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Strategies and Financing Opportunities for Airport Environmental Programs (2011)

Chapter: Chapter Two - Strategies for Identifying and Pursuing Funding Opportunities for Environmental Initiatives

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Suggested Citation:"Chapter Two - Strategies for Identifying and Pursuing Funding Opportunities for Environmental Initiatives." National Academies of Sciences, Engineering, and Medicine. 2011. Strategies and Financing Opportunities for Airport Environmental Programs. Washington, DC: The National Academies Press. doi: 10.17226/14567.
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Suggested Citation:"Chapter Two - Strategies for Identifying and Pursuing Funding Opportunities for Environmental Initiatives." National Academies of Sciences, Engineering, and Medicine. 2011. Strategies and Financing Opportunities for Airport Environmental Programs. Washington, DC: The National Academies Press. doi: 10.17226/14567.
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Suggested Citation:"Chapter Two - Strategies for Identifying and Pursuing Funding Opportunities for Environmental Initiatives." National Academies of Sciences, Engineering, and Medicine. 2011. Strategies and Financing Opportunities for Airport Environmental Programs. Washington, DC: The National Academies Press. doi: 10.17226/14567.
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Page 7
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Suggested Citation:"Chapter Two - Strategies for Identifying and Pursuing Funding Opportunities for Environmental Initiatives." National Academies of Sciences, Engineering, and Medicine. 2011. Strategies and Financing Opportunities for Airport Environmental Programs. Washington, DC: The National Academies Press. doi: 10.17226/14567.
×
Page 8
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Suggested Citation:"Chapter Two - Strategies for Identifying and Pursuing Funding Opportunities for Environmental Initiatives." National Academies of Sciences, Engineering, and Medicine. 2011. Strategies and Financing Opportunities for Airport Environmental Programs. Washington, DC: The National Academies Press. doi: 10.17226/14567.
×
Page 9
Page 10
Suggested Citation:"Chapter Two - Strategies for Identifying and Pursuing Funding Opportunities for Environmental Initiatives." National Academies of Sciences, Engineering, and Medicine. 2011. Strategies and Financing Opportunities for Airport Environmental Programs. Washington, DC: The National Academies Press. doi: 10.17226/14567.
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Below is the uncorrected machine-read text of this chapter, intended to provide our own search engines and external engines with highly rich, chapter-representative searchable text of each book. Because it is UNCORRECTED material, please consider the following text as a useful but insufficient proxy for the authoritative book pages.

5There are a variety of funding sources available to airports at the state and federal levels. The specific opportunities are dis- cussed in the following two chapters of this report. The focus of this chapter is on strategies or actions that airport operators can take to identify and successfully pursue these funding opportunities. The discussion turns first to matters of general applicability. Matters related to specific environmental issues follow. Finally, other potential sources of information on financing opportunities are discussed. GENERAL STRATEGIES Start Thinking Like a Government, Stop Thinking Like an Airport Most public-use airports are operated by public (governmen- tal) entities. Airports can be divisions or departments of cities or counties. Other airports are operated by independent author- ities; however, these authorities are political subdivisions of state or local governments. In a few states, for example Alaska, Hawaii, and Rhode Island, some airports are operated by units of state government. Aside from FAA programs, many envi- ronmental funding programs are open to qualifying state or local government entities. As governmental entities, airports may be eligible to participate in these programs. Depending on the resource area, there may be additional requirements for or limitations on eligibility. However, airports have the potential to qualify as governmental entities, which may open new fund- ing opportunities. Some funding programs may be limited to metropolitan planning organizations (MPOs) or regional planning agen- cies. Airports may be able to gain access to these programs by working through their local MPO or regional planning agencies. Some airport operators are multi-state agencies that do not meet the traditional definition of a local government. Never- theless, these operators may be able to qualify for funding programs available to local government entities. However, the level of effort and creativity required to demonstrate eligi- bility may be greater than the effort required from a traditional local government entity. Such entities might also qualify for state-only programs, although a higher level of effort may be required. Rely on Outside Experts As regular recipients of AIP funding, many airports may have the experience to successfully pursue ordinary AIP develop- ment and planning grants in-house. For other financial assis- tance programs different areas of technical knowledge and knowledge of grant administration may be required. During an interview for one case example, staff of CALSTART, a transportation policy and advocacy organization, emphasized the importance of obtaining outside expertise in areas beyond the airport’s core competencies to a successful effort to obtain environmental grants. Entities with the necessary expertise sometimes can be located through state websites addressing particular resource issues. In addition airport industry asso- ciations, including the Airports Council International–North America (ACI–NA), the American Association of Airport Executives (AAAE), and the Airport Consultants Council (ACC) maintain lists of consultants with expertise in various disciplines. Other sources of expertise may include universi- ties and environmentally oriented nonprofit organizations, such as the Sierra Club. In some cases, it may be necessary to contract for outside expertise. The costs of obtaining such outside expertise may be reimbursable from the grant as an allowable project cost. Partnering and Teaming May Provide Access to Funding Opportunities As reflected in the case example involving CALSTART, some grant programs establish a minimum grant amount that exceeds the financial capacity or the need of a single airport. Some grant programs may allow a coalition of individual airports to apply as a group. Some environmental financial assistance programs, such as historic preservation programs, rely on tax credits rather than on direct grants. Tax credits do not benefit public entities. However, tax credits could provide an incentive to airport ten- ants or equipment vendors. By partnering with private-sector participants that can use the tax credits, airports may be able to take advantage of environmental financing programs oriented toward the private sector. Some funding opportunities are open to both private and governmental entities. For some situations, it might be more advantageous for an airport to partner with private-sector participants than to pursue a grant directly. CHAPTER TWO STRATEGIES FOR IDENTIFYING AND PURSUING FUNDING OPPORTUNITIES FOR ENVIRONMENTAL INITIATIVES

Finally, for some programs, granting agencies may give priority consideration to applications from a coalition of enti- ties. During an interview for another case example, staff of the Seattle–Tacoma International Airport expressed the opin- ion that the airport’s participation in a Clean Cities Coalition grant with three other entities enhanced the attractiveness of the grant request as compared with a stand-alone application. Planning and Preparation are Essential This report provides information on a wide range of fund- ing opportunities for environmental initiatives. By using this information, airport management can select the initiatives they wish to pursue, taking into account cost and potential funding assistance. Once initiatives are selected, it would be prudent to begin planning, developing a budget, and develop- ing an estimate of project benefits. Many programs use cost- effectiveness as one selection criteria and require quantitative reporting of benefits. As noted in the Table 2 in chapter four, however, for many state programs the final design may be deferred until after the granting agency makes preliminary selections. Another reason that planning is critical is the schedule of the grant process. The matrices provide schedule information based on the most recent year for which it was available; however, schedules may vary from year to year. The time between the announcement of grant opportunities and the filing of preliminary or final applications may be rel- atively short. Planning and preparation may include developing a bud- get, obtaining necessary budget approvals, and hiring outside expertise. The planning and preparation process presents a number of organizational issues to be addressed if the process is to be successful. The following list summarizes these orga- nizational issues: 1. Understand Internal Process: • Budgeting for grant preparation • Mobilizing organization • Building your team • Legal and administrative requirements for executing grants. 2. Understand Grant Process: • Timelines • Contacts • Format of documents. 3. Understanding Commitments: • Of the grant • Matching funds • Operations and maintenance (O&M) • Reporting. 4. Follow Through: • Taking ownership of the project and grant process • Developing a champion for the project within the organization. 6 Weigh the Costs and Benefits of the Financial Assistance As reflected in the matrices and case examples, there may be substantial burdens associated with seeking and obtaining environmental grants. There are costs associated with devel- oping an application and these costs can be substantial. Most financial assistance programs require a contribution of a share of project costs from the applicant. There are also ongoing reporting and record-keeping requirements after a project has been completed. For some projects; for example, water qual- ity projects, there may be ongoing O&M expenses. Airport staff interviewed for one of the case examples suggested that on a purely financial basis a grant of less than $2 million would not have been cost-effective. However, the amount the airport received for the project described in this example substantially exceeded this figure. In weighing costs and benefits it is important to consider the nonfinancial benefits. The environmental benefits of a project may not be fully quantifiable as a monetary amount. In addi- tion, the airport may receive intangible benefits in the form of positive publicity or identification as a community-oriented good neighbor. These intangible benefits may be valuable to an airport when it is seeking community support for major capital development programs. Program Contacts Can Be Helpful As reflected in the matrices, most federal and state program listings on websites include contact information. Although the sample was small, the results were consistent. Responses were prompt and the information requested was provided. E-mail appeared to be the most effective means of communication. If this result is indicative, airport staff, as potential applicants, will usually be able to find a high level of cooperation. Pro- gram contacts can also assist an airport in the successful pur- suit of a grant. The collaboration can be mutually beneficial. Airport operators receive the financial benefit of the success- ful pursuit of funds. Program staff also benefit when they are recognized as contributing to the success of the funding pro- gram. Acknowledging the assistance of program staff in an air- port’s successful pursuit of a grant can provide an incentive for continued cooperation. Program staff can also be a source of information on new funding opportunities when they arise. A Proactive Not Reactive Approach Is Helpful Airport operators seeking new sources of funding for envi- ronmental initiatives are more likely to be successful by tak- ing a proactive approach in pursuing grants; this can include a number of actions. For example, regular monitoring of the federal and state websites included in the matrices is critical. The matrices contain information that was available at the

7time this study was conducted and postings are subject to change. The federal grants.gov website added new grant oppor- tunities on a weekly, and sometimes daily, basis. Some state websites also were not regularly updated and continued to list recently closed grant opportunities, although the amount of information on closed programs varied widely. Once airport staff have identified the resource area (or areas) they would like to pursue, it would be prudent to use the matrix to iden- tify potential funding sources and to monitor the websites listed for those sources on a regular basis. Some programs enable interested parties to sign up to receive automatic notices about program developments; using this option could reduce the burden of monitoring sites. For some states, links to grant information may not read- ily appear on agency home pages. It may be necessary to link to specific program information or to use the search function at the agency level. The information is available; the addi- tional effort that may be required to obtain the information is worthwhile because it can lead to identification of funding opportunities. Networking is another useful strategy. Participation in environmental conferences, environmental forums, and orga- nizations at the state, regional, or local level can enable airport staff to identify and pursue new environmental fund- ing opportunities. Two of the case examples in chapter six involve airports that were members of regional clean cities coalitions and relied on their memberships when in pursuit of funding. Planning and preparation, discussed earlier, also support a proactive approach to obtaining environmental funding. One planning tool used by the Massachusetts Port Authority (Mass- port), the owner/operator of Boston Logan International Air- port, involves the creation of a grants committee that includes key members from the Executive Administration and Admin- istration and Finance Departments. The grants committee is convened before a grant application is made. It focuses on understanding up front all the strings that are attached to a successful grant application; for example, matching funds, monitoring and reporting requirements, and Equal Employ- ment Opportunity standards, so that appropriate resources and procedures can be adopted to ensure compliance with these requirements. A proactive approach to funding does not end with obtain- ing a grant agreement or loan. It includes ensuring that proj- ects are carried out and all administrative, reporting, and record-keeping requirements are satisfied in a timely manner. Failure to implement projects or comply with administrative requirements can lead to the termination of existing funding commitments and jeopardize an airport’s competitive position for future funding. Successful airports ensure that responsibil- ity for projects is clearly assigned and that accountable per- sons are identified. Consider Multiple Funding Sources for an Environmental Initiative The Columbus Regional Airport Authority (CRAA) is cur- rently benefitting from multiple grant programs to support vehicle emission reductions. CRAA is part of a coalition assembled by Clean Fuels Ohio that obtained funding under the Clean Cities Program to finance the incremental costs of replacing existing parking lot shuttle vehicles with propane vehicles. CRAA also partnered with the Ohio Environmental Council to obtain funding from the Midwest Clean Diesel Initiative for retrofitting diesel vehicles to reduce emissions. However, many federal programs do not allow federal fund- ing sources to be combined, although grantor staff can help bring multiple parties or funding sources together. Another potential funding source may be fines for envi- ronmental pollution or settlements or awards from environ- mental litigation. Massachusetts dedicates the proceeds from fines for environmental pollution to environmental programs. Other states may have similar programs, but this study did not focus on this issue. Be Nimble As noted, planning and preparation are important. However, some funding opportunities may arise on short notice. An air- port with structures in place to respond to funding opportu- nities may be better positioned to take advantage of them when they occur. Proactively seeking out grant opportunities is one element. Having structures in place that provide legal authorization to apply for funds or that permit authority to be obtained on short notice is also important. Flexibility is also essential. One of the case example air- ports started out pursuing a grant on a stand-alone basis, but elected to complete the grant process as part of a consortium effort. In the opinion of airport staff, the decision to join a consortium may have increased the probability of obtaining the grant funding. Leverage the Hidden Value Streams at the Airport Some environmental initiatives can pay for themselves or can attract participation by for-profit enterprises. One case example involved a private business (Clean Energy, Inc.) investing in the construction of an on-airport compressed natural gas (CNG) refueling station (at no cost to the airport), because of the potential profits from CNG fuel sales. The guaranteed energy savings contract model discussed here is based on the concept that third-party providers can earn a profit by selling and installing efficient and renewable energy devices while being reimbursed from the reduction in electric utility costs. Finally, a private business (Go Green Airport Recycling Centers) is now offering to perform solid waste reduction, reuse, and recycling services for airports at no

charge, based on the potential revenue stream generated by the sale of recyclable materials. Depending on the type and volume of materials, the airports may even generate net rev- enue from the arrangement. Develop and Use Networks of Support for Environmental Initiatives A network focused on environmental initiatives can enhance an airport’s access to environmental funding. Internal networks can make it easier to identify projects or programs that may qualify for such funding. Internal networks can also be used to generate organizational support for the projects and pursuit of financial assistance. The internal network can also help ensure that projects are implemented and funding require- ments are met once financial assistance is awarded. An exam- ple of an internal network is the Massport Grant Committee. External networks can also help identify funding sources and provide assistance and advice in developing successful pro- posals. It may be advantageous to extend networks beyond the individuals or offices with specific environmental program responsibilities. For example, fines imposed on environmental polluters in Massachusetts are available to fund environmen- tal initiatives. Other states may also dedicate environmental fines or settlements and judgments in environmental litigation to environmental programs. By establishing contacts with state environmental attorneys, airport staff may acquire improved access to information on fund availability. SPECIFIC ENVIRONMENTAL ISSUES This section outlines strategies and suggestions for accessing financial assistance related to specific environmental issues. It is based on a review of the information from the funding pro- gram websites listed in the matrices and from the case exam- ples. In some instances more detailed information is presented in the succeeding chapters on federal and state programs. Air Quality For airports in Clean Air Act (42 USC §4701 et seq.) non- attainment or maintenance areas, the FAA’s VALE program may be available. The FAA continues to encourage partici- pation and to seek applicants. Projects to comply with the requirements of the Clean Air Act are also eligible for AIP funding. However, the projects do not enjoy a high priority for funding unless they are associated with another project that the FAA rates more highly, such as a safety or security proj- ect. Other programs focus on vehicle emissions. The Clean Cities program and Diesel Emission Reduction Act (DERA) program focus on alternative fuel and clean diesel retrofit or replacement initiatives to reduce emissions. As noted, DERA has a $500,000 minimum grant requirement. It may be more practical for some airports to join together with other airports. Both programs give special consideration to applications sub- mitted by consortia. 8 Many states or communities may have nonprofit agencies similar to CALSTART that can function as the applicant for Clean Cities or DERA funds. For Clean Cities funding the applicant must be part of a Clean Cities coalition. The CRAA has partnered with both Clean Fuels Ohio and the Ohio Envi- ronmental Council to obtain funding for replacement and retro- fitting of vehicles to reduce emissions. Brownfields Cleanup and Restoration Grant and loan programs are available to local government entities to perform assessments and to conduct cleanups of sites to prepare them for redevelopment. If the government does not own the site an agreement with the land owner will be necessary. A plan for redeveloping the site is recommended, because funding agencies typically consider the viability of the redevelopment as one factor in providing assistance. Conservation of Resources, Habitat, and Species Aside from grants related to water quality, grants for conser- vation of resources, habitat, and species appear to be most closely associated with lands under federal control and lands in agricultural use. However, for airports within or near lands under federal control, funding is available to local govern- ments and government agencies. Implementation of a project in this category could raise questions of conformity to FAA policies on protecting airspace and avoiding wildlife hazards. Electrical Energy—Emission Reduction A wide variety of programs are available to assist airports in reducing nonrenewable energy consumption. Some programs focus on enhancing efficiency to reduce consumption, others assist in developing renewable energy sources. Especially in the area of reducing energy use, options involving public– private partnerships are available in addition to publicly funded grants or low-interest loans. Many utility compa- nies offer rebates and other incentives for the installation of low energy consumption equipment and renewable energy sources. Cogeneration agreements may also be available. The Database for State Incentives for Renewables & Effi- ciency (DSIRE), accessible through http://www.dsireusa.org/, provides a comprehensive listing of financial assistance pro- grams available by state. The listing includes utility programs. Airports contemplating energy conservation or renewable energy initiatives can use the DSIRE website to identify poten- tial funding sources. Another potential funding strategy is derived from partic- ipation in the Guaranteed Energy Savings Contract (GESC). The GESC concept is described in more detail in chapter five. The basic concept is that a third-party energy service com- pany (ESCO) conducts an energy assessment. Based on the assessment it presents a plan to the facility owner and guar- antees a quantity of energy savings if its recommendations

9are implemented. The third party provides up-front financing for the capital costs needed to implement the recommenda- tions and is repaid through the guaranteed energy savings. Historic and Cultural Resources Most states have loan or grant programs available to support acquisition, preservation, and restoration of historic struc- tures. Such programs are open to local government entities. For those airports with historic structures the programs may provide a source of financing for preservation or rehabilita- tion. Most programs require a recipient to assume obligations to maintain the structure and provide for public access. The costs associated with these obligations would offset the value of the assistance. In some states, funding may also be available for cata- loguing and other documentation of historic sites. For air- ports that are required to conduct documentation efforts of historic sites as a condition for completing a development project this funding source may be available. Noise The primary source of funding for noise compatibility proj- ects continues to be the Noise Compatibility Program within AIP. With limited exceptions, discussed in more detail in chapter three, a FAA-approved noise exposure map and FAA-approved noise compatibility plan are required before FAA will make funding available. Measures typically funded within AIP include sound attenuation for structures or land acquisition. The study did not reveal any parallel assistance programs focused on noise compatibility at the state level. However, many states have airport planning and development grant pro- grams. Often, the focus of these programs is providing all or part of the local matching fund requirements for AIP grants. Information on the state programs is included in the matrix in chapter four. In states with airport grant programs, state funds may be available to help cover the local matching requirement for AIP noise grants. Petroleum Storage Tanks and Releases Petroleum storage tanks are as much a part of airport land- scapes as runways and taxiways. Most states have financial assistance programs to help cover the costs of cleaning up inadvertent petroleum releases from storage tanks. In many cases, as reflected in the matrix in chapter four, the program functions in a manner similar to an insurance policy. The tank owner pays a deductible and the funding agency covers the balance of the costs. Liability for damages to third parties may also be covered. Generally, to benefit from these programs airports must register their tanks with the appropriate state agency and promptly notify the state of any release. Timely action to stop and contain the release is also generally required. Many programs require preliminary steps such as registering tanks and payment of tank fees. Completing these steps would enable airports to expedite a funding request should a release occur. Water Quality Funding is available in most states for water quality proj- ects, including projects to address storm water runoff under Section 319 of the Clean Water Act. Funds are generally avail- able to local governments. However, priority is given to proj- ects that provide broad-based watershed benefits and that address water bodies identified as priorities in state plans. Therefore, airports may enhance their access to funding by partnering with local water resource agencies or utilities. A relatively recent strategy for water quality improvement (especially reduction of storm water run-off) is pervious or porous pavement. The principle of pervious pavement is that storm water can be absorbed into the pavement, similar to the absorption of water by soil. By reducing the volume of storm water flowing off pavement into the water shed, the pervious pavement also reduces the volume of pollutants flowing off the pavement. It is not clear at this time however that pervious pavement has the strength and durability necessary for appli- cation in all airfield uses. Waste Reduction and Recycling Many states have financial assistance programs to support recycling and other initiatives to reduce solid waste. In many cases, the focus of the programs is on encouraging community recycling or the construction of recycling facilities. Therefore, airports may enhance their access to funding for recycling by partnering with appropriate local governmental agencies. As noted, opportunities for public–private partnerships for recycling are available. If the volume and nature of recyclable materials are commercially viable, at least one private-sector firm may be willing to provide recycling equipment and facil- ities at no cost to the airport and may even provide a recycling revenue stream. ADDITIONAL INFORMATION SOURCES The following is a listing of general information sources on environmental financial assistance identified for this report. • As noted, DSIRE provides a comprehensive listing of financial assistance and incentives for renewable energy and energy efficiency projects. For each state, in addition to state programs, federal programs and programs offered by utility companies are cited. • A nationwide listing of geothermal incentives is available at: http://www.geoexchange.org/incentives/geothermal- heat-pump-incentives.html.

• For airports in Missouri, the Missouri Catalogue of Financial Assistance, http://www.mo.gov/mo/pdf/ MoCSAP.pdf, provides a listing of financial assistance opportunities within the state. • In 2008, the EPA published the Guidebook of Financial Tools, Paying for Environmental Systems. The guidebook is a compendium of tools and strategies for financing environmental initiatives and includes information on federal assistance programs and public–private partner- ships. The guidebook also discusses options that may be available to state or local governments to institute taxes and fees that generate revenues to support envi- ronmental initiatives. Links to relevant websites are also included. A link is available at http://www.epa.gov/ efinpage/publications/GFT2008.pdf. • The study effort located a number of commercial grant- finding websites, including www.NewUSAFunding.com, 10 www.MyFinancialPrograms.com, www.Environmental grants.com, and http://www.fedgrantservices.com/lc/. However, these websites appeared to be oriented toward individuals and small businesses and charge subscrip- tion or other fees. • Two sources of information on foundations offering grants were identified. The Foundation Center at http:// foundationcenter.org/ provides a comprehensive list- ing of foundations. A subscription is required to access some of the center’s databases. However, listings of open Requests for Proposals (RFPs) are available at no charge at http://foundationcenter.org/pnd/rfp/. The Norcross Wildlife Foundation includes in its website a link to general information on foundations, which appears to be oriented toward foundations, rather than potential grantees: http://www.norcrossws.org/Foundation%20 Infor/Foundmain.html.

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TRB’s Airport Cooperative Research Program (ACRP) Synthesis 24: Strategies and Financing Opportunities for Airport Environmental Programs summarizes public and private funding opportunities and strategies available to airports to help accomplish their environmental programs and objectives.

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