Airport Improvement Program: Update of Allocation of Funds and Passenger
Facility Charges, 1992-94 (Fact Sheet, 07/17/95, GAO/RCED-95-225FS).

Pursuant to a congressional request, GAO provided information on the
Federal Aviation Administration's (FAA) allocation of Airport
Improvement Program (AIP) funds and airports' collection of passenger
facility charges (PFC).

GAO found that: (1) between 1982 and 1994, FAA allocated about $16
billion in AIP funds for improvements at 2,780 airports; (2) 216 of the
545 eligible airports have collected $1.4 billion in PFC for capital
development projects; (3) Congress has reduced the AIP appropriation
from $1.9 billion in 1992 to $1.45 billion in 1995; (4) FAA estimates
that PFC collections could increase from $850 million to $1 billion
annually if eligible airports begin to collect the fees; (5) commercial
service airports received about 75 percent of AIP allocations from 1992
to 1994 and are the only airports eligible to collect PFC; (6) FAA
directed 65 percent of all AIP funds to on land acquisition projects and
projects focusing on pavements on runways, taxiways, and aprons from
1992 to 1994; and (7) airports plan to use about 47 percent of PFC
revenues for projects to develop terminals and improve airport access
and about 21 percent of these revenues for debt servicing costs.

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  RCED-95-225FS
     TITLE:  Airport Improvement Program: Update of Allocation of Funds 
             and Passenger Facility Charges, 1992-94
      DATE:  07/17/95
   SUBJECT:  Airports
             Air transportation operations
             Transportation safety
             Commercial aviation
             Federal aid for transportation
             Budget authority
             Set-asides
             Funds management
             Future budget projections
             Discretionary grants
IDENTIFIER:  FAA Airport Improvement Program
             Airport and Airway Trust Fund
             FAA National Plan of Integrated Airport Systems
             FAA Airport Capital Improvement Plan
             FAA Passenger Facility Charge Program
             FAA State Block Grant
             Denver International Airport (CO)
             Military Airport Program
             
**************************************************************************
* This file contains an ASCII representation of the text of a GAO        *
* report.  Delineations within the text indicating chapter titles,       *
* headings, and bullets are preserved.  Major divisions and subdivisions *
* of the text, such as Chapters, Sections, and Appendixes, are           *
* identified by double and single lines.  The numbers on the right end   *
* of these lines indicate the position of each of the subsections in the *
* document outline.  These numbers do NOT correspond with the page       *
* numbers of the printed product.                                        *
*                                                                        *
* No attempt has been made to display graphic images, although figure    *
* captions are reproduced. Tables are included, but may not resemble     *
* those in the printed version.                                          *
*                                                                        *
* A printed copy of this report may be obtained from the GAO Document    *
* Distribution Facility by calling (202) 512-6000, by faxing your        *
* request to (301) 258-4066, or by writing to P.O. Box 6015,             *
* Gaithersburg, MD 20884-6015. We are unable to accept electronic orders *
* for printed documents at this time.                                    *
**************************************************************************


Cover
================================================================ COVER


Report to the Chairman, Subcommittee on Transportation and Related
Agencies, Committee on Appropriations, U.S.  Senate

July 1995

AIRPORT IMPROVEMENT PROGRAM -
UPDATE OF ALLOCATION OF FUNDS AND
PASSENGER FACILITY CHARGES,
1992-94

GAO/RCED-95-225FS

Allocation of AIP Funds 1992-94


Abbreviations
=============================================================== ABBREV

  ACIP - Airport Capital Improvement Plan
  AIP - Airport Improvement Program
  FAA - Federal Aviation Administration
  GAO - General Accounting Office
  MAP - Military Airport Program
  NPIAS - National Plan of Integrated Airport Systems
  PFC - passenger facility charge
  SBG - State Block Grant

Letter
=============================================================== LETTER


B-261642

July 17, 1995

The Honorable Mark O.  Hatfield
Chairman, Subcommittee on Transportation
 and Related Agencies
Committee on Appropriations
United States Senate

Dear Mr.  Chairman: 

At your request, we have updated our October 1993 report on the
allocation of Airport Improvement Program (AIP) funds from 1982
through 1994 by the Federal Aviation Administration (FAA).\1 This
report provides information on FAA's allocation of AIP funds by type
of airport and by type of project over a 13-year period, with an
emphasis on 1992 through 1994.  In addition, as you requested we have
included information on airports' collection of passenger facility
charges (PFC).  We are providing information on the funds collected
by the airports from 1992 through 1994 and the types of projects
funded with PFCs. 


--------------------
\1 Airport Improvement Program:  Allocation of Funds From 1982 to
1992 (GAO/RCED-94-14FS, Oct.  19, 1993). 


   BACKGROUND
------------------------------------------------------------ Letter :1

AIP and PFC funds are derived through different processes but are
often used for similar purposes.  AIP funds are appropriated from the
Airport and Airway Trust Fund, which receives funding from taxes on
passenger tickets and aviation fuel.  FAA uses AIP funds to support
airport planning and development projects that enhance capacity,
safety, security or noise mitigation at the airports included in
FAA's National Plan of Integrated Airport Systems (NPIAS).\2 FAA
allocates most AIP funds on the basis of a legislated entitlement
formula and set-aside categories earmarked for specific types of
airports or projects.  It has the discretionary authority to allocate
the remainder on the basis of needs identified by the airports.  PFCs
were authorized under the Aviation Safety and Capacity Expansion Act
of 1990.  PFCs are imposed by individual commercial service airports
that apply for and receive from FAA the authority to collect the
charges.  Beginning in 1992, authorized airports could collect up to
$3 per passenger in PFCs to use for AIP-eligible projects and for
certain types of projects not eligible for AIP funding, such as debt
financing. 


--------------------
\2 NPIAS is FAA's multiyear planning document for identifying the
airports and projects critical to the national system.  NPIAS
describes the types and estimated cost of the airport development
projects proposed by the more than 3,300 public-use airports eligible
for federal aid. 


   SUMMARY
------------------------------------------------------------ Letter :2

From 1982 through 1994, FAA allocated about $16 billion in AIP funds
for improvements at 2,780, or about 84 percent, of the almost 3,300
airports eligible to receive these funds.  Since commercial service
airports began collecting PFCs in 1992, 216 of the 545 eligible
airports have collected about $1.4 billion for capital development
projects.  From 1992 through 1994, we identified some general
characteristics of the way AIP and PFC funds were used, including the
following: 

  Since our last report, federal funding for airport projects has
     increased, although the funding mix has changed.  From 1992
     through 1994, airports received about $5.1 billion in AIP funds,
     representing about one-third of all of the AIP funds obligated
     since 1982.  However, the Congress has reduced the AIP
     appropriation from $1.9 billion in 1992 to $1.45 billion for
     1995.  Meanwhile, FAA officials anticipate that PFC collections,
     about $850 million in 1994, could increase to $1 billion
     annually if all of the eligible larger commercial service
     airports begin to collect these fees. 

  Commercial service airports have benefited the most from AIP and
     PFC funds, while AIP funds for other types of airports have
     decreased.  From 1992 through 1994, commercial service airports,
     representing 17 percent of the airports eligible for AIP
     funding, received $3.8 billion, or 75 percent of the AIP
     allocations, and collected $1.4 billion in PFCs.  Other
     airports, representing 83 percent of the airports eligible for
     AIP funding, received $1.2 billion, or about 25 percent of all
     the AIP funds obligated during the same 3-year period.  These
     airports are not eligible to collect PFCs. 

  FAA allocated the majority of AIP funds for projects related to
     airfields' pavement; the airports used their PFC funds for other
     types of projects.  From 1992 through 1994, FAA directed about
     $3.5 billion, or 65 percent of all AIP funds, to projects
     focusing on the pavements of runways, taxiways, and aprons and
     on land acquisition.  In contrast, on the basis of the
     PFC-funded projects approved to date, airports plan to use about
     $3.7 billion, or about 47 percent, of the revenues from PFCs for
     projects to develop terminals or improve airport access. 
     Airports also plan to use about $1.7 billion, or about 21
     percent, for debt servicing costs--costs that are not eligible
     for AIP funds. 

Section 1 of this report details the funding processes and trends for
AIP and PFC funds.  Section 2 describes the funding by airport type
and location.  Section 3 describes the funding by the type of
project. 


---------------------------------------------------------- Letter :2.1

As with our earlier report, the data presented in this report are
segmented by fiscal year, by region, and by individual airports.  The
data on regional and individual airports depict more precisely how
the airports have invested their AIP and PFC funds and provide more
information about the allocation process. 

To develop information for this report, we used FAA's data bases on
fiscal year AIP obligations and calendar year PFC collections as well
as other sources that allow year-to-year comparisons across FAA's
nine regions by airport category and project.  We used nominal
dollars to describe AIP and PFC funding for airports and projects;
that is, we did not adjust fiscal year amounts to account for the
changes in purchasing power due to inflation.  You requested that we
provide nominal dollar amounts to assist in reviewing the actual AIP
appropriations made each year.  However, for comparison purposes we
have provided the fiscal year 1982-94 AIP obligation amounts in both
nominal and constant dollars (see app.  I).  We have also presented
the information on the basis of the year in which the funds were made
available to--rather than actually used by--the airports.  To
supplement our analysis of the data, we discussed our work with FAA
officials in headquarters.  We conducted our work from February to
July 1995 in accordance with generally accepted government auditing
standards. 

We provided FAA with a copy of our draft report for review.  We also
discussed the report with FAA's Manager, Programming Branch, Airports
Financial Assistance Division; FAA's Manager, Passenger Facility
Charge Branch, Airports Financial Assistance Division; other FAA
officials; and Department of Transportation officials.  These
officials generally agreed with the facts as presented and provided
some additional information on projects, which we incorporated in the
report. 

As agreed, unless you publicly announce its contents earlier, we plan
no further distribution of this report until 7 days after the date of
this letter.  At that time, we will provide copies to the Secretary
of Transportation, the FAA Administrator, and other interested
parties.  We will also make copies available to others on request. 

If you have questions, please contact me at (202) 512-2834.  Major
contributors to this report are listed in appendix II. 

Sincerely yours,

Kenneth M.  Mead
Director, Transportation Issues


AIP AND PFC:  FUNDING PROCESSES
AND TRENDS
============================================================ Chapter 1

This section describes the types of airports eligible to participate
in the Airport Improvement Program (AIP) or, in the case of certain
airports, to levy passenger facility charges (PFC).  It also presents
basic information about these programs and discusses trends in
funding. 


   TYPES OF AIRPORTS
---------------------------------------------------------- Chapter 1:1

Airports must be included in the Federal Aviation Administration's
(FAA) National Plan of Integrated Airport Systems (NPIAS) to be
eligible to receive AIP funding.  About 3,300 airports are listed in
the 1993-1997 NPIAS.  The majority fall into three general
categories, as follows: 

Commercial service.  Airports that board, or enplane, at least 2,500
passengers are designated as commercial service airports.  Airports
enplaning between 2,500 and 10,000 passengers each year are
designated as nonprimary commercial service airports; airports
enplaning more than 10,000 passengers annually are designated as
primary airports.  FAA further divides primary airports into four
categories of hubs--the smallest (called nonhubs) board between
10,000 and 264,460 passengers, and the largest (called large hubs)
enplane over 5.28 million passengers annually.  Many primary airports
also qualify as cargo airports, which serve aircraft carrying an
aggregate weight of over 100 million pounds of property or mail.  The
NPIAS for 1990-99 included 582 commercial service airports; the NPIAS
for 1993-97 lists 545.  Of the 545 commercial service airports, 130
are nonprimary commercial service airports--a decrease of 48 airports
since the 1990-99 NPIAS--and 415 are primary airports--an increase of
11 since the 1990-99 NPIAS.  Since 1990, the Congress has allowed
commercial service airports controlled by a public agency to apply
for permission to collect PFCs. 

General aviation.  This category comprises the majority of the
smaller airports that operate primarily to support nonscheduled
commercial aircraft operations.  General aviation includes
unscheduled passenger taxi and cargo airlines, as well as charters,
transport, and recreational aircraft.  The NPIAS for 1990-99 listed
2,426 airports in the general aviation category; the NPIAS for
1993-97 lists 2,450--an increase of 24 airports. 

Relievers.  Relievers are those general aviation airports located in
metropolitan areas that FAA has designated to reduce congestion at
large primary airports and to provide additional access to general
aviation.  Relievers provide alternative landing sites for general
aviation and other aircraft that might otherwise use commercial
service airports.  The 1990-99 NPIAS listed 266 reliever airports;\1
the 1993-1997 NPIAS lists 299 (including 9 commercial relievers), an
increase of 33 reliever airports. 

As shown in figure 1.1, general aviation airports continue to
constitute the majority of all the existing airports listed in the
NPIAS. 

   Figure 1.1:  AIP-Eligible
   Airports by Category

   (See figure in printed
   edition.)


--------------------
\1 This number includes those airports designated as commercial
relievers. 


   AIP:  CONGRESSIONAL DIRECTION
   AND FUNDING
---------------------------------------------------------- Chapter 1:2

FAA allocates AIP funds to airports using the following three types
of legislated funding arrangements: 

Entitlements or "formula grants." These provide funds (1) to primary
and cargo airports on the basis of passenger boardings or cargo
weight and (2) to states for use at general aviation airports on the
basis of the population and size of the state.  The state of Alaska
receives a separate entitlement grant under this category. 

Discretionary grants.  By congressional direction, the majority of
these grants go to projects that address goals established by the
Congress, such as enhancing capacity, safety, and security or
mitigating noise at all types of airports. 

Set-asides.  Unlike discretionary grants, set-asides are specific
categories established by the Congress and used to direct specified
amounts of funding to certain projects, such as planning and noise
abatement; or to certain types of airports, such as reliever and
nonprimary commercial airports; and to the military airport
program.\2

Congressional allocation of funds among these three categories has
changed several times since the AIP's inception in 1982.  Figure 1.2
shows the 1994 congressional allocation of funds among these three
categories, affecting the AIP funds allocated in fiscal year 1995. 
Entitlements, the largest category, made up 56.5 percent of the total
amount appropriated, followed by discretionary grants with 21.2
percent.  Five set-asides (for the military airport program,
planning, nonprimary commercial airports, relievers, and noise
abatement) collectively constituted 22.2 percent of the appropriated
funds. 

   Figure 1.2:  Congressional
   Allocation of AIP Funding, 1994

   (See figure in printed
   edition.)

Figure 1.3 shows the total funding authorized and appropriated for
the AIP in fiscal years 1982-95.  In general, both the authorized and
appropriated funding levels increased during the period.  However, in
the past several years, appropriations have decreased, from a high of
$1.9 billion in 1992 to $1.8 billion in 1993, $1.69 billion in 1994,
and $1.45 billion in 1995. 

   Figure 1.3:  AIP Authorized and
   Appropriated Funding Levels,
   Fiscal Years 1982-95

   (See figure in printed
   edition.)


--------------------
\2 The military airport program (MAP) was established in 1990 to
assist current and former military airports located in congested
metropolitan areas in converting to viable civilian airports.  See
Airport Improvement Program:  The Military Airport Program Has Not
Achieved Intended Impact (GAO/RCED-94-209, June 30, 1994) for
additional information on this program. 


   AIP:  FAA'S ALLOCATION PROCESS
---------------------------------------------------------- Chapter 1:3

Although the Congress establishes national AIP goals, funding
categories, and program limitations, FAA administers the program on
the basis of needs that the individual airports identify.  FAA
requests that local airport sponsors--in conjunction with local,
metropolitan, or state planning agencies--identify their annual
capital improvement needs and submit proposals for AIP-eligible
projects to be included in the NPIAS and in FAA's 5-year Airport
Capital Improvement Plan (ACIP).  While some airports are "entitled"
to receive a portion of federal funding each year on the basis of the
AIP formula, an airport must still submit an application for a
specific project before FAA will award these grants.  All airports
competing for discretionary and set-aside funding must also submit an
application for FAA's review.  FAA will generally fund an eligible
project using, whenever possible, a combination of entitlement and
discretionary or set-aside funds to best meet the airport's needs. 
Furthermore, all airports receiving AIP funds must provide a
"matching share," ranging from 10 to 25 percent of the total cost of
the project, before FAA will award a grant. 

Because there are always more eligible airport projects competing for
AIP discretionary funding than there are funds available, FAA has
established a priority system for all projects for which
discretionary funds are requested.  Each eligible project must be
listed in the ACIP.  FAA then calculates a national priority number
for each project, using such factors as the size of the airport and
the type of development proposed.  However, this method of setting
priorities does not consider factors such as the cost of the project,
cost-benefit data, or the forecast or historical growth.\3

FAA uses the ranked list to fund as many projects as possible with
the annual appropriation.  In FAA's 1995 AIP funding request, 1,067
airport projects received a priority number, and several projects
received the same priority number.  For example, 19 projects were
ranked 11th (the highest ranking assigned to a project in 1995).  The
projects were all related to safety, ranging from purchasing an
emergency response vehicle to removing an obstruction.  The projects
were for airports ranging in size from the largest primary airport to
general aviation airports. 

In addition to the project's priority number, FAA also uses another
mechanism--identifying a project's commitments--to allocate AIP
funds.  Projects with identified commitments are believed to merit
funding, regardless of their relative priority.  These projects
typically include letters of intent\4 and "phased" projects--like a
runway and adjacent taxiway or a runway completed over a multiyear
period--where it is important to complete the series of projects in
order to gain any benefit.  FAA funds all projects with commitments
first and then uses the priority list to distribute the remaining
discretionary funds. 

Figure 1.4 shows the allocation of AIP funds by entitlement,
discretionary, and set-aside categories for 1982-95.  Collectively,
AIP funding for the three categories has declined since 1992,
paralleling the trend in appropriations shown in figure 1.3.  The
moneys allocated to the entitlement and set-aside categories have
decreased over time, while the moneys allocated to the discretionary
category have increased. 

   Figure 1.4:  AIP Obligations by
   Allocation Method, Fiscal Years
   1982-95

   (See figure in printed
   edition.)

Although the funding in the discretionary category has increased over
time, the amount of funds available for FAA's own discretionary use
has actually decreased.  Since 1987, the Congress has directed FAA to
use 75 percent of its discretionary funds for projects that enhance
capacity, safety, and security or mitigate noise at primary and
reliever airports.  The remaining 25 percent is used at FAA's
discretion for any project at any eligible airport.  FAA has further
reduced the amount of discretionary funds available at the beginning
of the fiscal year by committing future discretionary funds to
projects through letters of intent. 


--------------------
\3 FAA is currently testing methods to provide a cost-benefit
analysis for any capacity project that would require over $10 million
in AIP discretionary funds.  For fiscal year 1994, FAA had tested 13
projects, approving 8 and requiring additional analysis for 5. 

\4 FAA can award a letter of intent stating its intent to reimburse a
primary or reliever airport in the future for eligible costs incurred
on a current improvement project.  In doing so, FAA establishes a
schedule for reimbursing the airport sponsor over several years, as
funds become available.  Typically, a letter of intent includes some
combination of an airport's projected future AIP entitlements and
discretionary or set-aside funds.  See Airport Improvement Program: 
Better Management Needed for Funds Provided Under Letters of Intent
(GAO/RCED-94-100, Feb.  2, 1994) for additional information. 


   PFC:  CONGRESSIONAL DIRECTION
   AND FUNDING
---------------------------------------------------------- Chapter 1:4

To augment the AIP, the Congress, in 1990, authorized domestic
commercial service airports to impose a facility charge, the PFC, on
passengers.  Under the PFC legislation, airports may charge each
passenger a $1, $2, or $3 facility charge per trip segment up to a
maximum of two segments per one-way trip and four segments per round
trip.  The airlines are responsible for collecting PFCs and
distributing the funds to the airports.  For example, a passenger
purchasing a round-trip ticket from Los Angeles to Washington, D.C.,
with one stop in Chicago could be required to pay an additional
$4-$12 in PFCs, depending upon how much each airport charged.  The
airline collects the PFC from the passenger when the ticket is
purchased and then distributes the fees to each participating
airport.  The airport controls the expenditure of PFCs. 

The airports determine the type of projects to be funded with PFCs
and apply to FAA for approval.  To gain FAA's approval, an airport
prepares an application that includes a list of proposed projects. 
After a public comment period, FAA reviews the application to
determine which projects are eligible for PFC funding.  FAA must
approve each proposed project before PFCs are expended.  As of
February 1995, FAA had approved applications from 216 airports to
collect PFCs and had rejected only one application.\5

Revenue collected from PFCs must be used for FAA-approved airport
planning and development projects.  Projects funded partially or
entirely with revenues from PFCs must meet at least one of the
following criteria:  (1) preserve or enhance the safety, security, or
capacity of the national air transportation system; (2) reduce or
mitigate the impact of airport noise; or (3) furnish opportunities
for enhanced competition between or among air carriers.  PFC-eligible
projects include development or planning projects eligible for AIP
funds, any AIP-eligible noise mitigation project, or projects related
to developing gates and other areas for moving passengers and
baggage.  PFC revenues may also be used by an airport sponsor as the
local matching share for AIP grants.  Unlike AIP funds, PFCs can also
be used to cover the cost of securing and retiring debt related to
airport projects. 

Between 1992 and 1994, primary airports collected about $1.4 billion
in PFCs, as shown in figure 1.5. 

   Figure 1.5:  PFC Collections,
   1992-94

   (See figure in printed
   edition.)

The PFC legislation stipulates that large and medium hub airports
collecting PFCs must return up to 50 percent of their AIP entitlement
funds to FAA.  The legislation requires FAA to reallocate the
returned entitlements, using a congressionally mandated formula, to
small and nonhub primary airports and to noncommercial service
airports.  Figure 1.6 shows how this formula redistributes these
funds. 

   Figure 1.6:  Returned
   Entitlement Allocation Formula

   (See figure in printed
   edition.)

For example, in fiscal year 1994, 35 airports returned about $103.4
million in AIP entitlement funds.  Using the formula shown in figure
1.6, FAA reallocated about $52 million to nonhub airports, $13
million to small hub airports, $26 million to noncommercial airports,
and about $13 million to its discretionary account. 


--------------------
\5 FAA rejected an application for PFC funds to build a new airport
in Austin, Texas, because it was unclear which of two sites the city
of Austin would eventually choose to develop as the new airport. 


AIP AND PFC:  FUNDING BY AIRPORT
TYPE AND LOCATION
============================================================ Chapter 2

This section provides information on the types of airports funded
with AIP grants from 1982 through 1994 and with PFCs from 1992
through 1994, as well as airport-by-airport information on the
combined AIP and PFC funds obtained by the top 50 AIP recipients. 


   AIP:  FUNDING BY AIRPORT TYPE
---------------------------------------------------------- Chapter 2:1

As shown in table 2.1, the AIP funds allocated to airports increased
greatly from 1987 to 1988.  From 1988 through 1994, the AIP funds
allocated to airports remained at high levels, but the amount
available for some airport categories had changed.  For example, the
amount of funding allocated to nonprimary commercial airports in 1994
was about 43 percent lower than the amount allocated in 1987, while
the amount allocated to primary airports in 1994 was about 150
percent higher than the 1987 level.  However, part of the increase
may reflect the reclassification of some nonprimary commercial
airports to primary airports.\6



                          Table 2.1
           
           AIP Funding by Airport Category, Fiscal
                        Years 1982-94

                    (Dollars in millions)


                          Genera          Nonprima
                               l                ry
                          aviati  Reliev  commerci
Fiscal year      Primary      on      er        al     Total
--------------  --------  ------  ------  --------  --------
1982              $312.3   $62.4   $48.2     $31.5    $454.4
1983               465.0   155.1    98.7      69.2     788.0
1984               502.8   146.5   103.6      62.0     814.9
1985               623.4   154.1   110.1      52.4     940.0
1986               542.0   146.5   100.8      58.9     848.2
1987               525.6   155.8   129.7      72.2     883.3
1988             1,082.9   190.9   135.1      47.7   1,456.5
1989             1,013.5   178.0   171.2      43.9   1,406.6
1990             1,010.6   168.5   138.0      43.7   1,360.7
1991             1,210.1   248.7   211.1      45.5   1,715.4
1992             1,203.4   249.2   166.5      56.4   1,675.6
1993             1,296.4   199.1   180.6      41.2   1,717.3
1994             1,316.1   181.1   133.2      41.4   1,671.8
============================================================
Subtotal        $11,104.  $2,236  $1,726    $665.9  $15,732.
                       2      .0      .8                   9
Planning funds                                        $424.9
 1982-94\a
============================================================
Total                                               $16,157.
                                                           8
------------------------------------------------------------
\a FAA allocated an additional $424.9 million in AIP funds directly
to local, regional, and state planning agencies for airport planning. 

Table 2.2 shows the percentage of total AIP funds allocated to each
airport category since 1982.  When AIP funds increased in 1988, the
percentage of total AIP funds received by primary airports increased
from 59.5 percent in 1987 to 74.3 percent in 1994, while the
proportion of AIP funds received by all other airport categories
decreased. 



                          Table 2.2
           
             Percentage of AIP Funding by Airport
                Category, Fiscal Years 1982-94


                                                    Nonprima
                                                          ry
                                 General            commerci
Fiscal year            Primary  aviation  Reliever        al
--------------------  --------  --------  --------  --------
1982                      68.7      13.7      10.6       6.9
1983                      59.0      19.7      12.5       8.8
1984                      61.7      18.0      12.7       7.6
1985                      66.3      16.4      11.7       5.6
1986                      63.9      17.3      11.9       6.9
1987                      59.5      17.6      14.7       8.2
1988                      74.3      13.1       9.3       3.3
1989                      72.1      12.7      12.2       3.1
1990                      74.3      12.4      10.1       3.2
1991                      70.5      14.5      12.3       2.7
1992                      71.8      14.9       9.9       3.4
1993                      75.5      11.6      10.5       2.4
1994                      78.7      10.8       8.0       2.5
------------------------------------------------------------

--------------------
\6 In 1987, the Congress reduced the AIP funding directed to
nonprimary commercial airports to correspond with a change in the
eligibility requirements that enabled smaller airports to claim
primary airport status.  Over 100 airports were reclassified between
1987 and 1988. 


   AIP:  FUNDING BY REGION
---------------------------------------------------------- Chapter 2:2

FAA's nine regional offices are responsible for allocating AIP funds
to eligible airports.  Figure 2.1 shows the total number of eligible
airports in each FAA region, ranging from 612 in the Great Lakes
Region to 111 in the New England Region.  Three regions--Great Lakes,
Southern, and Southwest--contain about 51 percent of all the airports
eligible for AIP funding. 

   Figure 2.1:  Number of
   AIP-Eligible Airports, by FAA
   Region

   (See figure in printed
   edition.)

Figure 2.2 shows the distribution of total AIP funds by region for
the 13-year period from 1982 to 1994.  As shown, these ranged from a
high of 19.7 percent for the Southern Region to 3.4 percent for
Alaska and 3.7 percent for New England.  The top three regions--Great
Lakes, Southern, and Western-Pacific--received about 50 percent of
the total AIP funds. 

   Figure 2.2:  Allocation of AIP
   Funding Across FAA Regions,
   Fiscal Years 1982-94

   (See figure in printed
   edition.)


   PFC:  FUNDING BY AIRPORT TYPE
---------------------------------------------------------- Chapter 2:3

As table 2.3 shows, FAA has approved PFCs at 216 airports for
projects valued at more than $10 billion.  Of this amount, the city
and county of Denver received approval to collect $2.3 billion--the
largest single PFC collection approved to date--to help finance the
Denver International Airport. 



                          Table 2.3
           
              PFC Collections by Type of Airport

                    (Dollars in millions)

                                   Number of
                                    airports    Total amount
                                  collecting         of PFCs
Airport type                            PFCs        approved
----------------------------  --------------  --------------
Primary large hub                         19          $4,389
Denver International                       1           2,337
Primary medium hub                        27           2,203
Primary small hub                         49           1,050
Primary nonhub                           116             218
Nonprimary commercial                      4              <1
============================================================
Total                                    216         $10,197
------------------------------------------------------------
Between June 1992 and September 1994, airports collected about $1.4
billion in PFCs.  The 47 primary large and medium hub airports
collected $1.3 billion, or about 92 percent, of the total amount
shown in table 2.4. 



                          Table 2.4
           
                   PFC Collections, 1992-94

                    (Dollars in millions)

Airport type                  1992\a    1993    1994   Total
----------------------------  ------  ------  ------  ------
Primary large hub                $59    $331    $553   $943\
Primary medium hub                20     121     220     361
Primary small hub                  5      25      57      87
Primary nonhub                     1       9      21      31
Nonprimary commercial             <1      <1      <1      <1
============================================================
Total                            $85    $486    $851  $1,422
------------------------------------------------------------
\a 1992 figure includes collections over a 6-month period (June
1992-Dec.  1992). 

No restrictions are placed on the number of years an airport can
collect PFCs.  Table 2.5 shows the average collection period.  To
date, the longest approved collection period is about 40 years. 



                          Table 2.5
           
            PFC Collection Time by Type of Airport

                                                     Average
                        Range of collection       collection
Airport type            periods                       period
----------------------  ----------------------  ------------
Primary large hub       1.3 years to 33.5          7.9 years
                         years
Primary medium hub      <1 year to 33.6 years      7.9 years
Primary small hub       1.9 years to 40.2          9.5 years
                         years
Primary nonhub          <1 year to 37 years        6.2 years
Nonprimary commercial   4.7 years to 8.4 years     5.9 years
------------------------------------------------------------

   COMBINED AIP AND PFC FUNDING
---------------------------------------------------------- Chapter 2:4

Since 1992, 216 airports have received approval to collect PFCs in
addition to their AIP funding.  Figures 2.3 and 2.4 and table 2.6
show the amount of AIP funding and PFCs collected by the different
categories of airports for the years 1991-94. 

   Figure 2.3:  AIP and PFC
   Funding, Fiscal Years 1991-94

   (See figure in printed
   edition.)

Note:  PFC dollar amounts were calculated on a fiscal year basis for
purposes of comparison with fiscal year AIP data and do not represent
the actual collections for each year.  Table 2.4 shows calendar year
PFC collections. 

   Figure 2.4:  AIP and PFC
   Funding by Hub Type, Fiscal
   Years 1991-94

   (See figure in printed
   edition.)

Note:  PFC dollar amounts were calculated on a fiscal year basis for
purposes of comparison with fiscal year AIP data and do not represent
the actual collections for each year.  Table 2.4 shows calendar year
PFC collections. 



                          Table 2.6
           
           AIP and PFC Funding for Airports, Fiscal
                        Years 1991-94

                    (Dollars in millions)

Airport type/
funding                 1991    1992    1993    1994   Total
--------------------  ------  ------  ------  ------  ======
All primary
 airports
 AIP                  $1,210  $1,203  $1,296  $1,316  $5,025
 PFC                  N.A.\a    43\b     408     760   1,211
Primary large hub
 AIP                     441     455     522     548   1,966
 PFC                    N.A.      30     278     498     806
 Primary medium hub
 AIP                     305     306     249     267   1,127
 PFC                    N.A.      10     101     196     307
 Primary small hub
 AIP                     271     206     297     265   1,039
 PFC                    N.A.       2      21      49      72
 Primary nonhub
 AIP                     194     236     230     236     896
 PFC                    N.A.      <1       8      18      26
Nonprimary
 commercial service
 AIP                      46      56      41      41     184
 PFC                    N.A.      <1      <1      <1      <1
General aviation
 AIP                     249     249     199     181     878
 PFC                    N.A.    N.A.    N.A.    N.A.    N.A.
Reliever
 AIP                     211     167     181     133     692
 PFC                    N.A.    N.A.    N.A.    N.A.    N.A.
------------------------------------------------------------
\a N.A.  = not applicable. 

\b PFC dollar amounts were calculated on a fiscal year basis for
purposes of comparison with fiscal year AIP data and do not represent
the actual collections for each year.  Table 2.4 shows calendar year
PFC collections. 

The top 50 AIP recipients received a total of about $7.4 billion in
AIP and PFC funds from 1982 through 1994.\7 Of this amount, about
$6.3 billion was funded through the AIP and about $1.12 billion
through PFC collections.  Table 2.7 shows the top 50 AIP-recipient
airports ranked by their combined total of AIP and PFC funding. 



                                    Table 2.7
                     
                       AIP and PFC Funding for Top 50 AIP-
                      Recipient Airports, Fiscal Years 1982-
                                        94

                              (Dollars in millions)


                                                Discretionar          Collection
                             AIP &  Entitlemen            y/   Total     s 1992-
Airport           Size         PFC           t     set-aside     AIP        94\a
----------------  ------  --------  ----------  ------------  ------  ----------

1. Denver         PL\b      $405.3       $79.6        $226.1  $305.6       $99.7
 International
2. Chicago        PL         324.6       156.2          80.6   236.8        87.8
 O'Hare
3. Dallas/Ft.     PL         304.1       171.4          98.6   270.0        34.1
 Worth
4. Kennedy (NY)   PL         290.6       163.5          66.8   230.3        60.3
5. Los Angeles    PL         285.9       162.0          43.1   205.1        80.8
6. Hartsfield/    PL         262.1       179.7          82.4   262.1         0\c
 Atlanta
7. Orlando        PL         242.5        64.7         133.8   198.5        44.0
8. Lambert/St.    PL         239.1        84.0          99.4   183.4        55.7
 Louis
9. Seattle/       PL         216.6        66.4          97.5   163.8        52.8
 Tacoma
10. McCarran      PL         208.8        59.1          71.6   130.7        78.1
 (NV)
11. Detroit       PL         201.0        72.7          69.8   142.6        58.4
12. Philadelphia  PL         191.4        60.4          85.5   146.0        45.4
13. LaGuardia     PL         179.5        86.7          39.5   126.2        53.3
 (NY)
14. Pittsburgh    PL         176.4        76.4         100.0   176.4         0\c
15. Newark        PL         174.8        70.5          36.0   106.5        68.3
16. Nashville     PM\d       173.1        35.2         116.2   151.4        21.7
17. Logan (MA)    PL         171.3        93.5          47.6   141.2        30.1
18. Sky Harbor    PL         166.1        81.2          84.9   166.1         0\c
 (AZ)
19. Minneapolis/  PL         164.2        70.7          26.5    97.1        67.1
 St. Paul
20. Miami         PL         158.7       114.5          44.1   158.6         0.1
21. Memphis       PM         147.1        65.2          59.0   124.2        22.9
22. New Orleans   PM         134.5        38.6          81.2   119.8        14.7
23. Cincinnati    PL         133.1        43.9          81.8   125.7         7.4
24. Baltimore     PL         132.9        44.8          56.4   101.2        31.7
25. Salt Lake     PL         128.6        53.3          75.2   128.6         0\e
 City
26. Indianapolis  PM         125.3        38.7          76.4   115.1        10.2
27. Houston       PL         124.0        78.8          45.2   124.0         0\c
 Intercontinental
28. Cleveland     PM         124.0        40.1          57.4    97.4        26.6
29. Chicago       PM         122.5        76.6          33.3   109.9        12.6
 Midway
30. San           PL         120.8        78.3          42.5   120.8         0\c
 Francisco
31. State of      SBG\f      116.7        31.5          85.2   116.7           0
 Illinois
32. San Jose      PM         101.0        32.5          47.4    79.8        21.2
33. Standiford    PS\g       100.3        45.6          54.7   100.3         0\c
 (KY)
34. Charlotte/    PL          97.3        64.3          33.0    97.3         0\c
 Douglas
35. Ft.           PM          92.2        46.2          46.1    92.2         0\e
 Lauderdale
36. Washington/   PL          91.7        50.9          29.3    80.2        11.5
 Dulles
37. Kansas City   PM          89.3        52.4          36.9    89.3         0\c
38. Honolulu      PL          84.7        78.6           6.1    84.7        0\c\
39. Tampa         PL          84.4        50.1          17.5    67.6        16.8
40. Tulsa         PM          77.3        23.3          43.7    67.0        10.3
41. John Wayne/   PM          69.8        31.2          38.6    69.8         0\c
 Orange County
42. Albuquerque   PM          69.6        33.5          36.1    69.6         0\c
43. Burbank/      PM          68.4        27.7          39.3    67.0         1.4
 Glendale/
 Pasadena
44. Theodore      PM          68.3        24.2          41.3    65.6         2.7
 Green (RI)
45. San Diego     PL          66.9        51.1          15.8    66.9         0\c
46. Hobby Field   PM          66.3        41.1          25.2    66.3         0\c
 (TX)
47. Palm Beach    PM          65.6        29.5          32.1    61.6         4.0
48. Adams/        PS          64.2        23.0          41.2    64.2        0\e\
 Little Rock
49. Birmingham    PM          64.1        23.6          40.5    64.1         0\c
50. King (VI)     PS\         64.1        21.5          40.0    61.5         2.6
================================================================================
Total                       $7,431    $3,288.5      $3,008.4  $6,296    $1,134.3
                                                                  .8
--------------------------------------------------------------------------------
Note:  Totals may not add because of rounding. 

\a Not all airports began to collect PFCs in 1992. 

\b PL = large primary airport, enplaning over 5,289,204 passengers
per year. 

\c Airport has not applied to FAA for PFC collection authority. 

\d PM = medium primary airport, enplaning over 1,322,300 passenger
per year. 

\e Airport applied and received authority to collect PFCs (Salt Lake
City began collections on Dec.  1, 1994; Fort Lauderdale on Jan.  1,
1995; and Little Rock on May 1, 1995. 

\f SBG = State Block Grant Program, through which FAA provides
special block grant funds to participating states for general
aviation, nonprimary commercial service, and reliever airports. 

\g PS = small primary airport, enplaning more than 264,459 passenger
per year. 

Of the 50 recipients shown in table 2.6, 29 are large primary
airports, 17 are medium primary airports, 3 are small primary
airports, and 1 represents a grant to a state participating in the
State Block Grant Program. 


--------------------
\7 In our previous report on AIP allocation (GAO/RCED-94-14FS), we
reported specific data for the top 50 AIP-recipient airports.  For
this report, we were also able to provide specific PFC collections
data for those airports. 


AIP AND PFC FUNDING BY PROJECT
============================================================ Chapter 3

This section provides information on the types of projects funded
with AIP grants and with PFC collections. 


   PROJECTS FUNDED THROUGH AIP
---------------------------------------------------------- Chapter 3:1

FAA categorizes projects receiving AIP funds into 16 unique
classifications of airport improvements, called work codes.  Work
codes characterize the type of activity funded through the
AIP--ranging from resurfacing of runways to procuring weather
equipment. 

Table 3.1 shows the distribution of AIP funds among the project
categories, including the funds directed to the seven states
receiving special general aviation entitlements through the State
Block Grant program, from 1982 through 1994. 



                                                                      Table 3.1
                                                       
                                                       Annual AIP Project Funding by Work Code,
                                                                 Fiscal Years 1982-94

                                                                (Dollars in millions)


Work
code          1982      1983      1984      1985      1986      1987      1988      1989      1990      1991      1992      1993      1994      Total
--------  --------  --------  --------  --------  --------  --------  --------  --------  --------  --------  --------  --------  --------  ---------

Planning       6.9      10.7      18.1      25.5      24.1      24.3      27.1      29.7      32.5      36.0      43.8      35.4      34.7      348.8
Safety        11.1      14.0      13.9      27.1      20.4      33.9      39.5      56.5      32.6      64.9     130.8     177.2      70.6      692.5
Security       1.2       1.0       3.4       4.4       3.2       4.2      20.5       9.9      77.2      99.0      50.5      19.4      12.2      306.1
Runways      120.9     215.7     205.6     201.0     208.0     194.4     334.7     297.9     280.0     393.5     414.7     361.7     443.3    3,671.5
Taxiways      70.9     163.9     155.1     168.0     150.7     169.4     251.5     230.4     196.0     293.8     281.3     258.4     314.3    2,703.8
Aprons        65.3     118.6     131.4     162.2     153.4     154.5     221.1     227.7     166.2     213.1     182.8     195.5     210.2    2,202.1
Lighting      15.8      34.7      35.8      49.6      30.2      47.1      57.4      51.4      45.1      50.7      60.6      66.4      45.0      589.8
Navaids        1.9       3.5       4.4       2.9       4.0       8.8      16.1      24.0      17.5      11.9      12.0      12.6      10.0      129.5
Weather        4.5       9.2      10.4      13.1       9.4      10.7      15.4      13.9      15.5      11.5      11.4      20.0      17.5      162.5
 equipme
 nt
Terminal      19.0      24.9      26.1      32.5      14.9      13.7      73.4      77.0      79.6      63.5      72.7      96.0      84.6      678.1
 s
Building       5.5       2.1       8.1      17.6       5.5       6.8       7.4       7.8      76.2       9.3      10.9       9.5       8.9      175.7
 s
Roadways      33.4      49.0      61.3      60.5      44.7      38.5      94.9      72.7      90.1      89.4      74.8      68.3      53.5      830.9
Noise          0.2       4.9       7.4      10.3      25.1      15.4      51.6      41.3      36.9      58.7      68.1      80.8      74.0      474.6
Land          89.5     119.3     113.8     141.4     139.2     147.2     217.5     226.3     200.4     270.9     238.0     303.5     267.5    2,474.6
Miscella      11.8      20.0      25.9      30.8      24.0      22.3      34.9      48.0      21.8      58.6      34.5      26.2      38.5      397.3
 neous
SBG              0         0         0         0         0         0         0         0      39.9      48.8      60.5      98.0      72.8      319.9
Total        458.0     791.6     820.8     946.8     856.8     891.1   1,463.1   1,414.6   1,407.6   1,773.4   1,747.4   1,829.0   1,757.6   16,157.8
-----------------------------------------------------------------------------------------------------------------------------------------------------
Note:  AIP funds allocated to noise-related projects are included in
the following project categories:  land/noise (land purchased for
noise-abatement-related purposes), lighting, navigational aids
(Navaids), noise (primarily soundproofing), planning, runways, and
taxiways. 

FAA allocated $11 billion, or about 68 percent of all AIP funds since
1982, to the construction of runways, taxiways, and aprons or to
resurfacing projects and land procurement. 

As shown in table 3.2, the percentage of total AIP funds allocated to
most project categories remained relatively constant over the 13-year
period. 



                                    Table 3.2
                     
                     Percentage of Annual AIP Project Funding
                        by Work Code, Fiscal Years 1982-94

