FBO Insight: Protect Your FBO with a “Durable Airport Minimum Standards” Document

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Photo credit: joshmort

Multi-Part Series on The 7 Immutable Elements of Building Equity in Your FBO Enterprise

Building equity in your FBO business can often take years. It’s an investment in both time and resources.

That’s why FBO owners and operators need to make sure their equity position is protected and made durable through a strong Airport Minimum Standards document.

In essence, an Airport Minimum Standards document creates a level competitive playing field by detailing the minimum requirements for an FBO or Specialized Airport Service Organization (SASO) operating at a public-use airport and sets the standard for compliance for both existing and potential competition. 

For instance, if an airport sponsor allows a new FBO to conduct business on a field where an existing FBO currently operates, under an existing durable Airport Minimum Standards document the new FBO must meet minimum standards in regard to making the same investment in facilities, providing similar services, and operate at the same level while paying equivalent rentals and fees. Also detailed should be the minimum size of the leasehold, the hours of operation and the required equipment.

In short, the benefit to the FBO is that the Minimum Airport Standard helps protect the investment of a current service provider from devaluation. Conversely, the benefit for potential service providers is that they can more accurately predict the amount of investment it will take to enter the market.

Often, a Minimum Standards document resides with the Airport Sponsor as part of the rules and regulations of the airport, separate from an FBOs leasehold agreement. However, FBOs should make sure that acknowledgement of the existence of such a document is called out in their lease. Furthermore, FBOs should have a copy of the Minimum Standards document in their files for current and future reference and keep track of any revisions.  

Within the Airport Minimum Standards documents are two key elements worth noting:

  • Purpose

  • Permit, Lease or Operating Agreement.

 Purpose

  • The purpose of minimum standards is to establish and make requirements for general aviation aeronautical activities. The standards are established in the public interest for the safe and efficient operation of the airport in order to enhance orderly growth and comply with federal, state and local government legal requirements. It also provides information to parties operating or desiring to operate at the airport. These standards, in general, establish minimum levels of service that shall be offered in order to protect the public welfare and prohibit irresponsible, unsafe or inadequate services.

 Permit, Lease or Operating Agreement

  • No person, including an aeronautical service operator, shall offer or perform a commercial aeronautical activity, operation or service at an airport without written authority for such service. Such authority will generally be contained in a Permit, Lease or Operating Agreement that has been negotiated between the FBO/SASO and the Airport.

For more information on Airport Minimum Standards, please refer to this FAA Advisory Circular: Minimum Standards for Commercial Aeronautical Activities.

In our next blog post, we will discuss Instilling a Strong Internal Safety Culture as a major component of The 7 Immutable Elements of Building Equity in Your FBO Enterprise.

ABOUT THE BLOGGERS: John Enticknap is the founder of Aviation Business Strategies Group (ABSG). He has more than 35 years of aviation fueling and FBO services industry experience and is an IS-BAH Accredited auditor. Ron Jackson is co-founder of ABSG and president of The Jackson Group (TJG), a PR agency specializing in FBO marketing and customer service training. Visit the biography page or absggroup.com for more background.

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