the end of the runway. How
do I stop this?
2. Trees have grown on the property adjacent to the airport.
a. Do I have to remove them?
b. What if they are in the approach corridor?
c. What if the airport/sponsor doesn’t own the land?
3. The local pilots are complaining about a tower that is along the flight path to the airport
that is unlighted. Who do I talk with about getting it lit?
Topic #4 – Case Study
1. The trees at the Water Treatment Plant.
a. The City owns both the airport and an adjacent water treatment plant. Over the
years, the Water Department has planted trees at the facility. These trees have
now grown to the point that they poke up through the approach surface to the
primary instrument runway. The City has a tree ordinance that requires anyone
that removes a tree to replace it with three others.
b. Can the airport remove these trees?
c. Will the FAA pay for the replacements?
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Thank You
Chicago
5218 N. Paulina St.
Chicago, IL 60640
Elevating the Industry
Los Angeles
8581 Santa Monica Blvd. #307
West Hollywood, CA 90069
424.218.9950
[email protected]
www.ACSFirm.com
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