[PDF] ACRP REPORT 4. Ground Access to Major Airports by Public Transportation AIRPORT COOPERATIVE RESEARCH PROGRAM

Authorizing Legislation Airport operators that are independent entities or enterprise funds of a city, county, or state government typically are governed by authorizing legislation or a local charter that establishes the airport operator’s organizational structure, responsibilities, and powers. The authorizing legislation may specify facilities, such as airport access roads, that the airport operator is responsible for developing, maintaining, or both.

Bond Indenture The bond indenture—also called a bond resolution or bond ordinance—provides the legal basis for issuing airport revenue bonds and defines the terms under which additional bonds

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Ground Access to Major Airports by Public Transportation

SOURCE: Jacobs Consultancy. NOTES:

FAA/DOT—Federal Aviation Administration/Department of Transportation NTSB—National Transportation Safety Board EPA—Environmental Protection Agency OSHA—Occupational Safety and Health Administration

Figure 7-1.

Factors governing airport financial operations.

might be issued, including the need for revenue-generating projects. The bond indenture defines what may or may not be included in the definition and computation of airport revenues and expenses. The indenture establishes various funds and accounts for the payment of interest and principal on the bonds from airport revenues; establishes the priority of payments for all of the airport operator’s obligations; and sets forth covenants between the issuing entity and the bondholders, including a rate covenant requiring the airport operator to set rates and charges to produce specified levels of revenues. Some airport bond indentures may also include principles to guide the establishment of rates and charges for the use of airport facilities.

Airline Agreement An airport–airline agreement generally stipulates the rights, privileges, and obligations of the airport operator and the airlines serving the airport and sets forth the manner in which the rentals, fees, and charges paid by the airlines for use of the airport are calculated and adjusted. The airline parties in such use-and-lease agreements are called “signatory airlines.” Many airline agreements contain provisions that require a certain number or percentage of the signatory airlines to approve or disapprove certain decisions of the airport operator, particularly capital expenditures. These provisions are known as “majority-in-interest” (MII) provisions and are designed to give the signatory airlines some control over the long-term financial obligations undertaken by the airport operator for which the airlines are committed to pay. Some airports, however, are not governed by such agreements; instead, rates are established by ordinance or regulation. In those instances, the airport operator typically adopts a policy for calculating user rentals, fees, and charges and applies those procedures consistently from year to

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