Under federal law, airport operators that have accepted federal grants or have obligations contained in property deeds for property transferred under laws such as the Surplus Property Act generally may use airport property only for aviation-related purposes unless otherwise approved by the FAA. Specifically, the Airport and Airway Improvement Act of 1982 (AAIA) (Pub. L. 97–248), as amended and recodified at 49 United States Codes (U.S.C.) 47107(a)(1), and the contractual sponsor assurances require that the airport sponsor make the airport available for aviation use. Grant Assurance 22, Economic Nondiscrimination, requires the sponsor to make the airport available on reasonable terms without unjust discrimination for aeronautical activities, including aviation services. Grant Assurance 19, Operation and Maintenance, prohibits an airport sponsor from causing or permitting any activity that would interfere with use of airport property for airport purposes. In some cases, sponsors who have received property transfers through surplus property and nonsurplus property agreements have similar federal obligations.
Predictably, the Federal Aviation Administration (“FAA”) has weighed in strongly in opposition to the City of Santa Monica’s (“City”) plan to close the Santa Monica Airport (“Airport”) within the next two years. The City, owner and operator of the Airport, plans to begin the process of closure, including cancellation and/or modification of leases held by various aeronautical service providers, such as providers of fuel, maintenance and hangar storage. Those Airport incumbents are already paying rent on a month-to-month basis, subject to summary eviction.
In an unprecedented action aimed at limiting or eliminating noisy helicopters and fixed-wing aircraft from use of the East Hampton Airport, in East Hampton, Long Island, New York (“Airport”), on April 6, 2015, the East Hampton Town Board, operator of the airport, imposed strict noise limits, including a curfew, on the hitherto largely unregulated Airport. The greatest source of the problem that has generated a flood of local noise complaints appears to be the increasing helicopter traffic that ferries well-to-do city dwellers and LaGuardia and Kennedy passengers who live on Long Island to the beach community. The noise has apparently increased with the imposition of a new rule by the FAA requiring helicopters to fly off the North Shore of Long Island, and cross Long Island at, and into, East Hampton on the South Shore. The proposed regulatory protocol is dramatic.
An article of December 23, 2014 in a local East Hampton, New York newspaper, now circulated to a wider audience throughout the nation, gives the impression that, upon expiration of its contractual relationship on January 1, 2015, “East Hampton Town will be free of Federal Aviation Administration oversight and able to set access restrictions at the East Hampton Airport, essentially opening the door for relief from often loud, and sometimes rattling, aircraft noise.” The article apparently misapprehends, and consequently, vastly overstates the impact of the expiration of the town’s contractual commitments to FAA, in return for funding of airport improvements. The fact is that, with or without the constraints of such contractual commitments or “grant assurances,” the application of noise and access restrictions will depend entirely upon FAA’s determination concerning the applicability of a parallel set of constraints set forth in the Airport Noise and Capacity Act of 1990, 49 U.S.C. § 47521, et seq. (“ANCA”), which, in turn, will depend on the noise levels of the specific types of aircraft the airport wishes to control or eliminate.
On November 7, 2014, the Federal Aviation Administration (“FAA”) published its “Final Policy Amendment” (“Amendment”) to its “Policy and Procedures Concerning the Use of Airport Revenue,” first published 15 years ago in the Federal Register at 64 Fed.Reg. 7696, February 16, 1999 (“Revenue Use Policy”). The Amendment formally adopts FAA’s interpretation of the Federal requirements for use of revenue derived from taxes including sales taxes on aviation fuel imposed by both airport sponsors and governmental agencies, local and State, that are non-airport operators.
On April 13, 2012, as a result of the February 14, 2012 passage of the Federal Aviation Administration Modernization and Reform Act of 2012 (“FMRA”), the Federal Aviation Administration (“FAA”) proposed modifications to the “grant assurances” incorporated into FAA’s contracts with airports that receive FAA funding for physical improvements and/or noise compatibility purposes. These changes were made in order to ensure the consistency of the grant contracts with the changes arising out of FMRA. The revisions primarily address three categories of actions: (1) permission for “through the fence” operations under specified conditions; (2) exceptions to current restrictions on use of airport revenues; and (3) revision to rules governing use of revenues gained from disposal of airport property subsidized by FAA.