Regulatory Alert: FAA Releases Supplemental Proposed Rule to Update PFC Program Regulations

November 4, 2026

Today, the Federal Aviation Administration (FAA) published a supplemental notice of proposed rulemaking (SNPRM) that would make a series of changes to the regulations governing the passenger facility charge (PFC) program. The SNPRM replaces a previous notice of proposed rulemaking released in 2023 that sought to codify policy changes that FAA had implemented into guidance. Unlike the 2023 proposal, however, the SNPRM released today would simply codify the changes made by Congress to the PFC program in the FAA Reauthorization Act of 2024, including the provisions relating to the streamlined PFC authorization process. Based on our review, the SNPRM does not propose any new major policy changes to the program.

The FAA has set Monday, January 4, 2027, as the deadline for the public and industry stakeholders to submit comments in response to the SNPRM. You can view the FAA’s SNPRM here. AAAE will be submitting feedback to the FAA. Please reach out to Justin Barkowski if you have any questions or input you would like for us to consider including in our comments.

Background. Under the FAA Reauthorization Act of 2018, Congress directed the FAA to allow small, medium, and large hubs to use a streamlined PFC authorization process that previously only applied to non-hubs. Under the program, airport sponsors may submit to FAA a notice of intent (NOI) to impose a PFC and move forward absent an objection within 30 days. This is known as the streamlined PFC process. Unfortunately, when FAA implemented this directive through internal guidance in PFC Update 73-20, many projects were deemed “ineligible” for the streamlined process. The FAA sought to codify these changes, along with many others, in a proposed rule in 2023. On multiple occasions, AAAE has strongly opposed how the FAA has implemented the streamlined process, including in comments to the 2023 proposal.

Under the FAA Reauthorization Act of 2024, Congress narrowed the list of projects that the FAA could exclude from the streamlined PFC process and provided the FAA with 60 days to review and object to an NOI (rather than 30 days). The 2024 law also made several other changes to the PFC program, including expanding project eligibility and adjusting PFC turnback amounts. The SNPRM published today would codify the changes made by the 2024 law.

Overview of Proposed Changes to PFC Program. Based on our review of the SNPRM, the FAA has proposed changes in six different parts of the PFC program, all of which reflect changes made by Congress in the 2024 law:

PFC Turnback Reductions: Medium and large hubs that collect PFCs are currently subject to a reduction in their apportionments (entitlement funds) under the Airport Improvement Program, known as the PFC turnback. The 2024 law decreased the amount of PFC turnback from 50 percent for medium and large hubs collecting a PFC of $3 or less and 75 percent for medium and large hubs collecting a PFC greater than $3 to 40 percent and 60 percent, respectively. The FAA’s SNPRM would codify these reductions but make no other changes.

New PFC-Eligible Projects: Section 775 of the 2024 law added two new PFC-eligible projects: (1) projects at a small hub airport for a noise barrier where the DNL from commercial, general aviation, or cargo operations is expected to exceed 55 dB as a result of new airport development; and (2) projects that replace existing workspace elements related to the relocation of a federal agency on airport grounds due to a terminal development or renovation project. The FAA’s SNPRM would codify these as newly eligible projects but make no other changes. (Note: FAA recently released PFC Update 77-26, which provides guidance to field offices on how they can assess the eligibility of projects that fall within the two new categories.)

Restrictions on PFC-Eligible Projects: Before the 2024 law, an airport sponsor could use PFCs to convert or acquire eligible vehicles and ground support equipment that use low-emission technology or clean fuels if two conditions were met: (1) the airport was located in an air quality nonattainment area or a maintenance area; and (2) the project would result in the airport receiving appropriate emission credits. In accordance with the 2024 law, the FAA’s SNPRM would codify the removal of those two conditions for these projects.

Responding to NOI Submissions: As explained above, Congress has allowed sponsors of commercial service airports to use a streamlined NOI process for obtaining a PFC authorization from the FAA. This process allows sponsors submit an NOI to the FAA and move forward with a PFC absent an objection within 30 days. In the 2024 law, Congress extended the timeframe for the FAA to review and object to a proposed project from 30 days to 60 days; however, the 30-day deadline for FAA to object to a sponsor imposing a PFC remained intact. The FAA believes this was a drafting error. Thus, the FAA’s SNPRM would specify that the agency has 60 days to issue an objection before an airport sponsor may move forward with a proposed PFC project and impose a PFC.

PFC Streamlining Review Eligibility: Since 2020, FAA has deemed many projects “ineligible” for the streamlined NOI process and required those ineligible projects to be reviewed by the agency through the traditional PFC application process. The ineligible projects are outlined in PFC Update 73-20. However, in 2024, Congress limited the scope of projects that FAA may exclude from the streamlined process to projects that (1) establish significant policy precedent; (2) raise significant legal issues; (3) garner significant controversy; (4) raise significant revenue diversion, airport noise, or access issues; (5) include multimodal components; or (6) serve no aeronautical purpose. The FAA’s SNPRM would codify this list of six projects that Congress allowed the agency to preclude from the streamlined NOI process.

PFC Submittal Requirements: Under the 2018 and 2024 laws, Congress limited the FAA’s authority to review and approve airport layout plans (ALP) for certain types of projects. Before these changes, all proposed PFC construction projects were required to be depicted on an FAA-approved ALP before a PFC could be authorized. The FAA’s SNPRM would eliminate the requirement for an airport sponsor to provide an FAA-approved ALP with its PFC application if the proposed project falls outside of FAA’s ALP approval authority. However, if no approval is required but the proposed project must still be shown on an ALP, the FAA would require the sponsor to provide a description and a drawing depicting the location of the project. The FAA contends the description and drawing are necessary to assess eligibility and justification for the proposed project.

What’s Next? The FAA’s SNPRM was published in the Federal Register this morning, triggering a 61-day comment period. Comments from airports and the public will be due to the agency on or before Monday, January 4, 2027. Airport staff that are responsible for managing PFCs are highly encouraged to review the proposal. AAAE will be working with members to ensure we communicate the airport community’s perspectives on the SNPRM to the FAA.