Airport Alert: Senate Releases FY23 Spending Bills: Good News on Airport Priorities

Senate Appropriations Committee Chairman Patrick Leahy (D-VT) on July 28 released what is referred to as 'the Chairman's mark' of the 12 annual fiscal year 2023 (FY23) funding bills for federal departments and agencies, including the Departments of Transportation and Homeland Security. 
 
In terms of airport priorities, there is very good news to report, including $3.35 billion in 'regular' AIP funding and $516.9 million for supplemental discretionary AIP grants; increased funding for the Contract Tower Program; and funding for TSA to continue to monitor exit lanes and carry on the LEO reimbursement grant program. The report accompanying the DOT/FAA spending bill also includes helpful AAAE-backed language related to the upcoming transition from aqueous film forming foam (AFFF) to a fluorine-free foam (F3).

The Senate Appropriations Committee is not expected to consider any of the annual funding bills before the end of the fiscal year on September 30 because there is not yet an agreement on the overall spending level for the upcoming fiscal year that begins on October 1. This means that funding for federal agencies will once again begin the fiscal year operating under a temporary continuing funding resolution. 
 
However, Chairman Leahy stated that 'It is my hope that by releasing these bills and making clear what the priorities of Senate Democrats are, we can take a step closer toward reaching a bipartisan compromise after months of stalled negotiations. The stakes of inaction are too high to not complete our work. The burden of inflation would make a long-term continuing resolution untenable with grave consequences for communities and families across the country and for our national security. It is my goal to finish our work before the end of the 117th Congress to avoid these consequences. I look forward to continuing to work with my dear friend, Vice Chairman Shelby, and I encourage good faith, bipartisan negotiations on toplines to resume with the urgency that this moment requires.' 
 
As we have reported, the House of Representatives has approved its version of the FY23 DOT/FAA spending bill. The House version of the FY23 DHS/TSA/CBP spending bill was approved by the Appropriations Committee but has not yet been “ and will not likely be “ considered by the full House. Ultimately, leaders will need to reconcile differences between the House bills and the Senate draft measures, a task that will not be concluded until after the mid-term elections. It remains to be seen if the work will be completed by the end of the year as Chair Leahy and Vice Chair Richard Shelby (R-AL) “ both of whom are retiring “ hope.  
 
Department of Transportation: 
 
Federal Aviation Administration (FAA)

FAA: Overall, the Senate bill includes more than $19.03 billion for the FAA “ about $534.5 million above the administration's budget request and almost $634 million more than the FY22 funding level. 
 
Operations: The bill includes $11.9 billion for FAA operations “ $33 million less than the administration requested. 
 
Facilities and Equipment: The measure proposes more than $3.06 billion for FAA facilities and equipment, including NextGen programs. 

Research, Engineering, and Development: The measure includes $266.1 million for research, engineering, and development “ $5.6 million more than the administration requested. 
 
Airport Improvement Program

AIP Funding: The Senate bill proposes $3.35 billion for the traditional AIP account in FY23 “ the same as the FY22 funding level. Of that amount, the bill designates $137.4 million for program administration expenses, $15 million for the Airport Cooperative Research Program, $40.8 million for Airport Technology Research, and $10 million for the Small Community Air Service Development Program. 

Supplemental AIP Funding: The Senate bill includes an additional $516.9 million in supplemental AIP discretionary grants “ approximately $37.2 million less than the amount Congress approved in FY22 but $240.7 million more than the $276.2 million approved by the House in its version of the FY23 DOT/FAA spending bill. Specifically, the Senate bill provides $400 million in supplemental discretionary grants with the remaining $116.9 million reserved for earmarks. With this supplemental funding, the bill would require at least $25 million to be designated for Voluntary Airport Low Emissions (VALE) or Zero Emission Vehicle (ZEV)-eligible projects and allows for discretionary grants to go to primary airports for airport-owned infrastructure required for the on-airport distribution, blending and storage of sustainable aviation fuels, as well as for resiliency projects. 

Earmarks:  The Senate bill reserves approximately $116 million of the supplemental AIP funding for earmarks, which are officially known as 'Community Project Funding' requests. The airport projects and other earmarks funded in the Senate bill may be viewed here. 

AIP Formula: The report accompanying the Senate bill acknowledges that the current AIP formula for primary airports is based on a definition of enplanements that does not encompass the full range of airport activities. Therefore, the report directs FAA 'to consider the full range of flight activities (such as flight training, air cargo, emergency response, pilot training, etc.) and associated metrics when considering AIP discretionary grants.' 

Burdensome Regulations: The report encourages FAA to identify opportunities to 'eliminate unnecessary regulations and streamline burdensome regulations' to ensure the agency is a good steward of limited resources and produces infrastructure that supports long-term economic growth. The report directs FAA to identify areas where more autonomy can be given to local jurisdictions with a better understanding of needs and challenges in building and maintaining infrastructure.  
 
Block Grant Program: The Senate report indicates that lawmakers are concerned that some states participating in the AIP State Block Grant Program (SBGP) lack the administrative funding to effectively administer the Bipartisan Infrastructure Law. While current law does not permit administrative funding for states participating in the SBGP, the FAA can permit states to be reimbursed for project administration costs. As such, the report recommends that FAA should work with state participants to improve administration of the SBGP. 
 
Small Community Programs

Contract Towers: The measure includes not less than $188 million in dedicated funding for the Contract Tower and Contract Tower Cost Share Programs “$10 million more than the current level. That increase would fund all 260 contract towers currently in the program and allow the FAA to add other airports to the program during the next fiscal year. The Senate report directs FAA 'to continue to operate all contract towers currently in the program, including the contract tower cost share program, as well as to expeditiously add qualified eligible airports.' Furthermore, it directs FAA 'to provide flexibility to contract towers at small-hub airports with unique terrain and winter weather challenges so they include a minimum of two controllers during all regularly scheduled commercial flights, where permissible under current law.' 

Essential Air Service: The Senate bill includes $368.7 million in discretionary funding for the Essential Air Service Program. Coupled with an estimated $81.3 million from overflight fees, the overall funding level for EAS would rise to $450 million in FY23 “ the same as the administration's budget request. 
 
Additionally, the Senate report expresses concern that commercial service providers are threatening to withdraw service from EAS communities and cutting non-EAS service at many small airports despite receiving significant COVID-relief funding and rapidly increasing profits as air traffic rebounds. As a result, the report 'directs the GAO to provide a report on the current state of commercial service air service to small airports, including the impact of COVID“19 and COVID“19-related financial assistance programs enacted by Congress. The report shall include any recommendations to Congress and DOT that would help maintain or increase commercial air service to small communities.'

Small Community Air Service Development: The bill also includes $10 million for the Small Community Air Service Development Program. This is the same amount that Congress approved for the program in FY22 and $10 million more than the administration requested.  

Environment and Noise
 
Transition from AFFF to Fluorine-free Foam (F3): The report accompanying the Senate bill includes AAAE-supported direction to FAA regarding the upcoming transition from AFFF to a F3 that mirrors similar language included in the House FAA/DOT spending bill report. As we have reported, the U.S. Navy last month provided industry with an opportunity to comment on a draft MIL-SPEC for F3, signaling that DOD and FAA are making significant progress in finding a suitable replacement foam and are on track to meet the January 2023 deadline set in the FY20 National Defense Authorization Act for having an approved F3. However, without a proactive transition plan from FAA in collaboration with other relevant federal stakeholders, the transition from AFFF to F3 for airports will likely face numerous hurdles. The AAAE team has worked closely with appropriators to press FAA to provide airports with the necessary guidance to ensure an orderly and cost-effective transition. 

The Senate report reads: 'The Committee commends efforts by the DOD and the FAA to research and test potential replacements to per- and polyfluoroalkyl substances- [PFAS]-containing aqueous film forming foam [AFFF], which have led to the DOD publishing a new military specification [MIL-SPEC] for a fluorine-free foam [F3]. The FAA is expected to allow part 139 commercial service airports to use foams that meet the new MILSPEC, but the Committee is aware that part 139 airports will require guidance from the FAA to efficiently and effectively transition away from AFFF to F3, including how to properly decontaminate existing aircraft rescue and firefighting [ARFF] vehicles, systems, and other equipment. As such, the Committee directs the FAA, in coordination with DOD, to develop a transition plan no later than 120 days after the publication of the MIL-SPEC for a F3 agent that provides guidance for part 139 airports to prepare for such a transition. The transition plan should, at a minimum, achieve the following goals: provide airports with information on obtaining EPA guidance on acceptable limits of PFAS in the environment; best practices for the decontamination of existing ARFF vehicles, systems, and other equipment previously used to deploy AFFF, as developed by DOD; and timelines for the release of policy and guidance relating to part 139 implementation plans for obtaining approved MILSPEC products and firefighting personnel training.' 

Community Engagement and Noise: Lawmakers continued to focus on aircraft noise and community engagement. The Senate bill provides an additional $1.3 million and four new positions for community engagement to address aviation noise issues. The additional funding will also go to technical and analytical support services to help address noise issues for communities that may not have such expertise themselves. 
 
The Senate report expresses concern that FAA has failed to provide a timeline for implementation of the new tools and systems related to noise by its June 2022 deadline. The Committee expects this comprehensive review of noise policy 'to focus on supplemental noise metrics beyond day night level [DNL] and to be inclusive of all relevant stakeholders, including, but not limited to, communities near airports, communities further from airports that are exposed to highly repetitive noise from Performance Based Navigation [PBN] procedures, other Federal departments and agencies, and airports.' Finally, the report addresses the fact that regional ombudsmen have not adequately engaged with the public, as required by the 2018 FAA Reauthorization Act, and directs FAA to brief lawmakers on efforts to engage with community groups and local elected officials.
 
Sustainable Aviation Fuels: In total, the bill provides $92 million for FAA's research on sustainable aviation fuels and aviation efficiency, including $27.5 million for the Center of Excellence for Alternative Jet Fuels and Environment (ASCENT) for SAF and noise. The Senate report directs the FAA to prioritize research related to SAFs and certification of SAFs to meet carbon offsetting goals. Furthermore, it acknowledges the challenges related to the SAF supply chain and recommends that FAA's Office of Policy, International Affairs, and Environment and Office of Airports work together to identify SAF related projects at airports that can be funded from AIP. 

Zero-Emission Vehicle (ZEV) and Voluntary Airport Low Emissions (VALE) Programs: In the Senate report, lawmakers were supportive of the use of AIP funds for the ZEV and VALE programs and directed the FAA to provide not less than $25 million of the supplemental AIP funding to go to ZEV and VALE eligible projects at any commercial service airport as noted above. Lawmakers also expect FAA to actively engage with airport sponsors at major hubs to identify projects suitable for the VALE program, such as energy efficiency, energy resiliency, and renewable energy projects that would help prevent power disruptions or outages.' 

Leaded Avgas: The Senate bill provides $7.5 million for alternative fuels for general aviation. In the report accompanying the bill, lawmakers expressed disappointment that despite continued funding for the Piston Aviation Fuels Initiative, leaded fuels continue to be used in piston-engine aircraft. The report 'directs the FAA to prioritize funding to the testing and identification of unleaded fuels that can be safely used in piston-engine aircraft fleet.' Moreover, it 'directs the FAA to prioritize the identification and testing of unleaded replacement fuels that are viable candidates for fleet authorization, including those related to issuance of supplemental type certificates, without compromising safety standards.' Finally, the report acknowledges that EPA 'is expected to issue an endangerment finding for leaded fuels soon, and expects the FAA to move forward expeditiously on any rulemakings triggered by such a finding.' 

New Entrants

Advanced Air Mobility: The Senate report supports the FAA's ongoing work on AAM, including the agency's work on aircraft certification, air traffic operations, landing site approval, infrastructure, and flight standards requirements. It goes on to encourage FAA 'to provide a transparent framework and requirements to all stakeholders for the safe use of AAM in the future.' 

Unmanned Aircraft Systems: While the FAA was previously directed to finalize the UAS BVLOS rulemaking by September 2023, due to the complexity of recommendations from the UAS BVLOS aviation rulemaking committee [ARC], the FAA has indicated that it is unlikely to finalize this rulemaking in time. As such, the report directs FAA 'to engage with UAS stakeholders to inform them of its proposed rulemaking schedule, the challenges associated with this rulemaking, and any differences between the proposed rulemaking and the BVLOS ARC's recommendations.' The Committee also directs the FAA to brief lawmakers on 'its plans to align policies that do not require rulemaking, including issuance of waivers, with the proposals recommended in the BVLOS ARC report; and (2) its plans to issue guidance providing accelerated pathways to enable low-altitude operations under existing rules, such as standard scenarios or pre-defined risk assessments.' 
 
Miscellaneous

Radio Altimeters: Lawmakers conveyed their concerns with potential interference caused by 5G C-Band signals and called for continued collaboration between federal, aviation, and telecommunications stakeholders to mitigate disruption caused by the 5G rollout and ensure safety and stability in the National airspace. The report directs FAA to prioritize the establishment of new performance standards that consider the future of 5G. Additionally, it directs FAA to 'provide an assessment of current radio altimeter technologies, including filters and other redesigns to reduce their susceptibility to potential 5G interference, and the extent to which such technologies can accommodate all future desired uses of C-band spectrum adjacent to the radar altimeter band. The assessment should include feedback from airlines, airports, telecommunications industry, and radio altimeter manufacturers on the limits of current technologies, the need for future research, the extent to which industry is already investing in such research, and any research and development activities that the FAA can conduct and/or sponsor to prepare for 6G, 7G, and beyond.' 

Aviation Workforce Development Grants: The bill includes $17.6 million for the Aviation Workforce Development Programs “ $12.6 million for the aircraft pilot workforce and $5 million for the aviation maintenance workforce. 

National Plan of Integrated Airport Systems (NPIAS): The Senate report states 'Public-use airports that meet all applicable criteria and which have had significant and material investment from their local communities should be included in the NPIAS.' As such, FAA is directed to expeditiously review requests for entry into the NPIAS. 

Cost Free Space: The House bill includes a AAAE-backed proposal that would continue to prohibit the FAA from requiring airports to provide space free of charge in airport-owned buildings. 

Contract Weather Observers: The bill would continue to block the FAA from eliminating the Contact Weather Observers program at any airport. 
 
Department of Homeland Security:
 
Overall, the Senate bill provides $59.9 billion in discretionary appropriations for DHS and its component agencies, including TSA and CBP. That amount is $2.4 billion more than the FY22 funding level. 

Transportation Security Administration (TSA)
 
The Senate bill provides a total of $9.292 billion for TSA, an increase of $545 million above FY22 but $753 million less than the administration's budget request. As part of this budget request, TSA assumed it would receive $4.01 billion in aviation security fees, including $1.52 billion that is currently diverted to deficit reduction payments. The Committee was unable to end this statutory diversion, which accounts for the funding reduction from the request. 

The bill restored $94.1 million in funding for TSA to continue to staff exit lanes at 109 locations instead of shifting those costs to airports and provided $245.6 million for TSA pay compensation, labor rights, and other protections. Unfortunately, the Senate did not fund the 2,540 new Transportation Security Officers (TSOs) requested to handle increased passenger volumes anticipated next year, explaining that the 'actual passenger volumes have consistently fallen short of the projections provided to date.' 

Additionally, the Committee approved the following items in the FY23 budget request:

·        $46.1 million for law enforcement officer reimbursement (LEO) grants, recognizing the important role the LEO reimbursement program has played in helping airports meet federally mandated airport security requirements; 
·        $104.5 million to procure, deploy, and test approximately 108 Checkpoint Property Screening Systems, including computed tomography (CT) machines at airport checkpoints; 
·        $13.94 million to continue to reimburse airports for the purchase and installation of checked baggage explosive detection systems procured shortly after September 11; and 
·        $22.34 million for credential authentication technology. 

The report that accompanies the bill contains a brief TSA discussion that highlights additional funding details and recommendations. Of note:
 
Exit Lane Staffing: In addition to rejecting TSA's request to eliminate exit lane staffing, the Committee directs 'TSA, within 120 days of the date of enactment of this act, to: (1) conduct an assessment of the impact of reducing exist lane staffing and report to the Committee on recommendations for changes that, at a minimum, identifies a prioritized list of airports at which exit lane control would be shifted to airports, the cost savings to be realized by TSA, and the cost burdens to be assumed by respective airports; and (2) provide a report to the Committee on existing technological solutions for exit lane control and the feasibility of implementing such controls.' 

Pay Parity and Labor Protections: As explanation on the $245.6 million recommended for TSA pay parity and labor protections, which is about one-quarter of the funding requested, the report notes that 'the budget request erroneously assumed that an additional $1.52 billion of aviation security fees could be diverted' to TSA's Operations and Support account instead of for deficit reduction payments required by statute. The Committee could not comply with that request, noting 'While erring in how the pay initiative was proposed, the Committee lauds TSA's effort to achieve pay equity for its workforce, especially in improving pay for frontline transportation security officers. The Committee recommends an appropriation of $245.6 million in the TSA Personnel System Changes and Collective Bargaining, Merit System Protection, and Associated Costs accounts, equaling one fiscal quarter's worth of pay, to account for time to implement the proposed changes.' 
 
Screening Workforce Pay Reporting Requirements: The Senate report recognizes TSA's continued work to improve efforts to retain, hire, and train TTSOs through pay reform initiatives, stating that the screener workforce is critical to identifying and mitigating aviation security threats and that these initiatives are key to increase workforce retention; provide opportunities for employees to develop, grow, and enhance their careers; and improve the Nation's overall aviation security posture. TSA is directed to provide quarterly reports to the Committee on its pay reform efforts and the subsequent effect on TSO retention levels. Additionally, TSA is required to submit a report, within 180 days, detailing the number of TSOs hired and corresponding retention levels since fiscal year 2016, and include a plan for continuous and sustained human capital investment that also incorporates the impact of new technology. 

Passenger Volume Growth: The Senate directs TSA to ensure that future budget requests include a robust forecast of passenger volume in relation to funded staffing levels and the projected improvements in operational capabilities as a result of the continued deployment of new technologies. 

U.S. Customs and Border Protection (CBP)

In total, the bill provides $16.4 billion for CBP, $1.7 billion above the FY22 enacted level. While the bill fully funds pay for all existing CBP officers and other personnel, it does not provide funding fo"