FAA Releases Notice of Funding Opportunity for FY23 AIP Discretionary Grants

On April 17th, the Federal Aviation Administration (FAA) released a notice of funding opportunity (NOFO) that outlines the process for airports to apply for and receive a share of approximately $1.5 billion in fiscal year 2023 (FY23) discretionary grants under the Airport Improvement Program (AIP). In the NOFO, FAA provides an overview of AIP discretionary funding, the process to apply, how the agency will evaluate proposed projects for funding, the Administration's goals, how grants will be issued, and key deadlines. This NOFO applies to traditional AIP discretionary funds only, not supplemental discretionary funding. 

FAA indicated that the agency will award FY23 AIP discretionary funds through the FAA's long-standing competitive grant process, which includes using the Airports Capital Improvement Plan (ACIP) process to prioritize eligible projects and the National Priority Rating (NPR) to score projects according to FAA goals and objectives. However, FAA noted in the NOFO that they will consider qualitative factors and favorably consider applications that have a positive benefit on safety; climate change and sustainability; equity; and workforce development, job quality, and wealth creation. Airports are advised to work with their local FAA office and carefully review the NOFO before submitting discretionary grant applications.

FAA is encouraging airports to submit applications as soon as possible, but no later than July 14. You can view the NOFO here and AAAE's latest overview of FAA airport development grant programs here. 

Why Issue a NOFO for AIP Discretionary Grants? This is only the second time that FAA has issued a NOFO for AIP discretionary grants. FAA has traditionally identified eligible airports in its National Plan of Integrated Airport Systems (NPIAS) and used the ACIP process to prioritize eligible projects. However, in 2020, the Trump Administration finalized guidance and a rule that requires all federal agencies to issue a NOFO for any discretionary or competitive grants. This is the second fiscal year FAA has had to comply with the new requirements. 

What About Supplemental Discretionary Funds? In the FY22 and FY23 omnibus spending bills, Congress collectively provided FAA over $1.1 billion in supplemental discretionary funding for airport development projects (in addition to the normal AIP funding). Of that amount, approximately $562.8 million is reserved for earmarks, which are officially known as 'Community Project Funding' requests. In late December, FAA released a separate NOFO outlining how airports can apply for a share of approximately $268.7 million in FY22 supplemental discretionary funding. FAA is expected to release another NOFO for about $272.2 million in FY23 supplemental discretionary funding later this year. Please refer to AAAE's overview of FAA airport development grant programs for additional details. 

What's Next? FAA has requested that any airport that wishes to be considered for FY23 AIP discretionary funding should submit applications that meet NOFO requirements as soon as possible, but no later than July 14, to their local FAA RO/ADO. FAA has already begun to review requests for discretionary funding and will continue to do so on a rolling basis. The agency anticipates awarding grants beginning in April of 2023 and will continue to announce additional awards several times throughout the fiscal year, but no later than September 30.