Federal Aviation Administration Needs to Strengthen Selection and Award Processes for Airport Improvement Grants

The Recovery Act calls for the Federal Aviation Administration (FAA) to award $1.1 billion in grants to airport operators for projects that improve airport safety, capacity, and security. When reviewing FAA's process for selecting and funding the projects, the agency's Office of Inspector General (OIG) found that FAA selected some low-priority projects that have questionable economic merit—a key Recovery Act requirement. Also, in some cases, FAA awarded money to recipients with histories of grant-management problems, which raised doubts about their ability to administer effectively their Recovery funds. The OIG urged the FAA to revise its guidance on selecting Recovery-related airport improvement projects, and to ensure that funding is awarded only for the highest-priority projects with demonstrated economic merit. In addition, the OIG recommended that FAA provide stronger oversight of the entities receiving grant money.