26
 KENTUCKY STATEWIDE AVIATION SYSTEM PLAN 41 4 Aviation Trends and Issues Recent trends, both national and statewide, are important considerations in the development of an aviation system plan, as these trends can influence the supply and demand for aviation services. Fluctuating trends regarding aviation usage and economic swings resulting from the nation’s business cycle and previous periods of record high oil prices have all impacted aviation demand. Many of these national trends are reflected within Kentucky, along with aviation developments that are unique to the state. This chapter examines trends relating to general aviation, air cargo, multimodal issues, and technology that are expected to have an influence on aviation in Kentucky. Note that this chapter is based on the best available data as of the first quarter of 2016. General Aviation Trends There are a number of components that can be examined to gain an understanding of general aviation (GA) trends. Key among these are the number and type of new GA aircraft entering the fleet, the number of active GA aircraft, and the number of pilots flying in the U.S. The following sections examine each of these aspects of GA, starting with new GA aircraft produced by year since 1975. The analysis of new aircraft provides an overview of how GA has performed over the long term, while the assessment of active GA aircraft and pilots focuses on the trends since 2010. In addition to these activity trends, this chapter will also summarize what is being done to address lead in aviation fuel, and how that could impact GA activity. New General Aviation Aircraft One indicator of the how the GA industry is performing is the number of aircraft delivered per year and their total value. Figure 41 shows this data starting in 1975. As with any industry, GA is subject to the ups and downs of the business cycle. However, GA is an industry that is among the first to suffer the effects of an economic downturn and the last to recover from it. This can clearly be seen in Figure 4‐1, where aircraft shipments can be seen tailing off before each major U.S. recession and not recovering until well after the recession ends. The number of aircraft sold was dominated by piston aircraft from 1975 until the early 1980s, when increasing product liability costs resulted in a contraction of the manufacturing of these aircraft. A prime example of this manufacturing retrenchment is Cessna Aircraft Company, which ceased production of all its single‐engine piston aircraft in 1986, primarily due to liability concerns. By the mid‐1990s, deliveries of single‐engine piston aircraft had fallen from its 1978 peak by 97 percent, and was now on par with the number of turbine aircraft shipped. In 1994, legislation went into effect that shielded GA manufacturers from lawsuits on aircraft and aviation parts that were more than 18 years old. With this protection in place, GA shipments of both piston and turbine GA aircraft began a slow but steady rise, with piston aircraft growth outpacing turbine aircraft. This lasted until the tech bubble burst in early 2001, followed by the terrorist attacks of September 11 th . GA manufacturing recovered briefly, but then was hit by the recession precipitated by the housing collapse that started in December 2007.

Aviation Trends and Issues - Kentucky …...Aviation Trends and Issues KENTUCKY STATEWIDE AVIATION SYSTEM PLAN 4‐2 The sale of turbine aircraft has followed a pattern similar to

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 KENTUCKY STATEWIDE AVIATION SYSTEM PLAN

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4 Aviation Trends and Issues

Recenttrends,bothnationalandstatewide,areimportantconsiderationsinthedevelopmentofanaviationsystemplan,asthesetrendscaninfluencethesupplyanddemandforaviationservices.Fluctuatingtrendsregardingaviationusageandeconomicswingsresultingfromthenation’sbusinesscycleandpreviousperiodsofrecordhighoilpriceshaveallimpactedaviationdemand.ManyofthesenationaltrendsarereflectedwithinKentucky,alongwithaviationdevelopmentsthatareuniquetothestate.

Thischapterexaminestrendsrelatingtogeneralaviation,aircargo,multimodalissues,andtechnologythatareexpectedtohaveaninfluenceonaviationinKentucky.Notethatthischapterisbasedonthebestavailabledataasofthefirstquarterof2016.

General Aviation Trends Thereareanumberofcomponentsthatcanbeexaminedtogainanunderstandingofgeneralaviation(GA)trends.KeyamongthesearethenumberandtypeofnewGAaircraftenteringthefleet,thenumberofactiveGAaircraft,andthenumberofpilotsflyingintheU.S.ThefollowingsectionsexamineeachoftheseaspectsofGA,startingwithnewGAaircraftproducedbyyearsince1975.TheanalysisofnewaircraftprovidesanoverviewofhowGAhasperformedoverthelongterm,whiletheassessmentofactiveGAaircraftandpilotsfocusesonthetrendssince2010.

Inadditiontotheseactivitytrends,thischapterwillalsosummarizewhatisbeingdonetoaddressleadinaviationfuel,andhowthatcouldimpactGAactivity.

NewGeneralAviationAircraftOneindicatorofthehowtheGAindustryisperformingisthenumberofaircraftdeliveredperyearandtheirtotalvalue.Figure4‐1showsthisdatastartingin1975.Aswithanyindustry,GAissubjecttotheupsanddownsofthebusinesscycle.However,GAisanindustrythatisamongthefirsttosuffertheeffectsofaneconomicdownturnandthelasttorecoverfromit.ThiscanclearlybeseeninFigure4‐1,whereaircraftshipmentscanbeseentailingoffbeforeeachmajorU.S.recessionandnotrecoveringuntilwellaftertherecessionends.

Thenumberofaircraftsoldwasdominatedbypistonaircraftfrom1975untiltheearly1980s,whenincreasingproductliabilitycostsresultedinacontractionofthemanufacturingoftheseaircraft.AprimeexampleofthismanufacturingretrenchmentisCessnaAircraftCompany,whichceasedproductionofallitssingle‐enginepistonaircraftin1986,primarilyduetoliabilityconcerns.Bythemid‐1990s,deliveriesofsingle‐enginepistonaircrafthadfallenfromits1978peakby97percent,andwasnowonparwiththenumberofturbineaircraftshipped.

In1994,legislationwentintoeffectthatshieldedGAmanufacturersfromlawsuitsonaircraftandaviationpartsthatweremorethan18yearsold.Withthisprotectioninplace,GAshipmentsofbothpistonandturbineGAaircraftbeganaslowbutsteadyrise,withpistonaircraftgrowthoutpacingturbineaircraft.Thislasteduntilthetechbubbleburstinearly2001,followedbytheterroristattacksofSeptember11th.GAmanufacturingrecoveredbriefly,butthenwashitbytherecessionprecipitatedbythehousingcollapsethatstartedinDecember2007.

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Thesaleofturbineaircrafthasfollowedapatternsimilartothatofpistonaircraftonlyatsmallervolumes,mirroringtheriseandfallofthebusinesscycle.Beginninginthemid‐1990s,thenumberofjetaircraftsoldbeganexceedingthenumberofturbopropaircraftsold,resultinginasignificantriseinthevalueofaircraftsold.Theincreaseduseofbusinessaviation,especiallythegrowthoffractionalownershipthroughcompaniessuchasNetJetsandFlightOptions,hashelpedspurthegrowthinturbineaircraftsales.

Figure4‐1U.S.AircraftShippedandSold

Source:2014GeneralAviationStatisticalDatabook&2015IndustryOutlook.

Itisclearthatthenumberofaircraftshippedannuallyhasnotrecoveredtothelevelsseenpriortothe2008recession.TheslowrecoveryfromtherecentrecessionisamajorfactordrivingrecenttrendsinGA,asthefollowingsectionswillalsodemonstrate.

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ActiveGeneralAviationAircraftThenumberofnewaircraftenteringthefleetisonlyapartialindicatorofthehealthoftheGAindustry.Thelevelofactivityofexistingaircraftalsoprovidesasignofhowtheindustryisperforming.TheFAAtracksthenumberofactiveaircraftannually,whichisdefinedasanaircraftthatisregisteredandflewforatleastonehourduringtheyear.TheFAArecordsthedatausingthefollowingninecategoriesofgeneralaviationaircraft.

Single‐EnginePiston–Thesearefixed‐wingaircraftpoweredbyasinglepistonengine. Multi‐EnginePiston–Thesearefixed‐wingaircraft,generallypoweredbytwo,butsometimes

more,pistonengines. Turboprop–Thesearefixed‐wingaircraftpoweredbyoneormoreturbineenginesthatdrive

oneormorepropellers. Turbojet–Thesearefixed‐wingaircraftpoweredbyoneormorejetengines. PistonRotorcraft–Thesearesingle‐enginerotorcraft,eitherhelicoptersorgyroplanes,that

arepoweredbyapistonengine. TurbineRotorcraft–Thesearerotorcraft,eitherhelicoptersorgyroplanes,thatarepowered

byoneormoreturbineengines. Experimental–Generally,theseaircraft,sometimescalledkit‐builtaircraft,areaircraftthat

theoriginalownerbuiltfromkitssuppliedbyamanufacturer. Sport–Thesearesingle‐enginepiston‐poweredaircraftthatmeettherequirementsofthe

LightSportAircraftregulation.Theyarelimitedinanumberofareas,includingweightandnumberofseats.

Other–Thiscategoryofaircraftcapturesanassortmentofflyingmachinesthatdonotfitintotheothercategories.Thisincludesaircraftsuchasgliders,airships,andballoons.

AsshowninFigure4‐2,thetotalnumberofactiveaircraftintheU.S.hasdeclinedsince2010byapproximately20,000aircraft,orabout9percentoftheGAfleet.Thepistonfleetislargelyresponsiblefordrivingthisdecline.Bothsingle‐andmulti‐enginepistonaircraftdeclinedduringthisperiod,withsingle‐enginepistonaircraftaccountingforthelossofmorethan14,000aircraft,orabout10percentofthesingle‐enginepistonfleet.Pistonrotorcraftalsofellbyabout10percentovertheperiod.

Intermsofabsolutenumbers,thehomebuiltmarketcontributedthelargestincreasebyaddingmorethan1,600aircraftsince2010,whichisa7percentincrease.Allturbine‐poweredaircraftexhibitedgrowthsince2010,withturbojetsleadingthewaywith9percentgrowth,followedbyturbinerotorcraftat7percentgrowth.Turbopropsincreasedbyamodest2percentduringtheperiod.Thisgrowthinturbineaircraftactivityisadditionalevidenceoftheincreasinguseofbusinessaircraft,whichrelyheavilyonturbineaircraft.

OneadjustmentthatisobviousinFigure4‐2isachangeintheclassificationofexperimentallightsportaircraft.Priorto2012,theseaircraftweregroupedunderthesportcategory.Startingin2012,theywereswitchedtotheexperimentalcategory,asreflectedinthejumpthatexperimentalaircraftexperiencedin2012andthedropthatsportaircraftshowin2012.

Thereareanumberoffactorsbehindthedeclineinactiveaircraft.Asdiscussedpreviously,thenumberofnewaircraftproducedissignificantlybelowlevelsseenpriortothelastrecession,sotheinjectionofnewaircrafttotheGAfleetisrelativelylowandhascontributedtothedeclineinaircraftactivity.

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ThesetrendsarereflectedinbasedaircraftinKentucky.From2005to2015,basedaircraftatKentucky’sairportshavedroppedfrom1,976to1,693,anaverageannualrateofdeclineof1.7percent.1

Figure4‐2U.S.ActiveAircraft,2010to2015

Note:ClassificationofExperimentalLightSportAircraftchangedfromSportAircrafttoExperimentalin2012.

Source:FAAAerospaceForecastFY2016‐2036.

PilotPopulationThepilotpopulationisaprimedriverofGAactivity.Withoutpilots,planescannotflyanddemandforassociatedaviationservices,foundatmanyGAairports,suffers.PilotcertificatesfallintooneofeightclassificationsbytheFAA:

StudentPilot–Pilotsintraining.Studentpilotsmayflyaircraftsolowhenproperlyauthorizedbyaflightinstructor.Unlikeotherpilotcertificates,studentpilotcertificatesexpire60monthsaftertheyareissuedforthoseunder40and24monthsaftertheyareissuedforthoseover40.

RecreationalPilot–Certifiedtoflyaircraftwithupto180horsepowerandfourseats,butmayonlycarryonepassenger.

SportPilot–Certifiedtoflylightsportaircraft.Limitedtotwoseatsandday‐timeflyingonly. PrivatePilot–Certifiedtoflyaircraft,aslongasitisnotforcompensationorhire.

1 Based aircraft reported by the FAA’s Terminal Area Forecast for years 2005 and 2015.  

223,370 220,453209,034

199,927 204,408 203,880

0

50,000

100,000

150,000

200,000

250,000

0

25,000

50,000

75,000

100,000

125,000

150,000

175,000

2010 2011 2012 2013 2014 2015

Total Aircraft Multi‐Engine Piston Turboprop

Turbojet Piston Rotorcraft Turbine Rotorcraft

Experimental Sport Other

Single‐Engine Piston

Number of Aircraft by Type To

tal Number o

f Aircraft

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CommercialPilot–Certifiedtoflyforcompensationorhire.Requiredtohave250hoursofflighttime.

AirlineTransportPilot–Certificationrequiredtoflyaspilotincommandorfirstofficerforascheduledairline.Requiredtohave1,500hoursofflighttime.

RotorcraftPilot–Pilotscertifiedtoflyhelicoptersandgyrocopters.Thiscategoryincludesthosepeoplethatarecertifiedtoflyonlyrotorcraft.Pilotsthatarecertifiedtoflybothfixedwingandrotorcraftareincludedintheappropriatepreviouslymentionedcategories.

GliderPilot–Pilotscertifiedtoflyglidersandsailplanes.Thiscategoryincludesthosepeoplethatarecertifiedtoflyonlygliders.Pilotsthatarecertifiedtoflyaircraftinadditiontoglidersareincludedintheappropriatepreviouslymentionedcategories.

Figure4‐3showsthatthetotalnumberofpilotsintheU.S.hasfallenbynearly38,000since2010,despitetheobviousgrowthinairlinetransportpilotsduringthatperiod.Thelossofprivateandcommercialpilotsaretheprimaryfactorscontributingtothedeclineintheoverallpilotpopulation.

Thedropincommercialpilots,alongwiththeincreaseinairlinetransportpilots,ispartlyexplainedbyCongressionalactionthatincreasedtheminimumqualificationsrequiredforfirstofficers.TheAirlineSafetyandFederalAviationAdministrationExtensionActof2010stipulatedthatafterAugust2013,onlyairlinetransportpilotscouldserveasflightcrewmembersforscheduledairlineflights(part121).Priortothislegislation,firstofficersonlyneededtopossessacommercialpilotcertificate.

Figure4‐3U.S.PilotTrends,2010to2015

Source:FAAAerospaceForecastFY2016‐2036.

627,588 617,128 610,576 599,086 593,499 590,039

0

100,000

200,000

300,000

400,000

500,000

600,000

700,000

0

25,000

50,000

75,000

100,000

125,000

150,000

175,000

200,000

225,000

250,000

2010 2011 2012 2013 2014 2015

Total Pilots Student Pilots Recreational Pilots

Sport Pilots Private Pilots Commercial Pilots

Airline Transport Pilots Rotorcraft Pilots Glider Pilots

Number of Pilots by Category

Total N

umber o

f Pilots

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Therelativegrowthinsportpilots,risingnearly50percentsince2010,haslittleimpactontheoverallpilotpopulationbecauseofthetotalnumberofsportpilotsisnotsignificantwhencomparedtothenumberofprivateandcommercialpilots.Thesameistrueforrotorcraftpilots,whichincreasedbyslightlymorethan1percentduringtheperiod.Likewise,thesmallnumberofrecreationalandgliderpilotsmeantthattheirdeclinesof10percentand9percent,respectively,hadlittleimpactontheoverallpilotnumbers.Onebrightspotsince2010istheriseinstudentpilotnumbers,whichincreasedby3percentsince2010.Sincestudentpilotsaresteppingstonestohigherpilotratings,growthinstudentpilotsoffersthepromiseoffuturegrowthinotherpilotratings.

Anobviousfactorinthedownwardtrendofpilotsisthecostassociatedwithbecomingapilot.Bothinrelativeandabsoluteterms,thecostofflighttraininghasincreasedovertheyears.Inabsoluteterms,thecostofflighttraininghasrisenalongwiththepriceoftrainingaircraft,fuel,insurance,andotherexpensesofflying.Inrelativeterms,thecostofflyinghasrisenaslessexpensivealternativeshavebecomemorereadilyavailable,asnotedinastudybyHarryR.ClementsoftheWichitaStateUniversityDepartmentofEconomics.

ThisstudyshowedthatGAactivitydecreasesascommercialairlinetravelhasbecomelessexpensiveandbecomemoreaccessible.Sincethederegulationoftheairlineindustryin1978,thestudyshowedthata10percentincreaseinairlinetraveldrovedownGAtravelby3percent,indicatingthatoneisbeingsubstitutedfortheother.ThestudyalsoshowedthatincreasingairspaceregulationhasresultedinhigherGAtrainingcosts,whichservetodiscourageentryintotheGAindustry.

Finally,thestudyfoundthatGAactivitydecreaseswhenothercompetingformsofentertainment(thattendtobelessexpensive)increase,suchasskydiving.Clementsspeculatedthatmotorcycling,scubadiving,mountainclimbing,andautoracingofferalternativestoflyingandhavestimulatedthedeclineintheprivatepilotpopulation.

Takentogether,allofthesefactorsserveasbarrierstoentrytoGA,andarecontributingfactorstothedeclineintheprivatepilotpopulation.

PilotpopulationtrendswithinKentuckymirrormanyofthoseseenatthenationallevel.OneexceptionisKentucky’sgrowthinstudentpilots,supportedinpartbytheaviationprogramatEasternKentuckyUniversity,whichisdescribedinmoredetailinChapter5:UniqueAspectsofAviationinKentucky.ThisgrowthinstudentpilotshashelpedmitigatethedeclineofthetotalpilotpopulationinKentucky.

FutureofAvgasAviationgasoline,oravgas,istheprimaryaviationfuelusedbypiston‐poweredaircraft.Itisnotableforbeingtheonlyremainingtransportationfuelstillcontaininglead,whichisusedtoprotectagainstenginedetonation,alsoknownasknocking.Itisgenerallyacknowledgedthatavgaswillnotbeavailableinthefuture,foranumberofreasons.Forstarters,theonlywesternmanufactureroftheleadadditiveisInnospec,aU.S.specialtychemicalcompanythatcouldchoosetoceaseproductionforliability,financial,orotherreasons.Anotherfactorispressurefromenvironmentalists,whowanttoeliminatetheuseofleadedfuel.TheyarelobbyingtheU.S.EnvironmentalProtectionAgency(EPA)toeliminatetheuseofleadinavgasthroughregulation.

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Inlightofthesefactors,thegeneralaviationindustryiscollaboratingwiththeFAAtodevelopareplacementforavgas.However,thetechnicalandregulatoryrequirements,aswellastheprocessofapproval,haveproventobetimeconsuming,withexpertsin2012estimatingthatareplacementfuelwouldnotbeavailablecommerciallyuntil2023.

Effortstofindareplacementforavgasinvolveextensiveresearchbyfuelcompaniesandcollaborationbetweenaviationstakeholders–suchasaircraftmanufacturers,fuelrefiners,andaviationassociations–andtheFAAandEPA.AkeycomponentofthiscollaborationtakestheformofthePistonAviationFuelsInitiative(PAFI),anindustry‐governmentinitiativestartedin2013.PAFIisworkingtowarddevelopingaviableunleadedaviationfuelby2018.AttheendofMarch2016,thePAFIprocessselectedtwofuelsoutof17submittedinthefirstphaseoftesting.ShellandSwiftFuelseachsubmittedoneofthetwoselectedfuels,whichwillgoontoasecondphaseoftestingexpectedtolastuntil2018.

EventhoughtheGAindustryismovingtowardalead‐freefuelsolution,thelongtimelineanduncertaintyoftheoutcomeactasadditionalbarrierstoentryforwould‐beaviators.

SummaryAnanalysisofGAparametersshowsthatrecenttrendshavenotbeenpositive.Newaircraftdeliveries,thenumberofactiveaircraft,andtheoverallpilotpopulationhavesufferedfromtherecessionthatbeganinlate2007andhavenotrecoveredtopre‐recessionlevels.Thehighcostofaviationhascontributedtothedeclineinaviationactivity.UncertaintyinregardstoleadedaviationfuelanditspossiblereplacementhindersthegrowthoftheportionofGAthatdependsuponleadedfuel.WhiletherearesomesegmentsofGAthathaveshownpromise,suchasthebusinessuseofGAaircraftandthenichemarketsofexperimentalaircraft,andthesportpilotsector,theoveralltrendinGAislikelytobenegativeforatleasttheshortterm,ifnotlonger.

Atthestatelevel,Kentuckyislikelytofeeltheimpactsofthesetrends.However,Kentuckydoeshaveanumberofpositiveattributesintermsofaviation.RecentinitiativeshavehelpedboostthestudentpilotpopulationinKentucky,thankstoaviationeducationeffortsdescribedinChapter5.Additionally,aerospaceproductsmanufacturedinKentuckyhavecontinuedtobethenumberoneexportforseveralyears,surpassingevenautomobilesandautomotiveparts.In2016,Kentucky’saerospacebusinessesexported$10.8billionworthofproducts.

Air Cargo Trends Aircargoplaysavitalroleinglobalcommerce,andKentucky’sairportsplayamajorroleinfacilitatingtheflowofaircargoonglobal,national,andregionalscales.AircargoactivityissupportedatKentucky’scommercialserviceairportsintheformofbellycargocarriedonpassengerairlinesandexpressfreightcarriedbyintegratedexpresscarriers.InadditiontothesecommercialserviceairportstherearealsoseveralGAairportswithinKentuckythatsupportaircargoactivity.

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StatewideTrendsKentuckyishometotwomajoraircargohubsoperatedbyintegratedexpresscarriersDHLandUPS.DHLoperatesitsNorthAmericanhubatCincinnati/NorthernKentuckyInternationalAirport(CVG),whileUPSoperatesits‘Worldport’hubatLouisvilleInternationalAirport(SDF).Thesehubsserveassortingfacilitiesthathandlesignificantvolumesofaircargothroughput,asmallfractionofwhichoriginatesinorisdestinedforKentucky.Kentuckybenefitsnotonlyfromthedirecteconomicactivitythatthehubsprovide,butalsofromthegrowthinthewarehousingand

distributionindustrythathasbeenspurredbythepresenceofthesehubs.

SincethelaunchofUPS’NextDayAirServicein1982,UPS’sWorldporthasundergonenumerousexpansionstobecomethe5.2millionsquarefootprocessingfacilitythatitistoday.Itisthelargestfullyautomatedpackagehandlingfacilityinthe

world,capableofsortingupto416,000packagesanhour.Theoperationcurrentlyturnsoverapproximately130aircraftdaily,processinganaverageof1.6millionpackagesperdaywitharecordofnearly5millionpackagesonitspeakdayof2013.Thefacilityhas70aircraftdocksand155milesofconveyorsthattransportparcelsfromaroundtheworld.2ThepresenceofUPSdrivesLouisvilleInternationalAirport’splaceamongtheworld’stopaircargoairports,whichin2015ranksthirdinNorthAmericaandinthetop‐tenglobally.Theairporthandlednearly2.6milliontonsin2015,representingagrowthof3percentover2014and19percentover2008.3

In2009,DHLadjusteditsbusinessmodel,ceasingitsU.S.domesticdeliveryservicetofocussolelyoninternationalshipments,andsubsequentlyrelocateditshubfromWilmington,Ohio,toCincinnati/NorthernKentuckyInternationalAirport.DHL’snewNorthAmericanhubatCVGservesasaninternationalgatewayforshippingbetweenNorthAmericaandglobalmarkets.Itisoneofthreeglobal“SuperHubs”fromwhichDHLExpressserves220countries.SinceDHL’sarrival,totalcargotonnageatCincinnati/NorthernKentuckyInternationalhasincreasedfrom40,000tonsin2008toover800,000tonsin2015,representinganincreaseof1,910percent.From2014to2015,CVG’scargotonnagegrewby12percent,ranking10thinNorthAmerica.4Since2009,DHLhasinvested$105millioninitshuband

2 http://www.pressroom.ups.com/Fact+Sheets/UPS+Worldport+Facts 3 http://www.aci‐na.org/content/airport‐traffic‐reports 4 http://www.aci‐na.org/content/airport‐traffic‐reports 

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planstoinvestanadditional$46milliontocontinueincreasingoperationalcapacitytomeetdemand,whichislargelydrivenbygrowthine‐commerce.5,6

CVG’saircargotonnageispoisedtocontinuegrowingasAmazonannouncedinearly2017itsplanstobuildacentralizedhubatCVGforitsnewlyformedcargoairline,PrimeAir.Amazon’s$1.5billioninvestmentwillresultina3millionsquarefootfacilityexpectedtoaccommodateexpresse‐commercetrafficfrommorethan200dailytakeoffsandlandingsbythePrimeAirfleet.Serviceisexpectedtocommenceinthespringof2017,andthe

newfacilitywillemploymorethan2,000peoplewhencompleted.7

HistoricaircargotonnageforKentucky’scommercialserviceairportsispresentedinTable4‐1.

5 http://www.cvgairport.com/about/news/facts 6 http://www.cincinnati.com/story/news/2014/11/20/dhl‐express‐expansion‐boone‐county‐hebron‐cvg/70007328/ 7 http://aircargoworld.com/amazon‐to‐move‐prime‐air‐cargo‐hub‐to‐cincinnati/ 

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Table4‐1HistoricAirCargoTonnageatKentuckyAirports

Year  CVG  LEX  PAH  SDF  TOTAL 

1997  399,731  3,287  119  1,483,371  1,886,508 

1998  401,646  3,031  303  1,537,721  1,942,702 

1999  440,780  2,401  200  1,587,762  2,031,142 

2000  430,805  2,381  303  1,674,991  2,108,480 

2001  354,852  1,560  86  1,619,114  1,975,612 

2002  385,824  962  69  1,680,120  2,066,975 

2003  432,872  370  34  1,783,908  2,217,184 

2004  455,590  188  35  1,917,459  2,373,273 

2005  277,343  284  20  2,000,864  2,278,511 

2006  47,718  250  8  2,185,916  2,233,892 

2007  43,752  210  36  2,291,644  2,335,642 

2008  40,014  186  11  2,176,264  2,216,476 

2009  146,745  136  6  2,148,984  2,295,872 

2010  409,284  82  0  2,388,327  2,797,693 

2011  530,949  86  ‐  2,412,319  2,943,354 

2012  593,786  107  ‐  2,390,211  2,984,104 

2013  655,345  121  ‐  2,442,806  3,098,273 

2014  719,440  138  ‐  2,527,851  3,247,430 

2015*  804,088  **  ‐  2,591,155  3,395,243 

AAGR 

2010‐2015  14%  ‐100%  ‐100%  2%  4% 

2005‐2015  11%  ‐100%  ‐100%  3%  4% 

1997‐2015  4%  ‐100%  ‐100%  3%  3% 

*2015datadirectlyfromairportrecords;ACI‐NAdatanotyetpublished.**LEXaircargostatisticsnotavailableasofQ12016.

Source:AirportsCouncilInternational‐NorthAmerica,AirportRecords.

AsshowninTable4‐1,Cincinnati/NorthernKentuckyInternationalhasexperiencedthemostdramaticgrowthinrecentyears,withanaverageannualgrowthof14percentsince2010and11percentsince2005.TonnageatLouisvilleInternationalhasincreasedsteadilywithanaverageannualgrowthrateof3percentsince1997.Year‐over‐year,tonnageatLouisvilleInternationalhasexperiencedgrowthin15of17years,withtheexceptionof2008,2009,and2012.BlueGrassAirportmaintainsasteadyvolumeofpassengerairlinebellycargoeachyear,butisdownfromitsoverallpeaktonnageofabout3,200tonsin1997.DuetotheproximityofBlueGrassAirporttonearbyhubsinNorthernKentuckyandLouisville,themajorityofaircargoistruckedtoandfromthearea.BarkleyRegionalAirporthasnotexperiencedaircargotonnagesince2009forthesamereasonsasBlueGrassAirport,plusitiswithincloseproximitytoFedEx’sMemphishub.

Statewide,totalaircargotonnageisdrivenbythetwoaircargohuboperationsatCVGandSDF.In2015,SDFrepresentedroughly76percentofthetotalstatewideaircargotonnage,whileCVGmadeuptheremaining24percent.AsshowninFigure4‐4,thestrongstatewidegrowthexperiencedfrom2010topresentcanbeattributedtotheestablishmentofDHL’snewNorthAmericanHubatCVG.

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Figure4‐4HistoricAirCargoTonnage1997‐2015,CVG&SDF

Note:2015datadirectlyfromairportrecords;ACI‐NAdatanotyetpublished.

Source:AirportsCouncilInternational‐NorthAmerica,AirportRecords.

PriortotheestablishmentofitsWilmingtonhub,whichwasoperatedfrom2003to2009,DHLpreviouslyoperatedoutofCVG.DHL’sdeparturefromandreturntoCVGisevidentintonnagedatashownfortheseyearsinFigure4‐4.CVG’sdeclineintonnagealsocorrespondstoDeltaAirLines2005bankruptcyandsubsequentflightcuts.Delta’s2008mergerwithNorthwestAirlinesalsoresultedinfurtherreductioninflights,contributingtoadeclineinpassengerbellycargoattheairport–althoughitisstillarelativelysmallfractionofoveralltonnage.

NotincludingKentucky’stwoaircargohubairports,thestate’stworemainingcommercialserviceairportswithmeasureablequantitiesofaircargotonnageareBlueGrassAirportandBarkleyRegionalAirport.AsshowninFigure4‐5,theseairportshaveseenstrongdeclinesinaircargotonnagesince1997.

 ‐

 500,000

 1,000,000

 1,500,000

 2,000,000

 2,500,000

 3,000,000

 3,500,000

 4,000,000

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Short Tons

CVG SDF

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Figure4‐5HistoricAirCargoTonnage1997‐2014,LEX&PAH

Source:AirportsCouncilInternational‐NorthAmerica,AirportRecords.

2015datanotavailableasofQ12016.

Kentuckyisanattractivelocationforaircargohubsduetoitsgenerallytemperateweatherandshorttraveltimes.FromUPS’Louisvillehub,approximately75percentoftheU.S.populationisreachablewithinatwo‐hourflight,andafour‐hourflightallowsforaccessto95percentoftheU.S.population.CVGisapproximately80milesfromSDFsosimilarfiguresapply.Inturn,thesurroundingareasofCVGandSDFhavebecomeprimespotsforamultitudeofcompaniestosetuptheirowndistributionfacilitiesthankstothepresenceofUPSandDHLandtheirextensiveglobalreach.BusinessesbenefitfrombeinginsuchcloseproximitytoKentucky’saircargohubsbyallowinglaterpickuptimes,shortertotaldeliverytime,andreducedshippingcosts.Morethan140companieshavelocatedtoKentuckytobenearUPS’Worldport,includingmanynotablee‐commercebusinesses.8AsimilartrendisoccurringinthevicinityofCVG.

Majorbrands’distributioncenterslocatedinKentuckyincludeAmazon,AmericanGreetings,Browne‐Forman,CengageLearning,Chegg,DormanProducts,FruitoftheLoom,Gap/OldNavy,GeekSquad,GiltGroupe,GordonFoodServices,LeviStrauss,NastyGal,SunProducts,ToyotaNorthAmericanPartsCenter,TractorSupply,Walmart,andZappos.910AuniqueexampleisClearWaterFineFoods,whichoperatestheworld’slargestinlandlobstertankinLouisville,towhereNovaScotialobstersareshippedandkeptinsaltwatertanksat39degreesuntiltheyaresentviaUPSto

8 http://www.businessclimate.com/kentucky‐economic‐development/ups‐dhl‐put‐kentucky‐distribution‐map 9 http://midamericafreight.org/wp‐content/uploads/Kelly_TransportationsRoleInKentuckysEconomicDevelopment.pdf 10 http://www.businessclimate.com/kentucky‐economic‐development/kentuckys‐strong‐transportation‐system‐energizes‐business‐climate 

 ‐

 500

 1,000

 1,500

 2,000

 2,500

 3,000

 3,500

 4,000

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Short Tons

LEX PAH

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restaurantsacrossthecountry.GiltGroupeisafashionandhomedécorretailerthatoperatesa“flashsale”businessmodel,shippingbetween20,000and30,000unitsperdayfromtheirhightechfacilityinLouisville.BestBuyopeneditsGeekSquadCityjustsouthofSDF,whichoperatesasacentralizedrepairandrefurbishmentcenterfortech‐products.Priortoitsopeningin2006,repairsweremadeatvariouslocationsthroughoutthecountry.11Thesefirms,amongmanyothers,havelogisticsneedsthatarewellaccommodatedbyacombinationofKentuckyairportsandlogisticsinfrastructure.

GivenKentucky’sprominenceinthehorseracingandbreedingindustries,itisnosurprisethatKentuckyairportsfrequentlysupportequinechartertransportflights.Accordingtothe2012KentuckyEquineSurvey,BlueGrassAirportandLouisvilleInternationalAirportarebothrankedinthetopfiveU.S.airportsinvolvedinhorsetransportation.AircargocarrierssuchasKalittaAirsetupspecial“airstables”onmodifiedBoeing727aircraft.Horsesaregenerallyflowninternationallybutarealsoflowndomesticallyoverlongdistances.LargerairportssuchasNewYork(JFK),Miami(MIA),andLosAngeles(LAX),whichhaveU.S.Customs/quarantinefacilities,mustbeusedwhenahorseisfirstimportedintotheU.S.TheaforementionedairportsplusHouston(IAH),Chicago(ORD),andDallas(DFW)aremostcommonlyusedforexportinghorsesafterdepartingKentucky.InadditiontoKalittaAir,otherairlinesthatprovidelivestockshippingincludeElAl,CAL,Lufthansa,KLM,Cargolux,andFedEx.12AmoredetaileddiscussionofKentuckyairports’supportoftheequineindustryisprovidedinChapter5:UniqueAspectsofAviationinKentucky.

GACargoInadditiontothecommercialserviceairportsthatsupportaircargo,therearealsoseveralgeneralaviationairportsinKentuckythatsupportaircargoactivity.GAairportsarefrequentlyusedbyregionalaircargooperatorsandfeederairlinesastheyprovideseveraladvantagessuchasconvenienceandflexibility.Aircargoistypicallylightweight,time‐sensitive,andhigh‐value.Servingtheaircargoneedsofsmallmarketareasisoftenbetteraccommodatedbysmallaircraftoperatingatageneralaviationairportthatprovidesquickaccesstothatmarket.Thisisoftenmoreeconomicalthantruckingtomarketsthatarerelativelyisolatedfromthelargerdistributionnetworkorthosewherethecargodemanddoesnotwarrantafull‐sizetruck(LTLshipments).OperatingatGAairportsisparticularlyeconomicalwhentherearemultiplesmallmarketsthatcanbeservedbyoneaircraftoperatingamulti‐segmentroute.Kentuckyhasseveralsuchsmallmarketsanditsgeographymakesthestatewellsuitedforgeneralaviationaircargo.

AccordingtoBTST‐100datatwoofKentucky’sGAairports–BowlingGreen‐WarrenCountyRegionalandElizabethtownRegional–reportedsmallvolumesofaircargotonnagein2014.Theseaircargooperationscanrangefromscheduledshipmentsofmedicalsupplies/samplestoadhocshipmentsofautomotivesupplies.BowlingGreenishometoGeneralMotors’Corvetteassemblyplant,whichoftenrequireemergencyshipmentsofspecialtypartsortooling.

Theinventoryeffortofthesystemplanaskedairportstoreportbasicinformationonthefrequencyofaircargooperations.TheresultsoftheinventoryfoundthatofKentucky’s53public‐usegeneralaviationairports,27,or51percent,reportedhavingsomelevelofaircargoactivity.ThreeGAairportsreportedweeklyaircargooperations:AddingtonFieldinElizabethtown,BowmanFieldinLouisville,andMountSterling‐MontgomeryCounty.FourteenGAairportsreportedmonthlyair

11 http://www.businessclimate.com/kentucky‐economic‐development/distribution‐assets‐draw‐top‐firms‐kentucky 12 http://equinechronicleonline.com/modern‐pegasus‐horses‐flying‐internationally/ 

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cargoactivity,and10GAairportsreportedexperiencingaircargooperationsonaseasonalbasis.Allairportsreportingaircargoactivityonadailybasisareclassifiedascommercialserviceairports.

IndustryTrendsAtthenationallevel,duetobothinternalandexternalfactors,theaircargoindustryhasexperiencedsignificantvolatilitythathasresultedinrapidmaturationoftheindustry.Highfuelcostsandarecessedeconomicclimatecausedanindustryshifttotruckingwhereunitcostsavingsbecamehigherprioritythanshipmenttime.Ascustomerbasesandmarketsharescontracted,aircargocarriersadaptedbyconsolidating,shiftingbusinessmodels,orceasingoperations.KittyHawkAirCargoceasedoperatingin2008;BAXGlobalwasacquiredbyDBSchenkerin2005andceaseddomesticaircargoactivitiesin2011;UPSacquiredMenloWorldwide(formerlyEmeryWorldwide)in2004andclosedtheDaytonhubin2006;DHLacquiredAirborneExpressin2003andclosedtheWilmingtonhubin2009afterDHLwithdrewfromdomesticdelivery.

Asaresultofthesechanges,outsideofsmallerregionalcontractorcharteroperators,thecurrentlandscapeofthedomesticaircargoindustryhaseffectivelybecomeaduopolywithFedExandUPSasthelastmajorplayersleftstanding.However,e‐commercegiantAmazonispoisedtoshakeuptheindustrylandscapeasitannouncedinJanuary2016thatitwouldlease20Boeing767widebodyaircraftfromAirTransportServicesGroup(ATSG)andoperateoutoftheformerDHLhubatWilmingtonAirPark(ILN)inOhio.13

Amazonhasbeenoperatinga“trialexpressnetwork”outofWilmingtonsincemid‐2015onkeyroutestoAllentown,Pennsylvania;Dallas/FortWorth,Texas;OaklandandOntario,California;andTampa,Florida.EachoftheseairportsarewithincloseproximitytoAmazondistributioncenters.AmazonisalsooperatingasmallEuropeannetworkwithroutesfromWroclaw,Poland,toLutonorDoncasterintheU.K.,andKassel,Germany.TheadvantageforAmazonisthatthecompanyknowstheirownairtrafficvolumesandknowstheamountofcargothatneedstobetransportedbetweenits100‐plusdistributioncentersacrossthecountry.14Ratherthangiveitscargotoathirdpartywhereitwouldpayapremiumandcompeteforlimitedspacewithothercargoshippers,Amazonsavesmoneybycharteringaplaneitself.ItisyettobeseenwhatimpactAmazon’sentrywillhaveontheindustry–whetheritbeanincreaseintonnageorsimplyatonnageshiftawayfrommoreestablishedcarriers,Kentucky’saircargohubsarelikelytobeimpactedinsomemanner.

ApartfromtheAmazondevelopment,themostsignificantareaofgrowthfortheairfreightindustryisoninternationalsegmentsbetweenmajormarkets.ThemorematureU.S.domesticmarkethasbeenrelativelyflatoverthepastdecade,withtherapidgrowthof1980sand1990sadistantmemory.However,astheeconomycontinuestostrengthenandtradegrows,sotoowillthedemandforaircargo.TheBoeingWorldAirCargoForecast2014‐2015projectsgrowthof2.1percentfrom2013to2033forintra‐NorthAmericanaircargo.RegionaltradeforecastsbetweenNorthAmerica‐Asia,NorthAmerica‐Europe,andNorthAmerica‐LatinAmericaareallprojectedtobeoverfivepercentoverthesametimeperiod.

SummaryAircargoactivityissupportedbybothcommercialserviceandgeneralaviationairportsinKentucky.LouisvilleInternational,hometoUPS’‘Worldport’hub,hasbeenthebusiestaircargoairportinthestatesinceitsestablishmentinthe1980s.Cincinnati/NorthernKentucky

13 http://www.wsj.com/articles/cargo‐airline‐expands‐flights‐believed‐to‐be‐for‐amazon‐1455125482 14 http://motherboard.vice.com/read/a‐secretive‐air‐cargo‐operation‐is‐running‐in‐ohio‐and‐signs‐point‐to‐amazon 

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InternationaliscurrentlyundergoingaresurgenceinaircargogrowthasaresultofDHLestablishingitsNorthAmericanhubattheairportin2009.Inadditiontointegratedexpresscargo,SDFandCVGalsosupportpassengerbellycargo,whichmakeupsignificantlysmallerpercentagesoftheirtotaltonnages.BlueGrassandBarkleyRegionalAirportsalsohaveahistoryofsupportingaircargoactivityintheformofpassengerbellycargo.GeneralaviationairportssuchasBowlingGreen‐WarrenCountyRegionalandElizabethtownRegionalalsoplayaroleinfacilitatingaircargooperationsbyregionalcargocarriersandfeederairlines.

Multimodal Issues AsafeandreliabletransportationsystemisvitaltoKentucky’sfutureeconomicgrowth,nationalcompetitiveness,andoverallqualityoflife.Kentucky’scentrallocationandaccessibilitytomajormultimodaltransportationroutesmakesKentuckyauniquelyattractiveenvironmentforbusiness,industry,andtourism.Multimodaltransportationinvolvesthemovementofpeopleandgoodsfromanorigintoadestinationusingmorethanonemodeoftransportation.Multimodaltransportationtypicallyincludesamixtureofmovementbyhighway,air,rail,waterway,publictransit,bicycling,orwalking.Multimodaltransportationprovidesapathwayformeetingtheincreaseddemandonourtransportationnetworkbyfacilitatingleast‐costtransportoptionsthataresafe,secure,andsustainable.15

Toprovideasafeandreliabletransportationsystemforthenext20years,stateandregionaltransportationplanningmustbecoordinatedandcomprehensive.The2014Long‐RangeStatewideTransportationPlan(LRSTP)wasdevelopedbytheKentuckyTransportationCabinet(KYTC)tomeetthevisionofKentucky’stransportationsystemoverthenext20yearswhiletakingintoconsiderationKentucky’suniquegeographicanddemographicchallenges.Thevisionforthestate’stransportationsystemwasdefinedas“awell‐maintained,multimodaltransportationsystemthatdeliverssafeandreliabletripswhichimproveKentucky’squalityoflife.”

DrawingprimarilyuponKYTC’s2014Long‐RangeStatewideTransportationPlan(LRSTP)andthe2016KentuckyFreightPlan,thissectiondiscussesthevariousmultimodalissuesinKentuckythathavethepotentialtoimpactaviationforbothpassengersandfreight.

MultimodalPassengerCommercialserviceairportsoftenhavemultimodallinkagesusedbybothpassengersandairportworkers,and,inKentucky,thesemultimodallinkagesconsistofautomobileaccessandbusservice.Generalaviationairportsdonottypicallyhavemajormultimodallinkages,withtheobviousexceptionofautomobileaccess.WhilethereisnorailconnectivitytoKentuckyairports,thereisalevelofferryusewhenaccessingKentuckyairports.Thefocusofthissectionisonpassenger‐relatedmultimodalactivities.

BusServiceInpractice,multimodaltransportationlinkshavelittleinfluenceongeneralaviationairports.Asseenthroughtheinventoryeffortofthisstudy,multimodalconnectivityisprimarilyrelatedtocommercialserviceairports.NoneofthecommercialserviceairportsinKentuckyareconnectedbypassengerrail,whilefourofthestate’sfivecommercialserviceairportsareservedbybus.TheTransitAuthorityofNorthernKentucky(TANK)providesbusservicefromdowntownCincinnatitothepassengerterminalandDHLhubfacilitiesatCVG,whiletheTransitAuthorityofRiverCity(TARC)providesbusservicetopassengerterminalandUPShubfacilitiesatLouisvilleInternational.TheTransitAuthorityofLexington(LexTran)offersbusservicetoBlueGrass

15 http://www.ktc.uky.edu/research/multmodal‐transportation/ 

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AirportfromthedowntownTransitCenter.BarkleyRegionalandOwensboro‐DaviessCountyRegionalofferon‐demandshuttleservice.Theinventoryeffortalsodeterminedthattwoofthe54generalaviationairportsinthestatesystemhavebusconnectivity:BowmanFieldinLouisvilleandLondon‐Corbin‐MageeField.Agreaternumberofairportshaveon‐demandtaxiandshuttleservicesavailabletousers.

PassengerRailWhilethereiscurrentlynodirectrailaccesstoanyKentuckyairport,thereisexistingrailserviceinthestateanddormantrailconceptsthathavethepotentialtoimpactairports.

IntercitypassengerrailtravelisprovidedbyAmtrak,toAshland,SouthPortsmouth/SouthShore,Maysville,andFulton,allalongKentucky’snorthernborder.

Lightrailorlightrailtransitistypicallyanurbanformofpublictransportwitha“light”passengercapacitythatoperatesprimarilyalongexclusiverightsofway.TheTransitAuthorityofRiverCity(TARC)inLouisville,whichrunsthelargesttransitsysteminKentucky,hasexploredtheconceptoflightrailinthepast.However,TARChaltedtheirlightrailstudy,TransportationTomorrow,in2004duetofundingandridershiphurdles.ProposalsforaraillinebetweendowntownCincinnatiandCincinnati/NorthernKentuckyInternationalhavebeendiscussedinthepast,butthereisnoprojectcurrentlyindevelopment.

FerryOperationsAnothernotableformofmultimodalconnectivitytoKentuckyairportscomesfromferries.Kentuckyusesaferryboatsystemtoaccommodaterivercrossingswhereconstructionofabridgeisnotafeasibleordesirablealternative.Thereare10ferryboatsoperatingwithinoralongthestate’sborders,sevenofwhichproviderivercrossingsatnocharge.Ferryboatsareconsidered“movingbridges”bytheKYTC,andprovidecrossingsovertheOhio,Mississippi,Green,Kentucky,andCumberlandRivers.FundingisprovidedbytheKYTCtofacilitateoperationofsevenoftheferryboats.ThefederalgovernmentprovidesfundingandoperationofthetwoferryboatslocatedinMammothCaveNationalPark.TheferryboatsmeetanimportantneedaspartoftheKentuckytransportationsystemandalthoughtheytransportrelativelylowvolumesoftraffic,Kentucky’sferriesarelikelytoindirectlyservetheneedsofsomeairport‐boundtraffic.

Oneexampleistheprivately‐operatedAndersonFerry,whichcrossestheOhioRivernorthofCincinnati/NorthernKentuckyInternational10mileswestofdowntownCincinnati.SinceitistheonlyautomobilecrossingbetweentheInterstate71/75bridgedowntownandtheInterstate275bridgeontheIndianaborder,theferryispopularamongresidentsofCincinnati’swesternsuburbsforcatchingflightsandgettingtowork.16Althoughlimited,itislikelythatKentucky’snineotherferriesprovideservicetoairportusers.Kentucky’sferriesarelistedinTable4‐2.

16 http://www.andersonferry.org/anderson_ferry_information.htm 

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Table4‐2FerryboatsinKentucky

Ferry  Crosses  From  To  Sponsor 

Anderson Ferry  Ohio River  Boone Co., KY  Hamilton Co., OH  Privately Operated 

Augusta Ferry  Ohio River  Bracken Co., KY  Brown Co., OH  State Funded 

Cave in Rock Ferry  Ohio River  Crittenden Co., KY  Hardin Co., IL  State Funded 

Dorena‐Hickman Ferry  Mississippi River  Fulton Co., KY  Mississippi Co., MO  State Funded 

Green River Ferry  Green River  Edmonson Co., KY  Edmonson Co., KY  Federally Funded 

Houchin Ferry  Green River  Edmonson Co., KY  Edmonson Co., KY  Federally Funded 

Reeds Ferry  Green River  Butler Co., KY  Butler Co., KY  State Funded 

Rochester Ferry  Green River  Butler Co., KY  Ohio Co., KY  State Funded 

Turkey Neck Bend Ferry  Cumberland River  Monroe Co., KY  Monroe Co., KY  State Funded 

Valley View Ferry  Kentucky River  Fayette and Jessamine Co., KY  Madison Co., KY  State Funded 

Source:KYTC

MultimodalFreightThemovementofgoodsandfreightthroughoutKentuckyisvitalforeachcitizenintheCommonwealth,fromtheaerospacepartsmachinisttothemineworkertothepharmacist.Eachhasaneedtotransportrawmaterials,manufacturedparts,andfinishedgoods;andthenproductstobesoldorpurchased.TherecentlycompletedKentuckyFreightPlan(KFP),whichisasupplementtothe2014LRSTP,outlinesthemultimodalissuesinKentuckyrelevanttofreight.Thissectiondiscussesmultimodalissueswithrelevancetoaviation.

MultimodalFreightSystemKentucky’smultimodalfreightsystemenablesthestatetocapitalizeonitsgeographicallystrategiclocation.Kentuckyislocatedwithin600milesofover60percentofthenation’spopulation,personalincomeandmanufacturing.Itscentrallocationfacilitatesthedistributionoffreighttoover30states.Kentucky’sfreightnetworkconsistsofextensivehighway,rail,maritime,andaviationinfrastructure.

HighwayThestateisservedby10interstatesand10stateparkways,includingmorethan500milesofthefederallydesignatedHighwayPrimaryFreightNetwork.Thisincludestwoofthenation’sbusiestnorth‐southinterstatecorridors(Interstates75and65),connectingindustriesacrossNorthAmericafromCanadatoMexico.KentuckyalsocontainsmajorportionsofInterstate64,whichisamajoreast‐westcorridorstretchingfromNorfolk,VAtoSt.Louis,MO.17

Kentucky’shighwaynetworkistheprimarymodeforfreightaccessingthemajorityofairportsinthestate,withtrucksservingastheonlyothermodefortransportingaircargo,eithertoorfromtheairport.

RailKentucky’sapproximately3,200milesofrailroadtrackcarryamyriadoffreightandprovideconnectivitytoallpointsintheU.S.ClassItrackmakesupapproximately2,300milesofKentucky’srailsystemandrepresentthemostheavilytravelledraillinesbyrevenue.KentuckyistraversedbyCSXT’sChicagotoNashville,TNandDetroit,MItoAtlanta,GAmainlines,byNorfolkSouthern’sCincinnati,OHtoAtlanta,GAandNewOrleans,LAmainlines,andbyCanadianNational’sChicago,ILtoNewOrleans,LAmainline.TheClassIrailroadsarecomplementedbyanetworkofregionaland

17 http://www.thinkkentucky.com/kyedc/pdfs/kytrannw.pdf.  

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shortlinerailroadsthatprovidein‐stateconnectivity.ThePaducah&LouisvilleRailwayisoneexample,providingeast‐westserviceinKentucky,connectingwithsixothercarriersatthreelocationswithinthestate.

WaterKentuckyisborderedonthreesidesbynavigablerivers.TheOhioRiverformsthe660‐milenorthernborder,whichisthelongestofthethreeborderrivers.TheMississippiRiverformsthewesternborder,andtheeasternsideofthestateisborderedbytheBigSandyRiverandTugFork.Withover1,980milesofcommerciallynavigablewaterwaysand12publicportauthorities,Kentuckyalsoprovidesefficientyear‐roundwaterbornecommerce.TheOhioRiver,amajortributaryoftheMississippiRiverSystem,providesconnectivityasfarasPittsburgh,PA,Minneapolis,MN,andTulsa,OK.WesternKentuckysitsattheconfluenceoftheOhioandMississippiRivers,markingthenominaltransitionbetweentheUpperandLowerMississippiRiver.TheentireinlandwaterwaysystemprovidesawaterwaylinktoCanadaviatheGreatLakes,andtoMexicanandSouthAmericanmarketsviathedeepwaterportsofNewOrleans,LAandMobile,AL.KentuckyalsoconnectstheOhioRivertonumeroussoutherncitiessuchasNashville,TNviatheCumberlandRiver,Knoxville,TNandChattanooga,TNviatheTennesseeRiver,andMobile,ALviatheTennessee‐TombigbeeWaterway.18

Thisinlandwaterwaynetworkprovidesforefficientyear‐roundfreighttransportofbulkmaterials,agriculturalproducts,chemicals,minerals,metals,wood,manufacturedgoods,andcontainerizedfreight.Thestate’swell‐developedterminalsandriverportshavestrongconnectivitytorail.However,similartorail,waterbornecommercehasnointermodalconnectivitywithairtransportation.

AirTherearesixcommercialairportsinKentucky,includingtwomajorshippinghubsthatarehometoUPSWorldport(Louisville)andDHLExpress(Covington).In2014,theLouisvilleInternationalAirportwasrankedthirdintheU.S.forannualairfreighttonnageshipments.19Thereare28generalaviationairportswithrunwaylengthsgreaterthan5,000feet,allowingthemtohandlelargercargoplanes.Thistransportationnetwork,furtherhighlightedinthefollowingsections,makesitpracticaltomovefreightlocally,regionally,andtoallpointsoftheglobe.

Inaddition,Kentuckyisanattractivelocationforaircargohubsduetoitsgenerallytemperateweatherandshorttraveltimes.FromUPSLouisvillehub,approximately75percentoftheU.S.populationisreachablewithinatwo‐hourflight,andafour‐hourflightallowsforaccessto95percentoftheU.S.population.Amoredetaileddiscussionofaircargocanbefoundinaprevioussectionofthischapter.

IntermodalThemajorKentuckyinfrastructuredevelopmentinthepast10yearshasbeentheupswinginvolumeandinvestmentinrailroadcontainerintermodalfacilities.Kentuckyhasfourintermodalfacilitiesthatcantransfercontainersand/ortrailersofcargofromrailtotruck.NorfolkSouthernoperatesthreefacilities,twoinLouisvilleandoneinGeorgetown,andCSXopenedafacilityinLouisvillein2012.20Railcarriers,withtheassistanceofsomepublicsubsidies,haveinvestedheavilyincreatingterminalsbridgingthemodalcapabilitiesofroadways,rail,andmarinecargo.

18 http://www.thinkkentucky.com/kyedc/pdfs/kytrannw.pdf 19 Kentucky Cabinet for Economic Development, Kentucky Economic Development Guide, 2014. 20 Kentucky Transportation Cabinet, 2015 Kentucky Statewide Rail Plan, 2015. 

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ThelocationofKentucky’sintermodalfacilitiesisadvantageousbecauseoftheKentuckymarket,thegoodconditionofKentucky’sroadsystem,andtheproximitytothenationalmarket.Whileintermodalgrowthoverthepast20yearswasprimarilydrivenbyinternationaltrade(specificallyimports),developmentofnewintermodalfacilitiesandrailroadoperatingandmarketingpracticeshasincreasedtheviabilityofall‐domesticintermodalmoves.

CriticalConnectionsandtheFirst/LastMileFreightmovementsbytruckinKentuckyrelyheavilyontheInterstateHighwaySystem.Becausetrucksperformtheinitialpickupanddeliveryformostgoodsandcommoditiesmovedbyair,rail,andwater,theconnectorroutesbetweenthefreighttransportationmodesareacriticallinktofacilitatethesmoothermovementoffreight.Oftentheseconnectorsor“lastmile”segmentsareunderlocaljurisdiction.

Asfreightvolumesgrow,theabilityofthemultimodalfreightsystemtoberesilientandresponsivetothefreightcommunity’sneedswillbeincreasinglyimportanttoKentucky’seconomicfuture.Itisimportanttomaintaintheconnectivitypointswithothermodesoftransportation.Theconnectionpointsarewheremostefficiencyisgainedorlostduringfreighttravel.InKentucky,theseconnectionpointsareairports,rail,truckdistributioncenters,pipelinesandportfacilities.TheroadsleadinguptomajorconnectivitypointsaredesignatedNationalHighwaySystem(NHS)IntermodalConnectorsbyFederalHighwayAdministration(FHWA)andKYTC.

IntermodalConnectorsareoftenmaintainedbydifferententitiesandfallintothecracksintheplanningandprogrammingprocess.Investmentinconnectorsisoftenincompetitionwithotherhigh‐profileprojectsfortheeverdecreasingtransportationfunding.Intermodalconnectorsoftensuffergeometricissues,pavementlifecycle,andotherchallengesthatcreateinefficienciesandreliabilityissuesforfreightusers.Table4‐3listsKentucky’sIntermodalConnectors.

AsshowninTable4‐3,thereareonlythreeNHSIntermodalConnectorsthataredirectlyrelatedtoairports(highlightedinblue).Althoughseveralotherconnectorscouldhavethepotentialtoimpactaviationfurtherdownstream,itisunlikelyduetothenatureofcommoditiestransportedviatheseconnectors.Airfreightistypicallylightweight,high‐value,andtime‐sensitive,withverylittleconnectivitytorailormaritimemodes.

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Table4‐3FreightNHSIntermodalConnectors

Facility  Type  Connector Description 

Bells Lane Petroleum/Chemical Pipeline 

Truck/Pipeline Terminal 

KY 2056 from I‐264 W to the Louisville‐Kentucky River Floodwall 

Bells Lane Petroleum/Chemical Port  Port Terminal  KY 2056 ‐ Louisville‐Kentucky Floodwall to I‐264 

Campground Rd Petroleum Pipeline Truck/Pipeline Terminal 

Campground Rd (Cane Run to Ralph), Kramers Ln (Cane Run to Campground), Ralph Ave (Cane Run to Campground Rd) 

Campground Rd Petroleum Port  Port Terminal  Same as above 

Cincinnati/N KY International Airport  Airport KY 212 from I‐275 S to the Airport Roadway System 

Clark Elkhorn Coal Tipple  Truck/Rail Facility KY 1441 (US 460 to Clark Elkhorn Tipple #1 Ent), KY 1789 (US 460 to KY 1441) 

Golden Oak Mining CO.  Truck/Rail Facility  KY 7 (KY 15 to KY 931), KY 931 (KY 7 to Facility) 

Ivel Coal Tipple  Truck/Rail Facility  County Rd 1020 ‐ US 23 to Facility 

Blue Grass Airport  Airport  FS 8550 ‐ US 60 to Facility 

Louisville International Airport  Airport Grade Ln (I‐264 to UPS Feedor Truck Entrance), FS 8879 (I‐264 to Facility) 

Louisville/Ashland Oil/Chevron Dist. Center 

Truck/Pipeline Terminal 

KY 1681 ‐ KY 4 Interchange to Facility 

McCoy Elkhorn Coal Corp  Truck/Rail Facility  KY 194 ‐ US 119 to Facility 

Norfolk Southern Intermodal ‐ Georgetown 

Truck/Rail Facility  KY 620 ‐ Facility to I‐75 Interchange 

Norfolk Southern Intermodal ‐ Louisville 

Truck/Rail Facility Newburg Rd (I‐264 to Bishop), Bishop Ln (Newburg to Jennings), Jennings Ln (Bishop to Facility) 

Owensboro Riverport  Port Terminal KY 331 (US 60 to Harbor Rd), Harbor Rd (KY 331 to Facility) 

Praise Dock Coal Tipple  Truck/Rail Facility  KY 80 from US 460 to Facility 

Truck to Barge Coal Dock Cluster, Boyd County 

Port Terminal KY 757 from US 23 near Lockwood to 2.3 Miles North 

Source:FederalHighwayAdministration,NationalHighwaySystem:IntermodalConnectors,June18,2012.

IndustrySpotlight–AerospaceManufacturingKentucky’saerospaceindustryhasbecomethestate’sleadingmanufacturingexportbyvalue,exportingonequarter($7.8billion)ofKentucky’s$27.5billiontotalexports,accordingto2014CensusBureaufigures.Thissectorgrewby37.5percentbetween2013and2014alone.AmajorcontributortothisgrowthareKentucky’snumeroussuppliersforCincinnati‐basedGEAviation,whichisseeingsignificantgrowthindemandfornewer,morefuelefficientaircraftengines.21Withoutitsextensivefreighttransportationnetwork,Kentucky’saerospaceindustrywouldnotbeinthestrongpositionitistoday.

Havingtakennotice,theKentuckyCommissionofMilitaryAffairs(KCMA),incollaborationwiththeKentuckyCabinetforEconomicDevelopment(CED)andKYTC,arecurrentlyconductinganAerospace,AviationandDefenseIndustryStudythatwillmeasuretheeconomicimpact,potentialgrowthareas,educationandworkforcedevelopmentissues,anddeveloprecommendationsforsustainedgrowthwithinthispartoftheKentuckyeconomy.Theresultsofthestudywillenable

21 http://www.lanereport.com/48224/2015/05/kentuckys‐exports‐are‐flying‐high‐with‐aerospace/ 

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Kentuckycompaniestounderstandandparticipateintheaerospace,aviation,anddefenseindustry,whileprovidingleaders,andpolicy‐makerswithaneffective,updatedinformationsourcetoinformthelegislativeprocessandhelpcontinuetogrowthissectoroftheeconomy.Thisstudyisexpectedtobecompletedbytheendof2017.

SummaryOthermodesoftransportationthatcouldpotentiallyimpactaviationdemandarebus,lightrail,high‐speedpassengerrail,andmultimodalfreightconnectionswithairports.Withtheexceptionofthehighwayandroadnetworkimpactingpassengerandcargoaccess,developmentsinothermultimodalconceptscurrentlyhavelimiteddirectimpacttomuchoftheaviationsystem.Truckingservesastheprimary,ifnotonlymodetointerlinewithaircargo.DespiteKentucky’sextensiveaviation,rail,andtruckingcomponents,interliningbetweenaviationandrailisnoteconomicallyviableduetothedisparityinweightandvaluecharacteristicsofthegoodsshippedbythetwomodes.Althoughtheimpactisminimal,severalofKentucky’sairports,includingCVG,havemultimodalconnectivitywithferryserviceacrossitsmajorbodiesofwater.HavinganunderstandingofthemultimodalissuesthatimpactaviationacrossKentuckyisessentialforstrategicallyimprovingthestate’stransportationsystemandprovidesopportunitiestofostergrowthinkeyindustries–suchasaerospacemanufacturing.

Technology Trends Advancesintechnologyhavehelpedaviationevolveoveritshistory,makingflyingsafer,faster,andmoreefficient.Forexample,theinventionofthejetengineenabledaircrafttoflyfaster,farther,andmorereliablythanpiston‐poweredaircraft,openingnewcommercialopportunitiesforaviation.Technologicalchangesareexpectedtoalteraviation,improvingthewaypeopleandgoodsaremoved.TwoinnovationsthatarelikelytoimpactaviationinKentuckyarethedevelopmentofanewairtrafficcontroltechnologyknownasNextGen,andunmannedaerialvehicles.

NextGenTheNextGenerationAirTransportationSystem(NextGen)isalong‐termplanbytheFAAtotransformthewaytheU.S.airtransportationsystemoperatesthroughimprovementsinaircrafttrackingsystems,communicationsystems,andweathermonitoringandforecastingsystems.Verybroadly,NextGenaimstoshiftairnavigationfromaground‐basedsystemtoasatellite‐basedsystem.TheFAAexpectstheNextGensystemtodeliverincreasedoperationalefficienciesleadingtoshorterflightroutes,lessfuelconsumption,reducedcongestionanddelay,fewerenvironmentalimpacts,andgreatersafetyforaircraft.

NextGenisacomplexsystemcomprisedofmultiplecomponents.ThisnextsectionsummarizesthemajorcomponentsofNextGenandtheircurrentimplementationstatus.

AutomaticDependentSurveillance‐BroadcastAutomaticDependentSurveillance‐Broadcast(ADS‐B)isakeycomponentofNextGenandhastwosystems–ADS‐BOutandADS‐BIn.Usingacombinationofgroundstations,aircraftavionics,andthesatelliteglobalpositioningsystem(GPS),ADS‐BOutprovidesairtrafficcontrollerswithanaircraft’sposition,altitude,airspeed,andotherinformationcriticaltoensuringaircraftseparation.Becauseitreliesonsatellitesinsteadofground‐basedradars,ADS‐BOutimprovesthecoverageandsituationalawarenessofairtrafficcontrollers,includingtrackingofaircraftwhiletaxiingatairportswithadequatesurveillanceequipment,makinggroundmovementssaferforallaircraft.

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ADS‐BInallowsproperlyequippedaircrafttoreceiveweatherandaircraftpositioninformation(forcollisionavoidance)whileinflight.Thiswillbenefitbothgeneralaviationandcommercialairlineswithenhancedsafetybygivingpilotsanimprovedabilitytoavoidhazardousweatherandaugmenttheirresponsibilitytoseeandavoidotheraircraft.

TheFAAhasestablishedadeadlineofJanuary1,2020forallaircraftoperatingincontrolledairspacetobeequippedwithADS‐BOutavionics(theFAAdoesnotrequireaircrafttobeequippedwithADS‐BIn).ThecosttoequipandinstallADS‐BOutisseveralthousanddollarsperaircraft,whichisfairlyinsignificantfortheairlines,butcanbeasubstantialburdenonprivateaircraftowners.Furthermore,thebiggestadvantageforgeneralaviationaircraftisfromADS‐BIn,whichimposesadditionalequipmentandcostsontheaircraftowner.

CollaborativeAirTrafficManagementTechnologiesTheCollaborativeAirTrafficManagementTechnologies(CATMT)focusesonimprovingtheFAA’sTrafficFlowManagementSystem,whichisawiderangingsystemthatdeliversairtrafficdatatouserswiththeintentionofimprovingoverallawarenessofthenationalairtransportationsystem.Usersincludeairlines,military,airtrafficcontrol,andthetravelingpublic.Thedataavailableisextensive,andincludesweatheranditsimpactsonthenationalairspacesystem,flightschedules,andairtrafficcontrolactionsthatinfluencethenationalairspacesystem.

DataCommunicationsTheDataCommunications(DataComm)portionofNextGenenablescontrollersandpilotstocommunicatewithdigitallywrittenmessagesinsteadofovertheradio.Thisallowscomplexmessages,suchasflightplanroutings,tobetransmittedquicklyandwithreducedriskofcommunicationerrortoandfromtheaircraftcockpit.

TheFAAbeganDataCommin2013bydeliveringdepartureclearances(theinitialroutinganaircraftisexpectedtotake)toflightcrewsoperatingatMemphisInternationalandNewarkLibertyInternational.ThetrialsinMemphisandNewarkhaveshownthatuseofthesystemcanresultinfastertaxiouts,reduceddelays,andreducedpilotandcontrollerworkload.AsofMarch2016,18airtrafficcontroltowerswereequippedwithDataCommtechnology,includingLouisvilleInternational,whereUPSassistedtheFAAwithexpandingDataCommbeyondNewark.

TheFAAplanstoexpanditsDataCommservicesfromairtrafficcontroltowerstoall20airroutetrafficcontrolcenters(thefacilities,commonlyreferredtoascenters,thatprovideairtrafficcontrolservicesduringmostoftheenrouteportionofaflight)by2021.

NationalAirspaceSystemVoiceSystemTheNationalAirspaceSystemVoiceSystem(NVS)willreplacethecurrentswitch‐basedvoicecommunicationsystemusedbyairtrafficcontrolwitharouter‐basedsystemthatprovidesanationwidenetworking,monitoringandcommunicationsharingcapabilities.NVSisexpectedtoenabledirectcommunicationbetweenairtrafficcontrollersandaircrews,includingoperatorsofunmannedaerialvehicles.

Currentcommunicationtechnologylimitstheairtrafficcontrolfacilitiesthatanaircraftcrewcanreachbasedongeography.TheNVSenvisionsaninterconnectedairtrafficcontrolcommunicationsystemthatcanallowaircraftcrewstoreachanyairtrafficcontrolfacilitynetworkedintotheNVS.Thisisimportantforpurposesofshiftingworkloadbetweenfacilities,orintheeventthatanair

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trafficcontrolfacilityisoutofserviceanditscommunicationsneedtobeswitchedtoanotherfacility.TheNVSisundergoingtesting,whichisplannedforcompletionin2019.OperationalNVSisexpectedinthefirstFAAfacilitiesin2019withfulldeploymentofthesystemplannedfor2026.

NextGenWeatherTheweathercomponentoftheNextGensystemconsistsofseveralimprovementstothecollectionanddisseminationofweatherinformation.TheNextGenWeatherProcessorwillidentifyweatherhazardsintheterminalandenrouteenvironments.TheAviationWeatherDisplayconsolidatescurrentweatherdisplaysandprovidesconsistentweatherinformationforterminalandenrouteusers.TheCommonSupportServicesmodernizesinformationmanagementservicesforweather,andprovidestailoredweatherproductsthroughSystemWideInformationManagement(seebelow).Improvedweatherinformationisexpectedtoreduceweatherdelaysandenhancesafety.

SystemWideInformationManagementTheSystemWideInformationManagement(SWIM)infrastructureisaimedatallowingmoreefficientdatasharingamongaviationusers.Itaccomplishesthisbyestablishingdataformatstandards,translatingdatafromdifferentdatasystemsintostandardformats,andconsolidatingmultipledataconnectionsintoasingleaccesspoint.OneexampleofhowSWIMresultsinoperationalefficienciesisthatthesystemallowscollaborationbetweenairlinedispatchersandtrafficmanagersbyprovidingbothusergroupsaccesstocurrentweatherandflightplanninginformation.UsingSWIM‐enableddata,thesetwogroupsareabletocooperativelyreroutetrafficandtakeadvantageofthemostcurrentinformationonweather,airtrafficcontroltrafficmanagementinitiatives,runwayconfigurations,andairportdeicingoperations.TheFAAcompletedthefirstportionoftheSWIMinitiativein2015andanticipatesthesecondportionwillbecompletein2016.

EnrouteAutomationModernizationEnrouteAutomationModernization(ERAM)consistsofimprovementstoequipmentatairroutetrafficcontrolcentersthatwillbetterautomateanumberofairtrafficcontrolfunctions,extendsurveillancerange,andincreasethetrackingcapacityforeachcenterfromitscurrentlimitof1,100aircraftto1,900.AsofMarch2015,ERAMwasoperationalatall20ofthecontinentalcenters.Additionalenhancementsareplannedthrough2017.

TerminalAutomationModernizationandReplacementTerminalAutomationModernizationandReplacement(TAMR)isanequipmentupgradeprogramsimilartoERAM,butforairtrafficcontroltowersandterminalradarapproachcontrolfacilities.Thesefacilitiesreceiveimprovedradarprocessinganddisplaysystemsundertheprogram.The

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FAAisimplementingTAMRacrossthreephases,thefirsttwoofwhicharecompleted.TAMRisscheduledforcompletionby2020.

TheNextGensystemhasthepotentialtogreatlyimprovebothcommercialandGA.Forexample,thankstoNextGenmodificationsinarrivalproceduresatLouisville,UPSsavesmorethan7,700gallonsoffueleverynight.22Thisisaccomplishedthroughtheuseofcontinuousdescentarrivals,whichreducefuelburnandnoise.TheuseofADS‐BInandOutpromisestoincreasesituationalawarenessforallaviators,therebyenhancingsafety.

However,theGovernmentAccountabilityOfficehascriticizedthe$40billionprogramforbeingbehindscheduleandmorethan$4billionoverbudget.23Furthermore,thehighcostofequippingaircraftincomparisontothebenefitsreceived(especiallyforGA)mayrestrictthebenefitstoasmallerpoolofparticipantsthanoriginallyanticipated.Finally,concernshavebeenraisedovertheunencryptednatureofthesignalssentoutbyaircrafttosupportNextGentechnologies.TheNationalBusinessAviationAssociationhasstatedthatundertheNextGensystem,eachproperlyequippedaircraftbroadcastsitsaircrafttype,position,airspeed,anduniqueidentificationinrealtimeintheclear.Sincethesesignalsarenotencrypted,anyonewiththerightkindofreceivercancollectthedata.Infact,flighttrackingwebsitessuchasflightradar24.com,makeuseofthesekindsofreceiversoperatedbyvolunteersthatfeedthatdatatothewebsite.

UnmannedAerialSystemsThegrowthinunmannedaerialvehicles(UAV)hasbeenspurredbyimprovementsinenginetechnology,batterylife,andminiaturizationofcomponents,allofwhichhavedrivendownthecostsoftheseeasy‐to‐operatevehicles.Asaresult,recreationalandespeciallybusinessuseofUAVshasproliferated.ThefollowingindustriesarejustasampleofthebusinessesthatexpecttocapitalizeonUAVgrowth.

Agriculture–UAVoperationscanprovidefarmerswithinformationonhowtheircropsareperformingandprovidetheabilitytoapplypesticides,fertilizer,andseedtospecificareas.

Energy–Currently,pipelineandpowerlineinspectionsarecarriedoutbymannedaircraft.UAVoperationshavethepotentialtoconducttheseinspectionsforreducedcosts.

Retailing–CompaniessuchasAmazonandWalmartareexploringhowUAVscanbeusedtodeliverproductsorderedonline.

FilmIndustry–ThemovieandTVindustryexpecttomakeuseofUAVsasaerialfilmingplatforms.

22 NextGen Update: 2014 (2014). FAA, August 2014. 23 Air Traffic Control Modernization: Management Challenges Associated with Program Costs and Schedules Could Hinder NextGen Implementation (2012). Government Accountability Office, GAO‐12‐223, February 16, 2012. 

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Insurance–UAVoperationscanprovidetheinsuranceindustrywithinformationmorequicklyandefficientlythancurrentmethods.Forexample,UAVscanbeusedtoinspectroofstoevaluateahomeowner’spolicy,orsurveydamagefromatornadotospeedclaims.

RealEstate–UAVuseisexpectedbeaboonfortherealestateindustry,givingtheabilitytoviewhardtoreachareasofpropertiesandprovideviewsthatareinaccessibletothoseontheground.

LawEnforcement–PolicedepartmentsareinterestedinusingUAVstoaidintrackingsuspectsandmonitoringforillegalactivity.

SearchandRescue–UAVoperationsareidealforwhensearchandrescueisundertakeninremoteareaswhereaccessislimited.

SafelyintegratingUAVoperationsintothenationalairspacesystemremainsachallenge.CongressdirectedtheFAAtodeveloprulesforUAVoperationsbySeptember2015.TheFAApublishedregulationsforthecommercialoperationofUAVsthatweighupto55poundsinJune2016.TheFAAcontinuestodeveloprulesforotherUAVsoperations.TheFAAalsoimplementedinDecember2015aUAVregistrationprocessforallUAVsweighingmorethan0.55pounds.ThisregistrationregulationwasvacatedinMay2017bythecourtsbecauseitviolatedtheFAAModernizationandReformActof2012.TheFAAisintheprocessofreviewingrecommendedrulesforsmallerUAVs,calledmicro‐UAVs,thatwouldbelessrestrictivethantherulesforheavierUAVs.

WiththeFAAstillintheprocessofdevelopingUAVrules,theKentuckyDepartmentofAviation(KDA)hasservedasaclearinghouseforUAVissuesandactivitiesinthestate.Withitsfocusoneconomicdevelopment,KDAhasreachedouttoprivatebusinessesengagedinUAVoperationsinanefforttopromotethecommercialuseofUAVswhilesimultaneouslyencouragingtheirsafeintegrationwithotherairspaceusers,andhelpingresolveissuesthatoccur.

EngineeringandcomputersciencestudentsarealsoindemandbytheUAVindustryandatleast50universitiesintheU.S.havecenters,academicprograms,orclubsfordroneengineeringorflying.TheUniversityofKentuckyhasanUnmannedSystemsResearchConsortium(USRC)thatseekstoadvancetechnologiesassociatedwithUAVs.Dr.SuzanneSmithisthedirectoroftheKentuckySpaceGrantConsortiumattheUniversityofKentuckyandleadsresearcheffortsthatincludessensordevelopmentandaircraftdesign.ShehasnotedthattherearequiteafewcompaniesinKentuckythathaveappliedtotheFAAforpermissiontooperateUAVs.Shesaidthatseveralfactorscontributetothistrend,includingthelargenumberofmilitarybasesinKentuckythatsupplyatechnicallyskilledworkforce,andtwomajorpackagedeliveryfirmsthatarepushingtouseUAVs.Notableareasofusethatsheindicatedincludeatmosphericresearch,agriculturalsurveying,andbridgeinspections,butsheexpectsthattherearemanyfutureusesofUAVsthatareasyetnotidentified.

WideAreaAugmentationSystemAviationanticipatedsignificantimprovementstonavigationwiththedevelopmentoftheglobalpositioningsystem(GPS).Whilethesystemprovidedexcellentenroutepositionalawareness,itwasinitiallyfoundtolacksufficientaccuracyforuseinallbuttheleastdemandinginstrumentapproachprocedures,andcouldnotbeusedtoprovideanysortofglideslopeguidance.ThatchangedwiththedevelopmentoftheWideAreaAugmentationSystem(WAAS),asystemthatimprovesthehorizontalandverticalaccuracyofGPStothepointwhereWAAS‐guidedapproachesnowmatchtheaccuracyofprecisioninstrumentapproaches,andcanofferverticalguidancetoaslowas200feetabovetheairportsurfaceinaslittleas0.5milesofvisibility.

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InKentucky,30airportsrelyonWAAS‐enabledapproachestoprovidethemwiththebestapproachminimumsavailable.TensofthousandsofgeneralaviationaircraftarealreadyequippedwithGPSandmanythousandsalsohaveWAASbecauseitisanattractiveupgrade.Inaddition,somecommercialoperatorshavealsoequippedscheduledserviceaircrafttoflyWAAS‐guidedapproaches.ItisexpectedthattheFAAwillcometorelymoreandmoreonWAASapproachesbecausetheycanbeimplementedwithouttheneedforadditionalground‐basedequipment.

Summary Technologyisakeydriverintheadvancementofaviation.Severalexamplesofthishavebeenhighlightedinthisreport.NextGenisreshapingthewayairtrafficcontrolandaviatorsworktogethertomakemoreefficientuseoflimitedairspace.UPShasalreadyassistedtheFAAwithdemonstratingsomeofthebenefitsanticipatedbytheaviationindustryoncetheNextGensystemisfullydeployed.Generalaviationexpectstoreapsafetydividendsonthein‐cockpitweatherandbettercollisionavoidancetechnologythatNextGenoffers.

DemandforcommercialUAVservicesappearstobegrowingdespiteuncertaintyaroundhowtheFAAplanstointegrateUAVoperationssafelyintothenationalairspacesystem.TheuseofUAVsisexpectedtoimpactairspaceandairportoperationalstandards.

WidespreaduseofWAAS‐supportedinstrumentapproacheshasenhancedaccessibilityfornumerousKentuckyairports,increasingthesafetyandversatilityofthosefacilities.

Finally,itshouldbementionedthatgovernmentalpolicieshavethepotentialtoimpactgeneralaviationactivity,eitherpositivelyornegatively.Someexamplesincludethepersonalpropertytaxonaircraft,environmentalcompliancerequirements,andthelimitforaircarriersonjetfuelsalestax,whichdeprivesthestateofneededaviationrevenuewhileencouragingcommercialairlineactivity.