Generating Revenue from Commercial Development On or Adjacent to Airports (2017)

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230 Abbreviations and Glossary Aviation/Airport Development Terms General Land Use/Development Terms Real Estate Development Terms Abbreviations AAAE American Association of Airport Executives AC Advisory Circular ACIP Airports Capital Improvement Plan AIP Airport Improvement Program ALP Airport Layout Plan ALUCP Airport Land Use Compatibility Plan AOA Airport Operations Area AOPA Aircraft Owners and Pilots Association APA American Planning Association ARFF Aircraft Rescue and Firefighting CATEX Categorical Exclusion CC&Rs Covenants, Conditions, and Restrictions CFR Code of Federal Regulations DHS Department of Homeland Security DOT Department of Transportation EA Environmental Assessment EIS Environmental Impact Statement EPA Environmental Protection Agency ESA Environmental Site Assessment FAA Federal Aviation Administration FAR Federal Aviation Regulations FBO Fixed-Base Operator FEMA Federal Emergency Management Agency FIRM Flood Insurance Rate Map FONSI Findings of No Significant Impact FTZ Foreign Trade Zone GA General Aviation IRR Internal Rate of Return MRO Maintenance Repair and Overhaul (ACRP Report 114) NAIOP Commercial Real Estate Development Association (formerly the National Association for Industrial and Office Parks) This list of abbreviations and glossary were developed specifically for this guidebook. The glossary is organized in three parts:

Abbreviations and Glossary 231 NPIAS National Plan of Integrated Airport Systems PFC Passenger Facility Charge PPP Public-Private Partnerships REC Recognized Environmental Condition(s) RFP Request for Proposals RPZ Runway Protection Zone T/E Threatened/endangered (species) TIF Tax Increment Financing TSA Transportation Security Administration TTF Through-the-Fence ULI Urban Land Institute U.S.C. United States Code Aviation/Airport Development Terms 100 Low-lead Fuel Leaded, 100 octane (100LL) aviation gasoline (avgas) that is typically used in propeller driven aircraft with piston engines. Advisory Circulars (ACs) A series of FAA publications consisting of all non-regulatory material of a policy, guidance, and informational nature (ACRP Report 113). Aeronautical Use Any activity that involves, makes possible, or is required for the operation of aircraft or that contributes to or is required for the safety of such operations (ACRP Report 114). Aerotropolis A wider geography that hosts businesses requiring significant volume of airport business travel services or air freight services, and that are supported by efficient surface transportation connections to an airport. Businesses that do not have a major reliance on airport services, as well as residential development, may be interspersed within an aerotropolis (ACRP Report 121). The term was coined originally in the book Aerotropolis: The Way We’ll Live Next by John D. Kasarda and Greg Lindsay (2011). Airport Improvement Program (AIP) An FAA-administered program to provide financial grants- in-aid for airport planning, airport development projects, and noise compatibility programs. The program was established through the Airport and Airway Improvement Act of 1982, which was incorporated as Title V of the Tax Equity and Fiscal Responsibility Act of 1982 (P.L. 97-248) (ACRP Report 113). Airport Layout Plan (ALP) A document that graphically depicts existing land, infrastructure, and improvements on an airport and identifies the planned capital improvement projects for the airport (ACRP Report 114). Airport Master Plan A long-range plan for development of an airport, including descriptions of the data and alternative analyses on which the plan is based (ACRP Report 47). Airside On-airport areas consisting of the runways, taxiways, taxilanes, aprons, roadways, lighting, utilities, navigational equipment, imaginary obstruction identification surfaces, airport design surfaces, etc. (ACRP Report 114). Bond Covenants An agreement between the bond issuer and bond holder specifying what the issuer will or will not do over the life of the bond, and recourse by bondholders if the issuer, such as an airport authority, defaults. (Adapted from entry at www.investopedia.com) Bonding Capacity The ability an airport sponsor may have to issue bonds through its own organization or through a city, county, or state government. The sponsor must determine that it has the debt capacity to support the proposed bond, and that the project revenue can cover debt obligations (ACRP 11-05, Task 4, p.34). NBAA National Business Aviation Association NEPA The National Environmental Policy Act of 1969

232 Generating Revenue from Commercial Development On or Adjacent to Airports Economic Non-discrimination Airports, their facilities, and services must be available on reasonable terms and without unjust discrimination (FAA Airport Sponsor Assurance 22). (ACRP Report 113, p.37) Exhibit “A” The Exhibit “A” is a snapshot of the inventory of parcels that make up dedicated airport property. It indicates how the land was acquired, the funding source for the land and if the land was conveyed as Federal surplus land or Government Property. Other detached parcels owned by the Airport Sponsor that are dedicated to airport purposes must also be shown on the Exhibit “A”. The Exhibit “A” must show all dedicated airport property regardless of the type of funds (AIP, state, local, etc.) used to acquire that property. All land described in a project application and shown on an Exhibit “A” constitutes the airport property federally obligated for compliance under the terms and covenants of a grant agreement. New airports receiving a grant for the first time must submit an Exhibit “A” depicting the land required to support the facilities needed to operate the airport (FAA Airports Organization (ARP) Standard Operating Procedure (SOP) 3.00). FAA 5190 Release The guidelines set forth in the FAA Airport Compliance Manual, Part VII: Releases and Property Reversions (Order 5190.6B), which provides a detailed overview on the release and disposal of airport land (adapted from ACRP Report 47, p.37). FAR Part 77 Federal Aviation Regulations Part 77, Objects Affecting Navigable Airspace, which establishes standards for determining obstructions and conducting aeronautical studies to determine the potential effects of obstructions on aircraft operations. According to FAR Part 77, objects are considered to be obstructions to air navigation if they exceed certain heights or penetrate certain imaginary surfaces established in relation to airports. Objects classified as obstructions are subject to an aeronautical study by FAA to determine their potential effects on aircraft operations (ACRP Report 113). Federally Funded Actions Any project or projects that involve federal funding, work performed by the federal government or permits issued by a federal agency. The definition of a federally funded action is significant because it is the trigger for applying the NEPA environmental review process to a project. Grant Assurances Certain obligations with which federally obligated airports must comply in order to receive AIP funds (ACRP Report 114; see the section describing airport sponsor assurances). Grant Obligations Include statutes, regulations, assurances, executive orders, policies, and guidance that are used by federal and state agencies to ensure that an airport is planned, developed, operated, and managed for the benefit of the public in a way that will not adversely affect the safety, utility, or efficiency of the airport (ACRP Report 114; see the section describing airport sponsor obligations). Hazard Removal and Mitigation Action to assure that such terminal airspace as is required to protect instrument and visual operations to the airport (including established minimum flight altitudes) will be adequately cleared and protected by removing, lowering, relocating, marking, or lighting or otherwise mitigating existing airport hazards and by preventing the establishment or creation of future airport hazards (FAA Airport Sponsor Assurance 20, in FAA Airport Sponsor Assurances). Height-restricted Areas Areas on or near an airport that have restrictions on building or object heights to avoid creating a hazard to air navigation or penetrating FAR Part 77 imaginary surfaces. Instrument Approach An air navigation procedure used to guide aircraft to a safe landing beginning at an initial approach point and ending at a point near enough to the ground to permit a visual landing (adapted from ACRP Report 113).

Abbreviations and Glossary 233 Land Release Involves the disposal of airport lands, and, more specifically, FAA approval to release land that has been acquired with federal funds (thus allowing the airport sponsor to dispose of the land or allow it to be used for non-aeronautical purposes). The airport sponsor may dispose of land if said land is deemed unnecessary for aeronautical purposes. However, the airport sponsor may be required to reimburse FAA, or FAA may stipulate how land sale proceeds are to be spent by the airport sponsor (see ACRP Report 47, p.37). Landside On-airport areas consisting of public roadways, public vehicle parking, lighting, utilities, etc. (ACRP Report 114). Noise Compatibility Relates to measures proposed or taken by the airport operator to reduce existing non-compatible land uses and to prevent the introduction of additional non-compatible land uses within the area (adapted from FAA AC 150/5020-1, 5.i. Definitions). Noise Mitigation Actions taken by an airport sponsor to reduce or eliminate the impacts of airport noise on nearby properties. Planning-year Horizon The short- (5-year), medium- (10-year), and long-term (20-year) planning and development goals for an airport (adapted from ACRP Report 114). Rate Covenants Documents defining the rights and responsibilities of issuers and bondholders, and how bond funds should be used. Runway Protection Zones (RPZ) A trapezoid-shaped area off the runway end that enhances the protection of people and property on the ground (ACRP Report 47). Surplus Property (Federally Owned or State Owned) Real property and related personal property that is owned by the federal government or a state government. Surplus property can be transferred at no cost to eligible local airport sponsors for airport purposes. The surplus property that is conveyed to an airport may include non-aeronautical use property intended to generate revenue for airport operations, maintenance, and development (Finding of Task 3 of ACRP Project 03-39). T-hangars Rectangular-shaped buildings that are split into numerous sections (often in the shape of a “T”) and that are used to store multiple smaller aircraft. Typically, doors on both sides of the structure provide access for each owner/lessee to their aircraft and their section of the hangar (see ACRP Report 113, p.16). Through-the-fence (TTF) An arrangement by which the public airport sponsor permits access to the public landing area by independent operators undertaking aeronautical activities from privately owned land adjacent to, but not a part of, the airport (ACRP Report 47). General Land Use/Development Terms Airport Zoning District Laws and regulations, generally at the city or county level that control the use of land, allowable construction, and improvements to property within a given area or zone surrounding an airport (adapted from ACRP Report 47). Arterial Road A primary roadway with high traffic volumes that connects to highways and collector streets. Building The percentage of a lot covered by a building, normally used as part of a zoning code (also see Floor Area Ratio). Categorical Exclusion (CATEX) A CATEX refers to a category of actions that do not individually or cumulatively have a significant effect on the environment and do not require the preparation of an EA or EIS. A CATEX is not an exemption or waiver of NEPA review; it may be considered the

234 Generating Revenue from Commercial Development On or Adjacent to Airports Coastal Jurisdiction An area near a coastline that may be protected as part of a state’s Coastal Zone Management Plan or similar program, as funded by the Coastal Zone Management Act of Regions). Conveyance Constraints Limitations on the capacity of public utilities, such as a municipal sewer and water systems, to deliver adequate collection or distribution to a particular site or land use. Development Program A specific development proposal expressed in quantitative terms, such as square feet or floor area of specific uses, feet of roadways or driveways, number of parking spaces, or other details. Environmental Assessment (EA) A statement prepared under the requirements of NEPA Section 102(2)(c). The EA represents a federal agency’s evaluation of the effects of a proposed action on the environment. At the conclusion of an EA, a determination is made by FAA regarding the significance of the expected impacts (ACRP Report 113). Environmental Impact Statement (EIS) An EIS is the most detailed environmental review required by NEPA. At the end of the EIS, FAA prepares a public record of its decision addressing the findings of the analysis. An EIS is conducted because (1) an EA has determined that the environmental consequences of a proposed project or action may be significant, (2) FAA has determined that the project is environmentally controversial, or (3) FAA anticipates the project may significantly impact the environment (see ACRP Report 114, p. 32). Environmental Remediation The removal, containment, and/or cleanup of land, soil, or groundwater contaminated with hazardous waste according to an approved plan. EPA Superfund Site Property that has been designated as severely polluted by EPA under the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (CERCLA). This designation gives EPA the power to hold liable past and present owners for site cleanup and remediation; CERCLA also created a “Superfund” to pay for EPA activities related to Superfund Regions). Expedited Approval The process of receiving building permits on an accelerated timeline if the proposed site meets certain predetermined requirements. Also called fast track permitting. Floodplain An area subject to flooding, usually referring to an area with a 1% chance of flooding in a given year (100-year floodplain) (adapted from ACRP Report 113). Floor Area Ratio The ratio of the gross square footage of a building to the land on which it is situated. Floor area ratio is calculated by dividing the total square footage within the building by the square footage of the land area within the leasehold. Some municipalities require the floor area ratio to be based on net lot area rather than gross lot area (ACRP Report 47). Foreign Trade Zone (FTZ) A restricted access site supervised by U.S. Customs and Border Protection (CBP) in or adjacent to a CBP port of entry. Under FTZ procedures, the usual formal customs entry procedure and payment of duties are not required on the foreign merchandise, unless and until it enters Customs territory for domestic consumption (adapted from ACRP Report 121). Geotechnical Study An analysis of subterranean soil and rock properties to identify the appropriate type and structural needs for buildings and infrastructure at a particular site. lowest level of NEPA review (FAA Website at https://www.faa.gov/airports/resources/ sops/media/arp-SOP-500-catex.pdf). sites (adapted from Environmental Planning Handbook for Sustainable Communities and 1972 (CZMA) (adapted from Environmental Planning Handbook for Sustainable Communities and

Abbreviations and Glossary 235 Herbaceous Vegetation and plants that have non-woody stems (i.e., that are not shrubs or trees) (based on information from USDA Website). Intermodal/Multimodal A concentrated geographic area with immediate access to more than one major transportation mode (e.g., air, freight rail, passenger rail, other transit, highway, marine), and supporting facilities (e.g., a loading zone to support transfer of cargo from airplane to truck) (ACRP Report 121). Lateral Line A sewer or water connection between a specific property and a major utility line. Lot A tract of land, or one of several contiguous parcels of land making up a fractional part or subdivision, the boundaries of which are shown on recorded maps and “plats” (ACRP Report 47). Lot Coverage The percentage of a lot covered by impervious surfaces, including building footprint, driveways, and parking. Main A major utility line serving multiple properties and linking to a larger line or central facilities. Master Plan A long-range plan for development that usually includes analysis of the future transportation, housing, recreation, and economic requirements for a community. May also be called a Comprehensive Plan. (For airport planning documents, see Airport Master Plan.) (adapted from ACRP Report 47 [see section describing the Airport Master Plan] and Black’s Law Dictionary, 4th Pocket Ed.). Maximum Height The maximum height allowable for a building, in stories and/or feet as defined by a municipal or airport zoning ordinance. Net Usable Land The area of a parcel of land remaining after subtraction of wetlands, floodplains, steep slopes, and other regulated or unsuitable areas. Specific definitions may be included in local zoning ordinances (adapted from ACRP Report 47). On-site Stormwater Management A specific collection and detention system that is developed to control the volume and rate of discharge of stormwater draining from impervious surfaces within a particular lot or tract of land. Over the Road Transportation Moving goods via roadways and highways, typically using semi- trucks. Package Treatment Plant A small, self-contained, often privately owned, sewage treatment facility intended to serve one or a limited number of properties or buildings, such as an office building or golf course. Parking Requirements The amount of automobile parking that must be provided for a specific land use as required by zoning and development codes. This may be expressed as a specific number of parking spaces for each 1,000 square feet of building area, or one space per a specific number of square feet, which generally varies with the type of building use. For example, four parking spaces per 1,000 square feet, or one space per 250 square feet (adapted from ACRP Report 47). Permitted Use Structures and/or use of land that complies with allowable use provisions of the applicable Zoning Ordinances, to include any amendment(s) to the ordinances (ACRP Report 47). Redevelopment Area Plan/Agreement An agreed-upon plan for a specific geographic area that outlines a specific redevelopment, which may or may not involve eminent domain condemnation. It is generally accomplished according to a specific legislated procedure of Gravity Connection A sewer or water connection where the intended direction of flow follows the terrain and is moved by the force of gravity. Greenfield A building site or lot that has not been previously developed.

236 Generating Revenue from Commercial Development On or Adjacent to Airports Request for Proposals (RFP) In this guidebook, a report prepared by an entity seeking a master developer, joint venture partner, or similar function to develop airport property. The RFP contains a description of the project site, goals for the project, zoning parameters and other requirements, and requests a response outlining a development program and financial plan. Sewer Conveyances The system of pipes transporting sewage effluent from properties to the sewage treatment plant. Sewer Main A major sewer line or conveyance serving many properties and linking to a larger line or sewage treatment plant. Site Plan A detailed depiction of proposed improvements to a given parcel of land, to include a description of how the proposed site development will comply with zoning ordinances (ACRP Report 47). Subdivision Approval An approval by a local authority that allows the division of land into multiple parcels, typically to facilitate the development of lots for building (adapted from Real Estate Market Analysis: Methods and Case Studies, 2nd Ed.). Threatened or Endangered Species Specific animals or plants identified by the U.S. Fish and Wildlife Service, through the Endangered Species Act of 1973 (ESA), that could become extinct without proper protection (adapted from Environmental Planning Handbook for Sustainable Communities and Regions). Transfer of Development Rights (TDR) The purchase and sale of development rights for a specified property based on the underlying zoning, which are then transferred from a sending zone to a receiving zone within a given jurisdiction (ACRP Report 121). Urban Design Plan A development plan that includes certain physical design elements of the built environment, such as street and sidewalk layouts or building and landscape architecture features. Variance (Use or Bulk) Refers to permission given to a property owner to depart from the literal requirements of a zoning ordinance that, because of special circumstances, cause a unique hardship. Variances may be granted for a specific use that is not allowed by right (use variance) or for relief from the physical development requirements such as height, lot coverage, or setbacks (bulk variance) (adapted from ACRP Report 47). Wetlands Lowlands covered with shallow and sometimes temporary or intermittent waters. This includes, but is not limited to, swamps, marshes, bogs, sloughs, potholes, wet meadows, river overflows, tidal overflows, estuarine areas, and shallow lakes and ponds with emergent vegetation (FAA Environmental Desk Reference for Airport Actions). Zoning A police power measure, enacted primarily by units of local government, in which the community is divided into districts or zones, within which permitted and special uses are established. Regulations governing lot size, building bulk, placement, and other development standards are examples of zoning criteria. Requirements vary from district to district, but they must be uniform within districts (ACRP Report 47). Real Estate Development Terms Absorption Rate The rate at which available square feet of retail, office, or commercial space in the marketplace is leased during a predetermined period of time. Also referred to as market absorption (ACRP Report 47). delineation and plan development, requiring public notice, and often represents an exception to the underlying zoning.

Abbreviations and Glossary 237 Building Yield The number of buildings that can actually be built on a parcel of land based on site conditions and compliance with zoning or development requirements. Class “A” Office Building classifications in most markets refer to Class “A,” “B,” “C,” and sometimes “D” properties. While the rating assigned to a particular building is very subjective, Class “A” properties are typically newer buildings with superior construction and finish, in excellent locations with easy access, attractive to credit tenants, and that offer a multitude of amenities, such as on-site management or covered parking. These buildings, of course, command the highest rental rates (ACRP Report 47). Clear Title Describes title to property that is free of liens and any other encumbrances. Also known as “free and clear” (ACRP Report 47; see text under the heading “Unencumbered”). Contingency Fees A fee paid on the basis of achieving a particular outcome (based on Black’s Law Dictionary, 4th Pocket Ed.). Covenants, Conditions, and Restrictions (CC&Rs) A series of governing documents and bylaws for a private residential development, legally enforced by a private entity such as a homeowners association (HOA), that outlines certain limitations, rights, and responsibilities of owners or tenants (see ACRP Report 114, pp.97, 154, and 170). Deed Restriction A deed is a written instrument conveying an interest in real property; a deed (ACRP Report 114). Draw-Down Spending a portion of available loan proceeds for development costs. Easement A right of use over the property of another, created by grant, reservation, agreement, prescription, or necessary implication. An easement is typically granted either for the benefit of adjoining land (appurtenant), such as the right to cross A to get to B, or for the benefit of a specific individual (in gross), such as a public utility easement that allows entry and maintenance within the easement area (ACRP Report 47). Fair Market Value The highest price a property would command in a competitive and open market under all conditions requisite to a fair sale, with the buyer and seller each acting prudently and knowledgeably in the ordinary course of trade (ACRP Report 47). Fair Share Portion A share of the cost of a utility, road or other public facility improvement, typically allocated to several users or beneficiaries based on the level of likely use of the improved facility. Ground (Land) Lease A long-term land lease, generally for the purpose of erecting a building or buildings, or for constructing improvements to the land to be used by lessee. At the end of the lease term, the land and all structures and enhancements revert to the owner. Land leases should follow the basic format of the hangar lease and include all of the same references to the airport’s rules, regulations, and minimum standards. The land lease price per square foot could vary by location, and possibly by the length of the term, and may also be connected to a business permit or an FBO lease (ACRP Report 47; see the section describing Land Lease). Internal Rate of Return (IRR) A metric used in capital budgeting measuring the profitability of potential investments. IRR is a discount rate that makes the net present value (NPV) of all cash flows from a particular project equal to zero. An IRR greater than the cost of capital generally indicates a profitable project. Book Value The value at which an asset is carried on a balance sheet. Generally, the original cost of an asset plus capital additions minus the accumulated depreciation. restriction is a limitation on the use or enjoyment of real property that is included in a deed

238 Generating Revenue from Commercial Development On or Adjacent to Airports Market Area The area or region from which a majority of the clients and competition is located for a particular development or business sector (adapted from Real Estate Market Analysis: Methods and Case Studies, 2nd Ed.). Master Developer An approach to development in which the developer acts as the airport owner’s master lessee and is responsible for development. The airport owner and developer share in the revenues under various formulas. Often the developer is required to contribute to a repair and replacement fund to cover certain repair and replacement costs (adapted from ACRP Report 66; see the section describing the master terminal concession developer). Mineral Estate Participating Leases A lease with mineral rights, giving the lessee the right to drill or mine through the surface. A royalty paying oil and gas lease is typically the governing document for oil and gas exploration on airport property (adapted from ACRP Report 47; see the section describing surface rights; also see ACRP Report 121, pp.5–11). Pro Forma A financial analysis that uses specific criteria to forecast future operating revenues of a development (adapted from Real Estate Market Analysis: Methods and Case Studies, 2nd Ed.). Public-Private Partnerships (PPP or P3) A contractual agreement between public and private sector entities that includes active private sector participation in the design, building, and operation of infrastructure or development (ACRP Report 121). Rate of Return The gain or loss on an investment over a specified time period, expressed as a percentage of the investment's cost. Gains on investments are defined as income received plus any capital gains realized on the sale of the investment. Real Estate Market Analysis A forecast of future demand for real estate with certain attributes, which generally includes an estimate of the square footage that can be absorbed and the rents that can be charged. Marketability Study is another terminology used for this activity (ACRP Report 47). Special Assessment A fee levied on properties within a specific geographic area and dedicated to public improvements that benefit those property owners (adapted from ACRP Report 121). Special Covenant A written agreement inserted into deeds or other legal instruments stipulating performance or non-performance of certain acts, or uses or non-use, of a property and/or land (ACRP Report 47). Tax Increment Financing (TIF) Within a specified district, bonds are used to pay for infrastructure that will help increase the value of the land within the district. All increases in property taxes collected as a result of the increase in value are set aside to pay off the bonds (ACRP Report 121). Title Report The result of research into the chain of ownership of a property, determining the owner’s rights to the parcel and identifying any liens, encumbrances, deed restrictions or limitations affecting the use of any portion of the property. Vacancy Rate The total square feet of available retail, office or commercial space compared to the total inventory of space and expressed as a percentage. Vacancy rate is calculated by multiplying the vacant space by 100, then dividing it by the total inventory (ACRP Report 47). Lease Terms The conditions set out in a ground or building rental agreement, including the price, the length of time the lease is to be in effect, escalation of rent, tenant and landlord responsibilities, and other parameters.