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Transportation Research Board Publishes Report on Airport Privatization

Shirley Ybarra
May 29, 2012, 11:55am

I had the pleasure of chairing the project panel for the Airport Cooperative Research Program (ACRP) for a study entitled "Considering and Evaluating Airport Privatization."  It is not an advocacy paper but is a guidebook to the factors that need to be evaluated by public officials as they look at the variety of ways to approach airport privatization.

The panel included experts from airports (large and small), airlines, financial experts, the Federal Aviation Administration and US Department of Transportation.  We had an excellent research team in Leigh Fisher conducting the study led by Sheri Ernico, Director of Leigh Fisher.

The forward is worth repeating here:

ACRP Report 66: Considering and Evaluating Airport Privatization is a guidebook that assists airport operators, policy makers, and other relevant stakeholders as they consider and analyze the potential advantages and disadvantages of implementing various approaches to airport privatization. The guidebook covers a range of potential privatization options, from service contracts to private airport ownership or development. In addition, the guidebook includes case studies conducted at a variety of airports both within the United States and internationally.Interest in airport privatization is increasing, especially as local and regional governments look for ways to make their airports as efficient, competitive, and financially viable as possible. Consideration by communities, governing boards, airport officials, and other stakeholders on whether to privatize all or part of an airport is a significant decision with long-term impacts. As such, the decision-making process must ensure that a thorough and complete review is undertaken, so financial and other implications of privatization are fully understood and, hence, an informed, transparent decision can be made. Private-sector participation in airports-through ownership, operation, management, or new investment programs-can take many forms, including outsourcing certain functions; management contracts; public-private partnership (P3) agreements; design-build-finance-operate developments; outright sale or long-term lease of assets; and other private finance initiatives. Full airport privatization has been adopted or considered in various forms at many foreign airports but only at a limited number of U.S. airports while a wide range of partial airport privatization has existed at U.S. airports for many years.

The Airport Privatization Pilot Program, under 49 U.S.C. Section 47134, provides a
limited number of airports in the United States with a special vehicle for full airport  privatization, including certain exceptions from existing legal disincentives, and continues to generate discussion among airport operators and owners, governing boards, and airport officials. Although there have been a number of applications for the program since it was created in 1996, only one applicant completed the process as of this publication (Stewart International Airport), which subsequently reverted back to public operation. As the discussion of these issues continues, U.S. airport stakeholders can benefit from an objective presentation of the international experience with airport privatization and the relative advantages and disadvantages of privatization for U.S. airports.

This report was developed under ACRP Project 01-14. Also contained in the guidebook are Appendices A and B; Appendices C through H, which provide additional background information as part of the research conducted in preparing the guidebook, are on the CD.

The report can be found here.  It is an extensive report and the appendices are a wonderful summary of what is happening through out the world in airport privatization.  It is on a CD with the report or can be downloaded.  (it is a big file however)


Shirley Ybarra is Senior Transportation Policy Analyst


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