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Program Funding:

The Airport and Airway Trust Fund provides the revenue source used to fund AIP projects. Taxes and user fees are collected from the various segments of the aviation community and placed in the Trust Fund. These revenue sources include taxes on airline tickets and freight waybills, international air carrier departure fees, and fuel taxes on general aviation gasoline and jet fuel.

The 1982 Act, as amended, defined eligible airports into five categories: Commercial Service Airports, Primary Airports, Cargo Service Airports, Reliever Airports and General Aviation Airports. In Massachusetts, 26 airports are potentially eligible for AIP funding. Two of the 26, Logan International Airport and Hanscom Field in Bedford, MA, are owned and controlled by the Massachusetts Port Authority (MASSPORT). The remaining 24 airports fall under the jurisdiction of the MassDOT Aeronautics Division. Of these 24 airports, six are designated as Primary Airports, four are designated as Reliever Airports, and the remaining sixteen are designated as General Aviation Airports.

Funding for the AIP is distributed under specific guidelines contained in the 1982 Act, as amended. The FAA distributes entitlement funding for Commercial Service and Primary Airports based on the number of enplaned passengers using the airport. General Aviation (GA) Airports, including Reliever Airports, also receive their funding from the FAA, but individual states determine the distribution of funds based on a ceiling provided by the FAA.

The new AIR 21 legislation also includes provisions that come into play when the total Airport Improvement Program (AIP) amount for a year is at least $3.2 billion. One of these provisions provides that non-primary airports will be entitled to receive annual AIP funding of the lesser of $150,000 or 20 percent of their needed funding as shown in the current published National Plan of Integrated Airport Systems (NPIAS). Non-primary airports include commercial service, general aviation, and relievers. The current NPIAS is 1998-2002. A new NPIAS is expected to be published some time in 2001.

Funding of projects that qualify under the AIP are typically divided into three sources: federal, state and local. The Federal share of most projects is 95 percent of the eligible cost to be reimbursed under the AIP. The remaining 5 percent is usually divided between the state and the local airport sponsor. In Massachusetts, the Aeronautics Division currently funds 2.5 percent of the non-federal share of projects under AIP, thereby relieving the local airport sponsor from a significant financial burden, resulting in a contribution from the host community of only 2.5 percent of the total cost of a project.

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