LEXIS-NEXIS® Academic Universe-Document

LEXIS-NEXIS® Academic

August 16, 1999, Monday, Home Edition

SECTION: Business Horizon; Pg. 4E

LENGTH: 619 words

HEADLINE: HARTSFIELD CITY LIMITS: Funds to improve airport up in the air;
Act of Congress: Ticket tax allocations may go up to $ 6 per airline ticket for use on specific projects.

BYLINE: Gary Hendricks, Staff

SOURCE: AJC

BODY:
Federal funding for Hartsfield International Airport could triple to $ 27 million under legislation pending in Congress, with the money slated for projects that would help passengers move through the world's most-used airport.

The money isn't, however, from Uncle Sam's deep pockets. It all comes from taxes on airline tickets paid by passengers. A bill to increase airports' allocations for those taxes is pending in Congress, which is also considering raising another set of ticket taxes set aside for specific projects. Hartsfield cleared $ 92.1 million last year from airport operations, but General Manager Ben DeCosta said any federal funding will be appreciated because Hartsfield is about to embark on a master plan to upgrade the airport. More than $ 5.4 billion in projects --- new terminals, concourses, road improvements --- are on the list of proposed additions.

"With that agenda, we will be watching our funding for anything that can be gotten (for improvements)," DeCosta said.

Hartsfield is about to spend $ 52.2 million on the latest project.

The southernmost runway needs to be reconstructed. Work should begin next month and be completed by the end of October --- about as long as Hartsfield can afford to shut down a runway. A newly constructed taxiway will substitute for the runway during construction.

This year, the federal government gave Hartsfield $ 14.7 million for reconstruction of the 9,000-foot long, 150-foot wide runway. That leaves about $ 37.5 million the airport will have to produce on its own for the project, according to Hartsfield officials.

"They're on a fast-track with that runway," said Scott Seritt, manager of the Atlanta airports district for the Federal Aviation Administration. "So, it's unlikely there will be any more federal money available."

Federal grants can be a dicey thing, and recent events at Hartsfield bear that out.

Hartsfield has a "letter of intent" from the FAA to provide $ 75 million toward construction of the new fifth runway, even listing how much the airport can expect to get through the year 2009 for the project which is estimated to cost $ 900 million.

But the same letter also says "this intention shall not be deemed an obligation of the United States ... nor shall this Letter of Intent be deemed an administrative commitment for funding."

That's because Congress tells the FAA how much and to whom federal dollars will go, Seritt said. The money comes from federal taxes on airline tickets, accounting for about eight percent of each ticket. Because work on the runway, which is now the subject of a FAA environmental impact study, hasn't begun, none of that $ 75 million has been spent.

The tax money goes into the national aviation trust, and each airport receives a certain amount based on passenger volumes. Under the proposed legislation, Hartsfield's entitlement would go from $ 9 million to $ 27 million. But the bill is hung up in conference committee, and Congress is in recess.

However, Hartsfield has spent about $ 90 million on the fifth runway project, mostly for land acquisition. That money is from a different pot: passenger facility charges, known as PFC, or a $ 3 per ticket surcharge on every airline ticket. It's a charge above the regular federal taxes on airline tickets and is designed for specific projects.

The airlines collect the surcharge for the FAA, which then sends it to the airport when it is needed.

Hartsfield now is allowed to charge the maximum PFC, or $ 3. But Congress is considering increasing that maximum to $ 6.

DeCosta said Hartsfield is lobbying for the PFC increase, because of the huge bill coming Atlanta's way with the master plan expansion.

GRAPHIC: Graphic
WHERE THE MONEY GOES
On May 1, 1997, Hartsfield began collecting a $ 3 per ticket tax to help fund construction of a new fifth runway and other projects. To date, that charge has piled up $ 188.9 million and the airport has spent $ 90 million, according to the FAA, which administers the funds. The airport has been approved to spend up to $ 211.9 million. Projects approved for collection and use:
Land for the 5th runway: $ 198.4 million
Design for the 5th runway: $ 10.6 million
Planning for Eastside Terminal: $ 2.7 million
Planning for Road Improvements: $ 210,814

LOAD-DATE: August 16, 1999