The Bipartisan Infrastructure Bill (BIL) is creating new and expanded opportunities for airports and maritime facilities to receive grants and low-interest loans for projects that in the past were not eligible for these funds – at least, not without providing access to surface transportation.
Over the next five years, the new federal infrastructure program will provide $25 billion in aviation and airport funding, as well as $17 billion over five years in new maritime spending across multiple agencies.
For aviation, this includes $15 billion in entitlement and competitive grants for airport infrastructure, $5 billion in competitive grants for airport terminals, and $5 billion for Federal Aviation Administration’s (FAA) facilities and equipment.
“One of the most interesting things is the funding within the new discretionary programs,” said Stephanie Atallah, senior aviation consultant with WSP’s Advisory business. “Larger airports are able to use federal funds now for more than just airfield projects, which are typically covered under the Airport Improvement Program (AIP), but also cover new terminal and passenger facility projects.”
While the newly introduced competitive funding application process that was issued by the FAA for airport terminal projects was very concise and brief this year, the application may vary slightly for 2023. But it is expected that the eligibility and evaluation criteria may look the same, with a focus on shovel-ready projects replacing aging infrastructure, improving energy efficiency, achieving compliance with Americans with Disabilities Act (ADA) and in other areas.
“Since this is a five-year program, prioritizing projects and answering the eligibility criteria will be crucial to successfully winning discretionary grant funding,” Atallah said.
The first round of Airport Terminal Program (ATP) grants for fiscal year 2022 were announced on July 7 for 91 projects at 85 airports, receiving a total of $968.6 million. It is interesting to note that the FAA received more than 650 ATP applications for about $14 billion in project requests, highlighting the significant need for funding to support our airports’ infrastructure. The allocation of these competitive grants was also based on the size of the airport. For fiscal year 2022, 53 percent of the funds went to large hubs, 13 percent to medium hubs, 20 percent to small hubs, and the remaining 14 percent to non-hub or non-primary airports, Atallah said.
Airports are also fully eligible for the U.S. Department of Transportation (DOT) Transportation Infrastructure Finance and Innovation Act (TIFIA) program, which are low-interest loan programs that provide subordinate debt at low interest rates. In the past, airports were not eligible unless there was a nexus to surface transportation, but airport agencies are now eligible to pursue TIFIA funds for projects that are eligible under the Passenger Facility Charge (PFC) program.
“This eligibility expansion now includes other airport-related infrastructure projects, such as terminal projects or surface transportation projects,” Atallah said. “These types of projects usually work well with alternative delivery options, either with airport funds or private capital, and private public partnerships.”