The National Academies

ACRP 11-01/Topic 10-03 [Final]

Legal Issues Relating to Airport Commercial Contracts
[ ACRP 11-01 (Legal Aspects of Airport Programs) ]

  Project Data
Funds: $50,000
Research Agency: Parker, Poe, Adams & Bernstein LLP
Principal Investigator: Scott A. Burrell
Effective Date: 6/15/2018
Completion Date: 6/30/2020

Airport attorneys spend considerable time drafting and negotiating airport contracts that involve specialized legal and business issues. Some are general commercial issues that aren’t necessarily exclusive to airports, while others are unique to airports. Airports as governmental entities are subject to a variety of governmental law principles that can affect their contracts for commercial services.
Several years ago ACRP Report 54: Resource Manual for Airport In-Terminal Concessions was published. This report reviewed many of the business concerns that airport proprietors address when planning and implementing a concessions program. ACRP Report 33: Guidebook for Developing and Managing Airports Contracts looks broadly at issues that may arise in a wide range of airport agreements and includes examples of various agreements. These past publications focused primarily on the business aspects of contracting for airport concessions and other services, but they did not focus on significant legal issues that can affect all government commercial contracts.
ACRP LRD 30: Contract Risk Management for Airports provides a general overview of the types of agreements airports use, but a variety of other government law principles also can affect government contracts for commercial services, such as restrictions on government's ability to "lend credit;" concerns for "void" and "voidable" contracts due to the scope of an airport's authority under state law; separation of powers concerns for contracts that effectively delegate government's responsibilities to private entities; requirements for obtaining value for the use of public assets; antitrust and "market participant" concerns that may apply to government; and the effect of subsequent legislation on an existing contract. State and federal law can regulate commercial contracts in areas such as letters of credit, limitations on indemnification, federally required FAA language, etc. Finally, airport commercial contracts may benefit from a variety of current commercial contracting practices, but those practices may not be fully understood and practices may require adjustment in a government setting.

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