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257 This chapter of the guidebook focuses on small airports that serve or could serve com- mercial passenger service. Icons are defined in Figure 1 in Section 1.1. 7.1 Transitioning to Commercial Air Service Key Insights On occasion, an airport will have an opportunity to transition from being a GA airport to being capable of providing commercial service. Multiple factors are involved in the decision to support airline service, including airport certification, security, airport rescue and firefighting, and snow removal, where applicable. Begin the certification process early, and well before scheduled passenger activity is expected, because of the lag time needed to develop an airport certification manual, the time required for the application process and the timing of FAA review and approval. To cut down on the potential costs for attaining Part 139 certification, it is sometimes advisable for airports to operate with a limited certification in anticipation of a full certification in the future. This is subject to budget availability to upgrade and operate under a limited certification for an unspecified period of time. Key Definitions Advisory circular: A series of external, informational FAA publications consisting of non- regulatory material about a policy and providing guidance for compliance. Aqueous film-forming foam (AFFF): A firefighting agent that is used to coat the burning material, cooling it and preventing its contact with oxygen to suppress the fire. Aircraft operations area or air operations area (AOA): Any area of the airport used or intended to be used for the landing, takeoff or surface maneuvering of aircraft, including runways, taxiways and, in some cases, ramp areas. Aircraft rescue and firefighting (ARFF): A special category of firefighting that involves response, hazard mitigation, evacuation and rescue of passengers and crew of an aircraft involved in an airport ground emergency. Airport certification manual (ACM): A document that details how the airport operator will comply with the requirements of FAR Part 139: Certification of Airports. C H A P T E R 7 Commercial ServiceâAttracting Airlines and Transitioning to Airline Service
258 Guidebook for Managing Small Airports Airport master plan (AMP): An assembly of appropriate documents and drawings covering the development of a specific airport from a physical, economic, social and political jurisdictional perspective by assessing current and projected demands. The master plan typically has a time frame of 20 years, with short-, intermediate- and long-term goals within that time frame. The airport layout plan is a part of this plan. Airport operating certificate (AOC): A certificate issued under FAR Part 139 for the operation of a Class I, II, III or IV airport. Airport security coordinator (ASC): An airport operatorâs designated primary and imme- diate contact for security-related activities and communication with the Transportation Security Administration. Code of Federal Regulations (CFR): The codification of the general and permanent rules and regulations (sometimes called administrative law) published in the Federal Register by the executive departments and agencies of the federal government of the United States. Federal Aviation Regulations (FAR): Regulations established by the FAA located in Title 14 of the Code of Federal Regulations. These regulations are the rules that govern the operation of aircraft, airways, airports and airmen. Federal security director (FSD): A member of the Transportation Security Administration in a leadership role responsible for security operations at federalized airports. An FSD may be responsible for an airport in a geography covering a group of airports. Passenger facility charge (PFC): A per-ticket charge imposed by a public agency on passengers enplaned at a commercial service airport it controls. Security identification display area (SIDA): A secure area of the airport that requires an appropriately vetted employee to have and display a security identification badge. Sensitive security information (SSI): Information that, if publicly released, would be detrimental to transportation security. SSI is not classified information, but there are specific procedures for recognizing, marking, protecting, safely sharing and destroying SSI. Sterile area: An area of controlled access for passengers boarding aircraft. Transportation network company (TNC): A company that uses an online platform to connect passengers with drivers using their personal, noncommercial vehicles. Transportation Security Administration (TSA): An agency of the U.S. Department of Homeland Security responsible for protecting the U.S. transportation systems and the travel- ing public. Transition to FAR Part 139 Commercial Service Airport On occasion, a small airport that is not already supporting commercial passenger oper- ations has an opportunity to initiate commercial passenger service. The opportunity for a small airport to transition from a nonprimary airport to a commercial service and, ideally, a primary airport (an airport with at least 10,000 enplaned passengers per year) can be an exciting opportunity, especially because primary airports receive higher levels of FAA AIP grant funding. However, the transition will have costs for the airport, especially if the airport does not already hold a FAR Part 139 certificate. Even if the airport is certificated as a Part 139 airport to support unscheduled operations, there are numerous additional requirements, particularly associated with security, that the airport will need to address prior to accommodating scheduled In addition to potential facility improvements, there are two critical operational changes: holding a FAR Part 139 operating certificate and implementing a security plan.
Commercial ServiceâAttracting Airlines and Transitioning to Airline Service 259 passenger operations. Also, the airportâs ARFF index may change, requiring the addition of ARFF equipment. An airport operator needs to carefully evaluate the costs and benefits in making this service change. Two major steps must be undertaken to transition to commercial air service: obtain the Part 139 AOC and establish an acceptable security program. Required facilities and equipment will need to be obtained to meet the security and certification provisions. The certification and security program efforts can be undertaken simultaneously to consolidate the time required to complete the process. The process could take between 18 and 36 months to complete. This timeline could be extended depending on the facility improvements that may be required and on the budget that is available. Airport Certification Every airport that handles commercial service must complete the certification process as defined by Part 139. Airports are divided into four Part 139 airport classes. The certification requirements vary by class. An airport operator identifies the class of Part 139 certification it is required to carry based on the type of scheduled or unscheduled air carrier operations to be served. As shown in Table 14, Class I Part 139 airports can serve all classes of aircraft required to operate from a Part 139-certificated airport, whereas Classes II, III and IV can only service some types of scheduled or large unscheduled air carrier aircraft. AOCs serve to ensure safety and conformity in air transportation. To obtain a certificate, an airport operator must agree to certain operational and safety standards and provide for such things as ARFF equipment. These requirements vary depending on the size of the airport and the type of commercial aircraft serving the airport. The regulation, however, does allow FAA to issue certain exemptions to airports that serve few passengers yearly and for which some requirements might create a financial hardship. Part 139 requires the FAA to issue AOCs as follows: â¢ To airports that serve scheduled and unscheduled air carrier aircraft with more than 30 seats â¢ To airports that serve scheduled air carrier aircraft with more than 9 seats but fewer than 31 seats â¢ To airports that the FAA administrator requires to have a certificate Airports that accommodate air carrier passenger operations only as a designated alternate airport are not required to be certificated per Part 139. Any airport operator that desires to serve air carrier operations as specified in Part 139 must comply with the requirements of the rule. The actions required by an airport operator to comply will vary depending on the type of air carrier operations served. Airport operators wanting to Class of Part 139 Certificate Required Type of Air Carrier Aircraft to Be Served Class I Class II Class III Class IV Scheduled large air carrier aircraft (at least 31 seats) Unscheduled large air carrier aircraft (at least 31 seats) Scheduled small air carrier aircraft (10â30 seats) Source: https://www.faa.gov/airports/airport_safety/part139_cert/classes-of-airports/, accessed August 2017 Table 14. Part 139 Airport certification classes based on type of air carrier operations.
260 Guidebook for Managing Small Airports apply for an AOC must initiate the application process, as prescribed in FAR Â§139.103. Typically, the AOC application process is as follows: â¢ The airport operator wanting to apply for an AOC contacts the appropriate FAA Airports regional office to initiate the application process. â¢ The regional office interviews the airport operator to obtain information about the airport and air carrier operations served or anticipated to be served. â¢ If the FAA determines that a certificate is necessary, FAA staff will provide the airport operator with an application for certification (FAA Form 5280-1: Application for Airport Operating Certificate) and guidance materials. â¢ The airport operator submits a completed application (as specified under FAR Â§139.103) to the regional office for approval. The application package must include two copies of the airportâs proposed ACM and written documentation as to when air carrier service will begin. Any requests for exemptions should be submitted at this time (as specified under FAR Â§139.111). The FAA reviews the application and associated documentation to ensure they are complete. The FAA also might conduct an inspection of the airport for compliance with the requirements of Part 139. The FAA will work with the airport operator to tailor the ACM to ensure compliance with any revised rules and might request changes to the ACM and any procedures it describes. As the FAA reviews the application and ACM, FAA staff will contact the airport operator to discuss whether additional action is needed and to what extent, if any, air carrier operations can continue until an AOC is issued. The FAA will issue an AOC if the application and other required documentation meet the provisions of Part 139 and an inspection shows that the airport operator is in compliance with Part 139. The certificate may include other provisions the FAA finds necessary to ensure safety in air transportation. All airport operators seeking certification must prepare the following for approval by the FAA or TSA as applicable: â¢ Airport certification manual (FAA) â¢ Emergency response plan (FAA) â¢ Snow and ice control plan (as required; FAA) â¢ Airport security plan (TSA) The ACM requirements are contained in FAA Advisory Circular 150/5210-22: Airport Certification Manual. This advisory circular provides methods for meeting the certification requirements specified in FAR Part 139. The written ACM details how the airport operator will comply with the requirements of Part 139. Airport operators that hold a Part 139 AOC already have an ACM. Airport oper ators that hold an FAR Part 139 limited AOC have a modified version of an ACM, known as airport certification specifications. The ACM is a working document that reflects current airport con- ditions. It should be easy to maintain and revised as airport conditions or regulations change. Part 139 requires the airport operator to maintain the ACM in printed form. It can be trans- mitted to the FAA electronically, but the airport operator should confirm in advance that the FAA can access the file format used. The organization of the ACM should follow the sequence of sections in Part 139 and in Chapter 5 of FAA Advisory Circular 150/5210-22. The checklists in Appendices 2 and 3 of that advisory circular provide additional guidance on what should be included in each section. Part 139 requires the airport operator to distribute applicable portions of the ACM to the airport personnel who are responsible for their implementation. The ACM is not intended
Commercial ServiceâAttracting Airlines and Transitioning to Airline Service 261 to provide complete instructions for all jobs or operational procedures, but it should provide instructions for any critical tasks that are necessary for compliance with Part 139. Airport Emergency Plan FAA Advisory Circular 150/5200-31: Airport Emergency Plan provides guidance to the airport operator in the development and implementation of an AEP. Each certificate holder must develop and maintain an AEP designed to minimize the possibility and extent of personal injury and property damage on the airport during an emergency. The emergency plan should be developed as a living document. One of the emergency plan considerations is staffing. At some small Part 139 airports, the operational employees are cross-trained to provide for required ARFF function. The AEP should be coordinated with local or regional disaster plans. Consideration should be given to mutual aid and coordination between local or regional resources and airport resources. In addition to law enforcement and firefighting aid, contingencies such as mass evacuation, with the airport being the ingress and egress point, and staging areas for arriving rescue teams should considered. The major components of the AEP are as follows: â¢ Basic plan: Provides an overview of the airportâs emergency response organization and its policies. â¢ Functional annexes: Provide plans organized around the performance of broad tasks, such as command and control, communications, health and medical, etc. Because functional annexes are operations oriented, their target audiences are those who perform those tasks. â¢ Hazard-specific sections: Provide additional detailed information applicable to the perfor- mance of a particular function in support of a particular hazard. They are prepared when the hazards analysis and regulatory considerations warrant. â¢ SOPs and checklists: Provide detailed instructions that an individual or organization needs to fulfill the responsibilities and perform the tasks assigned in the AEP. Most SOPs and checklists are hazard specific and are attached to each section. Airport Snow and Ice Control Plan Each certificate holder whose airport is located where snow and icing occur must prepare, maintain and carry out a snow and ice control plan, as prescribed by FAR Â§139.313. The plan must include elements and instructions on prompt and timely snow and ice removal and the positioning of removed snow so as not to interfere with aircraft operations in the movement area. It should also address the selection of appropriate snow and ice control materials that minimize engine intake ingestion. Another important part of the plan is the methods for notifying air carriers of airfield conditions. Airport Security Plan Many of the security plan development and infrastructure elements required to support commercial airline operations are contained in Section 4.5: Security of this guidebook. While those are recommendations for GA airports, they will become required, in part or in whole, as part of the security program for a Part 139 airport. This section focuses on the mandatory require- ments of the airport security plan. When an airport serves commercial passenger operations, it needs to have in place a written airport security plan. An airport security plan provides the means and methods to be used to provide for the safety and security of persons and property on an aircraft operating in air trans- portation or intrastate air transportation against an act of criminal violence, aircraft piracy and the introduction of an unauthorized weapon, explosive or incendiary onto an aircraft. It is a written
262 Guidebook for Managing Small Airports document that is signed by the airport operator and must be approved by the TSA. An airport security plan that meets 49 CFR Part 1542: Airport Security is required for the following: â¢ Airports regularly serving aircraft operations required to be under a security program by 49 CFR Part 1544: Air Carriers and Commercial Operators. â¢ Airports regularly serving foreign air carrier operations required to be under a security program by 49 CFR Part 1546: Foreign Air Carrier Security. â¢ Airport operators that receive security directives or information circulars issued by the designated official for civil aviation security. â¢ Airport operators that do not have a security program under 49 CFR Part 1542 that serve an aircraft operator under a security program required by 49 CFR Part 1544, or a foreign air carrier operating under a security program required by FAR Part 1546. Such airport operators must comply with 49 CFR Â§1542.5(e). There are three levels of airport security programs, as defined in 49 CFR Â§1542.103: â¢ A partial program is required for airports serving air carriers using aircraft (1) with 31 or more but less than 60 seats (2) that do not enplane from or deplane into a sterile area, per 49 CFR Â§1542.103(c). â¢ A supporting program is required for airports serving air carriers using aircraft (1) with 60 seats or fewer (2) that are enplaned from or deplane into a sterile area, per CFR Â§1542.103(b). â¢ A full program is required for airports serving air carriers using aircraft with more than 60 seats, per 49 CFR Â§1542.103(a). An SIDA is required for the complete program. No SIDA is required for either a partial or supporting program. The airport security plan must include the applicable items and be organized in the same subject area sequence listed in the part of CFR Title 49 corresponding to the required security program. Each airport operator subject to the security program requirements of 49 CFR Part 1542 must maintain one current and complete copy of its security program and provide a copy to the TSA upon request. The distribution, disclosure and availability of SSI, as defined in 49 CFR Part 1520, shall be restricted to persons with a need to know. All requests for SSI by any other person must be referred to the TSA. The airport security plan may need to contain and identify the following, depending on the type of security program required: â¢ Security of the secured area, AOA and SIDA, as required for the full security program under 49 CFR Â§1542.103(a) â¢ Access control systems â¢ Fingerprint-based criminal history records checks â¢ Identification systems â¢ Training â¢ Law enforcement support and personnel and personnel who supplement law enforcement â¢ Records of law enforcement response â¢ Contingency plan â¢ Security directives and information circulars â¢ Public advisories â¢ Incident management â¢ Alternate means of compliance â¢ Exclusive area agreements â¢ Airport tenant security programs As part of establishing an airport security plan, an ASC must be designated. The primary duty of the ASC is to oversee the implementation of security requirements stipulated in the airport
Commercial ServiceâAttracting Airlines and Transitioning to Airline Service 263 security program and accompanying federal, state and local regulations. The airport operator must ensure that one or more ASCs are designated as follows: â¢ To serve as the airport operatorâs primary and immediate contact for security-related activities and communications with the TSA. An individual designated as an ASC may perform other duties in addition to those required by the security program. â¢ To be available to the TSA on a 24-hour basis. In view of this requirement, consideration should be given to the designation of more than one ASC. â¢ To review with sufficient frequency all security-related functions to ensure that all are effective and in compliance with 49 CFR Part 1542, the security program and all applicable security directives. â¢ To immediately initiate corrective action for any instance of noncompliance with 49 CFR Part 1542, the security program and applicable security directives. â¢ To review and control the results of employment history, verification and criminal history record checks as required. â¢ To serve as the contact to receive notification from individuals who are applying for unescorted access and seeking correction of their criminal history record with the Federal Bureau of Investigation. When establishing an airport security plan, it is strongly recommended that the airport operator make contact with the nearest FSD early in the process to avoid losing time for security plan approvals. The FSD can usually be located at the nearest commercial service airport. It also is advisable to communicate with other airport managers who have recently completed the certification process to obtain information on what to do and what not to do. Facility Considerations To support the required Part 139 airport certification and airport security plan, additional staff members may need to be added to conduct inspections, maintain facilities, operate equipment or perform security functions. Staff costs must be included in the budgeting process. In addition, numerous facility improvements may need to be constructed, upgraded or modified; and equipment may need to be purchased to meet the requirements of the AOC, the SICP, the AEP and/or the security program. These projects should be prioritized based on the greatest need for compliance, the availability of grant funding and the budget available to either match grant funding or to fund the projects and equipment acquisitions entirely from available sponsor funds. Facilities that may need improvements in the airport terminal and apron area include the following: â¢ Sterile area: The area must be secure to prevent inadvertent entry. Access to the sterile area will be allowed only to screened passengers and employees with proper identification. â¢ Holding area: The holding area is located within the sterile area and must have adequate space to accommodate the maximum number of passengers that may be anticipated to await boarding of one or more aircraft. Exit doors from the passenger holding area will need to be locked. Furniture will need to be provided for the passengers. Consideration may be given to the installation of vending machines, especially for beverages. â¢ Baggage handling area: Enough space will need to be provided for an inline baggage screener or to allow for hand inspection of the checked luggage. â¢ SIDA: A security identification display area will need to be established on the tarmac in front of the terminal building. Access to this area is restricted to properly badged employees of the airport and any tenant employee involved in servicing the aircraft. An SIDA is only required for those airports subject to the requirements of a full security program (serving aircraft with 60 or more seats), as detailed in 49 CFR Â§1542.103(a).
264 Guidebook for Managing Small Airports â¢ Screening equipment: When the security program is approved for a certificated airport, the airport becomes federalized. The TSA will provide the staffing and screening equipment required. During terminal modifications, the space required by the TSA to conduct its operations and install the required equipment must be taken into account. The screening equipment sizes and electrical requirements may vary. Therefore, coordination with the TSA should occur early in the renovation planning process. This will help preserve budget dollars by alleviating expenditures on unneeded or inadequate improvements. Improvements also may be needed on the landside to accommodate commercial passengers. These may include the following: â¢ Access roads: Roads leading to the airport terminal may need to be improved. â¢ Parking areas: Space for vehicular parking should be adequate to accommodate one car per passenger for the largest aircraft serving the airport. If multiple overlapping flights are anticipated, the parking areas will need to be larger. Short-term and long-term parking may be established. â¢ Dropoff areas: A designated area for dropoff and pickup of passengers by private or public vehicles and taxi cabs should be considered. â¢ Smoking areas: Designated smoking areas may be established in accordance with state and local regulations. â¢ Commercial vehicle area: Paved landside areas adequate to handle buses, vans, taxis, TNCs and other commercial vehicles. Airside improvements also may be required as part of the airport certification process, espe- cially if the size of the aircraft using the airport will be changing. These improvements may include the following: â¢ Runway and taxiway pavements and safety areas â¢ Apron areas â¢ Lighting and signs â¢ Navigational aids â¢ Obstruction clearing â¢ Buildings to house required equipment â¢ Snow removal equipment and deicing agents ACRP Report 96: Apron Planning and Design Guidebook and its associated PowerPoint pre- sentation detail the numerous factors that should be considered when planning apron areas to accommodate commercial passenger service. ARFF Equipment and Firefighting Agents The number and size of ARFF vehicles and the extinguishing agents required to be carried on those vehicles will be based on the airportâs firefighting index, as shown in Table 15. The fire- fighting index is calculated by the size of the commercial service aircraft using the airport, also shown in Table 15. The vehicles are not required to be housed at the airport; however, ARFF equip- ment purchased with grant funds will be required to be housed at the airport and be dedicated to airport operations. Equipment housed off airport property must meet the index requirements, should be off-road capable and must be at the airport during all air carrier operations. Airport Master Plan For the needed improvements to be eligible for grant funding, the AMP and the ALP may need to be updated to include the various certification-required equipment and projects. The
Commercial ServiceâAttracting Airlines and Transitioning to Airline Service 265 public must be involved in the process to update the master plan. Input from the public should be obtained on the airportâs plan to initiate commercial air service. Public sentiment could adversely affect the proposed transition. Start early in the update process to build consensus. The proposed improvements on the AMP will require environmental review and documenta- tion. If this is the first time the airport will accommodate commercial service, the results of that change must be addressed as part of the environmental documentation. Index Aircraft Length Vehicles Extinguishing Agents A <90 ft (<27 m) 1 Either 500 pounds of sodium-based dry chemical, halon 1211, or clean agent; or 450 pounds of potassium-based dry chemical and water with a commensurate quantity of AFFF to total 100 gallons for simultaneous dry chemical and AFFF application B 90 ft (27 m) to <126 ft (<38 m) 1 500 pounds of sodium-based dry chemical, halon 1211, or clean agent and 1,500 gallons of water and the commensurate quantity of AFFF for foam production 2 One vehicle carrying the extinguishing agents as specified for Index A; and one vehicle carrying an amount of water and the commensurate quantity of AFFF so the total quantity of water for foam production carried by both vehicles is at least 1,500 gallons C 126 ft (38 m) to <159 ft (<48 m) 2 One vehicle carrying the extinguishing agents as specified for Index B; and one vehicle carrying water and the commensurate quantity of AFFF so the total quantity of water for foam production carried by both vehicles is at least 3,000 gallons 3 One vehicle carrying the extinguishing agents as specified for Index A; and two vehicles carrying an amount of water and the commensurate quantity of AFFF so the total quantity of water for foam production carried by all three vehicles is at least 3,000 gallons D 159 ft (48 m) to <200 ft (<61 m) 3 One vehicle carrying the extinguishing agents as specified for Index A; and two vehicles carrying an amount of water and the commensurate quantity of AFFF so the total quantity of water for foam production carried by all three vehicles is at least 4,000 gallons E 200 ft (61 m) and longer 3 One vehicle carrying the extinguishing agents as specified for Index A; and two vehicles carrying an amount of water and the commensurate quantity of AFFF so the total quantity of water for foam production carried by all three vehicles is at least 6,000 gallons Source: FAA Advisory Circular 150/5220-10E: Guide Specification for Aircraft Rescue and Firefighting (ARFF) Vehicles, June 1, 2011 Table 15. ARFF index requirements.
266 Guidebook for Managing Small Airports 7.2 Airline Use Agreements Key Insights Each airport is unique, and there is not a one-size-fits-all approach to airline agreements. The general objective of an airline use agreement is to develop a working relationship between the airport operator and airline(s) as business partners, which will help each party achieve its financial and operational goals and objectives. Key Definitions Airline use agreement: A contract between the airport operator and its tenant airlines that establishes the rights, privileges and obligations for each party and defines how the airport is to be used by the airlines. Common-use space: Nonexclusive areas of an airport used in common by airlines, along with other authorized users of the airport. Compensatory rate methodology: Under this methodology, an airport operator charges its airline tenants fees and rental charges in an amount necessary to recover the actual cost of operating and maintaining the facilities being leased and/or used by the airline parties. Cost per enplanement (CPE): The average passenger airline payments per enplaned passenger at a given airport. Exclusive-use space: An area rented to an airline for its sole use. Ticket counters, airline operational and administrative offices and airline club rooms are commonly designated as exclusive-use space. Preferential-use space: Space rented to an airline in which it has preferred, but not exclusive, use of the space and may be required to share the space if a certain level of activity is not maintained. Residual rate methodology: Signatory airlines agree to pay any costs of operating the airport system, airport or a specific cost center that are not allocated to other users or covered by non- airline revenues. Signature airlines assume the risk of overall revenue shortfall and receive the benefit from any revenue surpluses. Signatory airline: An airline that executes an agreement with a particular airport. At many airports, these airlines pay lower rates and charges than nonsignatory airlines. Overview An airline use agreement (sometimes called a lease agreement) is a necessary document for every airport with commercial air service. It is the contract between the airport operator and the airlines operating at the airport. The purpose of an airline use agreement is as follows: â¢ To establish the business arrangement and rate-setting methodology â¢ To identify premises and facilities leased by airlines â¢ To define the level of control over the budgeted expenses at the airport â¢ To identify responsibilities and obligations for indemnification, insurance, environmental issues and other governmental inclusion ACRP Report 36: Airport/Airline AgreementsâPractices and Characteristics offers a plethora of information and should be consulted when developing a new airline use agreement or making
Commercial ServiceâAttracting Airlines and Transitioning to Airline Service 267 changes to an existing agreement. Chapter 3: Business of this guidebook provides additional information on airport revenues and financial management. The provisions of typical agreements and rates-and-charges negotiation documents may include the use of terminal facilities [can be shared use (common use) or preferential use], schedule of rates and charges, revenue sharing between the airlines and airport, capital projects and noise abatement curfews. ACRP Report 36 contains a sample table of contents for typical agreements in Appendix B and sample items generally included in rates-and-charges negotiation documents in Appendix D. Rates and Charges One important part of the airline use agreement is the rates and charges. Two rate-setting philosophies are prevalent within the industry: the compensatory model and the residual model. The compensatory model is when the airport operator charges the air carriers fees and rental rates set to recover the actual cost of the facilities and services they use. The airport operator can keep any excess revenue generated but bears the burden of any revenue shortfalls. With the residual model, the airlines assume the risk of paying for operating the airport if there is any revenue shortfall. The airport operator is required to generate as much revenue from other sources as possible. Any excess revenues are returned to the airlines. Under a residual model, the airlines have a majority interest, enabling them to exercise a level of control over airport investment decisions that would affect fees paid by the airlines. Commonly, an airport operator also may choose to employ a hybrid of these two approaches. For example, a residual approach might be applied to airfield costs in the calculation of landing fees, while a compensatory approach might be used in setting terminal rents. Hybrid rates-and- charges models incorporate parts of each of the residual and compensatory models in a single agreement that may work best for any location and set of circumstances. Landing fees, terminal rents and fuel flowage fees within an airportâs schedule of rates and charges play an important role in how the individual airport market is viewed by existing and potential airlines. The total fee structure that an airline pays at any airport can be quite complex and cover a broad range of usage and real estate types. One of the metrics an airline uses to mea- sure an airport is the total cost, per passenger, that the airline must pay in rents, fees and charges to do business. Airlines use total passenger cost to compare airports of similar size and against the market yield or the profitability that the airline can obtain in a given market. Rolling up all rates and charges that compose the total costs for a given airline in a given market provides the total CPE. The CPE represents the most critical measurement for both the airline and the airport that wants to develop new service. In setting rates and charges in any of the previously described methods, the airport operator must keep in mind a maximum CPE goal. This goal would allow an airline to continue to make money and serve to attract new airline service. Many of the ultra-low-cost carriers have a very low CPE threshold that would need to be maintained before agreeing to serve in a particular market. Maintaining this very low threshold (sometimes less than $1 CPE) will require the airport to adopt a hybrid rates-and-charges model that will provide the airline with a revenue share. Airport/Airline Negotiations Chapter 3 of ACRP Report 36 discusses the negotiation process between the airport operator and airline, noting seven steps in a typical negotiation process: 1. Review existing agreement, if there is one, and develop airport operator goals and objectives. 2. Assess airport strengths and weaknesses.
268 Guidebook for Managing Small Airports 3. Incorporate capital development needs and develop priorities. 4. Prepare rates-and-charges analyses and business proposal. 5. Review of business deal by airport operator. 6. Prepare and review draft agreement. 7. Distribute executable agreement. Best Practices for Developing Airline Use Agreements Several best practices to be considered when developing or changing an airline use agreement are as follows: â¢ Do your homework before the airline meeting. Understand your financial situation and the flow down of expenses in your budget to the airline(s). â¢ Understand all parts of the agreement and the rate-setting method desired to be used. â¢ Prior to the meeting, fully understand the airlineâs perspective, and what it bases its decisions on. Be ready to offer concessions that meet its goals and perspective. â¢ Go into the meeting with a feeling for your beginning position and your bottom line position.
Commercial ServiceâAttracting Airlines and Transitioning to Airline Service 269 7.3 Customer Service Key Insights Airport operators are typically responsible for coordinating the overall customer experience for the passengerâs entire movement, from ground transportation to aircraft and aircraft to ground transportation. Airport operators today have become very competitive regarding attracting passengers because passengers have more than one choice as to which airport to patronize. Many times, the level of the customer experience will be the deciding factor. Airport operators must develop partnerships with local government, airlines, tourism companies, and local transportation companies, which can help maintain and improve the overall airport customer experience. Key Definitions Airport customer experience: The net impression of all experiences a customer has in an airport, as judged by customers based on their individual standards, expectations and perceptions. Customer service: The assistance and advice provided by a company to people who buy or use its products or services. Importance of Customer Service Todayâs airport operators must be committed to providing an excellent airport customer experience. An excellent experience occurs when an airportâs ability to exceed its customersâ needs and expectations consistently matches customersâ perceptions that their needs and expec- tations are being met. Regardless of airport size or location, improving customer satisfaction has become an important business strategy for airports. Airports should have a well-thought-out customer satisfaction improvement plan. This includes building an airport brand, determin- ing customer priorities, adopting and publishing service standards, implementing a branded customer service program/initiatives, training employees, implementing a performance manage- ment system, collaborating with the airport community and communicating with all stakeholders. Some customer service initiatives employed by airports are provided in Figure 20. Ensuring Positive Customer Experiences Airports must work with all parties and stakeholders at the airport to ensure positive customer experiences and high customer service standards. Customers often do not know or care who is responsible for each link in the airport service delivery chain. The airport is often held account- able by the customers, public and media for a poor experience. Key stakeholders and business partners at the airports include the following: â¢ Airlines â¢ Federal agencies (TSA and CBP) â¢ Local agencies (police) â¢ Ground transportation companies â¢ Service contractors (custodial, parking, ground handling and concessionaires)
270 Guidebook for Managing Small Airports Creating a uniformly excellent customer service experience is challenging, because each of these entities is partly responsible. ACRP Report 157: Improving the Airport Customer Experience notes that airports should take a strategic, comprehensive approach to customer service and adopt an airport-wide customer service brand. This report notes emerging practices in airport customer service management and what airports can do to improve customer experience. Figure 21 shows a road map for implementing a customer satisfaction improvement program that is divided into three phases: developing an airport brand and setting standards, managing for results and improving the airportâs image. The report contains a detailed template that uses this road map in Chapter 12 to help airport operators develop a program for the execution of excellent customer service. Source: Adapted from ACRP Report 157: Improving the Airport Customer Experience, 2016 Figure 20. Notable customer service initiatives.
Commercial ServiceâAttracting Airlines and Transitioning to Airline Service 271 Source: Â© Butterfly Consulting, used with permission Figure 21. Road map for implementing customer satisfaction improvement program.
272 Guidebook for Managing Small Airports 7.4 Air Service Development Key Insights Airport sponsors have little control over many of the factors that drive airline decisions. Air carriers choose a new service based on a comparative analysis of profitability across communities. Airport sponsors must work closely with community partners and stakeholders to improve air service. Because of regulatory limitations, airport sponsors can offer only certain air service incentives for airlines. It is imperative that each airport sponsor reach out to its local private-sector businesses that benefit from improved air service to encourage them to offer additional private-sector service incentives to airlines. Communication is the most important part of air service development effortsâcommunication with incumbent and prospective airlines, the community and the governing body on airport costs. Improving and maintaining air service is not a one-size-fits-all problem. The U.S. DOTâs Small Community Air Service Development Program provides temporary financial assistance to small communities in order to improve access to the national transportation system. Some states, including Kansas, Wyoming, Virginia and Iowa, have programs in place to pro- vide air service development assistance. You should check with your state to see if any assistance is offered. Air service development is the attraction, initiation, expansion, retention or any improvement of air service and can include changes in pricing, frequency, capacity, hub connectivity or the number of nonstop destinations served. Key Definitions Air service development: The practice of retaining and/or establishing air service to a given airport or community. Airport catchment area: The area surrounding the airport from which it attracts passengers. Most often influenced by the proximity of competing airports. Passenger leakage: The passengers that leave the airport catchment area to access air service from a competing airport instead of the nearest airport, often because of lower fares, more flights or better reliability. Passenger revenue: The multiplication of revenue passenger miles by the yield. Passenger yield: The average fare per passenger mile. Overview Air service development is the practice of retaining and/or establishing air service to a given airport or community. Air service development is a community effort, not just an airport effort. When stakeholders understand and are on board with air service development efforts, the chance of success is much higher. When you approach an airline with requests for improved air service, whether it be a new route, additional flights, larger aircraft or lower airfares, you must show that
Commercial ServiceâAttracting Airlines and Transitioning to Airline Service 273 you understand your market and the airline operating environment. You must make a strong economic business case and differentiate your community from other markets. You also must show the full support of the community. Commonly, the offer of incentives and rebates for new or improved service also is expected by the airlines. The air service section of the aviation toolkit of ACRP WebResource 1: Aligning Community Expectations with Airport Roles provides information, tools and resources to help educate your community on the realities of air service, the role of an airport in commercial air service and air service development and how to work closely with your community to attract, improve and maintain air service. ACRP Report 18: Passenger Air Service Development Techniques identifies methods that have been used in an effort to increase air service or maintain service. It is an excellent educational resource for air service development. ACRP Report 142: Effects of Airline Industry Changes on Small- and Non-Hub Airports identifies strategies for airports to market, retain and potentially expand air service and includes case studies. Evaluating Your Market to Pursue and Retain Air Service Airport managers and communities must understand their marketâs potential for supporting air service, as well the airline industry in general, to understand where their opportunities are to gain or improve air service. While commercial air travel demand will be primarily driven by local demand and regional events, it also will be influenced by industry events. ACRP Report 98: Understanding Airline and Passenger Choice in Multi-airport Regions provides an assessment of a system that includes nonhub primary airports in central Wisconsin and the factors that influ- ence a passengerâs choice in airports. An ACRP recorded webinar, titled âFactors That Influence Air Service Development,â is also available. Understand the Airline Operating Environment It is extremely important to understand the fundamentals of the commercial airline industry and the trends that are shaping carrier decisions, especially when it comes to smaller airports. Energy prices, airline competition, aircraft availability, pilot availability, seasonality and the regulatory environment are just a few examples of items you must understand. Airline bank- ruptcies also affect airports, as discussed in ACRP Legal Research Digest 6: The Impact of Airline Bankruptcies on Airports. The following recent trends have and will continue to have the potential to affect air service. Airline Rightsizing and Capacity Discipline. In response to the recession of 2007â09, airline management focused on profitability by cutting unprofitable and redundant flying and minimizing the number of empty seats. Overall, commercial service operations and domestic seat capacity at all U.S. airports declined. In addition, many of the mainline/network carriers no longer operate the aircraft needed to cost-effectively serve small airports, because they have transitioned routes they once served to regional partners that, for now, continue to operate aircraft with smaller seating capacities. U.S. airlines have been profitable over the last several years, and service and passengers have increased. However, a conservative approach in airline capacity planning remains. There will likely be a âlimited growthâ environment for the airlines in terms of seat capacity in the near term. Most airlines will remain capacity-disciplined. Airline Consolidation and Restructuring. Airline consolidation in the last decade, including the mergers of American Airlines and US Airways, Delta and Northwest Airlines, United and Continental Airlines, and Southwest Airlines and AirTran Airways, has left the United States with just four mainline/network carriers (including Alaska) and several âlow-costâ carriers. Consolidation, as well as a focus on yield improvement, led to improved capacity
274 Guidebook for Managing Small Airports rationalization (fewer departing seats). It is anticipated that the remaining consolidated carriers will continue to operate based on cost-cutting strategies, driven by profit margins. Limited Aircraft. The strong growth in the 1990s and early 2000s of the 37- to 50-seat regional jet (RJ) to replace turboprop aircraft in small markets and to supplement narrow- body jet aircraft in larger markets ended following the spike in jet fuel costs during 2007â08. It was no longer as economical to fly RJs to provide service to short-haul markets. Operational costs, coupled with the economic recession and curtailed demand, led to the rapid retirement of small RJs throughout all airline networks. It is anticipated, however, that the small RJs will continue to have a presence in airline route networks, albeit to a much lesser extent. The migra- tion of network carriers to aircraft with higher seating capacities, in search of lower costs, has left many smaller communities with fewer choices in terms of carriers and equipment. Pilot Supply. A nationwide commercial pilot shortage is anticipated to occur in the next several years; this shortage could affect commercial airports across the United States. Pilot retirements and fewer pilots coming from the military have reduced the pool of commercial pilots. Further, impediments to becoming a new commercial pilotâincluding the 1,500-hour rule for flight training to obtain a commercial pilot license and the financial burden of flight trainingâand low early-career salaries have constricted the pipeline of new pilots. Regional carriers (and the airports they serve) are feeling the impact first from the pilot shortage, because regional carriers typically hire the new pilots, who then move up to network carriers. Many regional carriers are working on partnerships with universities and other programs to increase the pilot supply, but it will take time to see any improvement. Airfares and Growth of Ancillary Revenues. The price for air travel is a significant factor that influences demand. In general, airfares are influenced by airline operating costs and by competitive influences. Nationally, fares saw a downward trend over the last decade, due largely to changes in fuel prices and the âdecouplingâ of the ticket price from ancillary services such as baggage fees, seat fees, reservation changes and food and drink purchases. U.S. carriers have posted net profits for 5 consecutive years, due to, in part, ancillary revenues. Understand Your Market Communities must demonstrate that demand exists in their markets for the airlines. Popula- tion and economic strength often drive passenger demand, so you must understand your local economy and air service market before you can ask for improvements. Several subscription passenger data services can be used to determine historic passenger trends by destinations, air fares, seasonality, load factors and historic numbers of flights and seats. Passenger and booking studies can help you understand travel habits and the ability to fill larger aircraft. You should define your airportâs catchment areas (see ACRP WebResource 1, Defining Your Airportâs Catchment Area, and measure âleakageâ to understand market demand. Leakage is based on numerous factors, including population, income levels, local economic activity, proximity to alternative airports, nonstop service or connections, airfares and comparing costs. This can be a complex exercise, so using a consultant may be helpful. Perhaps the most important data, because it cannot be easily obtained by airlines, is specific local business information. Private-sector data is a key driver for airline route evaluation. You need to know where businesses are going and which businesses are coming to your market, and you need to quantify that number. Ask business stakeholders to put their commitments in writing. If you have identified a new route, garner support and influence from interested parties in the destination market as well (tourism, chambers of commerce, airports, etc.).
Commercial ServiceâAttracting Airlines and Transitioning to Airline Service 275 SWOT Analysis An air service SWOT analysis can help you understand competitive advantages and dis- advantages for air service improvements. A SWOT analysis can help you and the community make decisions on what improvements to pursue and how to craft your case for improvements. A few items to consider when developing a SWOT analysis include the following: â¢ Historic or projected socioeconomic growth in region â¢ Major employers that rely on air service, tourism or other visitor travel â¢ Size of catchment area â¢ Existing airport facilities and airline charges â¢ Incentive and marketing program for airlines â¢ Passenger trends The SWOT analysis should use this data to examine: â¢ Strengths: The strengths that you want the airport to maintain, build on and use â¢ Weaknesses: The weaknesses that you want the airport to remedy or eliminate â¢ Opportunities: The opportunities that you want the airport to prioritize and optimize â¢ Threats: The threats that you want the airport to address Typically, strengths and weaknesses are more focused on external perceptions of the airport, while opportunities and threats are more focused on outside influences. Chapter 4 of ACRP Report 28: Marketing Guidebook for Small Airports provides guidance on developing a SWOT analysis. ACRP WebResource 1 provides an air service toolkit that can assist with SWOT efforts: SWOT Analysis Considerations (Word file). Developing a Practical Air Service Plan The key to attracting and maintaining service is that an air service development plan must be in place, clear and community driven, not just airport driven. An air service task force can be formed to identify the air service goals and objectives, gather information on air service needs, agree on incentives and develop the business case for new service. Establishing the air service goals is one of the steps in developing air service, as shown in Figure 22. The key stakeholders Adapted from ACRP Report 18: Passenger Air Service Development Techniques, 2009 Figure 22. Steps for developing an air service plan.
276 Guidebook for Managing Small Airports of air service development efforts include major employers, the local chamber of commerce and tourism board and the local economic development agency and/or other parts of the local municipal government. Stakeholder involvement in an air service task force will show commu- nity commitment and demand for service. More information on developing an air service task force, and a tool to identify potential task force members, can be found in ACRP WebResource 1. A realistic air service development plan must be based on underlying local demand, not just incentives. New markets must be backed and aligned with local corporate objectives. Types of incentives that can be considered will be discussed later in this section. When to Use and How to Select an Air Service Consultant Sometimes air service development can seem to be an overwhelming task. Many larger airports have staff strictly tasked with air service development. Smaller airports may not have the resources to hire staff or commit existing staff to air service development efforts. Air service development consultants offer a variety of services in various price ranges to assist an airport with its needs. Typical services provided by air service consultants include the following: â¢ Business case analysis for potential and current routes â¢ Leakage and retention analysis â¢ Fare structure and pricing analysis â¢ Airline schedule analysis â¢ Airport/new route economic impact analysis â¢ U.S. DOT data and statistical reporting/analysis at various intervals â¢ Development of incentives â¢ Assistance with Small Community Air Service Development Program (SCASDP) grant proposals â¢ Community coalition/partnership establishment and interaction ACRP Report 28 provides additional information on managing air service and community expectations. Using an air service consultant may seem like an expensive proposition; however, air service development consultants have an understanding of what the airlines need and desire, often have airline contacts and have access to data resources that may be too expensive and time consuming for an airport to obtain and analyze. Also, an air service consultant can be engaged to the level needed, which may be less expensive than adding staff. When considering an air service consul- tant, the cost should be considered during an airportâs budgeting process. Other mechanisms for funding air service development consultant studies and assistance could include SCASDP grants, state air service programs and private local funding. When selecting a consultant, consider their track record for assisting airports to improve air service, ensure that they have worked with similarly sized airports, see if they have contacts for airlines you are pursuing and ask for references from other communities. Also, consider the location of the airport the consultant has supported, i.e., is the airport a competitor or a desired destination airport? Air Service Incentive Programs Air service development is competitive and a difficult proposition in todayâs airline operating environment. An incentive program should be considered to provide cost savings and ensure the airlines will make money on their routes. This should be spearheaded by community repre- sentatives, not just the airport. A community must weigh the cost of the investment in incentives with the likelihood its market can sustain the service once incentives end. Although incentives
Commercial ServiceâAttracting Airlines and Transitioning to Airline Service 277 can influence airline decisions, local economic growth and market demand will be the drivers of success. Types of incentives that can be considered include discounted/waived landing fees, mar- keting, facility upgrades, travel banks, revenue guarantees, pledges of support, subsidies and provision of above- or below-wing services. A definition of, and more information on, each of these incentives can be found at Definitions of Air Service Incentives in ACRP WebResource 1. In addition, a sample incentive plan can be found in ACRP Synthesis 68: Strategies for Maintaining Air Service. To adhere to federal grant assurances and policy, airport sponsors may use airport revenues for airline incentives only as specified by the FAA (see box at right). An airport sponsor may not use airport revenues to promote any kind of general economic development, for cash subsidies or minimum revenue guarantees. Cash subsidies or minimum revenue guarantees, when offered, can be offered only by an outside entity such as a chamber of commerce, private business or economic development agency. The FAA provides guidelines in accordance with federal statutes on funding incentives in the FAAâs Air Carrier Incentive Program Guidebook: A Reference for Airport Sponsors. Small Community Air Service Development Program The SCASDP is a U.S. DOT grant program that was developed to help small communities address air service issues. The program is limited to 40 grant awards per year with a maximum of four grants per state. The grants range from $20,000 to $1.6 million. In 2016, the average grant awarded was $500,000. SCASDP grants are only available to non- and small-hub airports. Eligible communities must show that they have higher-than-average fares or insufficient service. Grant applications also must show local participation, such as local cash contributions, publicâprivate partnerships or timely use of funds, and that the grant would benefit a broad segment. New and innovative approaches to air service development also are often considered. In 2016, SCASDP grants were awarded for revenue guarantees, marketing programs and airline fee waivers to offset startup costs. Other grants in the past have been given for aircraft upgrades or research studies. An SCASDP presentation by the U.S. DOT is included in ACRP WebResource 1. Airport Revenue Use for Air Service Incentives The FAA allows airports to fund proÂ motional incentives such as fee waivers or to use airport revenue for acceptable promotional costs where the purpose is in support of clearly defined air carrier development program goals for new service. New service is defined as service to a destination not currently served, nonstop service where no nonstop service is currently offered, a new entrant air carrier or increased frequency of flights to a specific destination. Incentives may be offered only to new carriers for no more than 1 year. Existing carriers may be offered incenÂ tives for service to a new destination.
278 Guidebook for Managing Small Airports 7.5 Essential Air Service Program Key Insights Essential Air Service has been provided to the most rural airports in the United States since airline deregulation in 1978. Essential Air Service carriers shifted dramatically over the past decade, going from 19-seat turbo- props to 9-seat or 30-seat-plus operators. Key Definition Essential Air Service (EAS): A U.S. Department of Transportation program that guarantees that small communities that were served by scheduled airlines prior to deregulation will maintain a minimal level of scheduled commercial service. Essential Air Service Through the Airline Deregulation Act, the U.S. DOT has provided subsidies for scheduled service to the most rural U.S. airports through the EAS program since 1978. The program was modified and extended by the Airport and Airway Safety and Capacity Expansion Act of 1987 and later made permanent as part of the Federal Aviation Reauthorization Act of 1996. The EAS eligibility requirements and funding caps are shown in Figure 23. There are 172 rural airports that are served across the United States, including Alaska, under this program. Basic information regarding the program and its requirements can be found on the U.S. DOT Essential Air Service website. Changes to community eligibility and funding caps have recently been added to the program. Industry Changes and the Impact on Essential Air Service The oil spike and the economic recession experienced by the airline industry in the late 2000s had a detrimental impact on small communities throughout the United States. Airline consoli- dation and capacity discipline have again led to airline profits. However, future capacity growth will continue to be constrained. The continued phaseout of the 50-seat RJ aircraft, in addition to pilot shortages, is expected to continue to have major negative effects on small airports in the Source: U.S. DOT, 2017 EAS eligibility requirements and funding caps 70 miles from nearest medium- to large-sized hub. Required rate of subsidy per passenger of $200 or less, unless the community is more than 210 miles from the nearest airport. The average rate of subsidy per passenger is less than $1,000, regardless of distance from a hub airport. A communityâs enplanements need to average more than 10 per day, unless the airport is 175 miles from a hub airport. Figure 23. Essential Air Service eligibility.
Commercial ServiceâAttracting Airlines and Transitioning to Airline Service 279 future. The reductions in the 50-seat RJ as well as the 19-seat and 34-seat turboprop aircraft have left few economical options to serve EAS markets. The remaining options appear to be 76-seat RJs or small (9-seat) turboprop aircraft. Legislation that passed Congress in 2013 imposed new rules on pilots, including mandating co-pilots possess an airline transport pilot (ATP) certificate that requires a minimum of 1,500 hours (compared to 250 hours previously needed by co-pilots). This has dramatically increased the time and cost of becoming a pilot, and, as experienced pilots are moving to larger network carriers, it is leaving regional carriers that provide EAS without replacements. Annual EAS subsidies are continuing to rise, reaching over $277 million in 2017. Load factors at EAS airports are, on average, below 35 percent. This is an unsustainable trend and will likely lead to more changes to the EAS program in the future. Almost as long as the program has existed, there has been political pressure to discontinue it in order to reduce federal spending.
280 Guidebook for Managing Small Airports 7.6 Common-Use Facilities Key Insights Common-use facilities offer a cost-effective solution to retain and encourage new air service. When considering common-use facilities, airport operators must consider many factors, including carrier allocation, the size of the airport, the use of current facilities and the planned future use of facilities. The key agents to success for implementing common use include stakeholder intercommunication, top-down management support and commitment from all parties. Common-use facilities that offer a lower cost per enplanement for the airlines are an attractive attribute that should be communicated to the airlines. Key Definitions Common use: A facility allocation and management approach intending to maximize airport facility access and allocation through nondedicated resources, a shift from the traditional tenantâlandlord relationship. It comprises primarily flexible-use ticket counter and gate kiosk space. Common-use system: Airport-operator-provided hardware and software systems that pro- vide an interface through which airline proprietary systems can operate with increased facility utilization and flexibility. Considerations for Common Use The current airline operating environment is driven by the need for cost savings and cautious capacity increases. To retain existing service or encourage new service, the airport operator must often offer airlines cost-effective solutions. Airport operators, particularly at smaller airports that may have less frequent operations, can accomplish this by offering the airlines common-use facilities and services. This philosophy moves away from the traditional model in which airline facility use and leasing are focused on dedicated facilities. Types of common-use facilities are shown in Figure 24. ACRP Report 30: Reference Guide on Understanding Common Use at Airports can help airport operators identify and understand the financial, operational, liability, safety, customer service and competitive elements of a common-use approach to the utilization of airport facilities and the provision of services. Appendix A includes case studies. ACRP Report 30 includes a virtual interactive tour of an airport, allowing the user to focus on different areas of interest. It also includes spreadsheet models to analyze and evaluate how to integrate common use. If an airport is considering transitioning to common use, it is best practice for the change to coincide with the scheduled negotiation for developing a new rates-and-charges agreement. Appendix D of ACRP Report 30 provides 12 steps for developing a road map to common use, from the initial consideration to the execution, and includes lessons learned. When an airport operator is considering common use, it must also consider the costs and benefits associated with common useâincluding the need to hire a consultant, impact on staffing, modifications to facilities, and procurement of additional assets and business driversâsuch as whether common use will improve the customer experience, maximize facility utilization or decrease costs.
Commercial ServiceâAttracting Airlines and Transitioning to Airline Service 281 There also are many operational areas to be considered when implementing common use. They include planning, design and construction, terminal operations, airside operations, facilities maintenance, business considerations and technology. Each of these areas is discussed in detail in Chapter 3 of ACRP Report 30. Source: ACRP Report 30: Reference Guide on Understanding Common Use at Airports, 2010 Wireless for operations Common ramp information display system Managed campus area network for all tenants Passenger self-boarding gates Off-airport check-in Common bag drop Baggage tracking service Figure 24. Types of common- use facilities.
282 Guidebook for Managing Small Airports 7.7 PFC and CFC Funding Sources Key Insights Passenger facility charges and customer facility charges provide additional funding mechanisms for commercial service airports. Imposition and use of revenue from passenger facility charges must be approved by the FAA. Customer facility charges can be used to finance rental car services, parking garages and other customer-demand-based facilities and access. Key Definitions Customer facility charge (CFC): A fee paid by airport customers for the use of some non- aeronautical services at an airport, commonly collected by rental car companies to pay for their facilities. Passenger facility charge (PFC): A program for the collection of fees per enplaned passenger per flight segment, with a maximum of two flight segments. Overview For airports with passenger service, PFCs and CFCs provide two additional funding mecha- nisms for facilities. The FAA PFC program allows for the collection of a PFC of up to $4.50 per enplanement. PFCs are capped at $4.50 per flight segment with a maximum of two PFCs charged on a one-way trip or four PFCs on a round trip, for a maximum of $18 total. Airports use these fees to fund FAA-approved projects that enhance safety, security or capacity; reduce noise; or increase air carrier competition. The CFC is a user fee imposed by an airport on each parking or rental car user and collected by the facility operator. CFCs are regulated on the state level, not the federal level, so authori- zation and collection can vary by state. CFC revenues are more typically used to finance rental car-related projects, such as rental car space, rental car quick-turnaround facilities, consolidated rental car facilities (ConRACs) and related roadways. The CFC is collected for each transaction or each transaction day. How to Request PFC Funding for a Project Several steps must be followed to request PFC funding for a project. To obtain approval, projects must meet certain eligibility criteria, as outlined in FAR Part 158: Passenger Facility Charges. FAA Order 5500.1: Passenger Facility Charge provides guidance and procedures to the FAA and is a useful tool for airports as well. The FAA presentation âPFC 101âAn Overviewâ provides additional information on the PFC program. Airport sponsors must develop a PFC application and coordinate with the FAA before con- ducting an airline consultation. Sponsors of small-, medium- and large-hub airports must follow a traditional application process. Sponsors of nonhub airports may follow a more streamlined process that includes a notice of intent. The general steps include the following: 1. Formulation of PFC project: The airport sponsor (public agency) develops a list of projects that will use PFC funds and consults with the FAA. The airport sponsor develops a project description and costs and notifies the airlines of the consultation meeting. Airlines retain a processing fee out of the PFCs collected. Also, PFCs are collected at the time a ticket is sold, not when it is used.
Commercial ServiceâAttracting Airlines and Transitioning to Airline Service 283 2. Airportâairline consultation meeting: Thirty to 45 days after notification, the airport meets with the air carriers and discusses the PFC charges and projects. The airlines will provide the certification of agreement or disagreement no later than 30 days later. 3. PFC application: The airport sponsor prepares and submits a draft PFC application to the FAA. The draft must meet FAA grant assurances. After receiving comments on the draft, the airport sponsor sends it to the FAA for approval. 4. FAA actions and approval: The FAA will determine if the application is complete and has 120 days to complete a review. The FAA will file a notice for publication in the Federal Register and allow 30 days for public comment. The FAA will prepare an ROD and approve or disapprove the application. 5. PFC approval and collection: After the application is approved, the airport sponsor will notify the air carriers to begin collection. Air carriers remit PFCs to airport operators (typically the airport sponsor) monthly, and airport sponsors must submit a quarterly report to the FAA. CFC Specifics CFCs are considered a local funding mechanism and are, therefore, different from FAA- managed grants of PFCs. A CFC can be used for appropriate capital and operating expenses, for the operation of a consolidated rental car facility or for a common busing system to the consolidated rental car facility. In addition, if an airport operator chooses to use part of an exist- ing parking garage for rental car operations, a CFC may also be used to build parking facilities and replacement parking space elsewhere. The CFC rate is typically adjusted from time to time to provide adequate revenues associated with its obligations. Therefore, the CFC rate is determined at the airport level. These charges are typically collected monthly and are part of a lease-and- concession agreement with on-airport rental car companies that requires them to collect a CFC for all rentals originating at the airport. For more information, the ACIâNorth America has created the presentation âRental Car Customer Facility Fees and Financings.â
284 Guidebook for Managing Small Airports 7.8 Planning for Irregular Operations Key Insights It is extremely important to have a well-thought-out and comprehensive formal irregular operations (IROPS) plan in place. Good communication, collaboration and cooperation are the keys to prevent and respond to events that lead to delays and unwanted impacts on the traveling public. Key Definitions Irregular operations (IROPS): Events that disrupt optimized flight schedules and negatively impact the normal flow of passengers through the air transportation system. Irregular operations (IROPS) champion: The point person who has been identified by an airportâs management as responsible for handling coordination between all service providers and developing an airportâs IROPS plan. Overview Irregular operations at commercial service airports have the potential to cause a myriad of challenges, including tarmac delays, passenger surges in terminal and security areas, terminal passenger counts reaching capacity, off-hour staffing conditions for security and concessions, passenger conditions during extended stays in terminals and accommodating special needs passengers. In the last 10 years, there has been a push toward preventing these problems. The U.S. DOT has passed rules to limit tarmac delays and protect passengers during delays. In addi- tion, the FAA Modernization and Reform Act of 2012 required airport operators to file tarmac delay contingency plans every 5 years. Airports that have implemented plans for dealing with IROPS situations tend to have fewer negative experiences during these times. Airport IROPS plans address a variety of topics, including facilitating communication, providing facilities and supporting airline response efforts. Plans can vary from simple to complex. ACRP has developed several detailed guidebooks to help you prepare for IROPS situations and reduce IROPS impacts on passengers: â¢ ACRP Report 65: Guidebook for Airport Irregular Operations (IROPS) Contingency Planning â¢ ACRP Report 106: Being Prepared for IROPS: A Business-Planning and Decision-Making Approach â¢ ACRP Report 153: Guidebook for IROPS Stakeholder Communication and Coordination At the core of a successful IROPS plan is communication. Continuous communication, cooperation and coordination between the airport and each of the stakeholder groups or local service providers (airlines serving the airport, airlines that have reported using an airport as a diversion airport, airport operations, the TSA, the FAA, the CBP, concessionaires, FBOs, etc.) are required for a unified response during an IROPS event. A truly effective plan cannot be created without a coordinated effort and a cooperative response. Steps of IROPS Planning Process ACRP Report 65 outlines the six fundamental steps for implementing an effective IROPS plan, which are shown in Figure 25, and ACRP Report 153 expanded the process. Both ACRP reports
Commercial ServiceâAttracting Airlines and Transitioning to Airline Service 285 contain information and various resources, checklists and tools to support each step as well as sample IROPS plans to support your IROPS planning efforts. Key IROPS Planning Tools ACRP Report 65 and ACRP Report 153 each contain many useful tools, samples and checklists to assist in the development of IROPS plans. These resources, which are intended to be used in conjunction with the guidebooks, include the following: â¢ ACRP Report 65 â Resource A â Topics for IROPS Plan Development â Resource B â Model IROPS Contingency Plan â Resource C â Tools (for IROPS plan implementation) â¢ ACRP Report 153 â IROPS Risk Assessment Tool and Users Guide â IROPS Tabletop Planning Guide and Scenarios â Checklists for IROPS Stakeholder Communication and Coordination Source: Adapted from ACRP Report 65: Guidebook for Airport Irregular Operations (IROPS) Contingency Planning, 20p12 and ACRP Report 153: Guidebook for IROPS Stakeholder Communication and Coordination, 2016 1. Get executive buy-in and get organized â¢Include all stakeholders/service providers â¢Identify IROPS champion â¢Create IROPS Contingency Response Committee 2. Document current situation â¢Review existing plan â¢Utilize federal weather and flight data sources â¢Review potential events, passenger needs and current capabilities 3. Establish procedures for cooperation â¢Establish procedures for coordinated response â¢Focus on effective stakeholder cooperation â¢Use various technologies 4. Review, update and train â¢Conduct periodic reviews and update plan as needed â¢ Perform training exercises focusing on shared situational awareness 5. Consolidate cooperation during an event â¢Monitor IROPS event indicators â¢Execute plan 6. Capture lessons learned/plan updates Figure 25. Steps of the IROPS process.