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ACRP Report 47: Guidebook for Developing and Leasing Airport Property (2011)
Airport Cooperative Research Program (ACRP)

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Crider, Rick, Preisler, Matthew, Autin, Erin, Roth, Sanders, Fulton, Stephanie, Swartzlander, Julie, Tharp, Gary, Transportation Research Board. "3.6.3 The Economic Development Role." ACRP Report 47: Guidebook for Developing and Leasing Airport Property. Washington, DC: The National Academies Press, 2011.

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Page
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Front Matter (R1-R11)
Summary (1-4)
1.1 Purpose of This Guidebook (5-5)
1.2 How to Use This Guidebook (6-6)
1.3 Research Approach (7-9)
2.1.1 Aeronautical Versus Nonaeronautical (10-10)
2.1.2 Land Lease (11-11)
2.1.5 Hangar Rental Agreement (12-12)
2.1.7 Airline Leases (13-14)
2.2 Essential Lease Elements (15-15)
2.2.4 Use of Premises (16-16)
2.2.6 Rent (17-17)
2.2.8 Operation and Maintenance (18-18)
2.2.10 Reversion/Reversionary Clause (19-19)
2.2.12 Rights, Reservations, and Obligations of Lessee (20-20)
2.2.15 Insurance Obligations (21-21)
2.2.16 Environmental (22-22)
2.2.17 Taxes and Fees (23-23)
2.2.19 Defaults (24-24)
2.2.21 Regulatory Compliance (25-25)
2.2.25 Force Majeure (26-26)
2.3.1 Noncompete Clause (27-27)
2.3.2 Right of First Refusal (28-28)
2.3.4 Term Extension Options (29-29)
Chapter 3 - Airport Owner/Sponsor Role (30-30)
3.1.1 Airport Master Plan (31-31)
3.1.2 Infrastructure Inventory Analysis (32-32)
3.1.4 Airport Business Plan (33-33)
3.2 Grant Assurances and Federal Compliance (34-34)
3.2.2 Community Considerations (35-35)
3.2.3 Land Management Compliance (36-36)
3.2.5 Business Practice Assurances (37-37)
3.2.6 Exclusive Rights (38-38)
3.2.7 Environmental Compliance (39-39)
3.3 Minimum Standards and Rules and Regulations (40-41)
3.5 Stakeholder Coordination (42-42)
3.5.2 Economic Development Agencies (43-43)
3.5.5 Colleges and Universities (44-44)
3.5.7 Federal Government (45-45)
3.6 Sociopolitical Considerations (46-46)
3.6.3 The Economic Development Role (47-47)
3.6.4 Incentives and Assurances (48-48)
4.1 Existing Agreements (49-49)
4.3 Funding (50-50)
4.4 Land and Facility Development (51-51)
4.5.1 Appraisal (52-52)
4.6 Airport Revenue Maximization (53-53)
4.7 External Stakeholder Resources (54-54)
5.1.1 Funding (55-55)
5.1.2 Quantifying Benefits - Pro Forma Analysis (56-56)
5.1.3 Capital Recovery Rates (57-57)
5.2.1 Return on Investment (58-59)
5.2.2 Financial Effects of Lease Components (60-60)
5.3.1 Debt/Equity Coverage (61-61)
5.4.1 Tax-Exempt Debt (62-62)
5.4.2 Private Financing (63-63)
5.6 Funding Sources (64-64)
5.6.1 Airport Improvement Program (65-65)
5.6.3 Alternative Grant Sources (66-66)
5.6.4 Private Capital (67-67)
6.1.1 Airport Planning (68-68)
6.1.4 Economic Impact Considerations (69-69)
6.2 Lease Execution (70-70)
6.2.3 Lease Rate Determination (71-71)
6.2.5 Reversion (72-72)
6.3.1 Project Analysis Checklist (73-73)
6.3.2 Lease Agreement Checklist (74-76)
Case Study Summaries (77-77)
Collin County Regional Airport (TKI) (78-79)
Monroe County Airport (BMG) (80-81)
Coastal Carolina Regional Airport (EWN) (82-83)
New Bedford Regional Airport (EWB) (84-84)
Albany International Airport (ALB) (85-87)
Baton Rouge Metropolitan Airport (BTR) (88-89)
Pittsburgh International Airport (PIT) (90-91)
Ted Stevens Anchorage International Airport (ANC) (92-93)
George Bush Intercontinental Airport/Houston (IAH) (94-95)
Tampa International Airport (TPA) (96-99)
Project Attributes Matrix (100-101)
Project Stakeholder Matrix (102-103)
Appendix B - Acronyms (104-105)
Appendix C - Glossary (106-122)
Appendix D - References and Bibliography (123-126)
Appendix E - Nominated Airport Projects (127-129)
Abbreviations used without definitions in TRB publications (130-130)

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Airport Owner/Sponsor Role 47 3.6.1 The Airport Role in the Community Airports may be perceived differently from one community to the next, so the role the airport plays within its respective community may be unique. Some communities view their airports as generators of noncompatible development and a detriment to their growth, though airports are seen in most communities as valuable resources and a vital part of the infrastructure. Some com- munities view their airports as important attributes to attracting industry and jobs; others rec- ognize their community airport as a link to the world's air transportation network. Perhaps the community places its airport in high esteem because it supports emergency response activities in times of natural disaster or helps provide access to time-critical medical care. Regardless of the rationale for perspective, or the combination of perspectives and public sen- timent, airports should have a solid understanding of the role they are expected to play within their respective communities before embarking on airport development. This is an important point because the airport sponsor may encounter an unexpected response when the intent to begin an airport development becomes public, especially if the airport is out of tune with the com- munity perceptions. Participation in comprehensive planning exercises and an overall engage- ment in community discussion can position the airport sponsor for a solid understanding of the role it is expected to play. Regardless of the approach, the airport sponsor needs to be seen as a member of the community, not as a visitor or an adversary. 3.6.2 Community Relations Ongoing and quality community relations can have a significant impact on airport develop- ment. An airport sponsor that has a clear vision, a well-defined set of development goals and that is adept at building community consensus to support those goals is positioned for success in car- rying out its development initiatives. Community relations are vital to the mission of articulat- ing the vision of the airport sponsor, correcting any misperceptions, and building support for the initiatives undertaken by the airport sponsor. Elected officials, in many cases, have a role to play in an airport development project, can pro- vide resources, and are eager to take leadership and ownership of the project. When afforded the opportunity to take a center-stage leadership role, providing support and being an advocate in the policy arena, elected officials can play a valuable role. When overlooked, avoided, or circum- vented, elected officials can be an unnecessary adversary that can certainly influence the success of the project. 3.6.3 The Economic Development Role Because the vast majority of public-use airports are owned by public entities, social and politi- cal externalities can have a significant effect on airport development. Most communities perceive their airports as an economic engine and an important thread in the economic fabric of the economy. In cases where the airport is owned by a public entity (e.g., a county, a city, a state, or a stand-alone authority that may be governed by a board appointed by some combination of the aforementioned public-sector entities), social agendas and political influences bear economic con- sideration. This is particularly true when a development project has the potential for providing the community with significant economic benefits (such as new employment and/or tax revenues). Sometimes an airport development project may stimulate an abundance of enthusiasm within the sociopolitical arena, bringing those pressures to get the project done and setting the stage for inappropriate involvement or application of incentives by the airport sponsor. In these cases, it may be appropriate to enlist appropriate parties (such as state and/or local economic develop- ment agencies) to proactively provide incentives through sources such as EDA grant funds and