AST 205

Chapter 1 Notes

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FBO

• What does FBO stand for?

• Fixed Based Operator

• How did that term originate?

• Originated from the early Barnstorming days of aviation Post WWI.

• What services to FBO’s offer?– Fuel sales, repair/maintenance/alteration,

aircraft storage, rental, instruction, air taxi/freight, pilot supplies, sales, etc.

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What’s happening to FBO’s

• 1970- approximately 12,000 FBO’s in US

• 1980- approx. 10,000

• 1993- approx. 4,300

• Today- 4,800 – 5,200 approx.- projected to remain the same or decline slightly

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What are some examples of Larger Chain FBO’s in the US?

• Raytheon Aircraft Services

• Bombardier

• Mercury Air Centers

• Signature Flight Support

• Million Air

• Others?

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Reason’s for FBO Decline in numbers

• Onset of Jets- starting in the 1960’s – 1970’s

• Economic cycles- recession in 1970’s and 1980’s

• More competition for free time

• Expense- Why?– Liability issue- 18K deliveries in 1978, approx. 900

in 1993

– Production costs

– Increased complexity- Technology, airspace

– Progressive communities demand better service

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Currently

• Moderate Growth- Why?– Deliveries are up

– Hiring is up

– VLJ’s

– Sport pilot initiative

– 1994 General Aviation Product Liability Reform Act

– Deregulation- concentrated traffic at hubs

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Some Statistics

• Commercial airlines serve only 5% of public-use airports

• General Aviation is the exclusive user of 90% of these airports

• 281 large U.S. airports handle virtually all passenger traffic

• 25% of travelers board at the 5 largest airports

• Air carriers (121) compose about 2.2% of the civil aircraft fleet but make up 35% of the civil hours flown

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Statistics Continued

• Of the approx. 19,000 landing facilities in the U.S.- only 5,000 – 6,000 are for public use and roughly ½ of those are privately owned.

• Of the remaining half (roughly 3,000) these airports are classified into the NPIAS- National Plan for an Integrated Airspace System as:– Large Hub- i.e. Chicago O’Hare

– Medium Hub- Cincinnati- (comair)

– Small Hub- Louisville, Evansville

– Non-Hub- South Bend

– G.A. reliever- 25,000 – 35,000 operations per year such as Indy Mt. Comfort/Executive

– Others- Sullivan County

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NPIAS Airports

• All publicly owned and public-use airports and some private airports if they are public-use and not located too close to another NPIAS airport

• Projects include:– Runway maintenance/construction

– Hangar construction

– Approach/Nav. Aids

– Others

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Why is the fight for local airports important?

• We lose an average of more than one airport per week in the U.S.

• Airports are increasingly under attack from the NIMBY crowd

• More industries are being built in rural America

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How is the Aviation System Funded?

• Federal Airport and Airways Trust Fund- congress authorizes it’s use every few years

• FAA operating budget- $14 Billion Dollars in 2006

• Trust Fund Makes up 75% of that; the remaining 25% comes from the General Fund of Taxpayer revenues

• Sadly- User Fees are on the Horizon

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How is the Trust Fund Funded Currently?

• Commercial Passenger Tax- 10% of all tickets sold

• General Aviation Fuel Tax- 19.4 cents per gallon of AVGas- 21.9% cents per gallon of jet fuel

• (Part of the G.A. fuel tax- 4.3 cents per gallon has beed traditionally diverted to reduce the federal deficit- this was stopped about 4 years ago by the AIR21 Legislation)

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FAA Trust Fund Funding Ctn.

• Air Cargo Tax- 6.25% tax (a.k.a. freight waybill tax)

• International Departure Tax- $6 per person per trip.

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Why G.A. likes the current funding System

• Directly Related to System Use

• Easy and Inexpensive to Collect

• Easy to Pay

• Does not impact safety as user fees would

• Accepted to the taxpayer

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The Future of G.A.

• User Fees

• Sport Pilot Growth

• VLJ Growth

• Alternative Fuels

• Noise Reduction

• Increased Crashworthiness

• More Intuitive Avionics

• Influx of new designs from around the globe

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Thank you- Questions?