General

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Stewardship and Oversight of the Airport
Improvement Program (AIP)
Prepared for Biennial Fraud Awareness
Conference Arlington, VirginiaPresented
by Elliott Black Deputy Director Office of
Airport Planning and Programming Federal
Aviation Administration Date Wednesday, July
28, 2010
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Track Title

• Implication of Fraud on the
• Safety of Infrastructure Projects

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Overview

• Overview of the FAA Office of Airports
• Focus on the Airport Improvement Program (AIP)
• Relationship between AIP and other FAA programs
  and functions
• How the FAA leverages limited Federal resources
  to protect the traveling public
• Best practices in stewardship and oversight

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FAA Office of Airportskey program areas

• Planning support
• Environmental review
• Financial assistance programs
• Planning, engineering and construction standards
• Airport certification program(CFR Part 139)
• Compliance with grant assurances

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Planning Support

• National planning standards and guidance
• National Plan of Integrated Airport Systems
  (NPIAS)
• Ensure sponsors are eligible
• Identify eligible and justified projects
• Work with state aeronautical agencies on state
  system plans
• Support metropolitan system plans
• Work with individual airport sponsors to review
  activity forecasts, draft airport master plans
  and Airport Layout Plans (ALPs)

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Environmental Review

• Review proposed development (regardless of
  funding source) in accordance with the National
  Environmental Policy Act (NEPA)
• Ensure proper coordination including public
  consultation and interagency review
• Evaluate ability of proposed actions to secure
  other environmental permits

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Financial Assistance Programs

• Airport Improvement Program (AIP)
• Passenger Facility Charge (PFC) program

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Airport Improvement Program (AIP)
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Airport Improvement Program (AIP)

• Ticket taxes flow into the Airport Airway Trust
  Fund.
• Congress appropriates funds for the FAA to award
  grants to eligible airport sponsors.
• Requires local match (varies based on airport
  size).
• Strict eligibility rules based on different AIP
  funding categories, facility types, airport sizes
  and functions and other criteria.(continued)

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Airport Improvement Program (AIP) (contd)

• Strict implementation rules.
• Federal procurement regulations.
• Grant assurances and obligations.
• Use of electronic clearinghouse to maximize
  electronic funds transfer.

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Structure of Airport Improvement Program
(AIP)FY-2009 (3.4 billion in new grants)
(excludes ARRA funds)
Data Source Internal FAA data (pending
publication of FY-2009 Annual Report to Congress).
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Program Structure and Administration of the AIP

• More than 2,000 annual grants awarded nationwide.
• Broad variety of grants and grant recipients
• Size and type of airport organizations.
• Variety of relationships with state and local
  governments.
• Range of capabilities and resources of the state
  aeronautical agencies.
• Variability of internal staff resources and
  expertise.
• Variety of project sizes, types and
  implementation timeframes.
• Variability of consultant support.
• Tremendous geographic distribution.
• Different state laws affecting capital planning
  and grant administration.

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Complex system of diverse airports
Airport Type Number of Airports of U.S. Enplanements Examples
Large Hub (gt1.0 of all enplanements) 29 68.0 JFK, Chicago OHare, LAX, DFW, Atlanta, etc.
Medium Hub (0.25 - 1.0 of all enplanements) 37 20.0 Anchorage, Kansas City, Cleveland, Reno, etc.
Small Hub (0.05 - 0.25 of all enplanements) 72 8.0 Richmond, Des Moines, Akron-Canton, Fresno, etc.
Non-Hub (gt10,000 enplanements, but less than 0.05 of all enplanements) 244 3.0 Nantucket, Charleston, Duluth, Phoenix Mesa, etc.
Non-Primary Commercial Service (gt2,500 enplanements and scheduled service) 121 0.1 Cold Bay (AK), Saranac Lake (NY), Cedar City (UT)
Relievers (gt100 based aircraft or 25,000 annual itinerant operationsother criteria apply as well) 269 0.0 Teterboro, Oakland-Pontiac Van Nuys, etc.
General Aviation 2,560 0.0 Akiachak (AK), Allentown Queen City (PA), etc.
NPIAS airports 3,332 99.1
Low Activity Landing Areas 16,402 0.9
Grand Total 16,732
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Relationships with State and Local Governments

• Airports may be owned and operated by
• States
• Counties
• Municipalities
• Independent authorities
• Joint government agencies (e.g., multiple towns
  or cities)
• Channeling Act provisions
• Block-grant provisions

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State Block Grant Program

• Core element is to give states greater control
  over where to apply AIP State Apportionment
  funds, in return for taking on greater
  responsibility for the associated capital
  planning, grant administration and related legal
  and administrative requirements.
• Limited to ten (10) states.
• Nature of partnership between FAA and block-grant
  states
• Block-grant state takes on Federal
  responsibilities, including all legal
  responsibilities.
• Careful balance to be achieved in other
  relationships (i.e., with individual airports and
  other state agencies).
• Federal funds are still Federal funds, even in a
  block grant.

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State Block Grant Program (contd)
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Stewardship and Oversight

• Education, publication and guidance
• Internal FAA staff
• State aeronautical agencies
• Airport sponsors
• Planning and engineering consultant communities
• Pre-application process
• Application and review process
• Grant approval process
• Risk-based approach to grant administration
• Grant closeout

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Education, Publication and Guidance

• Internal FAA staff
• State aeronautical agencies
• Airport sponsors
• Consultant communities
• Airport planning
• Airport engineering
• Construction management
• Financial planning and advisory firms
• Accounting firms

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Recent Points of Additional Emphasis to Airports

• Re-familiarize yourself and your staff with all
  Federal grant requirements.
• Ensure airport staff and consultant personnel
  understand the importance of complete, clear and
  timely documentation.
• If you are not prepared to be held accountable
  in every regard, then consider carefully before
  requesting and accepting Federal funds.
• AIP certification requires grantees to certify
  that they will not be giving grants to debarred
  or suspended parties.

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Pre-Application Process

• Ensure projects proposed for grants are
  consistent with established national criteria.
• Ensure amounts and types of entitlement funding
  are accurate for each sponsor.
• Ensure budgetary sub-allotments are duly
  authorized and entered correctly in the agencys
  accounting system of record.

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Application and Review Process

• FAA reviews grant applications for completeness
  and consistency with the established Airports
  Capital Improvement Plan (ACIP) process.
• Ensure FAA does not offer grants to sponsors that
  have been determined to be noncompliant with
  grant assurances.
• Ensure sponsor risk level is properly established
  and/or updated before recommendation for funding
  is initiated.

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Risk Level Assignment
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Grant Approval Process

• Ensure that grants programmed (for either new or
  amended grants) do not exceed available funds.
• Ensure Grant Offer letter (and any amendments)
  meet all AIP grant requirements.
• Ensure sponsor certifies that it has the legal
  authority to accept the grant and all associated
  conditions.
• Ensure that only authorized obligations are
  entered into Delphi.

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Risk-Based Approach to Grant Administration

• Ensure that only sponsors in good standing get
  access to ECHO, and only after specific
  authorization.
• For non-ECHO payments, ensure that only approved
  payments are made.
• For ECHO payments, ensure that sponsors with
  repeated drawdown irregularities lose ECHO
  access.
• Ensure any sponsor that is suspended cannot
  access the ECHO system.
• Ensure sponsors submit quarterly performance
  reports.
• Standardized nationwide documentation
  requirements.

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Internal Reviews and Evaluations
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Grant Closeout and Documentation

• Ensure final project documentation requirements
  are fulfilled.
• Ensure FAA notifies sponsors of grant closeout.
• Ensure grant closeout is entered in both
  accounting system of record and grant planning
  system.
• Ensure sponsor cannot draw or reimburse funds
  through ECHO once grant is closed.
• Ensure that funds recovery procedures (if
  applicable) are followed.

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Audit Requirements

• Ensure that sponsors who receive more than
  300,000 in Federal funds in a given year satisfy
  all OMB Circular A-133 audit requirements.
• Ensure FAA follows up on any discrepancies found
  in an audit report.

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Tools and Metrics for Monitoring Grant Drawdown
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Tools and Metrics for Monitoring Grant Drawdown
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Airport Design Standards

• Establish and promulgate standards and policies
• FAA Advisory Circulars mandatory for all
  Federally obligated airports
• Planninge.g., runway length, runway/taxiway
  separation, Runway Safety Areas (RSAs), Runway
  Protection Zones (RPZs), Object-Free Areas
  (OFAs), airspace review process, signage and
  marking requirements, etc.
• Engineeringe.g., pavement design standards,
  drainage, electrical and lighting requirements,
  surface treatment (grooving), etc.
• Constructionquality control for construction,
  operational safety during construction, NOTAM
  process, obstruction lighting, etc.
• Maintenance and operationse.g., snow and ice
  control, runway surface condition monitoring,
  rubber removal, preservation of pavement
  markings, ARFF communications, etc.

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14 CFR Part 139 Airport Certification

• Periodic inspection of airports (both scheduled
  and unscheduled surveillance)
• Assist airport operator in meeting regulatory
  requirements
• Continuous educational outreach to disseminate
  best practices in airport management
• Inspect certificated airports to
• Ensure compliance with the regulation, including
  self-inspection and documentation requirements
• Ensure FAA design standards are being followed
• Check for operational and construction safety
• Verify airport emergency response capability

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Airport Safety Data Program (non-certificated
airports)

• State aeronautical agencies inspect
  non-certificated airportsapproximately one-third
  of the public use, non-Part 139 airports
  annually.
• Inspectors document and notify airport owners/
  operators of any
• Safety deficiencies
• Unsafe conditions
• Potential problem areas
• FAA trains inspectors through GCR (initial and
  recurrent training).
• GCR also maintains the publicly accessible 5010
  database containing all airport master records.

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Compliance with AIP Grant Assurances
Acceptance of Federal funding obligates airports
to comply with an extensive list of grant
assurances

1. General Federal Requirements
2. Responsibility and Authority of the Sponsor
3. Sponsor Fund Availability
4. Good Title
5. Preserving Rights and Powers
6. Consistency with Local Plans
7. Consideration of Local Interest
8. Consultation with Users
9. Public Hearings
10. Air and Water Quality Standards
11. Pavement Preventive Maintenance
12. Terminal Development Prerequisites
13. Accounting System, Audit, and Record Keeping
    Requirements
14. Minimum Wage Rates
15. Veteran's Preference
16. Conformity to Plans and Specifications
17. Construction Inspection and Approval
18. Planning Projects

1. Operation and Maintenance
2. Hazard Removal and Mitigation
3. Compatible Land Use
4. Economic Nondiscrimination
5. Exclusive Rights
6. Fee and Rental Structure
7. Airport Revenues
8. Reports and Inspections
9. Use by Government Aircraft
10. Land for Federal Facilities
11. Airport Layout Plan
12. Civil Rights
13. Disposal of Land
14. Engineering and Design Services
15. Foreign Market Restrictions
16. Policies, Standards, and Specifications
17. Relocation and Real Property Acquisition
18. Access By Intercity Buses
19. Disadvantaged Business Enterprises

For complete text of all assurances, see
http//www.faa.gov/arp/financial/aip/airport_spons
or_assurances.pdf
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Summary

• Complex program requiring unique measures to
  protect Federal resources.
• Extensive education, publication and guidance
• Oversight and stewardship measures before, during
  and after grant award
• Risk-based approach to grant management
• Corollary means of monitoring performance,
  efficiency and effectiveness
• Program administered in conjunction with other
  programs to ensure safety of the traveling public

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Thank you! Questions? Elliott
Black Deputy Director Office of Airport Planning
and Programming [phone]elliott.black_at_faa.g
ov