ACC Legislative News

Correction: House Stimulus Requires Local Match

An e-mail supplement to AirportConsulting, ACC's quarterly magazine
Prepared by T.J. Schulz, ACC Vice President

We have received questions about whether the House stimulus proposal would require matching funds by the airports. The Report accompanying the House bill states in the "Infrastructure and Construction Issues" section that "Because of the fiscal bind of most state and local governments, matching requirements are waived."

However, we conferred with the FAA and under their interpretation of the House legislative language, airports would be required to provide some form of matching funds. Upon further review there is no specific language in the legislation that waives the local match.

ACC and other aviation associations strongly oppose including a local matching requirement on the airport stimulus funding, and we will continue to voice our concerns to the House leadership. We will also encourage the Senate to waive the matching requirement in their bill.

The ACC staff regrets the error.

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House Democrats Release Stimulus Proposal; Includes $3 Billion in AIP, $500 Million for TSA

The House Appropriations Committee yesterday released its $825 billion economic stimulus proposal, titled "The American Recovery and Reinvestment Act of 2009." This bill represents the House Democrats' stimulus blueprint and was developed with input from the Obama administration. Hearings on the proposal could begin next week, and the House leadership hopes to have a final bill on the president's desk in mid-February.  

Democratic leaders in the Senate are currently drafting their own stimulus proposal in consultation with the Obama administration, which may be introduced next week. There will likely be some differences between the House and Senate versions that will have to be worked out in conference.

A total of $3 billion is provided for the Airport Improvement Program (AIP). The House bill directs that grant recipients must enter into contracts or other binding commitments that will utilize at least 50 percent of this funding within 120 days of enactment. Over the longer term, grant recipients must enter into contracts to use the remaining funding no later than two years after the date of enactment.

A total of $500 million is provided for the Transportation Security Administration (TSA) for the purchase and installation of explosive detection systems and emerging checkpoint technologies. The bill directs TSA to prioritize the award of these funds to accelerate the installations at locations with completed design plans and to expeditiously award new letters of intent.

There are some important conditions included in the bill that apply to the stimulus funding:

-       Matching requirements are not waived.

-       Funds are awarded on a discretionary basis by FAA and TSA.

-       If timeframes for obligation are not met, uncommitted funding will be redistributed to other eligible recipients under the grant program.

-       Transparency - each federal agency shall:

o   Develop a plan to use the funds;

o   Announce all grant competitions, allocations and awards of competitive grants using the funds; and

o   Notify the public of funds obligated by posting them on a website (Recovery.gov), including a description of project, the purpose, cost and rationale. The contact and e-mail address of federal official shall also be posted so the public can contact them if there are concerns.

-       State or local officials making funding decisions must certify that the projects have been vetted and the official accepts responsibility that the investment is an appropriate use of taxpayer dollars.

-       There are no earmarks in the bill.

-       Federal Acquisition Regulation shall apply to contracts awarded with funds made available. The bill states, "To the maximum extent possible, such contracts shall be awarded as fixed-price contracts through the use of competitive procedures. Any contracts awarded with funds not using fixed price and not awarded using competitive procedures shall be posted in a special section on Recovery.gov."

A copy of the bill can be found here http://appropriations.house.gov/pdf/RecoveryBill01-15-09.pdf

House appropriators also released a committee "report" on the bill which explains the provisions in narrative form, which can be found here: http://appropriations.house.gov/pdf/RecoveryReport01-15-09.pdf

The House Ways and Means Committee also drafted the tax provisions that will be included in the overall stimulus package. The committee draft includes a provision supported by ACC and other aviation associations that would eliminate the Alternative Minimum Tax (AMT) on interest from private activity bonds. Repeal of the AMT will help attract additional buyers for private activity bonds, and ACC sent a letter to Rep. Richard Neil, Chairman of the House Select Revenue Measures Subcommittee, in support of the AMT repeal, which can be found here.