"ACI-NA Calls on Congress To Focus Attention on Airports"

Tuesday, September 25, 2001

Airports Council International - North America Calls on Congress To
Focus Attention on Airports 
Funding for Increased Security Measures, A Reinforced Confidence in Bond
Markets, and Assistance in Retaining War Risk Insurance, Are Among the
Needs Sought for Airports 
Press Release


WASHINGTON, -- On behalf of the Airports Council International - North
America and the America Association for Airport Executives (AAAE), today
ACI-NA President David Z. Plavin called on Congress to provide much
needed assistance to airports whose operations are endangered as a
result of the terrorist attacks. During his testimony before the U.S.
House Transportation Aviation Subcommittee, Plavin emphasized two major
areas for consideration -- financial relief for airports and additional
measures in the screening of passengers. 

First, in order for airports to sustain the highest level of security
and safety, while at the same time, ensuring the efficient movement of
goods and people so vital to the economy, Plavin called for immediate
relief from the federal government to help pay for the additional
security measures that airports have implemented and to offset the
reduction in passengers and revenue. "In working with the Federal
Aviation Administration and the airlines, our airports have done a
terrific job in implementing the new federally-mandated security
requirements and in assisting the traveling public in dealing with the
new constraints on the aviation system," Plavin said. "While airports
are spending millions of dollars to increase security, passengers and
revenues are declining, so it is critical that Congress and the
Administration now focus attention on airports -- whose problems and
fate are inextricably tied with the airlines," he added. Airports
believe the total costs and revenue foregone will reach an estimated $3
billion by next year. ACI-NA and AAAE believe that since these costs
were incurred because of the terrorist attacks assistance should come
from the general funds in the Treasury. Other options noted include the
institution of a security fee on ticketed passengers, and the temporary
use of passenger facility charges (PFC) and Airport Improvement Program
(AIP) funding to pay for increased security requirements. 

This decline in passengers and revenues has further created instability
in the airport bond market as noted in Standard and Poor's announcement
last week that all of its North American airports are on "credit watch."
Therefore, in addition to increased costs associated with new security
measures, airports are also facing serious challenges in meeting their
debt service requirements. To help airports meet their obligations,
Plavin asked Congress to protect their stability by permitting airports
to refinance all tax exempt debt service, and to provide three to six
months of debt service to compensate for the halt and consequent
declines in traffic. In addition, as airports are concerned that
liability underwriters have elected to cancel war-risk insurance
policies, ACI-NA and AAAE urged Congress to work with the airport
community to provide airports with the same protection that airlines
received in their recent relief package. "While insurance companies have
raised the price of war risk insurance for airlines, they are canceling
it for airports so that it is not available at any costs," said Plavin.
"With such a high amount of fixed costs associated with airports, there
are some airports that won't be able to operate without it, and may be
forced to shut down critical operations unless they receive the
necessary relief," he added. 

In addition to providing necessary financial considerations, Plavin also
asked Congress to consider other ways to improve aviation security.
First and foremost, Plavin emphasized the need to use well-trained
security professionals to screen passengers and baggage. "The key issue,
in our view, is to improve the hiring, training, testing and thereby
proficiency of those individuals conducting the screening of passengers
and baggage. While many in Congress and the industry have called for
federalization of screeners and potentially other employees in security
functions, the most immediate need is to professionalize the workers in
aviation security," said Plavin. "If Congress chooses to federalize the
screening process, it is imperative that the agency or entity
responsible be given the resources and equipment it needs on a
continuing, long-term basis," he added. Other ways to improve security
at airports include accelerating the deployment of explosive detection
systems at more airports, providing new funding for more law enforcement
officials and K-9 units, disseminating intelligence to designated
airport security managers, and deploying additional federal security
managers at more airports.

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