Money & Business

Report: $100 Billion in Airport Infrastructure Spending Needed in Next Five Years

By / Mar 10, 2017 (iStock/Thinkstock)

In a new report, Airports Council International-North America says federal funding only covers about half of the estimated annual costs of infrastructure spending. The trade group is recommending covering this gap by increasing passenger fees—a suggestion that not everyone is on board with.

The airport industry wants to see some fresh investment in the infrastructure that gets travelers from one city to another.

However, the investment that Airports Council International-North America is recommending, according to a new report [PDF], however, isn’t cheap—the group wants to see $99.9 billion in capital projects over the next five years, a 32 percent increase from the prior ACI-NA estimate. The trade group says it needs federal help to cover much of that total.

“America’s airports have real and significant unmet needs that threaten their ability to serve their passengers, grow their local economies, and create good-paying jobs,” ACI-NA President and CEO Kevin M. Burke said in a news release. “The longer we delay, the more America’s airports will fall behind and our infrastructure needs will become even more expensive to fix.”

The needs tend to be more significant at larger airports, which the ACI-NA report says represent $60.4 billion of the $99.9 billion total. Medium hubs represent$11.7 billion, while small airports are at $8.5 billion. Slightly more than half (54.1 percent) of the costs highlighted by the report are related to terminal projects.

As Travel Weekly notes, the ACI-NA assessment far outpaces the $32.5 billion infrastructure estimates release by the Federal Aviation Administration last year, which the trade group says have a smaller scope as they include only projects without identified funding sources, along with programs eligible for Airport Improvement Program grants. ACI-NA’s estimate covers more projects, including those not eligible for grants.

The group is calling on the Trump administration to increase the passenger facility charge, a fee (currently $4.50 per passenger) that generally goes to infrastructure projects of this nature.

One group that is skeptical of this need is Airlines for America (A4A), which suggested in comments to Bloomberg that there are funding sources the airport industry can rely on before those costs are passed onto consumers.

“Saddling passengers with more taxes is not the solution, particularly given the abundance of funding resources already available to airports for capital improvement projects,” A4A said in a statement.

But ACI-NA’s Burke says increasing the fees can limit the federal impact of such infrastructure changes.

“Local user fees are the most affordable and most responsible method for modernizing our airport infrastructure,” Burke explained in a news release. “By giving airports the ability to meet their local infrastructure needs without relying on additional federal funding, airports will be well positioned to maintain their leadership in the global aviation system.”

Ernie Smith

Ernie Smith is the social media journalist for Associations Now, a former newspaper guy, and a man who is dangerous when armed with a good pun. More »

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