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Air Carrier Incentive Program


What is the Air Carrier Incentive Program?

The Air Carrier Incentive Program provides guidance to airport sponsors interested in offering promotional incentives to attract air carrier service at federally obligated facilities.

Updates Addressing Upgauging

On Monday, April 9, 2012, the FAA published a Federal Register Notice (see below)responding to a petition submitted by the Clark County Department of Aviation, sponsor of Las Vegas McCarran International Airport (LAS), about the Air Carrier Incentive Program. The premise of the Air Carrier Incentive Program is found in FAA's Policy and Procedures Concerning the Use of Airport Revenue (originally published on February 16, 1999). In the petition, Clark County requested the FAA consider expanding the definition of "new service," one of two existing goals of the Air Carrier Incentive Program identified in the Revenue Use Policy, to include increases in landed weight. This led to a number of policy questions about upgauging aircraft and whether it would qualify as "new air service" for the purposes of an air carrier incentive.

Historically, the FAA has not defined upgauging as a "new air service," which Congress directed be a component of the program. However, this notice confirms that a properly structured and administered program permitting airlines to upgauge may result in "new air service" when done so with certain conditions. For example, as stated in the notice:

  • Upgauging cannot be the only component of the program (e.g., the program must include adding flights too);
  • To be eligible for incentives to upgauge, air carriers must demonstrate an increase in service above and beyond the baseline set by the market(s) targeted by the program; and
  • Air carriers cannot receive incentives for "new" flights to other markets targeted under the incentive program when it reduces service in other markets targeted.

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