The National Academies

ACRP 03-46 [Anticipated]

Benefits and Challenges of Privatization: Guidance for Airport Policy-makers

  Project Data
Funds: $350,000
Staff Responsibility: Theresia H. Schatz
Fiscal Year: 2018

This project has been tentatively selected and a project statement (request for proposals) is expected in November 2017. The project statement will be available on this world wide web site. The problem statement below will be the starting point for a panel of experts to develop the project statement.

There are many forms of privatization that occur in U.S. airports (e.g., service contracts, management contracts), but there hasn’t been full privatization.  This is in large part due to the federal funding, tax exempt debt, and Passenger Facility Charges (PFCs) that airports have access to. Each of these capital funding sources is under stress in the US–there have been multiple proposals to reduce or eliminate AIP grants as one means to address the federal deficit; the PFC level has not been raised since 2000 and, therefore, has significantly less purchasing power while many airports have leveraged their PFC capacity for 20 or more years; and there have been multiple proposals to eliminate or dilute the value of tax-exemption for airports.

The objective of this research to develop a primer to help U.S. airports understands what the different forms of privatization are, the success and failures, and the benefits and challenges.

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