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PennDOT Expedites Tax Reimbursement Program Processing Vital to Airports

August 07, 2023 12:00 PM
By: PennDOT Bureau of Innovations

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From the 2023 Focus on Innovations report

Aviation plays a significant role in Pennsylvania's economy, and PennDOT's e-Grant program is helping to support the 121 public-use airports and related facilities.

Paul Bendigo, trustee to his family's privately-owned public-use Bendigo Airport in Tower City, Dauphin County, appreciates that support.

In 2022, PennDOT's Bureau of Aviation improved their process by transitioning its Real Estate Tax Reimbursement Program for public-use airports from being paper-based to the online e-Grants program.

"It did run a lot more smoothly this past year," Bendigo noted.

As one player in an industry that contributes nearly $24 billion to the state's economy, Bendigo's airport is home to roughly 20 privately-owned aircraft. When his family invested in a new runway and taxiway in 1999, Dauphin County assessed the improvement as a structure and assessed the pavement of the runway and taxiway at nearly $200,000 in addition to the land assessment of approximately $150,000. In 2022, the airport paid nearly $9,000 in real estate taxes and received roughly $6,200 from the Tax Reimbursement Program.

"Without the reimbursement program, it would be hard for us to stay open, because that's the only thing that can give us a level playing field with publicly-owned airports that don't have to pay any real estate taxes," Bendigo said.

Bendigo added that the privately-owned public airport business "is very challenging ... with the cost of fuel and the cost of maintaining airplanes, it's not what it was when my father opened the airport to the public in 1963. "We've been providing this public service for this whole time," Bendigo said. "The Real Estate Tax Reimbursement Program helps us out tremendously."

Before the transition to e-Grants, Justin Palmer, Aviation Specialist supervisor in PennDOT's Bureau of Aviation said, "airports mailed or emailed in tax documents, the Office of Administration (OA) verified the documents, the Bureau of Aviation determined eligibility areas, and OA processed the request."

With the transition to the new online process, the sponsor creates a Keystone log in account on e-Grants, signs a one-time agreement, creates a new application, uploads the tax information, and signs and submits the documents electronically.

"The application process is greatly improved, and the turnaround time is less than 28 days," Palmer added.

The funds used for the program come from a portion of the Aviation Restricted Account, which is supported by aviation fuel sales taxes. Palmer added that roughly 20 public airports apply for the program each year.

"Obviously, there is the benefit to the airport owner," he noted. "The reduction of their overall tax bill. It's an appreciation or a gesture of good will that we try to extend to these airports. We are doing everything we can to help them survive. Owning a public airport is not a lucrative business. It's a very difficult industry. It's a little way of helping the smaller airport owners in a very small way."

To find more information on the PennDOT Focus on Innovations report, click here.