Economic Discrimination
CEA alleges that its proposed application for scheduled commuter air service at the Centennial Airport has been denied without fair consideration. CEA further alleges that this violates the commitments made by the ACPAA in accepting airport development grants.
CEA proposed to initiate scheduled passenger service at Centennial Airport, offering commuter service using aircraft with a maximum capacity of 30 passenger seats or less under Federal Aviation Regulation Part 135. Currently, Centennial Airport has non-scheduled, air taxi operations with aircraft seating 30 passengers or less. CEA proposes a similar operation except on a scheduled basis. Under current FAA regulations, the activity proposed can be accommodated at Centennial Airport without the requirement to obtain a Part 139 certificate.
According to FAA regulations, the airport sponsor is not required to possess a Part 139 certificate for this type of operation. If, however, any operator desires to exceed the 30 seat limit, the airport sponsor must possess an airport operating certificate. However, the FAA will not require the sponsor to seek a Part 139 certificate simply because an operator is petitioning to provide service with aircraft accommodating more than 30 seats.
As the owner of the airport, the ACPAA has entered into agreements with the FAA for assistance to finance airport development. As required by the Airport and Airway Improvement Act of 1982 and predecessor statutes, the Authority, in each such agreement, has provided the FAA with assurances regarding the operation of the airport. The standard assurances include a commitment that the airport will be available for public use on fair and reasonable terms without unjust discrimination to all types, kinds and classes of aeronautical uses.
Assurance No. 22 conveys FAA's policy on economic nondiscrimination and states in part that the airport will be available as an airport, for public use, on reasonable terms and without unjust discrimination, to all types, kinds and classes of aeronautical use. By banning a scheduled Part 135 service, merely because it is scheduled, while permitting unscheduled Part 135 air taxi and charter operations, Centennial Airport is effectively discriminating against CEA. The ACPAA has not provided sufficient justification for this discrimination, as discussed below.
The Grant Assurance [No. 22, Economic Nondiscrimination] that permits the County to limit or prohibit an aeronautical use for safety or to meet civil aviation needs would not ordinarily, in and of itself, provide sufficient basis for excluding scheduled Part 135 operations. In this case, ACPAA has not provided evidence of safety, efficiency or environmental concerns that would justify the restriction at this airport. In fact, ACPAA has provided virtually no evidence of any kind to support its conclusory claim of adverse safety, efficiency, or environmental effects from scheduled service.
Safety. Because ACPAA permits operation of the same aircraft in nonscheduled commercial service as it has attempted to ban in scheduled service, the Authority cannot argue a safety impact of the scheduled operations per se. The argument that scheduled service will result in increased operations at the airport does not support the ban. First, ACPAA has presented no evidence that increased operations would be a safety problem, and indeed could not present such evidence because FAA operating rules and air traffic control would assure safe operations at any level of activity. Second, ACPAA claims that increased airport operations would be a problem but has not taken any measure to limit the total number of operations; the ban of scheduled operations does not limit total operations at the airport. Finally, all operations at the airport are conducted by pilots tested and licensed by the FAA; use aircraft certificated by the FAA for airworthiness; follow FAA operating rules; and follow the direction of FAA air traffic controllers. ACPAA has not provided a single item of information that would suggest any safety problem in any of these operations, scheduled or otherwise.
Congestion. ACPAA has not provided information that would support a claim that congestion at Centennial Airport is or will become a problem requiring a limit on operations. Centennial is a busy airport, and individual operators may experience delays at times of peak operation. However, a limit on the number of operations at an airport for reasons of congestion is an extraordinary measure that has been adopted and upheld at only a very small number of airports in the U.S. Also, the concerns about congestion are speculative. In order to uphold an airport restriction on operations, courts have required that existing levels of service have resulted in congestion. See Midway Airlines, Inc. v. County of Westchester, 584 F. Supp. 436, (S.D. NY 1984). In any event, the ban on scheduled operations adopted by ACPAA does not limit total operations, and therefore would not directly address the problem of congestion even if it existed.
Environmental effects. Similarly, there is no basis for the ban on environmental grounds, such as limiting the airport operator's liability for noise damages. In order to justify a restriction based on environmental grounds, the ACPAA must prove two things; first, that a noise or other environmental problem actually exists, and second, that the restrictions in question are rationally related to the problem. ACPAA has presented no evidence of specific actual or projected noise impacts to support regulation of any kind. Even if ACPAA presented evidence of a noise problem, a ban on scheduled operations does not control any characteristic of airport operation relating to the generation of aircraft noise. It does not limit the operation or frequency of use of a particular aircraft type; it does not limit total operations; it does not limit hours of operation; and it does not prescribe a maximum noise level, either for single events or cumulative effect. There is no evidence or even a claim that the turboprop aircraft proposed for scheduled operation would be the noisiest aircraft operating at the airport; in fact, the airport receives a substantial number of business turbojet operations, which ACPAA has not limited in any way. This situation is comparable to the FAA determination in San Francisco Airports Commission, FAA Docket 13-86-2, decided on 12/21/88, where FAA determined that a restriction based on the date of an aircraft's certification as a Stage II aircraft was unjustly discriminatory because other, noisier aircraft were allowed to operate.
A restriction to control noise might also be subject to the requirements of the Airport Noise and Capacity Act (ANCA). ANCA and the FAA's implementing regulations, 14 C.F.R. Part 161, stipulate specific steps that must be followed before an airport sponsor imposes certain airport noise or access restrictions. ACPAA did not follow the specified procedures before imposing restrictions in this case.
In addition, the assurance permitting a sponsor to limit aeronautical use to serve the public's civil aviation needs has not been applied in a case where the restricted use did not impair other uses of the airport necessary to meet the public's needs. Thus, the grant assurance would apply only if Centennial's scheduled service interfered with the function of Centennial Airport as a reliever airport. Review of the record does not substantiate any claims that the scheduled service would adversely affect the use Centennial Airport for general aviation.
Until CEA approached the ACPAA with its proposal to establish scheduled Part 135 operations, ACPAA's public position was that scheduled air carrier service, with fewer that 30 seats, was within the airport's mission. [FAA Exhibit 1, C-6, page 2]
By denying access to CEA to establish scheduled Part 135 operations, ACPAA has effectively violated the grant assurance no. 22(a) restriction on economic nondiscrimination.
In its defense, ACPAA presents several arguments that will be addressed individually below. The FAA has found none of these arguments to be persuasive. [FAA Exhibit 1, Item 4]
1. ACPAA states in its Answer that CEA has "neither been found fit or been granted the certification as an air carrier by the Department of Transportation and therefore, CEA may not hold out or operate scheduled service.
CEA, in it's Reply, states that "Golden Eagle Charters, Inc., d/b/a Centennial Express Airways, Inc., holds a valid Part 135 Air Carrier Certificate which is limited to four (4) round trips per week, both inter-and intrastate. [FAA Exhibit 1, Item 3, Exhibit A] The ACPAA may require in a lease agreement that CEA or any other applicant performing the same or similar operations hold the requisite Federal authority for conducting operations conducted at the Centennial Airport. The record establishes, however that CEA holds FAA authority that permits limited scheduled service. [FAA Exhibit 1, Item 3, Exhibit A]
2. ACPAA argues that the introduction of scheduled service at Centennial would raise significant safety and environmental concerns. ACPAA does not state which specific safety or environmental concerns this activity would raise, appearing instead to rely on the grant assurance that states that "In the interest of safety, the airport owner may prohibit or limit a given aeronautical use of the airport if such action is necessary for the safe operation of the airport."
For the reasons discussed above, the FAA has determined that the ACPAA has not justified an access restriction based on safety, congestion or environmental grounds. Moreover, a ban on scheduled operations would not be a reasonable and nondiscriminatory response even if some restrictions were justified. The FAA recognizes the sponsor's obligation to protect against adverse effects on airport operations such as undue ramp congestion on the ground or lack of adequate ground-side facilities. However, in accordance with the grant obligations, these concerns can and should be addressed in the first instance through adoption of appropriate minimum standards for scheduled commuter facilities and operations. Lack of a public passenger terminal with baggage handling facilities does not justify a commuter service ban at this airport, since on-demand air taxi operations have been providing passenger services without these facilities. The FAA Chief Counsel has determined that a carrier may not be denied access to an airport solely based on the non- availability of currently existing facilities and that some arrangements for accommodation must be made if reasonably possible. See FAA Order 5190.6A Sec. 4-15(d). This guidance is especially applicable in this case, where CEA had obtained access to facilities through a sub-lease.
Where a sponsor has defended a challenged restriction on safety grounds, the FAA will make the final determination of the reasonableness of the airport owner's restrictions which deny or restrict use of an airport. [FAA Airport Compliance Order 5190.6A, page 16]
3. ACPAA presents the argument that the Federal government should not invoke the airport grant assurances to compel Centennial to accept scheduled service despite strong community opposition and continuous confirmation of its role as a reliever airport in both regional and Federal airport plans. ACPAA also argues that the context of a Part 13 enforcement proceeding is not the proper forum for this type of decision to be made.
When an airport sponsor requests and accepts Federal airport assistance, it signs a binding agreement that includes a commitment to comply with specific grant assurances. These grant assurances are included in the documents that an airport sponsor receives with each and every grant. Most of the grant assurances, including those at issue in this case, are established by statute, and the sponsor does not have the option to pick and choose those assurances with which it will comply. It is a sponsor's responsibility and right, before accepting a grant, to understand and determine if compliance with all of the grant assurances is acceptable to the community. The responsibility includes a reasonable effort to resolve differences of opinion over the nature of those obligations. Once a grant is accepted, a sponsor's local authority is constrained by the obligations, which the sponsor undertakes in exchange for valuable consideration, i.e., the Airport Improvement Program grants. Further, Part 16 (or Part 13 for cases filed before December 16, 1996) is the appropriate forum to analyze alleged violations, as will be discussed.
4. The ACPAA sets forth the argument that the Authority's regulation preserving Centennial as a general aviation reliever facility is a reasonable limitation on the use of the airport.
Airport sponsors can plan for, promote and orient sponsor-financed infrastructure to advance the airport's role as a reliever airport. Additionally, an airport does have the right to designate certain runways or other aviation use areas at the airport to a particular class or classes of aircraft as a means of enhancing airport capacity or ensuring safety. Any such restrictions should be clearly supportable, based on operational considerations and not instituted as a means of deliberately discriminating against a particular class.
As the owner of the airport, the ACPAA has entered into agreements with the FAA for assistance to finance airport development. As required by the AAIA, and predecessor statutes, the ACPAA, in each such agreement has provided the FAA with an assurance that the airport will be available for public use on fair and reasonable terms without unjust discrimination to all types, kinds and classes of aeronautical uses. The FAA does consider an airport's classification as a general aviation and/or reliever airport to limit the obligation to provide for access to all types, kinds and classes of aeronautical use.
A designation as "reliever airport" is not a basis for banning scheduled Part 135 operations at Centennial. As noted previously, the claim that commuter operations will fundamentally alter Centennial Airport's character is speculative and unsupported. Non-scheduled FAR Part 135 operations are considered a general aviation use. There are currently operators based at Centennial Airport that do provide FAR Part 135 non-scheduled services. The operations of the same aircraft types in scheduled service would not have distinct operational effects that would support an access restriction.
Prior to CEA's efforts to initiate scheduled service, ACPAA itself apparently did not consider scheduled Part 135 operations to be inconsistent with its role as a reliever airport. ACPAA, in public documents, has stated that "The Authority has the responsibility and authority to promote and facilitate air transportation, commerce and navigation by air for the benefit and welfare of the State of Colorado, its political subdivisions, and its inhabitants." Additionally, ACPAA has stated that "No scheduled air carrier, either large or small, has applied to the Authonty to operate at the Airport. Should any apply, the Authority will consider only the smaller, regional air service applications." Also, the ACPAA has stated that "The Authority reaffirms the original intent of the airport to serve the general aviation community. To this end, Centennial will continue to accommodate aircraft operating under Federal Aviation Regulation Part 135/Operations Specifications 135 (30 or fewer seats). Requests for scheduled air service shall be reviewed for compliance with this policy, the established weight limit, and the applicable minimum standards."
It had been the intention of the ACPAA to accept applications from entities such as CEA and that, at one time, the ACPAA viewed air service as a positive aspect of the services provided by the Centennial Airport to the surrounding community. A sponsor is not free, once Federal funds have been used to support its infrastructure needs, under the grant assurances, to bar service at the airport just because local preferences change. In some localities, a single airport sponsor owns and operates more than one airport. In such a case, where the volume of air traffic is approaching or exceeding the maximum practical capacity of an airport, an airport owner may designate a certain airport in a multiple airport system (under the same ownership and serving the same community) for use by a particular class or classes of aircraft. The owner must be in a position to assure that all classes of aeronautical needs can be fully accommodated within the system of airports under the sponsor's control and without unreasonable penalties to any class and that the restriction is fully supportable as being beneficial to overall aviation system capacity. See Order Sec. 4-8(d)
As the operator of a single airport, the ACPAA may not rely on this policy to exclude scheduled Part 135 operations. It cannot assure that all classes of aeronautical need can be fully accommodated if they are barred from Centennial airport.
In these circumstances, the ACPAA cannot rely on the reliever airport concept to exclude 14 CFR Part 135 scheduled operations.
5. ACPAA avers that an enforcement proceeding is an inappropriate forum to resolve the issue of retaining Centennial as a general aviation reliever airport, arguing instead that this is a matter of broad airport policy and should be addressed within a deliberative process. ACPAA additionally states that "an enforcement proceeding necessarily deals with specific allegations involving the conduct of one party."
FAA believes that an enforcement proceeding is in fact the proper forum to decide if a denial of access to a federally-funded airport is unjustly discriminatory. The ACPAA has taken numerous AIP grants over the years and has a continuing obligation to comply with the grant assurances based on current FAA policy.
6. ACPAA argues that forcing Centennial to accept scheduled service would needlessly undermine the Federal investment in Denver International Airport. ACPAA states in its arguments that "Compelling Centennial Airport to accept scheduled service will needlessly undermine the Federal government's investment in Denver International and contravene Centennial's intended purpose. Centennial is meant to play a supporting role in the success of Denver International by helping to meet the region's general aviation needs."
Potential economic harm to another airport would never justify an access restriction under the grant assurance that requires Centennial Airport to be accessible to all categories of aeronautical users on reasonable terms, except possibly in the limited circumstances of a single operator of a multiple airport system, as discussed above.
Moreover, ACPAA's suggestion that introduction of scheduled commuter services would have a significant adverse impact on Denver International Airport (DIA) is speculative. DIA holds an airport operating certificate under Part 139; it was designed and constructed primarily to serve Part 121 operations. While DIA has extensive commuter operations under Part 135, many of the passengers on those flights use DIA to connect to the Part 121 operations. Part 121 operations cannot be conducted at Centennial. Thus, there is no danger that introduction of scheduled commuter operations at Centennial will cause a transfer of Part 121 operations away from DIA. Moreover, to the extent that the Part 135 scheduled operations at DIA depend on connecting passengers for their economic viability, those operations are not likely to relocate either.
7. ACPAA states that compelling APA to accept scheduled operations would be at least premature in light of pending consideration of recommendations to require that all airports served by air carriers that provide scheduled passenger service be certificated under Part 139.
Section 404 of the 1996 FAA Authorization Act permits the FAA to extend the airport certification requirement to airports with scheduled service with aircraft with 10 or more seats. To date, the FAA has not yet published even a notice of proposed rulemaking. Until an amendment to Part 139 is adopted as a final rule, any airport may receive scheduled service by aircraft with 30 seats or fewer. The FAA is obliged to consider ACPAA's compliance in light of the current requirement of FAR part 139. Should the FAA adopt an amendment to part 139 to apply to more than 10 seat aircraft, than any scheduled operation at Centennial would need to conform to the requirements of the new amendment.
Exclusive Rights
CEA alleges that by denying permission to conduct an aeronautical activity, Part 135 scheduled air service, on the airports in question, and by permitting other Part 135 unscheduled activities to be conducted, the ACPAA is in violation of the provisions regarding exclusive rights set forth in Section 511 (a)(2) of the Airport and Airway Improvement Act (AAIA), 49 U.S.C., 47107(a)(4) as amended, and Section 308(a) of the Federal Aviation Act of 1958, as amended, 49 U.S.C. Section 40103(e), as amended, and the Federal grant assurances.
The ACPAA claims that it has not granted an exclusive right to operate unscheduled air carrier service.
The FAA interprets an exclusive right as the granting of any special privilege, power or right to provide an aeronautical service on the airport to the exclusion of others. Existence of an exclusive right to conduct any aeronautical activity at an airport limits the usefulness of the airport and deprives the using public of the benefits of a competitive enterprise.
The ACPAA has allowed commercial operators to conduct 14 CFR Part 135 unscheduled operations without unreasonable restriction while it has denied CEA the ability to operate under Part 135 with scheduled air services even though both operations use the same general kind of aircraft. Indeed, the ACPAA obtained and successfully defended a permanent state court injunction barring CEA's scheduled operations. By granting unscheduled operators the right to provide aeronautical services while excluding scheduled operators, the airport operators have granted a prohibited exclusive right to conduct air carrier operations to on-demand air taxi operators.
FAA Order 5190.6A explains the FAA's policy, stating,
The policy applies equally here where one class of Part 135 service, scheduled operations, is excluded, while another, on-demand services, is permitted and there is no significant operational difference between the two.
In addition, Airport Improvement Program Assurance 23 (to which all AIP grant recipients are bound), states that the sponsor "... will permit no exclusive right for the use of the airport by any person providing, or intending to provide, aeronautical services to the public." Airport Improvement Program sponsor assurance no. 23, page 11 (Jan. 1995 edition) (emphasis added). FAA Order 5190.1A, "Exclusive Right," paragraph 8, which states that "the grant of an exclusive right for the conduct of any aeronautical activity is contrary to applicable law ...whether such exclusive right s results from express agreement or from the imposition of unreasonable standards or requirements, or any other means." As discussed above, the ACPAA has established an unreasonable policy. It has, therefore, granted a prohibited exclusive right.
The FAA is charged with the responsibility of bringing about or enforcing compliance with the exclusive right provision of Section 308 of the Federal Aviation Act of 1958 and Section 303 of the Civil Aeronautics Act of 1938.
Even before adopting an explicit ban on scheduled service, and obtaining an injunction against CEA, the ACPAA took actions, or failed to act, in violation of the exclusive rights prohibition. Prior to 1991, when CEA sent a letter to the ACPAA requesting that minimum standards be set under which CEA would be allowed to operate, Centennial had a stated airport policy of encouraging commercial service "in the form of Part 135 charter/air taxi certification, whether scheduled or unscheduled. Such activity may not be prohibited but is limited to aircraft with 30 seats or less." [FAA Exhibit 1, C-6, page 2]
After a delay of several months following the request for minimum standards, the ACPAA notified CEA that the airport was revising its airport policy statement and that the new policy would have to be completed prior to the minimum standards being enacted. After 16 months, the ACPAA adopted minimum standards for Part 135. At the same time, a moratorium on accepting new applications for scheduled service operations was also adopted. [FAA Exhibit 1, Item 3, page 3]
There is nothing in the record in this proceeding that shows that the moratorium has ever been lifted. Significant delay in processing an application or request for entry to a Federally-funded airport can in itself be construed as denial of access. (British Airways Board v. The Port Authority of New York and New Jersey, 564 F.2d 1002 (1997) This unreasonable denial of access to part of the category of Part 135 operators amounts to a prohibited grant of an exclusive right.
Federal Preemption of Scheduled Service Ban
Title 49 U.S.C. 41713 prohibits a state or local government from regulating the rates, routes or services of an air carrier authorized to provide air transportation. Section 41713(b)(1) provides, in relevant part, that
The FAA has authority to consider this issue under Section 1002 of the Federal Aviation Act of 1958 (FAAct), 49 U.S.C. 46101, and 46105. These provisions grant the FAA the authority to investigate compliance with provisions of the Federal Aviation Act, as recodified, in part A of subtitle VII of Title 49 of the United States Code, including section 41713(b). For the reasons set forth below, the FAA has determined that the ACPAA's ban on scheduled service amounts to the regulation of rates, routes and service within the meaning of § 41713(b), and that the ACPAA's actions fall outside the scope of the proprietor's exemption.
This determination is based on and limited to the specific circumstances existing at Centennial Airport; i.e., the access restriction was implemented after the statutory restrictions contained in 41713(b) were enacted and after the sponsor accepted a grant of Federal airport assistance under the AIAA; the access restriction was adopted by the ACPAA on its own initiative and without a claim of legal obligation; and the complainant in this case had never agreed to any form of restriction on access or service to the airport.
The ban on scheduled service at Centennial Airport by the ACPAA constitutes the regulation of both air carrier service and air carrier routes. With respect to service, the ACPAA has effectively prescribed the kind of commercial air service that may operate at Centennial Airport -- on-demand Part 135 operations. The ACPAA is exercising control over a fundamental air carrier business decision on the kind of service to provide -- scheduled or charter. In this regard, the decision in Hodges v. Delta Airlines, Inc., 44 F.3d 334, 336 (5th Cir. 1995) does not limit section 41713(a) to regulations relating to "ticketing, boarding procedures, providing meals and drinks to passengers, and baggage handling." Rather, the Hodges decision identified these activities as elements of air carrier service "in addition to the transportation itself." Id. A decision to offer scheduled or charter service to the public in a particular market is, in the words of the United States District Court in Butcher v. City of Houston, 813 F. Supp. 515, 517-518 (S.D. TX 1993), "distinctively incident to the provision of airline service to the public..." [FN 6]
In addition, this unilateral ban on scheduled service creates an inherent conflict with Federal law, which permits an air carrier holding authority to provide scheduled passenger service to provide that service to any airport in the United States. Thus, the ban cannot be considered to be "only a peripheral concern of the Act so [that] it could not be inferred that Congress intended to deprive the State of the power to act." Local 926, International Union of Operating Engineers, AFL-CIO v. Jones, 460 U.S. 669, 676 (1983).
The ACPAA's unilateral ban on scheduled service also represents a regulation of air carrier routes, because the effect of the ban is to prohibit regular operations over any route involving the Centennial Airport. An outright prohibition on operating over any route is as much a regulation of routes as a restriction on the number of routes that a carrier can operate from an airport, or a local ordinance either prohibiting service on a named route. Each of these ordinances would be considered to be a regulation relating to air carrier routes within the meaning of section 41713. See, e.g. Butcher v. City of Houston, supra, 813 F. Supp. at 517-518.
Based on the current record in this investigation, the ACPAA has not adequately justified the ban as an exercise of proprietary powers under section 41713(b). As previously noted, the discretion of an airport proprietor under section 41713(b) is not unlimited. In this case, ACPAA's proprietary rights are limited by its obligations under the AIP grant assurances and the statutory prohibition on exclusive rights. A restriction that is inconsistent with these Federal obligations is not within the proprietary powers preserved by section 41713(b). New England Legal Foundation v. Massachusetts, supra, 883 F.2d 157. [FN 7]
The ban on scheduled service is subject not only to Federal grant obligations but also to limitations under the Commerce Clause and Supremacy Clause of the U.S. Constitution. As a local restriction on interstate commerce, the ban could be permitted under the proprietor's exception only if it were reasonable, non- arbitrary and non-discriminatory. See British Airways BD v. Port Authority of New York, 558 F.2d 75 (1977). However, based on the analysis of the restriction at Centennial under the grant assurances, the FAA is unable to find that the restriction meets this standard.
The courts have recognized that prevention or elimination of ground-side congestion, including congestion in passenger terminals, can provide a basis under the proprietor's exception for restricting air carrier scheduled operations, very limited circumstances. Those cases are not applicable to Centennial Airport. One case involved a perimeter rule adopted by the Port Authority of New York and New Jersey (Port Authority), setting a maximum distance for nonstop flights to LaGuardia airport [FN 8]. The Port Authority controlled two other local airports at which it permitted (and encouraged) nonstop service to the New York City metropolitan area from points beyond the perimeter, and the Port Authority permitted flights to LaGuardia from beyond the perimeter so long as there was at least one stop within the perimeter. While the court recognized that control of ground-side congestion was a legitimate proprietor concern on which to base restrictions on air traffic, and that it was reasonable for the Port Authority to adopt rules designed to alleviate those problems, the decision also turned on the fact that the sponsor operated multiple airports and, through its control of these airports, could assure that scheduled service between New York City and any point in the United States could be accommodated. The ACPAA is not in the position of the Port Authority. It controls only Centennial Airport. [FN 9]
[FN 9] The other decision involving a perimeter rule, City of Houston v. Federal Aviation Admin., 679 F.2d 1184 (5th Cir. 1982) does not provide useful guidance in defining the authority of local governments that are airport proprietors. The perimeter rule in that case was imposed by the Federal Aviation Administration in its role as operator of Washington National and Dulles airports. The court was considering the scope of the Federal government's authority to set perimeter rules. It was not, therefore, applying the same legal standards that govern state and local airport proprietors.
Applicability of National Environmental Policy Act
While the Department was considering the ACPAA's July 1993 request for policy guidance on providing access for scheduled service, the City and County of Denver sought guidance on the application of the National Environmental Policy Act (NEPA) to the introduction of scheduled airline service at Centennial Airport and to an FAA compliance action to require to ACPAA to accept scheduled service at the airport. The Chief Counsel of the FAA provided that guidance in a letter dated October 22, 1993. To avoid any confusion or misunderstanding, the FAA is taking this opportunity to reaffirm that guidance, subject to clarification based on a change in the nature of the operation that CEA's proposed operation that occurred after the Chief Counsel issued his opinion. [FAA Exhibit 1, C-7]
First, NEPA, and specifically the NEPA requirement to conduct environmental reviews, applies to Federal actions. The action of an airport sponsor to permit individual commercial operators to do business on the airport is not itself a Federal action and is not, therefore, subject to NEPA.
Second, administrative civil enforcement actions, such as the issuance of this determination, are not Federal actions subject to NEPA under the regulations implementing NEPA, 40 CFR 1508.18(a). Therefore, this decision is not subject to environmental review.
Finally, when scheduled air carrier service is introduced at an airport, the Federal action that could trigger environmental review would be the issuance of an air carrier operating certificate and operations specifications to an air carrier proposing to introduce scheduled service at the airport. The Chief Counsel's letter concluded that issuance of operations specifications to CEA permitting scheduled service at Centennial would require preparation of an environmental assessment (EA), largely because CEA was, at the time, proposing to operate turbojet service. However, FAA guidelines provide that issuance of an air carrier operating certificate or approval of operating specifications requires an EA only if the new service "may significantly change the character of the operational environment of an airport." FAA Order 1050.1(D), Appendix 4, paragraph 3(e). Thus, if the proposed turbojet service will not change the character of the operational environment at Centennial, no EA is required.
In any event, the issue would be addressed when, and if, CEA submits an application for approval of a modification to its operating specifications to permit scheduled service at Centennial Airport.
Upon consideration of the responses and submissions of the parties, and the entire record herein, including the material in the consolidated Part 13 proceedings, and the applicable law and for the reasons stated above, the FAA Office of Airport Safety and Standards finds and concludes as follows:
1. The Arapaho Public Airport Authority (ACPAA), by unreasonably delaying adoption of minimum standards for the operation of scheduled Part 135 air carrier services at Centennial Airport, and by adopting a moratorium on consideration of applications for scheduled Part 135 air carrier services at Centennial Airport in conjunction with the adoption of minimum standards for such services, violated its Federal obligations regarding Economic Nondiscrimination, as set forth in 49 USC 47107(a)(1) and standard Airport Improvement Program (AIP) grant assurance No. 22.
2. The ACPAA, by banning scheduled air carrier service on or about September 8, 1994, violated its Federal obligations regarding Economic Nondiscrimination, as set forth in 49 USC 47107(a)(1) and standard AIP grant assurance No. 22.
3. The ACPAA, by unreasonably delaying adoption of minimum standards for the operation of scheduled Part 135 air carrier services at Centennial Airport, and by adopting a moratorium on consideration of applications for scheduled Part 135 air carrier services at Centennial Airport in conjunction with the adoption of minimum standards for such services, violated its Federal obligations regarding Exclusive Rights, as set forth in 49 USC 47107(a)(4) and 40103(e) and standard AIP grant assurance No. 23.
4. The ACPAA by banning scheduled air carrier service on or about September 8, 1994, violated its Federal obligations regarding Exclusive Rights, as set forth in 49 USC 47107(a)(4) and 40103(e) and standard AIP grant assurance No. 23.
5. The ACPAA, by unreasonably delaying adoption of minimum standards for the operation of scheduled Part 135 air carrier services at Centennial Airport, and by adopting a moratorium on consideration of applications for scheduled Part 135 air carrier services at Centennial Airport in conjunction with the adoption of minimum standards for such services, violated the prohibition on state and local regulations relating to a price route or service of an air carrier as set forth in 49 USC 41713.
6. The ACPAA, by banning scheduled air carrier service on or about September 8, 1994, violated the prohibition on state and local regulations relating to a price, route or service of an air carrier as set forth in 49 USC 41713.
ACCORDINGLY, the FAA Orders that:
1. The Arapahoe County Public Airport Authority (ACPAA) present a plan to the Airports Division, Northwest Mountain Region of the FAA within 20 days from the date of this Director's Determination on how it intends to address the FAA's concerns by eliminating the violations outlined above;
2. Pending FAA approval of the corrective action plan specified in Ordering Paragraph 1, or until further notice, the ACPAA is ineligible to apply for new FAA grants pursuant to 49 USC 47106(d). [FN 10]
If the ACPAA does not submit a corrective action plan in accordance with Ordering Paragraph 1 above or appeal this determination as set forth below, the FAA proposes to issue an order pursuant to 49 USC 47122 directing the ACPAA to eliminate the violations outlined above. The failure to comply with that order would result in permanent termination of the eligibility of the ACPAA for new FAA grants.
These determinations are made under 49 U.S.C. Section 47107 (a)(4) as amended by Pub. L. No. 103-305 (August 23, 1994).
Opportunity to Request a Hearing Or an Appeal
Pursuant to Federal Aviation Regulations, 14 CFR Part 16, the Arapahoe County Public Airport Authority may request a hearing under subpart F of Part 16 within 20 days after service of the Director's Determination. See 14 CFR Section 16.109. The Arapahoe County Public Airport Authority may waive a hearing and appeal the Director's determination directly to the FAA Associate Administrator for Airports within 30 days of service of the Director's determination as provided in 14 CFR Section 16.33.
David L. Bennett
Director, Office of Airport Safety and Standards