Strategies for Reuse of Underutilized or Vacant Airport Facilities (2011)

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53 GLOSSARY Aeronautical use: Aviation activity that takes place on the airfield or at the terminal gates. Aeronautical revenue: Operating revenue that an airport collects from— • Terminal rents – Based on the amount of space an air- line uses inside the terminal; • Landing fees – A per plane charge, usually based on the weight of the aircraft; • Other charges – Specific fees for extra airport services (i.e., use of a jet bridge). An airline does not have to have a signed contract to use an airport. However, an airline with a contract, called a sig- natory airline, enjoys special benefits, such as lower rates, than those airlines that do not sign a contract. Compensatory agreements: The airport operator assumes the major financial risk of running the airport and sets rates and charges to recover the costs of the facilities and services that airlines use. Connecting passengers: Passengers who disembark one aircraft and connect to another aircraft at the same airport. Enplanements: Passengers boarding an aircraft. Hub and spoke systems: One model airlines use to organize their network of service. Airlines operate hubs in a few cities where most of their flights originate, and service goes out to spoke cities. Hub and spoke systems give pas- sengers from smaller cities much greater access to a vari- ety of destinations as passengers connect at the hub on flights to their destination. In the United States, United Airlines, American Airlines, Frontier Airlines, Alaska Airlines, Delta Airlines, Continental Airlines, and US Airways operate hub and spoke systems. Other carriers operate point-to-point service, although carriers such as Southwest Airlines and AirTran operate in focus cities where it is possible to make connections. Large, medium, small, and nonhub airports: The FAA defines large hubs as having 1% or more of total national annual passenger boardings. A medium hub has 0.25% to 1% of boardings. A small hub has at least 0.05%, but less than 0.25%. A nonhub airport has more than 10,000 board- ings but less than 0.05%. There are 30 large hub airports, 38 medium hubs, 68 small hubs, and 385 nonhub airports. Majority-in-interest clause: Provisions in an airport’s gen- eral use agreement with an airline that typically give those airlines performing a majority of the operations at the airport veto power over airport expansion when those airlines would be responsible for paying the cost of that expansion. Nonaeronautical revenue: Nonaeronautical, or landside revenue, is generated from the following types of activities: • Concessions – Rents paid by gift shops, restaurants, or newsstands. Most concession contracts also require a concession to pay a percentage of its profits to the airport. • Parking – Fees for all airport-owned parking lots. • Advertising – Ads placed on airport walls, billboards, and buses are a source of airport income. • Land rent – Excess airport land may be rented for golf courses, office buildings, hotels, or farming. • Permits – Fees paid by off-airport companies to access the airport and pick up passengers (e.g., taxis or shuttle buses). Primary airports: As defined by the FAA, a commercial service airport with more than 10,000 passengers board- ing each year. Residual cost agreements: A type of contract with an air- port owner where airlines collectively agree to pay any costs of running the airport that are not allocated to other users or covered by nonairline revenue. Signatory airlines: Any airline that has a valid and effective airport use and lease agreement with an airport sponsor.