Abstract:
Reasonableness Standards:|The requirement that airport fees be "reasonable" does not obligate airport proprietors to obtain an appraisal report and use fair market rental rates for leases of aeronautical facilities. (p. 7).|Both the interim "Policy Regarding Airport Rates and Charges" (June 9, 1994) and the supplemental notice of proposed policy (September 8, 1995) recognize the proprietor's discretion to establish nonairfield property lease rates based on justifiable valuation methodologies, emphasize the importance of local negotiation and resolution of airport fees, and encourage agreement on fees between proprietors and air carrier users without federal intervention. (p. 7).|Financially Self-Sustaining:|The self-sustaining requirement lends itself to a goal of self-maintenance or existence rather than to specific annual fee-level requirements. (p. 8).|The obligation to make an airport as self-sustaining as possible does not permit an airport proprietor to establish aeronautical fees exceeding its aeronautical costs, absent the agreement of aeronautical users. (p. 8).|Both the interim "Policy Regarding Airport Rates and Charges" (June 9, 1994) and the supplemental notice of proposed policy (September 8, 1995) recognize that market conditions at some airports may not permit an airport proprietor to establish fees that are sufficiently high to recover aeronautical costs and sufficiently low to allow commercial aeronautical services to operate at a profit. Where this is the case, the decision to charge rates below those needed to achieve self-sustainability in order to assure services are provided to the public is not inherently inconsistent with the obligation to make an airport as self-sustainable as possible under the circumstances. (p. 9).|The obligation to make an airport as self-sustainable as possible under the circumstances does not obligate airports to charge its tenants at fair market rental value. (p. 9).|Under 49 U.S.C. ยง 47129(a)(3), the Secretary is not to set the level of a fee in dispute between an air carrier and an airport. The Secretary may only determine whether a fee is reasonable or unreasonable. (p. 9).|Fees for Non-Aeronautical Uses:|An in-flight kitchen facility is not an aeronautical activity, because "it is not required for, does not involve or make possible the safety of the operations of, and is otherwise not directly related to, the operation of aircraft." (p. 10).|The lease rates charged for in-flight kitchen activities are not within the jurisdiction of the DOT/FAA. (p. 10).|"While fees assessed for nonaeronautical uses may exceed the cost of service to those users, the surplus funds accumulated from those fees must be used in accordance with the statutory revenue retention provisions." (p. 10).
Index Terms:
Self-sustainability|Airport Revenues (Grant Assurance 25)|Revenue diversion|Aeronautical activity|Market value|Appraisals|Rates and charges|Proprietary right|Fee and Rental Structure (Grant Assurance 24)|Jurisdiction