1. Steven Landau Economic Development Research Group, Inc. www.edrgroup.com January 13, 2014 1

2. The primary purpose of airport system planning is to study the performance and interaction of an entire aviation system to understand the interrelationship of the member airports. - FAA Advisory Circular 150/5070-7, The Airport System Planning Process, 2004 2

3. Among goals of a System Plan are: To provide for the timely development of airports that will meet the air transportation needs and economic goals of the system planning study area To maximize the economic benefits from the development of the airport system 3 - FAA Advisory Circular 150/5070-7

4. 4 21 Economic studies to measure the benefit of interrelated developments in the network of airports and their impact on airport activity 24 Performance indicators or priority systems for pavement management and capital improvement plans

5. Benefit cost analysis based on productivity gains and increased economic benefits Social (non-transactional) returns monetized. Common measure s are value of time for personal travel, environmental benefits Incremental economic impact benefits 5

6. Project x project benefit cost analysis Project x project economic impact analysis Economic impacts/ benefit to costs analyses of alternative bundles of projects Economic impacts of not investing 6 States are using economic criteria to help prioritize surface transportation improvements. Among these are North Carolina, Kansas & Ohio.

7. 7 Performance Measures Congestion Safety Score Pavement Score Benefit/Cost Economic Competitiveness (Value Added in $) Lane Width (Existing Width vs. Standard Width) Shoulder Width (Existing Width vs. Standard Width) Source: North Carolina DOT Project Prioritization Process

8. Project Classification Engineering Data Local Input Economic Impact Preservation100% Modernization80%20% Expansion50%25% 8 Source: Kansas DOT Tworks

9. Actions and projects to improve system performance relative to airport-specific facility, service, and equipment objectives; and provide Generalized cost estimates related to implementing improvements identified in the system plan 9

10. Safety/SecurityServicesAirfield Operations De-Icing Equipment Fencing Snow Removal Equipment Maintenance Facilities Runway Edge Lights (LIRL, HIRL, MIRL) Weather Reporting facilities Auto Parking Ground Transportation Hangars Paved Aircraft Parking Terminal Improvements Apron Parallel Taxiway Precision Approach or LPV/APV Runway Extension Runway Strengthening Runway Widening Upgrade Airport Role in State Visual Aids 10

11. Rough cost estimates Approximate implementation schedules Likely benefits of investments (e.g., operations, enplanements, reduced diversions) Forecasts of operations, enplanements & fleet mix 11

12. Who wants to know? Managers of aviation and transportation budgets Policy makers who appropriate state & local expenditures for airports Airlines and other airport stakeholders 12

13. ROI Type of Project Category (e.g., airside, landside) Single Airport or by Classification of Airport Geography/ Sub-state Regional Equity DOT/Aviation Dept. Policy Goals 13

14. 14 Runway Extension - 30 year cost and benefit stream

15. BenefitPerspective Benefit / Cost Ratio Net Present Value Traveler Efficiency Benefit User Benefits/ Costs3.50$24,031,000 General Public Benefits (User Benefits + Other Public Benefits)/ Costs 3.55$24,524,000 Wider Benefits (User Benefits + Other Public Benefits + Discounted GSP)/ Costs 5.78$45,905,000 Fiscal ImpactsPublic Revenue/ Costs0.07($8,967,000) 15

16. 16

17. 17 AirportProject Travel Efficiency Benefits ($1000s) Total Public Benefits ($1000s) Govt. Revenue ($1000s) Project Cost ($1000s) Travel Efficiency Total Public B/C Govt. AAARunway Extension $23,823$24,142$0$9,8952.412.440.00 AABRunway Extension $13,642$14,136$644$9,6121.421.470.07 AACParallel Taxiway $1,993$2,152$0$2,0810.961.030.00 AADRunway Extension $12,167$12,615$585$8,7181.401.450.07 AAERunway Widening $15,079$17,252$0$4,9383.053.490.00 AAFPCI Increase $1,793$1,817$79$1,7821.011.020.04 AAFTaxiway Lighting $398$432$15$1253.183.460.12 AAGPCI Increase $1,152$1,194$57$9201.251.300.06 AAGParallel Taxiway $1,869$1,942$45$2,0530.910.950.02 AAHTaxiway Lighting $91$99$11$751.211.320.15 AAIParallel Taxiway $1,823$1,890$0$1,7551.041.080.00 AAJPCI Increase $889$966$25$9200.971.050.03 AAJ PAPI (visual guidance) $29$46$0$400.731.150.00 AAKPCI Increase $945$1,027$0$9201.031.120.00 AAL Runway/Highway Widening $8,403$10,701$0$3,7812.222.830.00

18. 18 AirportProjectNet Present Value ($1000s) Total Public B/C AAERunway Widening$12,3143.49 AAFTaxiway Lighting$3073.46 AAHTaxiway Lighting$1533.04 AAL Runway/Highway Widening $6,9202.83 AAARunway Extension$14,2472.44 AABRunway Extension$4,5241.47 AADRunway Extension$3,8971.45 AAGPCI Increase$2471.30 AAIParallel Taxiway$3541.20 AAJPAPI (visual guidance)$61.15 AAKPCI Increase$1071.12 AAJPCI Increase$461.05 AACParallel Taxiway$711.03 AAFPCI Increase$351.02 AAGParallel Taxiway-$1110.95

19. 19 Contribution to Gross State Product ($1000s, discounted over the life of the projects)

20. Decide on Important Measures/ Categories Analyze possible investments as System Plan is being developed to help decide on project that should be recommended Prioritize final recommendations 20

21. Demonstrates how economic analysis is being used in the screening/selection process and how it helps lead to better decisions on how to spend public money 21 MeasuresKey Application issues in State System Plan User time and cost factors Broader economic impacts For airport improvements Need to balance large and small airports/commercial and GA-only airports

22. 22 State Aviation System Plan Prioritization of Airport Projects Benefits/Costs of Airport Investments Economic Impacts of Airport Investments System Roles & Connectivity

23. Steven Landau Economic Development Research Group 155 Federal Street, Boston, MA 02110 617-338-6775 x 206 Slandau@edrgroup.com www.edrgroup.com 23