Michael Fleming recently spoke to Future Airport, a reference and procurement guide for the airport industry, on the Federal Aviation Administration’s (FAA’s) Airport Privatization Pilot Programme (APPP). Mr. Fleming, a partner at Washington, DC-based consulting and law firm, The Wicks Group (TWG) explained the origins of the APPP, reasons to pursue privatization and the legal concerns potential APPP sponsors will need to address.
The interview began with Mr. Fleming stating that the APPP was launched to see if American airports could follow the European example and successfully privatize. He went on to explain that before the APPP, American airports were prohibited from revenue diversion, the practice of taking airport revenue off-airport and using it for another purpose. Mr. Fleming clarified that the APPP offers limited relief from revenue diversion.
In his interview, Mr. Fleming offered three reasons for privatizing US airports: enormous forecast capital costs, privatization of airports around the world and the belief that private owners could operate airports more efficiently.
Mr. Fleming advised those airports interested in privatization of the lengthy and complex nature of a transaction involving a major asset such as an airport. In terms of legal concerns, he stressed the need for those airports wishing to enter the APPP to perform due diligence. Speaking from his experience, Mr. Fleming also expressed the necessity of adept legal guidance in obtaining FAA approval for participation in the APPP.
There have been only two applications under the APPP in the last several years, and The Wicks Group served as FAA counsel to the sponsor in its initial application to participate in the APPP process, an effort spearheaded by Partner Michael Fleming. The firm's Managing Director, Glenn Wicks, has also worked with Westchester County Airport, which, applied to APPP in November of 2016 and is currently in the process of selecting a private operator.
TWG is a multi-disciplinary legal and consulting firm that provides specialized services to clients with aviation and transportation-related interests worldwide. TWG advises clients around the globe on achieving their civil aviation development objectives, whether achieving compliance with international regulatory standards or establishing best practices to foster economic growth.
For more information about TWG’s services related airport privatization and public-private partnerships, please contact Michael Fleming at mfleming@wicks-group.com or (202) 457-7790.