As everyone knows, times are tight. I've been putting off a few medical checkups just to save a little money here and there. But obviously, that's not a good thing to do for long, otherwise the costs will be greater than the transient for-now savings.
Same goes for airports. The US airport construction market needs have decreased from an estimated $80.1 billion needed over the next five years to $71.3 billion, according to a new report by Airports Council International-North America. But that still leaves the airports with very large needs.
The report follows in the jetstream of an ASCE report that reported a $39-billion gap in airport infrastructure over the next seven years unless lawmakers step up to the cockpit and enable some major changes—such as allowing Passenger Facility Charges (PFCs) to increase from the $4.50 they've been held at for years and years, despite inflation—as has Airport Improvement Program grants.
"Airport Improvement Program funding as a whole has been static or growing at less-than-inflation for many years, and it’s now highly unlikely that the program will EVER be increased," says Ginger Evans, senior vice president with Parsons Corp. "AIP will continue to shrink and become much more specifically for the smaller airports. So airports of all sizes increasingly will be looking more to either PFCs or the airlines directly for funding."
Evan Futterman, an airport design consultant, says that as air traffic figures continue to rebound from the recession, airports are moving ahead with new capital development plans. However, "clearly a better financial model is needed, to give airports more capabilities to meet future needs without excessive government controls or airline pushback."
Some airports are experimenting with new project delivery and funding models. For example, "New York is leading the way for the next wave of development with P3 funding planned for the LaGuardia central terminal and Newark Terminal A," says Evans. "This creates a new model available to select airport properties not only for additional funding sources, but for increased efficiency in capital and operations cost control."
Evans adds: "The decrease in stated capital needs is more a reflection of responsible airport management taking a hard look at hard decisions in a tough economy – and deferring projects as a result – rather than a true reduction in the actual need."