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3.10 Grants and Capital Improvement Funding

Various sources of federal and state grants are available to assist small airports with planning and development. Airport managers should be familiar with the various types of federal grants and associated key requirements and identify their needs through the preparation of a 5-year capital improvement plan. Other types of funding resources for capital improvements include state loan programs, bond funding, tax increment financing and local funds.

ACRP Report 120: Airport Capital Improvements: A Business Planning and Decision-Making Approach
Provides a guidebook and a spreadsheet-based cost-estimating model to assist practitioners with estimating the cost of construction projects regularly proposed in an airport’s capital improvement plan.

ACRP Synthesis 1: Innovative Finance and Alternative Sources of Revenue for Airports
Explores alternative financing options and revenue sources currently available or that could be available in the future to airport operators, stakeholders, and policymakers in the United States. The report examines common capital funding sources used by airport operators, reviews capital financing mechanisms used by airports, describes various revenue sources developed by airport operators, and reviews privatization options available to U.S. airport operators.

FAA Advisory Circular 150/5100-21: State Block Grant Program
Provides guidance for application to and implementation of the State Block Grant Program. The advisory circular is intended for states and airport sponsors who participate, or plan to participate, in the State Block Grant Program.

FAA Airports Central Region, Airport Improvement Program (AIP) Sponsor Guide-100
Provides information on the funding of airport development and planning including checklists for typical AIP projects, sponsor eligibility, project eligibility, AIP obligations, FAA standards, and non-primary entitlement funds.

FAA Airports Central Region Web Page on AIP Sponsor Guide
Provides guidance to assist airport owners and their consultants with obtaining and administering an AIP grant.

FAA Order 5100.38: Airport Improvement Program (AIP) Handbook
Referred to as the AIP Handbook. Provides the policies and procedures on the implementation of the AIP based on the enabling legislation. It covers who is eligible for an AIP grant; what projects can be funded and the required project justification; project procurement requirements; allowable costs; the grant process, oversight and payments; letters of intent; State Block Grant Program; Military Airport Program; Innovative Finance Demonstration Program; Voluntary Airport Low Emissions Program (VALE), and other programs. The appendices of this document detail the requirements for specific types of projects.

FAA Order 5100.39: Airports Capital Improvement Plan
Prescribes the development of the national Airports Capital Improvement Plan (ACIP). The ACIP serves as the primary planning tool for systematically identifying, prioritizing, and assigning funds to critical airport development and associated capital needs for the National Airspace System. The ACIP also serves as the basis for the distribution of grant funds under the AIP.  Describes the national priority rating system used to align funding with critical airport development.

FAA Web Page on the Airport Improvement Program
Provides an overview of the AIP, which provides grants for public-use airports in the National Plan of Integrated Airport Systems.

FAA Web Page on Economically Distressed Communities Special Rule
Summary of the application of the economically distressed communities special rule to the determination of airport and FAA Essential Air Service/Economically Distressed Areas.

FAA Web Page on Grant Assurances
Summarizes the obligations airport owners or sponsors, planning agencies, or other organizations agree to when accepting funds from FAA-administered airport financial assistance programs. These obligations require the recipients to maintain and operate their facilities safely and efficiently and in accordance with specified conditions.

National Plan of Integrated Airport Systems
Identifies nearly 3,400 existing and proposed airports that are significant to national air transportation and thus eligible to receive federal grants under the AIP. It also includes estimates of the amount of AIP money needed to fund infrastructure development projects that will bring these airports up to current design standards and add capacity to congested airports. The FAA is required to provide Congress with a 5-year estimate of AIP-eligible development every 2 years.