Background

Although aviation-related activities produce a small amount of the total air  pollution in the United States, according to EPA, the types of pollutants  emitted by these activities are among the most prevalent and harmful in  the atmosphere and are expected to increase based on the forecasted  growth in the aviation sector. The major sources of emissions at airports  are aircraft, the ground equipment (such as vehicles that transport  baggage) that services the aircraft, and vehicles transporting passengers  to and from the airport. The emissions produced by these sources include  carbon monoxide; toxic substances (such as benzene and formaldehyde);  particulate matter; sulfur dioxide; and nitrogen oxides and volatile  organic compounds, which contribute to the formation of ozone, a major  pollutant in many metropolitan areas and a major concern to many airport  operators and to state and local air quality authorities. In addition, the  potential health effects of particulate matter are becoming an increasing  concern of these groups.
In response to concerns about emissions from airport sources, the Vision  100—Century of Aviation Reauthorization Act (Vision 100), signed into law  in December 2003, established a voluntary program to reduce airport  ground emissions at commercial service airports in air quality  nonattainment and maintenance areas. Geographic areas that have levels  of a criteria pollutant above those allowed by the standard are called  nonattainment areas. Areas that did not meet the standard for a criteria  pollutant in the past but have reached attainment and meet certain  procedural requirements are known as maintenance areas. The program,  according to FAA, is intended to help airports meet their obligations under  the CAA, and to assist regional efforts to meet National Ambient Air  Quality Standards set by EPA for limiting the amount of the six criteria  pollutants considered harmful to public health and the environment.  States that have areas exceeding these standards are required to develop  and implement a plan, known as a State Implementation Plan (SIP), for  bringing the areas into compliance with the standards. Under the CAA  conformity provision, no federal agency may approve or provide financial  assistance for any activity that does not conform to an applicable SIP.
To implement the Vision 100 provisions relating to airport emission  reductions, FAA created and began implementing the VALE program in  2004. According to FAA, in the 9-month period between the passage of the  act in 2003 and the implementation of the VALE program, the agency—in  cooperation with EPA and the Department of Energy—developed program  guidelines and application procedures; technical requirements, such as  standards for low-emission vehicles; and a system for assigning credits to  airports for emission reductions.
The FAA relied on experience with the FAA Inherently Low Emission  Airport Vehicle (ILEAV) Pilot Program to design the VALE program.  Authorized under the Wendell H. Ford Aviation Investment and Reform  Act for the 21st Century (AIR-21), the ILEAV pilot program operated from  2001 to 2005. Six airports implemented ILEAV projects with individual  grants of up to $2 million each to demonstrate the benefits and economic  feasibility of low-emission vehicles and supporting infrastructure.  According to FAA, the pilot program projects also provided useful  information about the environmental and economic trade-offs of  alternative fuels, their safe handling, and the commercial availability of  low-emission technology.
Airports eligible for the VALE program can apply for federal AIP  entitlement funds or discretionary funds under the “set-aside” for noise  and air quality projects. With FAA approval, eligible airports may also use  their PFCs to finance VALE projects. According to FAA officials, VALE  grants using discretionary set-aside funds have no impact on the amount  of entitlement funds an airport receives through AIP, since AIP  entitlements are based on a legislated apportionment formula tied to the  number of passengers an airport enplanes. FAA officials stated that most  participating airports seek set-aside funding for VALE projects because  VALE projects only compete in this portion of the AIP budget against  noise reduction projects. According to FAA officials, the agency considers  the approval and funding of VALE projects on a case-by-case basis based  on the project’s relative importance to other eligible airport activities. FAA  officials stated that prior to the establishment of VALE, the only emission-  reduction projects eligible for AIP grants and PFC use were those intended  to reduce emissions as a condition of approval of an environmental action  associated with an AIP-funded airport development project. These officials  also noted that the VALE program expands AIP and PFC eligibility into  new areas, such as airport mobile sources, including vehicles.
VALE projects may be stand-alone projects (i.e., they do not have to be  linked to a project that could increase emissions to be eligible for program  funding); however, for a project to be approved, it must meet specific  criteria. For example, an airport must demonstrate that the project will  result in emission reductions. Although according to FAA officials, these  reductions are “surplus” in the sense that they are not required in the SIP  for meeting CAA standards. To demonstrate that a project will lower  emissions, an airport must prepare estimates comparing the amount of  emissions currently produced with the amount of emissions that will be  produced after the project is implemented. To prepare these emission  estimates, airports use FAA’s Emissions and Dispersion Modeling System  (EDMS), which calculates emissions from project-related airport sources,  such as aircraft, ground service equipment, and shuttle buses. The airport  must also demonstrate, among other things, that the VALE project will  result in permanent emission reductions. According to FAA officials,  using the EDMS air quality model ensures the reliability of emission- reduction estimates and reduces planning costs.
VALE’s authorizing legislation and implementing guidance greatly  expanded AIP and PFC eligibility for low-emission technology, including  the purchase of low-emitting hybrid vehicles and electric-powered  equipment used to service aircraft, such as baggage tugs. FAA officials  stated that VALE employs an innovative approach by converting EPA  average national fleet standards into low-emission standards for each  VALE vehicle purchase. All vehicles and engines that are eligible for AIP or  PFC funding under the VALE program must either be EPA certified (new  vehicles) or EPA verified (retrofit technology). VALE low-emission  standards for all new vehicles are based on EPA average national fleet  standards and are referenced, in some cases, to comparable California Air  Resources Board standards. The VALE program sets emission standards at  cleaner levels than presently required by EPA. According to FAA officials,  a goal of the VALE program is to encourage airports to make investments  in capital equipment to provide substantial emission-reduction benefits  over many years. The VALE program is also intended to support U.S.  energy independence by emphasizing domestically produced alternative  fuels that are substantially nonpetroleum based. Also, the program is  designed to provide airports with financial and regulatory incentives to  increase their investments in proven low-emission technologies. FAA  officials stated that FAA, EPA, and the Department of Energy coordinate  on an ongoing basis VALE program standards, including nonattainment  status for airport eligibility and eligible alternative fuels.
The legislation authorizing the VALE program also provides a means for  airports to receive credits for the emission reductions achieved through  VALE projects and use these credits to comply with federal CAA air  quality standards. Before the VALE program was instituted, airports could  not receive credit for voluntary emission reductions. Therefore, any  voluntary reductions lowered an airport’s emission baseline, which is used  to calculate the impact of future emissions, and thus airports would need  to find further emission reduction options to obtain approval for future  projects. In 2003, we reported that because of this situation, some airport  officials told us that they waited to initiate emission-reduction efforts until  these efforts were needed to gain approval for an expansion project. The  EPA issued national guidance in September 2004 on how airports can  receive airport emission-reduction credits (AERC) for VALE projects and  apply those credits to future airport projects to meet certain CAA  requirements. AERCs can be used to mitigate future airport project  emissions, as long as they will be earned in the year for which they will be  applied. To be approved for the VALE program, an airport must obtain a  commitment from the state’s air quality authority that it will approve the  use of AERCs for projects to conform to federal air quality requirements,  should the airport choose to use them for this purpose.

	A Small Number of Eligible Airports Have Used VALE Funding to Help Reduce Airport Emissions, but Participation in the Program Is Increasing

While the number of airports that have undertaken VALE projects since  2004 is relatively small compared with the number of eligible commercial  airports—9 of 160—the number of participants is increasing, as are the  range of projects being conducted and the amount of money spent on  them.

		Few Eligible Airports Have Initiated VALE Projects, but FAA Expects Participation to Increase

Participation in the VALE program has been limited to date, although the  number of airports applying for the program is increasing, and FAA  expects more airports to seek VALE funding as they become more familiar  with the program. About 160 of the 524 commercial service airports are  eligible to participate in the VALE program; however, as of September  2008, 9 airports had received VALE program funding. (Fig. 1 shows the  locations of airports participating in VALE.) According to FAA officials, all  airports that have applied to participate in VALE have been approved.
Participation in the VALE program has risen in recent years. For example,  in 2005, the first year of the program, FAA approved VALE projects for   2 airports. In fiscal year 2008, FAA approved 11 projects at 6 airports, 4 of  which were new participants in the program. Overall, FAA reports that a  total of 20 projects at 9 participating airports are under way. In fiscal year  2009, FAA expects additional VALE participants. For example, the Seattle- Tacoma International Airport has proposed a multiyear project to  purchase electric ground support equipment, with a $3.1 million first  phase beginning in fiscal year 2009. FAA officials stated that FAA regional  officials are considering the airport’s application to fund this project  through VALE.
FAA officials stated that as the VALE program matures, and concerns  about foreign oil, climate change, and fuel prices influence public policy,  airport participation in the VALE program is expected to grow. These  officials noted that they expect VALE applications to increase as airports  learn more about the program and about projects initiated at other  airports, and that numerous airports throughout the country have recently  expressed their interest in the program. FAA points to the Part 150 Noise  Compatibility Program as an example of an airport environmental program  that grew gradually. The Part 150 program provides guidance to airports  on the types of land use that are incompatible with certain levels of airport  noise and encourages airports to develop a noise compatibility plan to  reduce and prevent such uses. Airports that develop such plans can  receive AIP noise set-aside funds, which, among other things, can be used  to (1) soundproof residences and public buildings, such as schools, and   (2) support relocation by acquiring homes in areas that experience  significant noise exposure. When the Part 150 program was initiated in the  early 1980s, only a few of the approximately 3,000 eligible airports  completed compatibility plans and applied for AIP grants. However, the  program has grown over the years and, as of fiscal year 2007, nearly   300 airports have participated. According to FAA officials, the growth of  the VALE program in its first 4 years of existence has outpaced that of the  Part 150 program during its initial 4 years, particularly considering that far  fewer airports are eligible for VALE than for the Part 150 program.
FAA officials responsible for the VALE program have conducted outreach  to eligible airports in a number of ways, but these officials believe that  more outreach is needed. FAA’s VALE outreach efforts include making  presentations at conferences attended by airport executives and working  with airport associations—including Airport Council International, North  America (ACI-NA), and the American Association of Airport Executives— to disseminate information about the program to eligible airports. FAA has  also provided guidance to FAA regional staff on the program and  encourages these staff to contact airports in their region about VALE.  However, FAA officials noted that few regional staff are available to work  on VALE outreach, and that more resources to administer the program and  provide technical assistance to airports could increase participation. FAA  officials noted several instances where airports learned about VALE too  late in the process of planning expansion projects to fully take advantage  of assistance offered through the program. For example, Detroit  Metropolitan Wayne County Airport began installing its fuel hydrant  system before its VALE grant was issued to meet its project deadline;  therefore, only part of the system was covered by a VALE grant. Officials  at this airport noted that had they known about VALE earlier, they could  have submitted their application in time to use VALE funding for the entire  project.
Although FAA may be correct in its assumption that VALE will follow the  Part 150 program’s experience of participation levels gradually increasing  as the program matures, we found several reasons that airports are not  currently participating in VALE.
Officials at all four of the nonparticipating airports we contacted stated  that VALE emission-reduction projects currently are not a high-priority use  of AIP funds when compared with airport expansion or improvement  efforts. For example, these officials stated that they prefer to use AIP  funds for higher-priority safety and airport efficiency and capacity  improvement efforts. However, these officials noted that reducing  emissions is important for addressing community air quality concerns. In  addition, officials at two nonparticipating airports, as well as an official at  one airport that has been approved for a VALE project, said that it was  their understanding that VALE projects compete for AIP funds with all  AIP-eligible projects. Consequently, the two nonparticipating airports  chose not to pursue VALE projects and the participating airport has  limited the scale of its VALE project to use AIP funds for high-priority  projects. FAA officials stated that these airports have a misperception of  VALE AIP grants in that VALE projects do not compete with most other  types of AIP-eligible projects at airports, because VALE projects are  funded through a 35 percent set aside earmarked for noise-abatement and  emission-reduction projects. Therefore, VALE AIP grants have no effect on  an airport’s eligibility for other types of AIP grants.
ACI-NA officials noted that some airports may not be best positioned to  take advantage of the VALE program because they have no relevant capital  projects planned or do not need to replace ground service equipment,  which has up to a 15-year life cycle. Officials from one of the  nonparticipating airports we contacted stated that most of the airport’s  facilities and equipment are relatively new and will not need to be  replaced in the near future. Also, officials at the four nonparticipating  airports we contacted stated that they already have some of the equipment  and facilities that are eligible under VALE.
Officials from one airport noted that their airport lacked the expertise to  conduct the emissions inventory required to establish a baseline for  measuring VALE project emission reductions. FAA officials noted that  airports eligible for VALE, including smaller airports with less planning  resources, typically can be reimbursed by FAA for project formulation  costs, including hiring a contractor to assist in conducting the emissions  inventory and preparing the VALE application, if the project is approved.
FAA officials and airport officials noted that some airports have been  reluctant to seek approval for emission-reduction credits from their state  air quality authority, as FAA requires before it will approve a project.  According to these officials, some airports have little experience in dealing  with their state air quality authority because airport emission reductions  previously have not been necessary as part of the CAA SIP. Officials from  one airport we visited stated that it is their impression that the state air  quality authority will not grant emission-reduction credits for any reason,  and, consequently, the airport had not pursued a VALE grant, even though  it is currently undertaking a terminal and gate expansion project.  According to FAA officials, the guidance that EPA has developed for  AERCs provides instructions to state air quality officials on the process  and criteria for issuing AERCs to airports.

		Participating Airports Have Initiated a Range of VALE Projects

The VALE projects initiated at airports have ranged from purchases of  small numbers of fuel-efficient, low-emitting vehicles to projects that help  decrease aircraft ground emissions. Table 1 shows a summary of the  projects at the airports participating in the VALE program from fiscal  years 2005 through 2008.
Detroit Metropolitan Wayne County Airport has used VALE funding to  install systems to supply electricity and air conditioning to aircraft from  gates at a new terminal that opened in September 2008, eliminating the  need for aircraft to run their auxiliary engines to power and cool aircraft  while loading and unloading passengers, thereby reducing emissions (see  fig. 2). The airport has also partially relied on VALE funding to install an  underground fuel hydrant system for refueling aircraft, which reduces  emissions by eliminating the need to truck fuel to the aircraft.
Several other airports have used the VALE program to purchase low- emitting vehicles for use at the airport. For example, George Bush  Intercontinental Airport and William P. Hobby Airport, which are both  owned by the city of Houston, have received VALE funding to purchase   37 hybrid cars and sport utility vehicles, and Albany International Airport  has purchased natural gas-powered shuttle buses and other low-emitting  vehicles through VALE (see fig. 3). As table 1 indicates, George Bush  Intercontinental Houston Airport and Philadelphia International Airport  have also used VALE funding to purchase ground service equipment, such  as baggage tugs and power stations to recharge this equipment.
The scope of VALE projects at airports has also been increasing. For  example, in fiscal year 2008, Philadelphia International Airport received  FAA approval for a $3.4 million VALE grant for electric tugs that transport  baggage, systems for supplying electricity and air conditioning to aircraft  at gates, and hybrid vehicles. FAA officials noted that this is the first VALE  project with airline participation. United Airlines has agreed to keep 10 of  its electric baggage tugs at the airport for their entire useful life in  exchange for the airport agreeing to purchase a recharging station for the  tugs through VALE. Similarly, US Airways agreed to purchase 34 new  electric ground support vehicles for use at Philadelphia International. For  this project, US Airways obtained a grant from Pennsylvania through the  state’s Alternative Fuels Incentive Program to fund part of the purchase  of the tugs. George Bush Intercontinental Houston Airport, which  previously used VALE to purchase hybrid vehicles, increased its  participation in the VALE program to include funding the expansion of its  people-mover system and other projects.

		Expenditures for the VALE Program Are Increasing

Expenditures for the VALE program have increased significantly as the  program has matured. In fiscal years 2005 and 2006, VALE funding for  projects totaled less than $400,000, but has increased to nearly $20 million  for projects funded through fiscal year 2008, including the airports’  required share for AIP-funded projects. About 56 percent of these  expenditures occurred in fiscal year 2008. Table 2 indicates that most of  the VALE funding came from the AIP program. To date, no airports have  applied PFC funds to VALE projects. Officials at Philadelphia International  Airport had initially intended to use PFC funds to meet its required 25  percent share for its VALE grant, but later decided to rely on other funding  sources for this share. According to FAA officials and officials of the seven  participating airports we contacted, because there is more flexibility in  using PFC funds for airport projects than in using AIP funds,  participating airports use AIP funds for VALE projects and apply PFCs to  other types of projects, such as terminal improvement projects, that may  not be eligible for any type of AIP grants. In addition, these participating  airport officials, as well as FAA officials, said that VALE projects have to  compete with all other priorities for PFC use, and many PFC priority  projects have been set well into the future. For example, officials at one  airport we visited said that the airport currently collects the maximum  $4.50 PFC, and that all PFCs collected have already been dedicated to  capital projects, including building a new terminal with six additional  gates.

	While VALE Projects Reduce Emissions, FAA Plans to Assess the Program’s Overall Performance as Participation Increases, and Two Airports Have Used Emissions Credits

VALE projects have reduced emissions at participating airports, according  to FAA officials, and FAA plans to assess the overall performance of the  VALE program in reducing emissions across airport activities as  participation in the program increases. Thus far, two airports have taken  advantage of emission credits available through the program to offset  emissions from planned construction projects.

		VALE Projects Reduce Emissions at Participating Airports

The estimated emissions reductions resulting from VALE projects initiated  at airports vary, depending on the type and scope of the project. Table 3  shows the estimated reductions in tons of criteria pollutants, including  nitrogen oxides, volatile organic compounds, carbon monoxide, and  particulate matter. Airports use FAA’s EDMS, which calculates emissions  produced by aircraft and equipment used at airports. Airports determine  the estimated reductions by comparing the estimated amount of pollution  produced before the project was initiated with the estimated amount after  it was implemented. For example, officials at George Bush  Intercontinental Houston Airport compared the estimated amount of  pollution produced by the airport’s conventional vehicles with the  estimated amount of pollution produced by the replacement hybrid  vehicles purchased with VALE funding.
According to FAA officials, the emission reductions resulting from VALE  projects, although relatively large in the case of some projects, represent a  small portion of total emissions at the participating airports. For example,  the VALE project at Philadelphia International Airport is projected to  reduce nitrogen oxide emissions by about 1 percent. In addition, some of  the VALE projects would have been undertaken even without VALE  funding. For example, according to Detroit Metropolitan Wayne County  Airport officials, the airport would have used other funding sources to  install systems to supply electricity and air conditioning to aircraft at the  gates of its new terminal even if it had not received an AIP grant through  the VALE program for this purpose. However, airport projects that are not  part of the VALE program may not receive emission credits from their  state air quality agency.
According to FAA officials, the agency has taken steps to ensure that  estimates of emission-reductions from VALE projects are quantified  accurately. These steps include developing and updating emission  standards for airport vehicles eligible for VALE in cooperation with EPA.  FAA also publishes a technical report that contains vehicle emission  standards as well as guidance on how to do the required emission  inventories for proposed VALE projects. In addition, emission reduction  estimates that airports are required to provide are verified by FAA regions  using a formal checklist. The estimates are also checked by FAA  headquarters and by the airport’s EPA region and state air quality agency.
FAA officials are developing a methodology to assess the cost- effectiveness of VALE projects in reducing emissions and plan to develop  other measurable performance objectives. As part of its oversight of the  VALE program, FAA evaluates the cost-effectiveness of VALE projects  based on a comparison of emission reductions over the useful life of the  project and the total project costs. FAA recognizes that cost-effectiveness  may vary by project type, the way the project is implemented, and airport  size. For example, according to FAA, gate electrification projects tend to  provide the largest emission reductions and are the most cost-effective,  while a project involving a refueling station tends to yield lower cost- effectiveness. FAA has developed specific cost-effectiveness measures for  gate electrification projects initiated under VALE based on actual program  experience to date. According to FAA, these projects have reduced ozone  and carbon monoxide at a cost of $7,000 and $6,000 per ton, respectively.  To further develop its cost-effectiveness methodology, FAA plans to  expand its cost-effectiveness ranges to include other types of VALE  projects. FAA officials stated that based on the number and size of VALE  projects funded to date, they believe more history and experience with the  VALE program is needed before they can develop other performance  measures, such as setting goals for the number of projects implemented  and the amount of reductions achieved through these projects.  Nevertheless, FAA program officials noted that they have set an informal  goal for each of FAA’s nine regions to approve at least one VALE project in  fiscal year 2009. An EPA official involved in the development of the VALE  program noted that a future requirement should be the development of the  cost-effectiveness and efficiency measures for the VALE program to hold  airports and the federal government accountable for results.
As we have previously noted, airports that participate in the VALE  program can apply to their state or local air quality authority to receive  AERCs for emission reductions achieved through the program. To date,  two airports have obtained these credits to help mitigate the increases in  emissions resulting from airport development projects. FAA officials  stated that while most airports that participate in VALE are mainly  interested in receiving VALE funding, some airports also plan to use  emission credits to meet CAA conformity requirements. As of June 2008,  William P. Hobby Houston Airport and George Bush Intercontinental  Houston Airport have applied for and received a formal AERC statement  from the Texas Commission on Environmental Quality, which allows the  airports to use their AERCs to mitigate emissions from airport  development projects. For example, Houston Intercontinental will use  AERCs in its environmental impact statement for a terminal expansion  project to help satisfy CAA conformity requirements. According to FAA,  other airports, including Philadelphia International, are planning to use  emission credits to offset emissions from development projects currently  under way. For example, Philadelphia International Airport plans to use  AERCs to satisfy CAA conformity requirements to offset the emissions  produced in the construction of its ongoing capacity enhancement project,  which includes a new airport runway. Airport officials at Philadelphia  International expect that the state will approve these credits. Officials with  whom we spoke from two airports that have initiated VALE projects but  that have not applied for earned AERCs stated that they currently have no  ongoing development projects, or have not needed the credits for ongoing  projects because the resulting emissions fall within federal standards. In  addition, FAA officials indicated that some airports do not need AERCs for  expansion projects, but are expressing interest in participating in the  VALE program to buy low-emitting equipment partly because such  equipment uses less fuel, and rising fuel prices have put a strain on airport  finances.

	Agency Comments and Our Evaluation

We provided copies of a draft of this report to EPA and the Department of  Transportation for review and comment. EPA and FAA both provided  several clarifying comments and technical corrections, which we have  incorporated in this report as appropriate. We also received comments  from officials in FAA’s Office of Airport Planning and Programming,  including the National Resource Advisor, Noise and Air Quality who is  responsible for managing the VALE program. FAA generally agreed with  the report’s findings. The FAA representatives, however, stated that the  draft suggested that FAA was not aware of the performance of the VALE  program, and that tracking program benefits and performance is one of   VALE’s strongest attributes. We modified the report to more clearly reflect  that FAA is developing a methodology to assess VALE’s cost-effectiveness  and plans to develop other measurable performance objectives, but that  FAA has yet to assess the overall performance of the VALE program. The  representatives also stated that while the report covers the various  elements of the VALE program, they also wanted to emphasize the  “innovativeness” of the program. In this regard, they noted that VALE  represents a new model for government efforts to promote clean fuels and  technology. For this reason, they state and we point out in the report, EPA  is recommending in current proposed revisions to its General Conformity  Regulations that the VALE system for granting emissions credits be  expanded to all actions subject to General Conformity Regulations. The  FAA representatives also provided information on what they regarded as  other innovative elements of the VALE program, which we have  incorporated in this report as appropriate.
We are sending copies of this report to interested congressional  committees, the Secretary of Transportation, the FAA Administrator and  the EPA Administrator. We will also make copies available to others on  request. In addition, this report will be available at no charge on the GAO  Web site at http://www.gao.gov.
If you or your staffs have any questions about this report, please contact  me at (202) 512-2834 or dillinghamg@gao.gov. Contact points for our  Offices of Congressional Relations and Public Affairs may be found on the  last page of this report. GAO staff who made major contributions to this  report are listed in appendix II.

Appendix I: Airports GAO Contacted with and without VALE Projects

	Airports with VALE Projects

Albany International (ALB)
Detroit Metropolitan Wayne County (DTW)
George Bush Intercontinental Houston (IAH)
Greater Rochester International (ROC)
Philadelphia International (PHL)
Stewart International (SWF), Newburgh/New Windsor, New York  William P. Hobby Houston (HOU)

	Eligible Airports without VALE Projects

Chicago O’Hare International (ORD)
Denver International (DEN)
John Wayne Airport-Orange County, California (SNA)
Los Angeles International (LAX)

Appendix II: GAO Contact and Staff Acknowledgments

	Staff Acknowledgments

In addition to the contact named above, individuals making key  contributions to this report include Edward Laughlin (Assistant Director),  Lauren Calhoun, James Geibel, Delwen Jones, Rosa Leung, Josh Ormond,  Stan Stenersen, and Larry Thomas.

Summary:
Why GAO Did This Study

In 2003, Congress established a program to reduce airport ground emissions at commercial service airports in areas failing to meet or maintain air quality standards. The Federal Aviation Administration (FAA) administers the Voluntary Airport Low Emissions (VALE) Program and oversees the program's two sources of funding: Airport Improvement Program (AIP) federal grants or Passenger Facility Charges (PFC), which airports can collect from passengers. Participating airports also receive credits for the emission reductions achieved through VALE projects in accordance with the law and guidance. Airports can use these credits to offset emissions resulting from development projects to comply with federal Clean Air Act requirements. GAO was asked to determine (1) how the VALE program has been implemented, including airport participation levels, types of projects, and program expenditures, and (2) the outcomes attributable to the VALE program. To do this, GAO reviewed FAA data on VALE projects for all nine participating airports; visited two of these airports; obtained information from the remaining seven participating airports and four nonparticipating airports; and interviewed officials from FAA, Environmental Protection Agency (EPA), and airport associations. FAA generally agreed with the report's findings, and FAA and EPA offered technical clarifications.

What GAO Found

While the number of airports that have undertaken VALE projects is relatively small compared with the number of eligible airports, the number of participants in the program is increasing, as are the range and scope of projects being conducted and the amount of money spent on them. As of September 2008, 9 of the 160 airports that were eligible had or were planning to initiate a VALE project, which is up from 2 participating airports in VALE's initial year of operation in 2005. FAA expects participation in VALE to increase as more airports become familiar with the program. Although FAA may be correct in its assumption about participation, officials GAO interviewed from 4 nonparticipating airports, and others, such as representatives of airport associations, indicated various reasons for airports not wanting to participate in the program, which is funded through the same sources of funds--AIP grants or PFCs--as other airport development projects. One reason is that some airports have a misperception that VALE projects compete with other projects, such as runways or terminals, for AIP funding. According to FAA officials, this is usually not the case because VALE projects are funded through a discretionary AIP set-aside for noise and emission projects. FAA officials want to increase FAA's outreach to airports regarding VALE, but noted that the regional staff who are responsible for outreach have limited time for this purpose. VALE projects have ranged from airports' purchase of fuel-efficient vehicles to projects that help decrease aircraft ground emissions. Expenditures for the VALE program have been nearly $20 million for 20 projects through fiscal year 2008 (with 56 percent of these expenditures occurring in fiscal year 2008). All participating airports have used AIP grants to fund VALE projects for various reasons, mainly because their PFCs have already been committed for high-priority, large-scale terminal improvement projects that may not be eligible for any type of AIP grants. FAA has yet to assess the outcomes and overall performance of the VALE program. However, VALE projects are expected to reduce emissions at participating airports, and two airports have taken advantage of the program to obtain emission credits for planned construction projects. According to FAA data, the VALE projects initiated to date will reduce emissions of such pollutants as nitrogen oxide and carbon monoxide by over 5,700 tons estimated over the projects' lifetime, which range from 10 to 40 years. According to FAA, the emission reductions resulting from VALE projects, although large in some cases, such as equipping gates with electricity and air conditioning outlets for aircraft, represent a small fraction of total emissions at participating airports. FAA plans to assess the overall performance of the VALE program as participation increases. FAA officials have begun developing cost-effectiveness measures, such as the amount of emission reductions per dollar spent. FAA officials stated that based on the number and size of VALE projects funded to date, they believe more history and experience with the program is needed before the agency develops other performance measures, such as setting goals for the number of VALE projects