The Federal government has played very key roles in the funding of Airports. It has done this in two different ways. First, through the Airport Improvement Program (AIP) as well as discretionary grants which are funded by international departures, freight, aircraft fuel, as well as waybills. Secondly, the funding is done through the exemption of the airports from payment of federal tax upon interest income for individuals holding airport bonds.
Similarly, funds are usually generated by the Passenger Facility Charge program (PFC). This is usually under the administration of FAA. The local funds generated by this program ensure that there are improvements in the airports (Federal Aviation Administration, 2010).
Despite the fact that the capital investment of most of the airports are presently funded by cash reserves by the airports, commercial loans, debt capital which are raised through municipal bonds, as well as grants from Federal and state governments, sale of bonds which are exempted from tax as well as Federal grants which are provided through AIP program are the major financers of the main capital projects within the airports (Federal Aviation Administration, 2010).
Airport Improvement Program (AIP)
Airport Improvement Program (AIP) ensures that grants are provided to the public airports. In a number of instances, the grant covers private entities. The funding is majorly to ensure that there are significant developments of the airports that are used by the public.
Since the year 1980, a number of airports have attained significant developments. The capital developments were made possible through funding boosts made by the Federal government. This is through grants. The grants are usually given through the Airport Im...
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...by propeller aircrafts that are powered by piston (Avgas). They also levy a tax of 21.8 cent for every gallon used on the jet fuel. The tax directly goes to the Airway Trust Fund, and the Airport with a tenth of a cent being submitted to programs aimed at environmental protection as well as cleanup programs (Wells, 1992).
Works Cited
Federal Aviation Administration. (2011). Airport Improvement Program (AIP) ;Funding for
Airport Planning and Development. http://www.faa.gov/airports/aip/. Assessed
September 1, 2011
Federal Aviation Administration. (2010). what is AIP?
http://www.faa.gov/airports/aip/overview/. Assessed September 1, 2011
Horonjeff, R. and McKelvey, F. (1983). Planning & Design of Airports. New York: McGraw-
Hill Book Company.
Wells, A.T. (1992). Airport Planning & Management. Blue Ridge Summit, Pa.: Tab Books.
The difference between the airport when it was first built is not drastic, but many things have upgraded. Fly.mcw.com said when the
Keen, M. and J. Strand (2007). "Indirect Taxes on International Aviation*." Fiscal Studies 28(1): 1-41.
...ing scarce. Oil, from which jet fuel is derived, is becoming so valuable because of its so many usages, yet the supply is getting lower everyday and not being replenished. This situation must drive us to the wise use of the oil that is still available and develop technology that can derive the maximum amount of energy from the minimal amount oil used. General Electric has been able to not only reduce the amount of fuel consumption but increase the amount of thrust at the same time. It is encouraging to see the new technology that GE is developing to reduce fuel consumption and contamination produced by their jet engines.
The issue that is being discussed in whether or not the government should help Air Canada out financially. As can be seen in the articles presented in the scrapbook, it is known that the government controls many of the operations at Air Canada.
Denver International Airport Construction and Operating Costs. (1997, July 5).University of Colorado Boulder. Retrieved April 28, 2011, from http://www.colorado.edu/libraries/govpubs/dia.htm
Before we discuss government intervention and its affect on an industry’s competition we must first seek to understand the five forces framework. The theory, discussed in 1979 by Micheal Porter seeks to evaluate the attractiveness of an industry. Throughout this essay I will explore the theory and then relate government action and its well-documented affects on the airline industry.
Airborne should strengthen and continually improve its services domestically, since it gives larger revenues, then strengthen its alliances internationally, so as to serve the demands of the international market. To add on its profitability, Airborne should lease out a portion of the airport facilities to other airlines, so that it could have other source of income to compensate the maintenance costs of the airport.
Airport planning, once carried out utilizing a single future forecast, failed to account for the complexity and uncertainty of the aviation industry. Today, it is widely assumed airport success can only be met through the utilization of a flexible, integrated planning approach that sees forecasts as incorrect.
Many projects may only be accomplished with funds coming from a combination of sources, among them federal, state, or local programs and grants from private
Introduction Aviation has a huge environmental impact on the environment and society, the aircraft engines release a noise that affects human life and the particulates and gases that are released from the aircraft engines contribute to climate change and increases the global warming. Despite the emission reductions from cars and more fuel-efficient and less polluting turbofan and turboprop engines, the rapid growth of air transportation in the recent years contributes to an increase in total pollution attributable to aviation. In the European Union, greenhouse gas emissions from aviation increased by 87% between 1990 and 2006. Like any other form of public mass transportation that relies on resources that are extracted from the planet, for e.g. Oil, and the airline cannot be considered sustainable in the long-term. Because of the limited resources in which the Aviation relies, it is more realistic to think about how to improve the sustainability of the air transportation rather than achieving a sustainable development.
Capital investment projects are extremely complex endeavors, understood traditionally as financial resources invested in an organization for the general purpose of cashing in the profits generated by the respective investment. Two particular features which need to be mentioned relative to capital investments is that these can occur within the entity making the investment, or within a different entity, and also that the capitals are generically destined to cover the purchase of fixes assets (equipments, land and so on), rather than use them to cover everyday expenses (Ward).
There are several limitations in aviation infrastructure in India for instance parking bays, gates to board passengers, landing slots etc are in short supply. This often leads to massive delays, cancellation and major losses in revenue for many LCCs. For upgraded infrastructure facilities, India’s civil aviation minister Praful Patel said on 15 February 2006 that Indian government defer decision on privatization of International Airport in Delhi and Mumbai. The government aims to set up joint venture to operate these airports and offered 74 per cent stakes. Foreign direct investment (FDI) can hold up to 49 per cent in this transaction, while 25 per cent must be held by private Indian companies. Remaining 26 per cent to be held by Airport Authority of India (AAI) and other government PSUs.
Government spending is all the consumption, investment, and transfer payments that our government has funded over a certain period of time. (Merriam-Webster) The United States government spends more money total than any other nation. They spend it in areas such as the military, environmental preservation, natural disaster relief, education and transportation. The US government spends all this money into trying to make a difference. (@Natpriorities)
Funding could also come in the form of increasing money supply in the country. Increasing money supply could be through printing money, seignorage or quantitative easing.
Stakeholders are those groups or individual in society that have a direct interest in the performance and activities of business. The main stakeholders are employees, shareholders, customers, suppliers, financiers and the local community. Stakeholders may not hold any formal authority over the organization, but theorists such as Professor Charles Handy believe that a firm’s best long-term interests are served by paying close attention to the needs of each of these stakeholders. The modern view is that a firm has responsibilities to all its stakeholders i.e. everyone with a legitimate interest in the company. These include shareholders, competitors, government, employees, directors, distributors, customers, sub-contractors, pressure groups and local community. Although a company’s directors owes a legal duty to the shareholders, they also have moral responsibilities to other stakeholder group’s objectives in their entirely. As a firm can’t meet all stakeholders’ objectives in their entirety, they have to compromise. A company should try to serve the needs of these groups or individuals, but whilst some needs are common, other needs conflict. By the development of this second runway, the public and stakeholders are affected in one or other way and it can be positive and negative.