Medium and large airports would be given the green light to increase passenger facility charges to account for a proposed $1.1 billion reduction in airport grants under US President Barack Obama's proposed fiscal year 2012 budget for the FAA.

The cut would come from the airport improvement programme (AIP), which this year has an obligated funding stream of $3.5 billion under the continuing resolution funding the agency. The FAA has been operating under funding extensions since its last long-term funding bill expired in 2007. Both the US House and Senate have recently introduced their respective versions of FAA Reauthorisation.

Counterbalancing the cut, however, would be a proposed one-time stimulus of $3.1 billion, part of a broader $50 billion transportation infrastructure improvement package, to be used for building new runways.

"To assist those airports that need the most help, the Administration proposes to focus federal grants to support smaller commercial and general aviation airports that do not have access to additional revenue or other outside sources of capital," says FAA in the budget documents.

"The budget also proposes to allow large and medium hub airports to increase the non-federal [PFC], thereby giving large and medium hub airports greater flexibility to generate their own revenue."

The proposal runs counter to efforts in the US House, where a proposed FAA budget bill under review calls for freezing PFC charges for four years.

FAA's budget as a whole under the Obama plan represents an $0.5 billion increase from this year, to almost $13 billion, of which almost $5 billion will come from the airport and airways trust fund, which is funded by ticket taxes and fees.

The budget does not call for so-called user fees, which would charge airlines or other operators for the amount of time a flight is being handled by controllers.

Other benefits in the budget include a one-time $250 million grant to help kick start the agency's next generation air traffic control system (NextGen). Of the total, $200 million would be used to accelerate applied research, advance development and implement engineering solutions, and $50 million would be used for upgrading infrastructure like power systems and air traffic control towers.

The grant would augment $190 million dedicated to FAA research and development in the proposed budget, down $1 million from this year's budget.

Source: Air Transport Intelligence news