In a momentous shift of its normally conciliatory relationship with aircraft manufacturers, the United States Senate, on June 17, 2020, introduced the “Aircraft Safety and Reform Act,” legislation that will, if enacted, effectively reverse the provisions of the Federal Aviation Administration Reauthorization Act of 2018 (“2018 FAA Act”) which allow aircraft manufacturers to perform, with a minimum of FAA oversight, the certification for safety purposes, of the aircraft it manufactures.

The proposed, bipartisan, legislation, seeks to control both the performance of the industries to which were delegated the aircraft safety certification responsibilities (“ODA”) under the 2018 FAA Act, and the FAA personnel charged with overseeing their compliance.Continue Reading Proposed Legislation Repudiates Congress’ Hands Off Policy Toward Aircraft Certification

Airport sponsors and their legal counsel have been forced by the COVID-19 pandemic to exercise judgment and make tough decisions regarding the financial accommodations they will offer their commercial aeronautical tenants to help them weather the current storm. In many ways, these decisions have mirrored the difficult decisions employers have had to make to pare down their workforces in order to survive in the wake of this public health emergency and the resultant economic downturn. Airport sponsors are highly motivated to support their valued commercial tenants and to negotiate mutually beneficial financial terms (including rent abatement). But federally-obligated airports must also balance their regulatory obligations to maintain an economically self-sustaining airport and to treat similarly situated tenants equally.

Buchalter’s airport regulatory attorneys have developed the following best practices airport sponsors should consider as they navigate the growing tidal wave of negotiations with commercial aeronautical tenants.Continue Reading Financial Accommodations for Airport Tenants in Response to COVID-19

In the FAA Reauthorization Act of 2018, Pub. L. 115254, § 188, Congress required the Federal Aviation Administration (“FAA”) to “evaluate alternative noise metrics to current average day-night level standard, such as the use of actual noise sampling to address community airplane noise concerns.” In its April 14, 2020 Report to Congress (“Report”), FAA thumbed its nose at that mandate, and chose instead to enumerate the various available metrics, without any attempt at comparative analysis of their efficacy at representing real world noise impacts when compared to Day/Night Average Sound Level (“DNL”), currently required by FAA for analysis of airport noise impacts.
Continue Reading FAA Sidesteps Congressional Mandate to Evaluate Alternative Noise Metrics

If there is anything to be learned from the FAA’s distribution of the $10 billion in funds allocated to airports in the Coronavirus Aid, Relief, and Economic Security (CARES) Act, it is that allocating billions of dollars in just a few weeks is more difficult than it sounds. On March 27, 2020, the CARES Act was signed into law as Public Law No. 116-136. The CARES Act is aimed at mitigating the effects of the COVID-19 pandemic on most segments of American business and infrastructure. Title XII of the Act specifically supports airports by directing the FAA to make $10 billion available based on each airport’s level of operations and debt. However, when it came to calculating each airport’s share of the pie, the FAA botched the process by employing a formula that allocated massive amounts to some smaller airports while snubbing larger, busier airports.

In April, the FAA attempted to correct the problem by capping each airport’s CARES Act funding at four times the airport’s annual operating budget. The FAA then issued guidance stating that grant funds not used within four years are “subject to recovery by the FAA,” and designated a four year “period of performance” pursuant to 2 C.F.R. section 200.309. In other words, if you don’t use it, you lose it. But just as the FAA has experienced hiccups distributing the grant funds, airport sponsors will inevitably encounter thorny regulatory issues as they attempt to spend millions of dollars in new grant funding while navigating their compliance obligations under the CARES Act. This begs the question, “What are permissible uses of CARES Act grant funds by airport sponsors?”Continue Reading Permissible Uses of CARES Act Grant Funds by Airport Sponsors

In a somewhat unsubtle attempt to implement the current Administration’s 2017 Executive Order “Enforcing the Regulatory Reform Agenda,” allowing federal agencies to simplify their regulatory mandates, the Department of Transportation (“DOT”), on behalf of its subsidiary agency the Federal Aviation Administration (“FAA”), has instead thrown complex and expensive regulatory/legal hurdles in the path of consumers who attempt to enforce the provisions of current protective regulations. Specifically, the DOT published, on February 28, 2020, in the Federal Register, a Notice of Proposed Rulemaking (“NPRM”), that purports to simplify “definitions of the terms ‘unfair’ and ‘deceptive’ in the Department’s regulations implementing its aviation consumer protection statute.” See 85 Fed.Reg. 11881. The devil, however, is, as usual, in the details.
Continue Reading FAA Seeks to Free Airlines from “Burden” of Consumer Protections

Many communities rely on Congressional representation to establish lines of communication with the Federal Aviation Administration (“FAA”) because communication with federal agencies in general and FAA particularly is difficult for the public at large. That reliance may have been overly optimistic as can be seen in a response from FAA (“Response”) to a letter from Congressperson Eleanor Holmes Norton representing the Congressional Quiet Skies Caucus (“Caucus”). In the Response, the new Administrator of the FAA betrays a substantial misunderstanding of the agency’s role in its interaction with both airports and the public.

The Caucus was established principally to articulate to the FAA the interests of noise and air quality impacted communities throughout the nation. While the examples used by the Caucus in its letter are substantially oriented toward East Coast concerns, the issues overlap with those of other communities, including the impacts of NextGen, the reorganization of arrival and departure paths at airports based on new technology, which has consolidated flight paths over previously unimpacted communities in the name of “safety” and “efficiency.”

The FAA’s misunderstanding becomes obvious on the first page of its Response, where FAA takes the position that it is powerless to influence the factors that are the primary cause of airport noise, such as numbers of people that want to fly, and goods that must be delivered by air, thus necessitating more air traffic. While that may be true with respect to demand for air travel, it is patently untrue with respect to supply.Continue Reading Quiet Skies Congressional Caucus Gets Brush Off from FAA

The concern of the Federal Aviation Administration (“FAA”) regarding the use by airport operators of airport generated revenues to soften budget shortfalls off the airport appears to be growing. In a speech delivered at the November 11, 2019 National Air Transportation Association Leadership (“NATA”) Conference, Kirk Shaffer, FAA’s Associate Administrator for Airports, solicited the assistance of the aviation community in working with jurisdictions on compliance. Mr. Shaffer went on to opine that jurisdictions that operate airports are sometimes unaware of the laws governing revenue diversion, or confused by revenue flows, particularly as related to state and local taxes. He illustrated the problem by sharing the fact that, of the 177 jurisdictions with which the FAA has worked over the past five years on revenue diversion issues, 107 still remain noncompliant.

That number of noncompliant jurisdictions is somewhat surprising as the rules governing the use of airport revenues from airports are fairly explicit. The general rule is that revenues generated by a public airport may only be expended for the capital and operating costs of: (1) the airport; (2) the local airport system; or (3) other facilities owned or operated by the airport operator and directly and substantially related to the air transportation of passengers or property. 49 U.S.C. §§ 47107(b)(1) and 47133(a). The use of airport revenue for purposes other than airport capital or operating costs is generally considered “revenue diversion” and is prohibited by federal law. See Policy and Procedures Governing the Use of Airport Revenue, 64 Fed.Reg. 7696, 7720 (February 15, 1999) (“Revenue Policy”). Airport revenues subject to the revenue use requirements include all fees, rents, charges, or other payments received from anyone who makes use of the airport and from the airport sponsor’s activities on the airport. Id. at 7716.

The third prong provides unique revenue allocation opportunities to airport sponsors that own or operate other facilities.Continue Reading FAA Focuses on Controlling Revenue Diversion

In a decision of October 21, 2019, the Federal Aviation Administration (“FAA”) defied its own regulations, federal law, and logic in determining that the City of Santa Monica had properly expended airport revenues in the demolition of 3,500 feet of the runway at Santa Monica Municipal Airport (“SMO”), for the express purpose of limiting access by turbojet aircraft.

In its decision, FAA stated “[w]e conclude that airport revenue may be used to fund the payment removal, pavement pulverization, and hydro-seeding project, including the work within the Runway Safety Area, at SMO. The removal of the subject pavements, pavement pulverization and reuse, and the soil stabilization at SMO appears justified as an airport operating cost.” [Emphasis added]. Existing law and governing regulations would, however, appear to lead to the contrary conclusion.Continue Reading FAA Ignores Its Own Regulations in Allowing Expenditure of Airport Revenue to Demolish Runway at Santa Monica Municipal Airport

The Federal Aviation Administration (“FAA”) relies on the mantra “safety is our business, our only business” where, for example, justifying changes in aircraft flight paths over heavily populated residential communities. But is that reality? Not according to the Office of Inspector General, U.S. Department of Transportation (“OIG”) report of October 23, 2019, Department of Transportation’s Fiscal Year 2020 Top Managerial Challenges (“OIG Report”), when dealing with members of one of FAA’s primary constituencies, the aircraft manufacturers.

Specifically, the OIG Report highlights significant “challenges FAA faces in meeting its safety mission,” p. 1. Most notable is the correction of its lax oversight of aircraft certification procedures as graphically demonstrated by the recent deaths of 346 people in two separate crashes of Boeing’s 737-Max 8 aircraft, at least preliminarily thought to have been caused by systemic malfunctions in computer systems designed and installed by Boeing but never disclosed to operators.Continue Reading DOT Inspector General Finds “Challenges” in Achievement of FAA’s Safety Mission