FAA Updates Rules for Airport Improvement Fees and Projects
Published Date: 11/4/2026
Proposed Rule
Summary
The FAA is updating rules about Passenger Facility Charges (PFCs), which are fees airports charge to improve facilities. These changes affect airports and airlines by adding new project options, tightening rules on eligible projects, and speeding up review times. The updates follow new laws from 2024 and aim to make the PFC process clearer and more efficient, with comments open until January 4, 2027.
Analyzed Economic Effects
9 provisions identified: 7 benefits, 1 costs, 1 mixed.
Less AIP Turnback for Hub Airports
The rule would change how much Airport Improvement Program (AIP) apportionment medium- and large-hub airports must return. Airports collecting PFCs at $3.00 or less would return 40% (down from 50%), and those collecting above $3.00 would return 60% (down from 75%). Also, a small-hub airport that becomes a medium- or large-hub must be designated as such for three consecutive years before a turnback is applied.
Noise Barriers Now PFC-Eligible at Small Hubs
The 2024 Act makes noise barrier projects at small-hub airports eligible for Passenger Facility Charge (PFC) funding when the day-night average sound level (DNL) from airport operations is expected to exceed 55 decibels as a result of new airport development. This change adds noise-mitigation projects to the list of PFC-eligible work at qualifying small-hub airports.
No PFC Collections Until FAA's 60-Day Review
FAA proposes to align the statutory 60‑day review/objection period for Notices of Intent (NOIs) with the period before an eligible agency may begin collecting PFCs. Under the proposal, an agency may not begin collecting PFCs until 60 days after submitting an NOI unless FAA has no objection. This is intended to avoid situations where a public agency starts collecting after 30 days but FAA later objects within 60 days, which would require returning collected funds to air carriers and passengers (refunds FAA expects should be in dollars).
More Projects Protected From Streamlining Objections
The 2024 Act and this proposal specify that FAA may not object to including an eligible airport-related project in the PFC streamlining process if the project received Federal financial assistance and the combined Federal grant and PFC collections (including interest/returns) do not exceed the project's total cost. Such projects must be considered under the streamlined NOI review.
Streamlined NOI Review Shortened to 60 Days for Hubs
FAA would continue treating certain PFC notices of intent (NOIs) from approximately 138 small-, medium-, and large-hub airports under the streamlined review process, shortening FAA's review/acknowledgement period to 60 days (versus 120 days under the traditional application process). This continues the expedited handling described in PFC Update 73-20 until the rule's effective date.
Federal Workspace Replacement Eligible for PFCs
PFCs may now be used for replacing existing workspace elements (including in-kind facilities or equipment) that need to be relocated because a terminal development or renovation project forced a Federal agency to move on airport grounds. FAA proposes to add this project type as PFC-eligible.
Low-Emission Vehicle Projects Eligible at Any Airport
The rule removes the requirement that certain low-emission airport projects be located in air quality nonattainment or maintenance areas. Projects converting vehicles or ground support equipment from diesel/gasoline to low-emission technology, or acquiring low-emission vehicles/equipment, remain PFC-eligible at any covered airport.
FAA Can Object If Project Has No Aeronautical Purpose
FAA proposes to adopt a definition of 'no aeronautical purpose' and may object to PFC streamlining for projects that do not directly relate to safe/efficient aircraft operations or to movement of passengers and baggage. Examples include decorative landscaping, sculptures, works of art, cell phone waiting lots, or roads to non‑aeronautical areas.
Simpler ALP Submission Rules for Some Projects
FAA proposes that for projects that are required to be shown on an Airport Layout Plan (ALP) but do not require FAA review and approval, public agencies must submit a description and a drawing showing the project's location (rather than a full FAA-approved ALP). For projects that do require FAA review and approval, FAA would require an FAA-approved ALP and the date of that approval.
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