The Use of Passenger Facility Charges as a Funding Stream for Sustainable Transport Facilities at Airports

In this paper the authors use a case study approach to examine how airport operators have used passenger facility charges (PFCs) to finance sustainable transport facilities, specifically multimodal transit and rail links, on their properties. PFCs are charges that airports may impose on boarding passengers to fund improvements on their properties. Under Federal Aviation Administration (FAA) requirements, PFC projects must enhance security, increase capacity, or reduce noise impacts. Importantly, unlike Airport Improvement Program (AIP) grants, the other significant FAA-administered improvement fund, PFCs can finance non-aeronautical projects (on the “land” side)—access roads, terminals and gates. This represents a potential major revenue stream for airport multimodal transit and rail connections. However, PFCs are limited to projects located on airport property and for the exclusive benefit of airport passengers, employees and visitors. The authors examine the types of projects that have been funded by these charges and obstacles to their use. The findings suggest that there is growing airport operator interest in developing multimodal transit connections, as well as federal policy support. Motivations for this consideration include airport operators' increasing interest in improving their properties' sustainability. Through this research, they identify exemplar cases of PFC-funded intermodal projects and how FAA policy shaped them. They also identify areas for additional research: studies to develop deeper knowledge of effective airport intermodal strategies, more robust evaluation of economic impacts and effects on mode split and greater understanding of integrating airports with the surface transportation system, especially with recent federal and state policy efforts and discussions related to the development of high-speed rail.