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Chapter 13. 89. General. The establishment of the airport master plan's economic feasibility, i.e., the balance between annual cost of capital investment and airport revenues, is vital to the promotion of financing for the improvements proposed in the plan. The imple- mentation of the airport master plan will depend largely on the proper financing of those capital im- provements. The primary responsibility for financing the development plans rests with Local operating agen- cies or authorities. There are many ways in which public financing of airport development can be accom- plished. Financing may be raised from taxes, general obligation bonds, revenue bonds, private financing, government assistance, or a combination thereof. 90. General Obligation Bonds. General obli- gation bond financing for airport improvements backed by taxing powers has been used for financing. How- ever, fiscal pressures on local governments for all manners of activities have been especially great in recent years. The need for school construction and other essential public works has required a consider- able volume of general obligation bond financing. In numerous cases, local governments have reached statu- tory bond limits or desire to reserve whatever margin is left for more general functions of government. It is becoming increasingly difficult to obtain taxpayer approval for general obligation bond issues for air- ports. 91. Revenue Bonds. Revenue bond financing for airport improvements has become the most common financing method. Financing with revenue bonds pre- sents an opportunity to provide those improvements without direct burden to the taxpayer. 92. Private Financing. Private financing of specific facilities such as hangars, fuel distribution systems, even hotels and the like, may be practical. Such facilities can be constructed with private capital on land leased from the airport. The obvious ad- vantage of such an arrangement is that it relieves the FINANCING community of all responsibility for raising the capital funds for the particular improvements involved. 93. Financing by Nonprofit Corporations. Another method of obtaining capital for the construc- tion of airport improvements is through the nonprofit corporation approach. In some jurisdictions, the law provides for the formation of a nonprofit corporation to be used for financing of improvement for the benefit of a local governmental agency. The principal re- quirement is that the improvements constructed will revert to an airport authority after the bonds issued for the construction of the facilities have been retired. This method of financing can be used for the con- struction of facilities such as airline maintenance hangars and air cargo terminals. 94. Federal Grants for Airport Construc- tion. Government assistance for development projects recommended in airport master plans is provided for by grants-in-aid covered by the Airport and Airway Development Act of 1970. 95. Master Plan Implementation. The devel- opment of a financial plan is the final step in the air- port master plan process. Thereafter, the overall master plan must be accepted by authorities having jurisdiction over such matters and by the public. Once the plan has been adopted and the financing has been obtained, the final design and construction of improvements proposed in the master plan can be implemented. 96. Capital Budget. With a determination of the projects to be constructed and their timing, a capital budget should be prepared to show on an annual basis the requirement for capital funds and the source of funds. This analysis will also permit accurate estimation by the operator of the amount of interest to be earned on capital funds held from the sale of bonds prior to the need to commit such funds for construction purposes. 75