Wendell H. Ford Aviation Investment and Reform Act for the 21st Century (AIR-21)

On April 5, 2000, the far-ranging Wendell H. Ford Aviation Investment and Reform Act for the 21st Century became law. This statute, designed to alleviate many of the intransigent problems faced by the aviation infrastructure arising from deregulation, increased funding for civil aviation in the United States by $10 billion over levels current at the time of its passage. The majority of the increased funding was earmarked for air­port construction and improvement and for radar modernization. The major components of the law, broken out into the general categories that are affected, are outlined in the box on page 315.

For the first time, as a result of AIR-21, large and medium hub airports are required to submit Competition Plans to the FAA as a condi­tion of receiving PFCs at those airports. These requirements are designed to assure a competi­tive environment for all airlines, including gate use monitoring, gate sublease oversight, and pro­cedures for assignment of gates.

When the Deregulation Act was passed in 1978, most airports had in place legally enforce­able gate and lease contacts with the airlines that reflected the economic realities of rules imposed by the CAB. Under these rules, as discussed above, airports were happy to have the airlines serving their airports, and the existing contracts reflected this disparity in negotiating position. As we have seen, the beneficial provisions in these contracts to incumbent airlines translated into anticompetitive barriers to new entrant carriers. With the anticompetition provisions in AIR-21, and with the expiration of these pre-deregulation contracts, all airlines, including new entrants, will have a more level playing field.