Airport Funding: Changes in Aviation Activity Are Reflected in Reduced Capacity Concerns
Published: 2015-04-23T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: U.S. airports are key contributors to the national and regional economies, providing mobility for people and goods, both domestically and internationally. Since 2007 when GAO last reported on airport funding, airports of all sizes have experienced significant changes in aviation activity. Financing for airport capital improvements is based on a mix of federal AIP grants, federally authorized but statutorily-capped PFCs, and locally generated aviation-related and non-aviation-related revenues. As deliberations begin in advance of FAA's 2015 reauthorization, Congress is faced with considering the most appropriate type, level, and distribution of federal support for development of the National Airspace System.
This testimony discusses trends in (1) aviation activity at airports since 2007, (2) forecasted airport capacity needs and airports' planned development costs, and (3) financing for airport development. This testimony is based on previous GAO reports issued from June 2007 through December 2014, with selected updates conducted through April 2015. To conduct these updates, GAO reviewed recent information on FAA's program activities and analyses outlined in FAA reports, including the 2015 aviation forecast, and the 2015–2019 planned airport-development estimates.
section_title: What GAO Found
paragraphs: Economic factors, since 2007, have led to fewer scheduled commercial flights, a trend more pronounced for some types of airports. These economic factors include not just the volatile fuel prices and the 2007 to 2009 recession but also evolving airline practices, such as airline mergers and the adoption of business models that demonstrate capacity management. For example, as GAO reported in June 2014, the number of scheduled flights at medium- and small-hub airports has declined at least 20 percent from 2007 to 2013, compared to about a 9 percent decline at large-hub airports. General Aviation (GA) has also declined in activity, as measured by the number of GA aircraft operations and hours flown, due to similar economic factors. In recent years, however, passenger growth has rebounded. According to the Federal Aviation Administration's (FAA) projections, U.S. airline passenger growth is predicted to grow 2 percent per year through 2035—a growth rate that is slightly lower than that of past forecasts.
According to FAA estimates, the number of airports that require additional capacity to handle flight operations to avoid delays has declined since 2004. Similarly, the future cost of planned airport development has also declined in recent years. Earlier this year, FAA projected that 6 airports will be capacity constrained in 2020 compared to 41 in the 2004 projection. Even with this improvement, some airports—like those in the New York City area region—will remain capacity constrained, according to FAA. The overall improved capacity situation is also reflected in reduced estimates of future airport-development costs that are eligible for federal grants. In September 2014, the FAA estimated that for the period 2015 through 2019, airports have about $33.5 billion in planned development projects eligible for federal Airport Improvement Program (AIP) grants—a 21 percent reduction from the $42.5 billion estimate for the time period 2013 through 2017. The biggest decline in planned development costs among project categories is in capacity projects such as new runway projects. However, an airport industry association estimated planned airport capital project costs, both those eligible and not eligible for AIP, of $72.5 billion for 2015 through 2019, an increase of 6.2 percent from the association's prior 5-year estimate for 2013 through 2017.
As traditional funding sources for airport development have generally declined, airports have increasingly relied on other sources of financing. Specifically, federal AIP grants and Passenger Facility Charges (PFC) are two primary sources of federally authorized funding for airports. The amount made available for AIP decreased from over $3.5 billion for fiscal years 2007 through 2011 to less than $3.4 billion for fiscal year 2015. Further the President's 2016 proposed budget calls for additional reductions in AIP, though it would be offset with a proposed increase in the PFC cap, which is currently $4.50 per flight segment. Airports have sought additional opportunities to collect non-aviation revenues. As a result, according to FAA, non-aviation revenue has increased each year from 2008 through 2014. For example, airports have 1) partnered with the private sector to fund airport improvements; 2) identified new business ventures on airport property including the development of commercial retail, leisure activities, and medical facilities; and 3) explored options for privatization.

section_title: Letter
paragraphs: I am pleased to be here today to discuss airport capacity and funding  issues in light of a changing aviation industry. U.S. airports are important  contributors to our economy, providing mobility for people and goods both  domestically and internationally, and contributing to the economic  success of the communities they serve.
Aviation activity in the United States experienced a decline since  operations and passenger activity peaked in 2007, especially in the  amount of commercial aircraft operations at U.S. airports. While  passenger activity has rebounded close to 2007 levels, the total number  of operations has not, leaving many airports with reduced activity. Even  so, airport capacity—that is, the maximum number of flight operations an  airport can handle over a period of time—is still a problem for some  airports, resulting in significant delays for passengers throughout the  National Airspace System (NAS). While, according to Federal Aviation  Administration (FAA), only nine new commercial service airports have  been built in the United States over the last three decades, billions of  dollars have been invested in expanding new capacity, such as runways,  and in maintaining and upgrading existing airports during that time.  However, since 2007, federal financing sources for airport development  have seen small declines, especially when considering inflation. The FAA  forecasts that the NAS will need to accommodate more than 1 billion  passenger enplanements and almost 57 million aircraft operations  annually by 2029—an increase from 756 million enplanements and 49  million aircraft operations in 2014—as FAA forecasts aviation activity to  grow by an average of 2 percent per year over the next 20 years. FAA’s  growth rate for 2015 through 2035 was slightly lower than in previous  years. In response to these pressures, airports have sought to increase  the statutorily-capped, airport-imposed Passenger Facility Charge  (PFC)—which are airport fees collected by the airlines on passenger  tickets and remitted to the airports—and have also worked to develop  new funding sources.
My statement today focuses on current trends in airport capacity and  funding for airport development. Specifically, this statement discusses  trends in (1) aviation activity at airports since 2007, (2) airports’ capacity  needs and planned development costs, and (3) financing for airport  development.
This statement draws from our body of work completed from June 2007  through December 2014 examining airport and aviation industry trends.  Specific products from this work are cited throughout the statement. The  products cited contain descriptions of the methods we used to conduct  this work. We have updated our work through April 2015 with FAA’s  reports and analyses, including FAA’s 2015 aviation forecast, the 2015- 2019 National Plan of Integrated Airport Systems (NPIAS), and airport  funding and cost data spanning from 2004 through March 2015. We also  examined the FAA’s fiscal year 2016 budget proposal and obtained  updated information on FAA program activities from public sources. In  addition, we have ongoing work examining airport funding and planned  capital development for which we plan to issue a report later this year.
More detailed information on our objectives, scope, and methodology for  our prior work can be found in the issued reports. We conducted the work  on which this statement is based in accordance with generally accepted  government auditing standards. Those standards require that we plan  and perform the audit to obtain sufficient, appropriate evidence to provide  a reasonable basis for our findings and conclusions based on our audit  objectives. We believe that the evidence obtained provides a reasonable  basis for our findings and conclusions based on our audit objectives.
subsections: section_title: Background
paragraphs: The United States has the largest, most extensive aviation system in the  world with over 19,000 airports ranging from large commercial  transportation centers handling millions of passengers annually to small  grass airstrips serving only a few aircraft each year. Of these, roughly  3,300 airports are designated by FAA as part of the national airport  system and thus are eligible for federal assistance.
The national airport system consists of two primary types of airports— commercial service airports, which have scheduled service and enplane  2,500 or more passengers per year, and general aviation (GA) airports,  which have no scheduled service and enplane fewer than 2,500  passengers annually. FAA divides commercial service airports into  primary airports (enplaning more than 10,000 passengers annually) and  commercial service nonprimary airports. The 395 current primary airports  are classified by hub type—large-, medium-, small-, and nonhub—based  on passenger traffic. Passenger traffic is highly concentrated: 88 percent  of all passengers in the United States enplaned at the 63 large- or  medium-hub airports in 2013 (see fig. 1).
More than 2,900 airports in the national system are designated as GA  airports. These airports range from large business aviation and cargo  shipment centers that handle thousands of operations a year to small  rural airports that may handle only a few hundred operations per year but  may provide important access to the national transportation system for  their communities.
Generally, the level of aviation activity, whether commercial passenger  and cargo or general aviation business and private aircraft, helps to  generate the funds that finance airport development. The three primary  sources of funding for airport development are Airport Improvement  Program (AIP) grants, PFCs, and locally generated revenue. All three  sources of funds are linked to passenger aviation activity.
AIP is supported by the Airport and Airway Trust Fund (AATF), which  is funded by airline ticket taxes and fees; GA flights contribute to the  AATF through a tax on aviation jet fuel. Airports included in FAA’s  NPIAS are eligible to receive AIP entitlement (apportionment) grants  based on airports’ size and can also compete for AIP discretionary  grants. AIP grants can only be used for eligible capital projects,  generally those that enhance capacity, safety, and environmental  conditions, such as runway construction and rehabilitation, airfield  lighting and marking, and airplane noise mitigation. The amount  made available in AIP appropriations totaled $3.35 billion in fiscal year  2014. The grants generally require matching funds from the local  match ranging from 10 to 25 percent depending on the size of the  airport and type of project.
PFCs, another source of funding for airport development projects, are  a federally authorized, statutorily-capped, airport-imposed fee of up to  a maximum of $4.50 per enplaned passenger per flight segment, and  a maximum of $18 per round trip ticket. The PFC is collected by the  airline on the passenger ticket and remitted to the airports (minus a  small administrative fee retained by the airline). Introduced in 1991,  and capped at $3.00 per flight segment, PFC collections can be  used by airports for the same types of projects as AIP grants, but also  to pay interest costs on debt issued for those projects. Since its  inception, landside development projects—including, for example,  new terminal projects—and interest payments on debt used to finance  eligible projects have each accounted for 34 percent of total PFC  collections spent. The maximum level of PFCs was last increased in   Collections totaled almost $2.8 billion in calendar year 2014.  2000.According to FAA, 358 commercial service airports are collecting  PFCs as of February 2015.
Airports also fund development projects from revenues generated  directly by the airport. Airports generate revenues from aviation  activities such as aircraft landing fees and terminal rentals, and non- aviation activities such as concessions, parking, and land leases.  Aviation revenues are the traditional method for funding airport  development and, along with PFCs, are used to finance the issuance  of local tax-exempt debt. Because of the size and duration of some  airport development projects—for example, a new runway can take  more than a decade and several billion dollars to complete—long-term  debt can be the only way to finance these types of projects.
FAA’s main planning tool for identifying future airport-capital projects is  the NPIAS. FAA relies on airports, through their planning processes, to  identify individual projects for funding consideration. According to FAA  officials, FAA reviews input from individual airports and state aviation  agencies and validates both eligibility and justification for the project over  the ensuing five-year period. Because the estimated cost of eligible  airport projects that airports plan to perform greatly exceeds the available  grant funding available for these projects, FAA uses a priority system  based on airport and project type to allocate the available funds. The  Airports Council International-North America (ACI-NA), a trade  association for airports, also estimates the cost of planned airport capital  projects.
While almost all airport sponsors in the United States are states,  municipalities, or specially created public authorities, there is still a  significant reliance on the private sector for finance, expertise, and control  of airport assets. For example, we have previously reported that the  majority of airport employees at the nation’s major airports are employed  by private sector firms, such as concessionaires, and some airports are  also operated by private companies. Pursuant to statutory authorization,  since 1996, FAA has been piloting an airport privatization program that  relaxes certain restrictions on the sale or lease of airports to private  entities.
section_title: Aviation Activity at Many Airports Has Slowed Since 2007
paragraphs: A variety of factors has had a substantial impact on the airline industry.  We reported in June 2014 that economic issues such as volatile fuel  prices and the economic recession have affected the industry as have  airlines’ consolidation and an adoption of business models that focus   For instance, the 2007-2009 recession  more on capacity management.combined with a spike in fuel prices, helped spur industry mergers and a  change in airline business models. Specifically, Delta acquired Northwest  in 2008, United and Continental merged in 2010, Southwest acquired  AirTran in 2011, and US Airways and American Airlines merged in 2014.  Although passenger traffic has generally rebounded as the economy has  recovered, the number of commercial aircraft operations has not returned  to 2007 levels as airlines are flying larger and fuller aircraft.
In June 2014, we found that one outcome of economic pressures and  industry changes had been reductions in U.S. passenger aircraft  operations as measured by scheduled flight operations. Many airports  lost both available seats and flights since 2007 when aircraft operations  last peaked. However, medium- and small-hub airports had proportionally  lost more service than large-hub or nonhub airports, as major airlines  merged and consolidated their flight schedules at the largest airports. In  June 2014, we found—based on our analysis of Department of  Transportation’s (DOT) data—that there were about 1.2 million fewer  scheduled domestic flights in 2007 as compared to 2013 at large-,  medium-, small-hub, and nonhub airports. The greatest reduction in  scheduled flights occurred at medium-hub airports, which decreased  nearly 24 percent from 2007 to 2013, compared to a decrease of about 9  percent at large-hub airports and about 20 percent at small-hub airports.  Medium-hub airports also experienced the greatest percentage reduction  in air service as measured by available seats (see fig. 2). While 2014  passenger activity as represented by the number of passengers onboard  aircraft departing U.S. airports has rebounded nearly back to 2007 levels  (down 4 percent), the total number of commercial passenger and cargo  aircraft departures (operations) in 2014 is still down 18.5 percent since  2007. Declining operations reduces pressure on airports’ airside capacity,  while rebounding passenger traffic could put pressure on airports’  terminals and gates to accommodate passengers.
We found in June 2014 that air service to small airports, which generally  serve small communities, has declined since 2007 due, in part, to volatile  fuel costs and declining populations in small communities. According to  a study by the Massachusetts Institute of Technology (MIT), regional  aircraft—those mostly used to provide air service to small communities— are 40 to 60 percent less fuel efficient than the aircraft used by mainline  carriers at larger hub airports. Further, from 2002 to 2012, fuels costs  quadrupled and became the airlines’ largest expense at nearly 30 percent  of airlines’ operating costs. While more recently oil prices have dropped, it  remains uncertain whether currently low oil prices will continue. The  second major factor affecting small community service is declining  population in many regions of the country over the last 30 years. As a  result, in previous work, we have found that population movement has  decreased demand for air service to certain small communities. For  example, geographic areas, especially in the Midwest and Great Plains  states, lost population from 1980 through 2010, as illustrated in figure 3  below. As a result, certain areas of the country are less densely  populated than they were 35 years ago when the airlines were  deregulated and the Essential Air Service (EAS) was created. For small  communities located close to larger cities and larger airports, a lack of  local demand can be exacerbated by passengers choosing to drive to  airports in larger cities to access better service and lower fares. The EAS  program was created in 1978 to provide subsidies to some small  communities that had service at the time of deregulation. We reported last  year that EAS has grown in cost but did help stem the declines in service  to those communities as compared to other airports.
In June 2014, we reported that GA activity has also declined since 2007,  particularly affecting airports that rely on general aviation activity for a  large share of their revenue. For GA airports—which generate revenues  from landing fees, fuel sales, and hangar rents—the loss of traffic can  have a significant effect on their ability to fund development. A 2012 MIT  study that examined trends for GA operations at U.S. airports with air-  traffic control towers indicated that from 2000 to 2010, total GA operations  dropped 35 percent. According to the MIT study, the number of annual  hours flown by GA pilots, as estimated by FAA, has also decreased over  the past decade. Numerous factors affect the level of GA operations  including the level of fuel prices, the costs of owning and operating  personal aircraft, and the total number of private pilots and GA aircraft.  For example, we recently reported on the availability of airline pilots and  found that the GA pilot supply pipeline has decreased as fewer students  enter and complete collegiate pilot-training programs and fewer military  pilots are available than in the past.
section_title: Airport Capacity Needs and AIP- Eligible Planned Development Costs Have Mostly Declined
subsections: section_title: The Projected Number of Future Capacity Constrained Airports Has Declined
paragraphs: Earlier this year, FAA reported on airport capacity needs through 2030.  The focus of FAA’s analysis was not on the broad range of investments  airports make to serve passengers and aircraft, but on the capacity of  airports to operate without significant delay. Therefore, the primary focus  was on airside capacity, especially runway capacity. To do this, FAA  modeled recent and forecasted changes in aviation activity, current and  planned FAA investments in air-traffic-control modernization, and airport  investments in infrastructure, such as new runways, to determine which  airports are likely to be congested or capacity constrained in future  years.with previous studies in 2004 and 2007 following a similar methodology.  The most recent study found that the number of capacity-constrained  airports expected in the future has fallen dramatically from the number  projected in earlier reports, referred to as FACT1 and FACT2 (see fig. 4).  For example, in 2004, FAA projected that 41 airports would be capacity  constrained by 2020 unless additional investment occurred. However, in  the 2015 report, FAA projected that 6 airports will be capacity constrained  in 2020. FAA attributed this improvement to changes in aviation activity,  investment in air-traffic-control modernization, and the addition of airport  runways.
section_title: Estimated AIP-Eligible Development Costs for Next 5 Years Are Lower, Though Estimates of Overall Development Costs Have Increased
paragraphs: In the September 2014 NPIAS, FAA estimated that airports have roughly  $33.5 billion in planned development projects for the period 2015 through  2019 that are eligible for federal support in the form of AIP grants.estimate is roughly 21 percent less than FAA’s previous estimate of $42.5  billion for the period 2013 through 2017 (see fig. 5). FAA reported a  decrease in estimated needs for most hub-airport categories and all types  of airport development except projects to reconstruct or rehabilitate  airport facilities, security related infrastructure projects, and safety  projects (see fig. 6). Notably, according to FAA, planned capacity-related  development decreased to $4.9 billion, a 50-percent decrease. Planned  terminal-related development also saw a major decline, down by 69  percent from the previous estimate.
The ACI-NA also estimated airports’ planned development for the 2015  through 2019 period for projects both eligible and not eligible for AIP  funding. According to ACI-NA, the total estimated planned-development  cost for 2015 through 2019 is $72.5 billion, more than twice FAA’s  estimate for just AIP eligible projects.percent over its prior estimate of $68.7 billion for the prior 2013–2017   ACI-NA’s estimate increased 6.2  estimating period. According to ACI-NA, the difference in the respective  estimates is attributable to ACI-NA’s including all projects rather than just  AIP-eligible projects like the NPIAS, as well as including projects with  identified funding sources, which the NPIAS excludes. For example, ACI- NA’s estimate includes AIP-ineligible projects such as parking facilities,  airport hangars, and commercial space in large passenger terminal  buildings. ACI-NA attributed more than half of the development costs to  the need to accommodate growth in passenger and cargo activity. ACI- NA estimated that 36 percent of planned development costs were for  terminal projects. We are currently analyzing FAA and ACI-NA’s most  recent plan estimates and will be reporting later this year on the results.
section_title: Federal Support for Airport Development Has Decreased, While Debt Levels May Leave Little Room for New Development at Some Airports
subsections: section_title: Federal Funding for Airport Development Has Declined in Recent Years
paragraphs: In Fiscal Year 2015, Congress made $3.35 billion available in  appropriations acts for AIP funding, a reduction from the annual  appropriations of $3.52 billion for fiscal years 2007 through 2011. The  President’s 2016 budget proposal calls for a reduction in annual AIP  funding to $2.9 billion in conjunction with an increase in the PFC cap. As  we testified in June 2014, if amounts made available in appropriations  acts for AIP fall below the $3.2 billion level established in the Wendell H.  Ford Aviation Investment and Reform Act for the 21st Century of 2000and no adjustments are made, under the 2000 Act the amount of AIP  entitlement grants would be reduced, but more AIP discretionary grants  could be made as a result. The larger amount of AIP funding that would  go to discretionary grants would give FAA greater decision-making power  over the development projects that receive funding.
Previous proposals have considered changing how GA airports are  allocated their share of AIP funds, which represented approximately one- quarter of total AIP funds in fiscal year 2014. For example, in 2007, the  Administration’s FAA reauthorization proposal suggested changing the  funding structure for GA airports. Specifically, FAA would have tiered GA  airports’ funding based on level of and type of aviation activities. AIP  entitlement funding would then range, based on the tier, up to $400,000.  While this proposal was not adopted, FAA recently undertook an exercise  to classify GA airports based on their activity levels. reported that 281 airports remained unclassified because they did not  meet the criteria for inclusion in any of the new categories, thus having no  clearly defined federal role.airports with few or no based aircraft. According to the most recent NPIAS  report, many of these 227 airports have received AIP funding in the past  and may be considered for future funding if and when their activity levels  meet FAA’s criteria for inclusion.
In a 2012 report, FAA categorized GA airports as National (84), Regional (467), Local  (1,236), and Basic (668). In addition, another 497 GA airports were unclassified. Federal  Aviation Administration, General Aviation Airports: A National Asset (ASSET 1), May  2012. large- and medium-hub airports collecting PFCs must return a portion of  their AIP entitlement grants, which are then redistributed to smaller  airports through the AIP. As previously noted, 68 percent of PFCs have  been used to pay for landside development (terminals) and interest  charges on debt. In addition, many airports’ future PFC collections are  already committed to pay off debt for past projects, leaving little room for  new development. For example, at least 50 airports have leveraged their  PFCs through 2030 or later, according to FAA data.
The President’s fiscal year 2016 budget proposal and airports have called  for increasing the PFC cap to $8—which is intended to account for  inflation since 2000, when the maximum PFC cap was last raised—and  eliminate AIP entitlements for large-hub airports. reported on the effects of increasing PFCs on airport revenues and  passenger demand. Specifically, we found that increasing the PFC cap  would significantly increase PFC collections available to airports under  the three scenarios we modeled but could also marginally slow passenger  growth and therefore the growth in revenues to the AATF. We modeled  the potential economic effects of increased PFC caps for fiscal years  2016 through 2024 as shown in figure 7 below. Under all three scenarios,  trust fund revenues, which totaled $12.9 billion in 2013 and fund FAA  activities, would likely continue to grow overall based on current  projections of passenger growth; however, the modeled cap increases  could reduce the growth in total AATF revenues by roughly 1 percent  because of reduced passenger demand if airlines pass the full amount of  the PFC increase along to consumers in the form of increased ticket  prices.
Airport trade associations, the ACI-NA and the American Association of Airport  Executives, have made prior proposals to raise the PFC cap to $8.50 with periodic  adjustments for inflation.
section_title: Airports Rely on a Variety of Local Revenues, Which Have Increased since 2004
paragraphs: Pub. L. No. 112-95, § 112, 126 Stat. 11, 18 (2012). totaled $5.2 billion, while nonaviation revenues were just over $5 billion.  According to ACI-NA, non-aviation revenue has grown faster than  passenger growth since 2004, over 4 percent on average for non-aviation  revenue versus 1.5 percent average growth in passenger boardings over  the same period. Further, some airports have developed unique  commercial activities with stakeholders from local jurisdictions and the  private sector to help develop airport properties into retail, business, and  leisure destinations. Some examples include:
Non-aviation development on airport property: Airports have  turned to an increasing range of unique developments on airport  property, including high-end commercial retail and leisure activities,  hotels and business centers, and medical facilities for non-aviation  revenues. For example, airports in Denver, Miami, and Indianapolis  have built cold storage facilities on airport property in an effort to  generate revenue by leasing cold storage space to freight forwarders  and businesses that transport low-volume, high-valued goods,  including pharmaceuticals, produce, and other time-sensitive or  perishable items.
Public-private partnerships: Airports can fund airport improvements  with private sector participation. Public-private partnerships, involving  airports and developers, have been used to finance airport  development projects without increasing the amount of debt already  incurred by airports. For example, the Port Authority of New York and  New Jersey has recently received responses for its request for  proposals for the private sector to demolish old terminal buildings and  construct, partially finance, operate, and maintain a new Central  Terminal Building for LaGuardia Airport in New York City.
Privatization: FAA’s Airport Privatization Pilot Program (APPP),  which was established in 1997 to reduce barriers to airport  privatization that we identified in 1996, has generated limited interest  from the public and private sectors. As we reported in November  2014, 10 airports have applied to be part of the pilot program and one  airport—San Juan Luis Muñoz Marín International Airport in Puerto  Rico—has been privatized (see fig. 8). In our report, we noted that  several factors reduce interest in the APPP—such as higher financing  costs for privatized airports, the lack of state and local property tax  exemptions, and the length of time to complete a privatization under  the program. Public sector airport owners have also found ways to  gain some of the potential benefits of privatization without full  privatization, such as entering airport management contracts and joint  development agreements for managing and building an airport  terminal.
In conclusion, last year commemorated one century since the first  commercial airline flight,commercial aviation has grown at an amazing pace to become an   and in that relatively short time span  ubiquitous and mature industry in the United States. While commercial  aviation still has many exciting growth prospects for its second century, it  also faces many challenges—among them how to ensure that the  aviation system can accommodate millions of flights and hundreds of  millions of passengers every year in the midst of shifting aviation activity  and constrained federal funding. Despite recent declines in airport  operations, it remains important for airports to be maintained as well as  upgraded to maintain safety and accommodate future growth. Declines in  airport operations have reduced demands on AIP, but rebounded  passenger activity could continue to put pressure on PFCs to finance  terminal and other projects. Developing airports will require the combined  resources of federal, state, and local governments, as well as private  companies’ capital and expertise. Effectively supporting this development  involves focusing federal resources on FAA’s key priorities of maintaining  the world’s safest aviation system and providing adequate system  capacity, while allowing sufficient flexibility for local airport sponsors to  maximize local investment and revenue opportunities. In deciding the  best course for future federal investment in our national airport system,  Congress is faced with weighing the interests of all aviation stakeholders,  including airports, airlines, other airport users, and most importantly  passengers, to help ensure a safe and vibrant aviation system.
Madam Chair Ayotte, Ranking Member Cantwell, and Members of the  Subcommittee, this completes my prepared statement. I would be  pleased to respond to any questions that you may have at this time.
section_title: GAO Contacts and Staff Acknowledgments
paragraphs: For further information about this testimony, please contact Gerald L.  Dillingham 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 statement. Key contributors to this testimony  include Paul Aussendorf (Assistant Director), Amy Abramowitz, David  Hooper, Delwen Jones, Josh Ormond, Melissa Swearingen, and Russell  Voth.
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