The issues surrounding airport finances are among the most complex legal issues that airport sponsors face. Kaplan Kirsch & Rockwell represents clients in the structuring of airport rates and charges programs, the structuring of financial arrangements with neighboring governments, and the negotiations with airlines, fixed-base operators, and other tenants. We work both inside and outside of government to help formulate federal policies, legislation, and regulations on Passenger Facility Charges (PFCs), permitted uses of airport revenues, and airport rates and charges.
We litigate state and federal cases and administrative proceedings on virtually all aspects of airport finances and revenue: rates and charges, revenue diversion, PFCs, and local taxation issues. Our attorneys negotiate agreements and litigate disputes with airlines and fixed-base operators over lease and use agreements and rates and charges. We work with airports to resolve FAA Part 16 proceedings concerning airport rates and charges, to settle informal investigations concerning revenue diversion, and to obtain PFC approvals for airport projects in the face of vehement objection by air carriers or other parties.
In a time when non-aeronautical revenue is increasingly important, we assist clients in developing innovative programs that generate significant revenue while complying with the arcane and often counterintuitive federal revenue use and revenue diversion requirements. We assist airports that want to be developers or to enter into design-build-operate-maintain arrangements with private sector enterprises, including negotiating novel use and lease agreements in which airlines or third parties provide capital financing for terminal development. Navigating the legal requirements for such complex projects requires intimate knowledge of federal laws applicable to airport finances as well as broad expertise in real estate development projects and real estate financing.
We represent clients in the evaluation of financial issues, negotiations with carriers and fixed-base operators, structuring of financial arrangements with neighboring governments, and ongoing federal rulemaking and legislative activity. Our team helps formulate federal policies and draft agency rules governing permissible rates and charges methodologies, advises individual airports on innovative rates and charges methodologies imposed on airlines and other users, and participates in many contested Part 16 administrative proceedings concerning airport rates and charges. We have assisted airports in negotiations with FAA about the propriety of differential rates for different airport facilities in the face of aggressive litigation pressures from airlines and have resolved potential problems through negotiations with FAA regulators to structure airport rates and charges to avoid compliance issues.
We have provided advice to large, medium, and small hub airports on innovative means to attract and/or retain domestic and international air service for their communities—through fee waivers, marketing programs, and non-airport revenue guarantees—consistent with federal law and their contractual obligations. We have assisted in preparing programs designed to attract new service to resort airports in Florida and Colorado, to incentivize up-gauging of aircraft at congested hub airports in the Southwest, and to encourage shift of service to secondary airports within busy metropolitan areas in the Tampa Bay and Phoenix metropolitan areas.
We advise clients and coordinate with FAA on the use of airport revenue in many different contexts, including the settlement of disputes between airport sponsors and neighboring jurisdictions. We have advised clients on major intergovernmental settlement agreements in Denver, Minneapolis, Los Angeles, and Cleveland.
We assist airports in obtaining federal grants, including Letters of Intent; and in restructuring Letters of Intent to accommodate changed program needs. We advise on the development of PFC programs, demonstrating eligibility of the projects; holding airport consultation meetings and responding to airline comments; and completing the PFC application process, including meetings with FAA, where appropriate. We have successfully handled large, complex, and controversial projects, including major international terminals, the issuance of PFC-backed bonds, and assisting an airport sponsor by successfully advocating for the redeployment of PFC revenue. While most of our work involves complex projects at major hub airports, we also assist small commercial airports throughout the nation.
Our attorneys assist airports in the review and implementation of competition plans and competition plan updates. We advise airport proprietors on possible impacts of their competition plans in negotiations with airlines on lease and use agreement provisions and other issues relating to the management of their facilities, particularly terminals. We also work with airport proprietors on ways to attract competitive service and limit the ability of dominant hub airlines to restrict competition at their airports.
In addition to the specific experience of the Firm relating to competition plans, Steve Kaplan has been engaged in airline and airport competition issues broadly throughout his entire career: during his tenure as General Counsel of the United States Department of Transportation, later as the Vice Chair of the National Civil Aviation Review Commission (Mineta Commission), and in his representation of fortress hub airports throughout the country.