S. 5572: Modern Skies Act

The bill would provide new federal funding for airport and air traffic control projects, mainly through the Federal Aviation Administration (FAA), and create a new grant program for a small number of older airport terminals.

Airport terminal modernization pilot program

The bill would direct the Secretary of Transportation to create a pilot program that gives grants to the sponsors of up to 3 airports. These airports would have to meet specific conditions, including:

• being classified as medium hub airports when the bill is enacted,
• having a main terminal built before January 1, 1990,
• still using that terminal as the airport’s main passenger terminal,
• not having fully replaced that terminal since 1990, and
• having a project that has already finished environmental review and is in final design.

Airports applying for the grants would have to show things like the terminal’s historic or unique features, expected local economic benefits, effects on airline competition and service to small communities, project readiness, and estimated costs.

Money from this program could be used for terminal construction, demolition, rebuilding, utility and energy systems, baggage systems, passenger flow improvements, replacement of old ground equipment, and cargo/logistics facility upgrades. The Secretary could also place additional conditions on how the funds are used.

The federal government could cover up to 90% of a project’s cost. The bill would appropriate $10 billion for this pilot program in fiscal year 2027, with up to 3% for administrative expenses.

Air traffic control improvements

The bill would also appropriate money for several FAA air traffic control upgrades in fiscal year 2027, including:

• $300 million to consolidate terminal air traffic control facilities,
• $7.2 billion for a common automation platform and controller workstation,
• $2 billion for cloud computing and related telecommunications infrastructure for the national airspace system, and
• $600 million for strategic air traffic flow management technology.

The FAA Administrator could move money among these categories if needed, and would have to report to Congress regularly on spending.

Additional airport and terminal grant funding

The bill would provide another $10 billion in fiscal year 2027 for airport and terminal improvement grants, including:

• $2 billion to build, replace, and improve terminal air traffic control facilities, including digital tower technology,
• $3 billion for existing discretionary airport grant programs, and
• $5 billion for airport terminal development projects aimed at aging airport infrastructure.

For the $3 billion discretionary grant portion, the bill would remove some normal formula and minimum-percentage requirements, giving the FAA more flexibility in how it awards the funds.

For the $5 billion terminal-development portion, grants could go to airports already eligible for discretionary airport grants, and projects could include terminal development as defined in a prior airport program. The federal share would be capped at 80% for large and medium hub airports, and 95% for small hub, nonhub, and nonprimary airports.

Use of existing ATC modernization funds

The bill would let the FAA reallocate money that was previously appropriated in Public Law 119-21 for the new air traffic control system, and would require those transfers to be reported to Congress.

Reporting and administration

The FAA would have to provide quarterly reports on spending for the air traffic control improvements. The Transportation Secretary would also have to brief Congress within one year on the airport terminal pilot program. In several places, the bill gives the Secretary or FAA Administrator discretion over award decisions, conditions, and certain cost determinations.

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