U.S. Airports to Receive $8 Billion to Help Pay Bills as Travel Recovers

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U.S. airports are set to receive $8 billion in government grants to help them emerge from the coronavirus pandemic that decimated travel last year.

Air travel is returning, but airports say they are still grappling with lower traffic volumes, high debt payments and new costs stemming from the pandemic.

The grants announced by the Federal Aviation Administration Tuesday, which were included in the $1.9 trillion stimulus package approved in March, will help ease financial burdens until travel fully recovers, airports say.

Airports can use the fresh round of funds to cover operating costs, to pay debt service, or for new expenses related to preventing the spread of disease, like installing air filters or stepping up cleaning practices. Funding levels are based largely on an airport’s 2019 traffic, with some money earmarked to cover rent payments for concessions operators. Airports must also commit to keeping 90% of employees as a condition of accepting the funds.

A waiting area in mid-April at Philadelphia International Airport, where half of the concession businesses remain closed.



Photo:

Marcus Dipaola/NurPhoto/Zuma Press

Leisure travelers have flooded back into airports in recent months. Some 2.1 million people passed through U.S. airport security screening Sunday, the highest number since the pandemic began to decimate air travel in March 2020, according to the Transportation Security Administration.

Still, passenger volumes remain about 25% lower than pre-pandemic highs, according to TSA figures. Many international markets have been hobbled by restrictions and business travelers have yet to return en masse. Some airports, particularly those that serve as international gateways, have felt those losses more heavily than others.

Philadelphia International Airport had its best year ever in 2019, serving more than 33 million passengers, said

Chellie Cameron,

the airport’s chief executive. That number dropped to around 11.9 million in 2020, and losses from fiscal years 2020 to 2022 will total almost $500 million, Ms. Cameron said.

“When I say that [the funding] was everything to us, it was everything to us. To people, and to businesses, and to this community,” she said.

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Some of the $115 million the airport is set to receive under the latest round of grants has been earmarked for concession businesses, half of which remain closed, Ms. Cameron said. The airport has also used previous rounds of funding for debt service and other costs.

Kevin Burke,

chief executive of Airports Council International-North America, an airport trade association, said that airports have recovered considerably this year, averaging about two million passengers a day over the past month compared with between 2.3 million and 2.5 million passengers in 2019.

“It’s been a bit of an uneven recovery,” he said.

As passengers return to air travel in big numbers, the Federal Aviation Administration has reported an uptick in unruly and dangerous behaviors by travelers. WSJ’s Alison Sider explains. Photo: David Zalubowski/AP

Airports in cities that are popular with vacationers, such as Key West, Fla., and Bozeman, Mont., are busier than ever. But scheduled capacity is still down significantly at airports in big cities like New York and San Francisco, according to Cirium, an airline data provider.

Fewer passengers means those airports are bringing in less revenue, including from so-called passenger facility charges that help fund many airport infrastructure projects.

Other sources of income like parking and rental-car revenue also dried up during the pandemic. Airports Council International-North America has estimated that the pandemic’s hit to U.S. airports will total about $40 billion. At the same time, airports are on the hook to pay about $16 billion to service their debt in 2020 and 2021, the group said earlier this year.

The fresh round of aid brings the total government assistance to airports during the pandemic to $20 billion. Airports previously received $10 billion under the Cares Act passed in March 2020 and another $2 billion under another stimulus package passed in December.

Write to Alison Sider at alison.sider@wsj.com

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