States will be impacted by a least several of the federal obligations reviewed in this section.

A. Overview of Conveyance Documents

There are several types of conveyances the federal government has used to transfer personal and real property to airport sponsors. The types of transfers include surplus property and non-surplus property conveyances, and the type of conveyance can establish differing rights and obligations regarding the airport’s obligation to accommodate federal agencies. Further, many airports are composed of property acquired through various methods: some may have been conveyed by the federal government and will therefore be subject to the discussion in this section regarding obligations that attach to federally conveyed property, while other property may have been acquired through grants, independently purchased by the airports, or donated by local governments or even private landowners. The ownership mechanism for a particular piece of property will become critical for airports as they determine how they may use the property. The details of conveyance documents and their potential applications are outside the scope of this report, but generally airport sponsors should consider obligations that attach to their entire airports, and how those obligations may overlap with or be different than obligations that attach only to a particular parcel.

Surplus Property and Non-Surplus Property Conveyances

Surplus property refers to U.S. property that was conveyed to the airport sponsor under the Surplus Property Act of 1944, as amended. Non-surplus property refers to U.S. property that was conveyed to the airport property by other means, such as under 49 U.S.C. § 47125 and its predecessors.

The Surplus Property Act was the primary legislative effort by the U.S. government to dispose of excess military equipment and infrastructure as World War II was coming to an end. The Surplus Property Act authorized the conversion of surplus military airports to civilian public use airports. Many current civilian public use airports in the United States were formed in this manner, and approximately 700 civilian public use airports contain these surplus property interests. Neither the FAA nor the federal government owns the properties in question once they are transferred, but the government may retain a property interest, and the scope of the property interest can vary by airport.

The ownership of such property is generally transferred to the new public-entity owner, i.e., city, county, state, or airport authority, by instruments of property conveyance issued by the GSA. GSA has statutory jurisdiction over the disposal of properties that are declared to be surplus to the needs of the federal government. Prior to the establishment of the GSA in 1949, the War Assets Administration (WAA) issued the property conveyance instruments. While the WAA and later GSA handled the “surplussing” process, the Civil Aeronautics Authority and later the FAA assumed responsibility for the actual transfer to a civil sponsor. They also retained responsibility for enforcing compliance with the terms and conditions of the instruments for transfer by which surplus airport property was conveyed to non-federal agencies.

For the purposes of this report, the focus is only on the conveyance instruments for real property, not personal property. Further analysis and points to consider for the two instruments identified above are provided in the report.

Each federal instrument of conveyance of surplus property for public use airport purposes, regardless of its form or format, sets forth the particular rights retained by the federal government and the specific federal obligations assumed by the airport sponsor following the transfer of ownership. As will be discussed in more detail in the following sections, an instrument of conveyance issued by the WAA may contain a provision that requires the airport sponsor to permit the federal government the right to unlimited use of the airport by federally owned aircraft without charge, while an instrument of conveyance from the GSA agreement may require an airport sponsor to provide land for federal air traffic and air navigation facilities to the federal government at no charge.

WAA Instruments of Conveyance

The instruments of conveyance issued by the WAA either directly to the ultimate airport sponsor, or via another federal agency, transferred the surplus property subject to terms and conditions set forth in a document called Regulation 16. One common variation in WAA conveyance instruments is the provision relating to joint military use of the airport. Some WAA property conveyance instruments give the federal government the right to unlimited use of the airport by federally owned aircraft without charge. Others stipulate that the use by federally owned aircraft may not exceed a specified percentage of the capacity of the airport if such use interferes with other authorized uses. In some cases, the conveyance communicates the WAA’s position at the time of the conveyance regarding the use of the surplus property solely for airport operations, and for the property subject to that conveyance, property, as well as structures, cannot be used for any other purposes—including revenue-producing, manufacturing, or industrial purposes—without FAA written concurrence. While some of the restrictions on use will be consistent with the current grant assurances or other federal obligations, there can be nuances that impact that airport’s obligation to federal agencies. Conversely, some WAA conveyance instruments establish greater obligations on the receiving entity than other federal obligations would, such as providing the federal government unlimited use rights of the airport, at no charge. This is yet another reason airports should be familiar with the conveyance documents applicable to their facilities.

GSA Instruments of Conveyance

Section 13 (g) of the Surplus Property Act of 1944, which is continued in effect by section 602(a) of the Federal Property and Administrative Services Act of 1949, and amended by Public Law 311, 81st Congress, authorizes the conveyance or disposal of all right, title, and interest of the United States in and to any surplus real property or personal property, exclusive

of property the highest and best use of which is determined by the FAA Administrator to be industrial, to any state, political subdivision, municipality or tax-supported institution without monetary consideration to the United States.¹ The surplus property being considered for transfer under this authority must be determined by the Department of Transportation Secretary to be suitable, essential, or desirable for development, improvement, operation, or maintenance of a public airport. This can include property needed to develop sources of revenue from non-aviation businesses at a public airport. This authorizing legislation provides specific terms, conditions, reservations, and restrictions upon which such conveyances or disposals may be made. Therefore, airport staff and counsel should review the language of the Surplus Property Act in addition to the actual language in a particular airport conveyance document.²

The layers of potential regulation do not necessarily end at the language in the conveyance document or the Surplus Property Act. For example, the airport sponsor is required to reasonably accommodate the Air National Guard as an aeronautical use under 49 U.S.C. § 47107(a)(11) and (12), and Grant Assurances No. 27 and No. 28. Additionally, if an airport has requested surplus property by submitting an application to the FAA, even the language in the application can contain requirements for accommodating federal agencies.³ The application template provided by the FAA as of the date of this report includes a specific reference to Grant Assurance No. 27, Use by Government Aircraft, as well as obligations to permit the federal government use of the airport during a national emergency, and an agreement to provide land for federal air traffic and air navigation facilities to the federal government at no charge. All three of these obligations will be covered in more detail later in this report.

Base Realignment and Closure Act (BRAC) Conveyances

A more recent source of conveyance of federal surplus property comes from surplus military bases identified through the Base Realignment and Closure program. Since the initial authorization of the Base Closure and Realignment Action of 1988, there have been five approved rounds of closures and realignments, identified by the year of the approval: 1988, 1991, 1993, 1995, and 2005. Each approved round has a correlating implementation period, with the final 2005 round having an implementation deadline of 2011. Several public airports have been created under this program, including Austin-Bergstrom International Airport in Austin, Texas, and Alexandria International Airport in Alexandria, Louisiana. The FAA works with the Department of Defense (DoD) and local civil airport sponsors to convert military airfields to civil use. The FAA manages surplus property transfers for airports, military base conversions, and the promotion of joint use of existing military air bases. A sample deed of BRAC conveyance is provided as an appendix to the Airport Compliance Manual, 5190b change 3, which references the property conveyed to the City of Austin when the Bergstrom Air Force Base closed. This conveyance document includes the standard grant assurance obligations applicable to all federally obligated airports, but also reserves some specific rights for the U.S. Air Force, such as rights to access the property for environmental testing and excluding the City of Austin from accessing a portion of the property without consent by the U.S. Air Force.

Non-Surplus Property Conveyances

Federally owned or controlled land that is not surplus may be conveyed for airport purposes under the authority contained in section 516 of the Airport and Airway Improvement Act of 1982 (AAIA).⁴ Prior to the effective date of the AAIA, similar authority existed in section 16 of the Federal Airport Act of 1946 and section 23 of the Airport and Airway Development Act of 1970 (1970 Airport Act), but those have now been superseded by the AAIA. There are many instances where a government entity, such as the Department of Interior’s (DOI) Bureau of Land Management (BLM) agreed to convey non-surplus land for public use, including use as an airport. This is particularly common in the western states. FAA records indicate that about 170 airports have benefited from non-surplus conveyances, usually when an existing airport requested land from a federal agency for airport expansions.

Non-surplus property conveyances are used for property transferred pursuant to three federal statutes: the Federal Airport Act of 1946 § 16, the Airport and Airway Improvement Act of 1970 § 23, and the Airport and Airway Improvement Act of 1982 § 516. The Airport and Airway Development Act of 1970 repealed the Federal Airport Act of 1946, with section 23 of the Airport and Airway Development Act using language similar to that of the section 16 of the Federal Airport Act regarding conveyance of property for airport use. Airports that have received non-surplus property for airport creation, use, or expansion are sometimes referred to as section 16, 23, 516 or 47125 airports, in reference to the legal source of the property conveyance. These conveyance documents also come with obligations that may be more stringent than other federal obligations, such as the grant assurances. For example, non-surplus federal land conveyance instruments issued under sections 16, 23, and 516 provide for reversion to the U.S. government in the event the lands are not developed, or cease to be used, for airport purposes. However, depending upon the relevant authority under which the land was conveyed, the process for the reversion may differ, e.g., automatic versus non-automatic.

Understanding whether there are specific restrictions or rights granted to the United States that are unique to a particular airport is another reason that airport staff should be aware of the language of each specific conveyance document. The conveyance documents and obligations discussed earlier apply to the property conveyed, and to the airport sponsor receiving the conveyance. In effect, while obligations may only

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¹ 49 U.S.C. § 47151; 50 U.S.C. § 1622(a)-(c).

² 49 U.S.C. § 47152; 14 C.F.R. § 155.

³ See FAA Application for Airport Surplus Property Pursuant to 49 U.S.C.—FAA Template 3/14.

⁴ See 49 U.S.C. § 47125 for current provision.

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⁵ See 49 U.S.C. § 47107(g).

⁶ See FAA Order 5100.38, Change 1, Airport Improvement Program Handbook, Paragraph 3-22(e) Other Standards.

Airport Noise Compatibility Planning regulations, set forth in 14 C.F.R. Part 150.

Some federal obligations remain in effect only through the useful life of the facilities developed under the grant-funded project, but not longer than 20 years for publicly owned airports, unless the specific grant or grant assurance for that grant specifies otherwise. The time-limited federal obligations relate to the use, operation, and maintenance of the airport. In contrast, there are a handful of federal grant obligations that do not expire until the FAA releases the airport sponsor from an obligation: for example, there is no limit on the duration of terms, conditions, and assurances with respect to real property acquired with federal funds. While a more in-depth summary of all the federal grant obligations applicable to airports is outside the scope of this report, there are several other ACRP publications that can serve as useful resources: ACRP Web-Only Document 44: Understanding FAA Grant Assurance Obligations, Volume 1 and Volume 2, for example.⁷

The research for this report indicated that three grant assurances specifically address an airport’s obligation to provide federal agencies use of and access to the airport’s real property: Grant Assurance No. 5, Preserving Rights and Powers, Grant Assurance No. 27, Use by Government Aircraft, and Grant Assurance No. 28, Land for Federal Facilities. This report also touches on two other grant assurances relevant to the analysis of airport obligations: Grant Assurance No. 24, Fee and Rental Structure, and Grant Assurance No. 25, Airport Revenues. Depending upon the function or activity of the federal agency in question, other grant assurances may apply as well, such as Grant Assurance No. 22, Economic Nondiscrimination, and Grant Assurance No. 23, Exclusive Rights.

Grant Assurance No. 5, Preserving Rights and Powers

Grant Assurance No. 5, Preserving Rights and Powers, communicates the obligation that a sponsor cannot take any action that may deprive it of its rights and powers to direct and control airport development and comply with the grant assurances. This grant assurance prohibits a sponsor from selling, leasing, encumbering, or otherwise transferring or disposing of any part of its title or other interests in the property shown on Exhibit “A” without the prior written approval of the FAA. Exhibit “A” is the exhibit attached to an Airport Layout Plan that summarizes all the airport property included in the Airport Layout Plan and explains how the sponsor acquired that property. The requirement to maintain an Airport Layout Plan itself is addressed in Grant Assurance No. 29, as well as in 49 U.S.C. § 47107(a) (16). This grant assurance becomes relevant to the focus of this report when a federal agency wants to lease, use, or encumber airport property for such duration or to such an extent that the airport sponsor is concerned that the FAA could determine that the airport has been deprived of its ability to direct or control airport development. For example, the U.S. Postal Service may lease airport land or airport buildings for a postal facility pursuant to a very long-term lease that exceeds 50 years’ duration. Generally, a lease of this duration is seen by the FAA as a “disposal” of airport property, and a violation of Grant Assurance No. 5 unless the FAA has consented to the term of that lease. It is not uncommon for an airport to discover that prior decision-makers have made commitments that violate the airport’s grant assurances, as in the U.S. Postal Service example.

While an airport sponsor may not be able to terminate the lease early once it has been executed by all parties, and possibly many years prior to the discovery of the violation, the sponsor might be able to secure approval of a tenant to insert a “subordination clause” into the lease via an amendment. A “subordination clause” can be drafted and inserted into tenant leases and agreements that subordinates the terms of the lease or agreement to the federal grant assurances and surplus property obligations. A subordination clause may assist the sponsor in amending a tenant lease or agreement that otherwise deprives the sponsor of its rights and powers. A typical subordination clause will state that if there is a conflict between the terms of a lease and the federal grant assurances, the grant assurances will take precedence and govern. Including a subordination clause in a lease with a federal agency may provide a compromise position that enables an airport sponsor to comply with its federal grant obligations while providing the federal agency the access and use it wants on the airport property. If a situation were to arise where the airport sponsor needed to choose between complying with federal grant obligations and honoring the terms of its lease with a federal agency, a subordination clause could provide the airport sponsor a path towards resolution, at least legally. It would remain up to the airport sponsor to actually implement the power provided by the subordination clause. Alternatively, or in addition to the insertion of a subordination clause, another potential resolution would be for the airport sponsor and FAA to establish an approved corrective action plan that might include an amendment to the lease agreement to address any compliance concerns.

A critical determination from the research conducted for this report is that there is no federal “supremacy” construct that provides an airport sponsor a clear path towards resolving a conflict between its obligations to the FAA pursuant to grant assurances, for example, and its obligations to another federal agency acting in an airport tenant capacity. In the example provided above regarding the U.S. Postal Service, an airport could find itself stuck between the proverbial “rock and a hard place”: on one hand it is in non-compliance with its federal grant obligations if it continues to lease property to the U.S. Postal Service over a period of time that exceeds 50 years without FAA approval, on the other hand, it is in breach of its lease with the U.S. Postal Service it if attempts to terminate the lease early in order to comply with its federal grant obligations. It is for this reason that identifying a potential conflict before a lease or contract is signed is important.

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⁷ NATIONAL ACADEMIES OF SCIENCES, ENGINEERING & MEDICINE, UNDERSTANDING FAA GRANT ASSURANCE OBLIGATIONS VOLUME 1: GUIDEBOOK (2018), https://doi.org/10.17226/25126; NATIONAL ACADEMIES OF SCIENCES, ENGINEERING & MEDICINE, UNDERSTANDING FAA GRANT ASSURANCE OBLIGATIONS VOLUME 2: TECHNICAL APPENDICES (2018), https://doi.org/10.17226/25125.

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⁸ FAA Order 5190.6B § 7.16(c), Airport Compliance Manual, Change 3, 15 September 2023 [hereinafter FAA Order 5190.6B § 7.16(c)].

⁹ FAA Order 5190.6B § 7.16(c), supra.

rized aircraft, so long as such limitation does not restrict federal government use to less than 25 percent of the capacity of the airport. Both of these conveyance mechanisms provide the federal government broad latitude to use the airport, and neither contain specific requirements to reimburse the airport for use or impacts, other than the requirement to pay for damage caused by the use.

While this Grant Assurance No. 27 and the conveyance documents do not provide the airport sponsor much leverage in imposing fees for federal agency use of the airport, it is somewhat helpful to acknowledge that at least these conveyance documents and Grant Assurance No. 27 contain no language prohibiting a federal agency from reimbursing the airport sponsor for use. The FAA Reauthorization Act of 2018, Sec. 147, contains language that restricts the FAA Administrator from requiring an airport sponsor to provide the FAA at no cost (a) “building construction, maintenance, utilities or expenses for services related to air traffic control, air navigation or weather reporting” and (b) “space in a facility owned by the airport sponsor” for those same functions (air traffic control, air navigation, or weather reporting). However, the provision goes on to state that below-market rates are still permitted to be negotiated, and that the language in the Reauthorization Act does not affect any grant assurance governing the provision of land (as compared to services and space in an already-existing facility)—i.e., Grant Assurance No. 28, Land for Federal Facilities.

In cases involving military units, the military entity in question may be subject to military regulations relating to fee negotiations.¹⁰ All federal government aircraft are classified as airport users under federal obligations. Federal government aircraft include aircraft operated by the U.S. Army, U.S. Navy, Marine Corps, Air Force Reserve, all Air National Guard units, Coast Guard, National Oceanic and Atmospheric Administration (NOAA), National Aeronautics and Space Administration (NASA), Forest Service, and U.S. Customs Service.

In all cases where the airport sponsor proposes to charge the federal government for use of the airport under the joint use provision or any other request for the imposition of fees for use, the sponsor should negotiate directly with the federal government agency or agencies in question. The FAA does not assume the role of negotiator when it comes to rates and charges imposed upon other federal government agencies and will not directly intervene in those discussions; rather, it oversees compliance with applicable requirements such as those under Grant Assurance No. 27, Use by Government Aircraft, and it is left to the airport sponsor to balance these interests.

Grant Assurance No. 28, Land for Federal Facilities

Grant Assurance No. 28, Land for Federal Facilities, requires the sponsor to provide land (or water) to the federal government for certain facilities at no cost to the federal government. The specific facilities are: air traffic control or air navigation activities, or weather-reporting and communication activities related to air traffic control. However, the Airport Compliance Manual explicitly states that “there are subtle differences in the terms of these assurances under the various grant programs,” so airport sponsors should carefully review the wording of the assurance included in its most current grant agreement to identify its specific obligations.

Under the Airport Development Aid Program (ADAP) and the Airport Improvement Program (AIP), sponsors are not federally obligated to furnish space rent-free (providing space rent-free and providing a federal agency use of the airfield without charge are two different things). However, the sponsor is required to furnish to the federal government without cost any land necessary for facilities to house any air traffic control activities, such as very high frequency omni-directional radio range facilities (VORs), Air Traffic Control (ATC) Towers or Terminal Radar Approach Controls (TRACONs), or weather reporting and communication activities related to air traffic control. This may include utility easements, and could include land necessary for construction purposes, but not ultimately for the facility (pursuant to a temporary construction easement, for example). The airport sponsor is not required to furnish land rent-free for parking or roads to serve the facility, and the airport sponsor is not required to fund these federal facilities.

The Airport Compliance Manual acknowledges that “sponsors on occasion do provide space to other federal government agencies such as postal, customs, FBI, or immigration services at no cost or at nominal rent.”¹¹ This same section of the Manual proceeds to say that

the FAA does not view leasing space at these rates for activities that complement or support aeronautical operations as violating the self-sustaining grant assurance. However, federal agencies may not lease airport property for administrative purposes beyond the federal agencies’ operational needs at no cost or nominal rent; airports should limit the leasehold to just the space necessary to conduct the federal operations, which may include some administrative space necessary to serve the operations. In most cases, an airport does not bear the expense for the space leased for customs, immigration, or agriculture operations, but rather the costs are built into the airlines’ cost structure and are assessed to the airlines.

This is good news for airport sponsors who may be concerned that providing a federal agency space for nominal or no rent was in violation of the grant assurances. On the other hand, it also makes it difficult for an airport to rely on the self-sustaining grant assurance language as leverage to get rent from a federal agency.

C. Summary of Other FAA Guidance

In addition to grant assurances, there are other relevant sources of FAA guidance and regulations that apply to airport sponsors. In reviewing all of the available FAA guidance and regulations, the project team identified several Advisory Circulars (ACs) and FAA orders that were relevant to the topic of this digest. The AC system provides a single, uniform, agency-wide system that the FAA uses to deliver advisory material to FAA customers, industry, the aviation community, and the public. Some ACs are advisory in nature, while others that the FAA has

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¹⁰ E.g., infra note 74.

¹¹ FAA Order 5190.6B § 7.16(c), supra note 8.

incorporated by reference into regulations and grant assurances are binding. Regardless of whether a particular AC is advisory or binding, they can provide critical insight into how the FAA will interpret or apply a mandatory rule, regulation, or law, and are invaluable sources of guidance. FAA orders and notices are binding on FAA personnel, and they communicate standards, policies, procedures, and guidelines that must be followed by the FAA staff and administration. While FAA personnel are the primary audience for orders/notices, the aviation industry may use orders/notices as reference and the general public may find particular orders/notices of interest, and these are also helpful reference documents regarding airport compliance.

Advisory Circular 150/5300-7B FAA Policy on Facility Relocations Occasioned by Airport Improvements, 1972

AC 150/5300-7B communicates the FAA requirements regarding when the airport has to fund the relocation, replacement, or modification of federal facilities located at the airport. It is a “policy”—there is no reference to statutory authority or any formal rule. There are two classes of FAA facilities governed by this policy—Class I and Class II. Class I includes the facilities that are “exclusively used in support of the airport or from which primary benefits are derived by the airport.” Examples provided include the airport traffic control tower, instrument landing system, weather observing equipment, and airport surveillance radar. Class II includes facilities that “service a wide area and are located on the airport as a matter of convenience.” Examples provided for Class II include long range radar and flight service stations.

Generally, under this policy, the airport sponsor is required to pay for the relocation, replacement, or modification of FAA Class I facilities when: an airport improvement impairs the technical characteristics of the FAA facility; and in order to accommodate the extension or construction of runways, taxiways, or other improvements to existing airport facilities (parking expansion or additional terminal buildings).

An airport sponsor is required to pay for the relocation, replacement, or modification of FAA Class II facilities when there is a lease, permit, license or other legal document that provides the FAA a legal basis to request that the airport sponsor assume that cost.

The language of the policy explicitly provides that the “agency shall not pay any part of the costs other than might be provided under Airport Development Aid Program funding,” and the airport sponsor’s obligation to shoulder the cost of these relocations includes situations where a relocation is necessary because of a right provided by the airport sponsor to another party (such as leasing land to a third party for construction of an airplane hangar). The policy also sets forth the circumstances for relocations that are funded by the FAA, such as when relocation is necessary for FAA operational requirements, but is not necessitated by improvements to the airport.

The FAA determines how the work will be accomplished, including engineering, construction, and site selection, with the latter potentially causing conflicts between an airport’s vision for a particular piece of property, versus the FAA’s vision. The parties will “negotiate a reimbursable agreement setting forth all essential elements…” but the airport sponsor pays the actual costs of the project, whether that is lower or higher than estimated costs.

For an airport facing the need to relocate an air traffic control tower due to impending improvements by the airport (such as terminal expansion), the interplay between Grant Assurance No. 28 and AC 150/5300-7B could leave the airport sponsor responsible for the engineering, construction, and testing costs of the new tower, as well as having to provide the land for the new tower at no cost.

Aeronautical Center Order 5150.2A Federal Surplus Property for Public Airport Purposes, 1972

This Aeronautical Center Order (ACO) is active, though it was released in September 1972, and is not mentioned in the Airport Compliance Manual. This ACO provides guidance and procedures for the FAA’s participation in the disposition of federal property by the GSA for public airport purposes, and for all practical purposes has been replaced by the surplus property procedures followed and promulgated by the GSA. The ACO is based on the Federal Property Management Regulations that are issued by the GSA, and the ACO focuses on two specific parts of the FPMR: FPMR Part 101-47, Utilization and Disposal of Real Property, and FPMR Part 101-44, Donation of Personal Property. An excerpt from this ACO is shown in Exhibit 4, where it references authority for a request that National Emergency Use Provision (NEUP) not be applied to a particular transfer of real property. Although this ACO is active, airport sponsors following more current GSA and FAA guidance referenced in this report regarding application for and acceptance of federal surplus property, both real and personal, will likely not need to be specifically familiar with this ACO. For example, 14 C.F.R. Part 155 permits the FAA to release the airport (or portions of airport property) from the National Emergency Use Provisions after consultation with the DoD. Numerous releases have been granted under this regulation, although usually for

Exhibit 4. ACO excerpt.