FAA's $481M Airport Grants Mark Program's Final Year

A Labor Day grant round with an expiration date attached

On September 3, 2026, U.S. Transportation Secretary Sean P. Duffy announced that the Federal Aviation Administration would send $481 million to airports across the country "ahead of a busy Labor Day travel weekend." On its face, it read like dozens of similar announcements the agency has made since 2022: a list of grants, a handful of headline dollar figures attached to familiar hub names, and a press release timed to a holiday travel surge.

But this round carries more weight than the ones that came before it. The money is part of the Airport Infrastructure Grants (AIG) program created by the 2021 Infrastructure Investment and Jobs Act (IIJA), a five-year, $14.5 billion commitment running from fiscal year 2022 through fiscal year 2026 — and fiscal 2026 is the last year on the clock. The supplemental funding stream that has helped rebuild runways, taxiways and terminals at hundreds of U.S. airports is set to lapse at the end of September, reverting the FAA's baseline airport-grant authority to a smaller, pre-IIJA level unless Congress acts.

That makes the September 3 announcement less a routine funding drop and more a marker: the last big wave of a program that reshaped how American airports pay for concrete and steel over the past four years.

Where the money is going

The FAA is distributing 191 grants to airports in 36 states and two territories through the AIG program. The list is dominated, as usual, by a mix of major hubs and smaller regional fields:

Hartsfield-Jackson Atlanta International Airport in Georgia — $100 million, the largest single award in this round, for runway and taxiway reconstruction, terminal work and runway safety area improvements.
Louisville Muhammad Ali International Airport in Kentucky — $32.5 million to reconstruct terminal facilities.
San Diego International Airport in California — $30.3 million for terminal construction.
Milwaukee Mitchell International Airport in Wisconsin — $14.2 million for taxiway construction and rehabilitation.
El Paso International Airport in Texas — $8.7 million to rehabilitate its apron.

Selected FAA Airport Infrastructure Grants announced September 3, 2026

AIG dollars can be used for a wide range of projects: airport planning and development, terminal expansions, baggage-handling system upgrades, runway and taxiway rehabilitation, roadway and access improvements, and other safety-focused infrastructure. Duffy framed the round in political terms typical of his tenure, describing it as part of ushering in a "Golden Age of Transportation," language he has used in comparable announcements earlier this year, including a $523 million round of 332 grants across 43 states in late May.

Between the two rounds alone — May's $523 million and September's $481 million — the FAA has pushed out over $1 billion in AIG funding in roughly four months, underscoring how much of the program's five-year allocation has been concentrated in its final stretch as the agency works to obligate money before deadlines tied to each fiscal year's funding.

Why fiscal 2026 is different

The IIJA structured AIG funding so that each fiscal year's allocation comes with its own obligation deadline, spaced out over subsequent years — FY2023 money, for instance, needed to be committed by September 30, 2026, while FY2025 and FY2026 allocations have deadlines extending into 2028 and 2029. But the formula allocations themselves stop after FY2026, which totaled roughly $2.89 billion for that year alone, according to FAA guidance on the program's funding amounts.

After that, the FAA's baseline Airport Improvement Program (AIP) authorization — a separate, older mechanism — reverts to lower levels absent Congressional action. The FAA Reauthorization Act of 2024 set AIP entitlement funding at $3.35 billion for FY2024, rising incrementally to $3.575 billion in FY2025, $3.625 billion in FY2026, $3.675 billion in FY2027 and $3.725 billion in FY2028. Those figures are meaningfully below what airports have grown accustomed to when IIJA's supplemental AIG dollars are added on top. The 2024 reauthorization did make some structural changes airports welcomed — raising the share of AIP funding reserved for smaller commercial and general-aviation airports from 20 percent to 25 percent, and replacing an older $100 million AIP supplement with a new $200 million annual discretionary grant program aimed at airport resilience and runway safety projects.

Airport trade groups have already begun pressing lawmakers on the gap. Airports Council International-North America (ACI-NA), joined by more than a dozen other aviation organizations, has urged Congress to extend IIJA-level airport infrastructure funding before the key provisions lapse on September 30, 2026, arguing that the drop-off would slow a construction pipeline that has become standard practice at airports of every size — from single-runway regional fields to Atlanta's sprawling complex.

A four-year building spree, tallied up

Since IIJA passed in 2021, the AIG program alone has represented $14.5 billion in dedicated airport infrastructure spending, layered on top of the FAA's traditional AIP grants and the separate, larger Airport Terminal Program that has funded marquee projects like new terminal buildings at major hubs. Industry analysts tracking large-hub airport capital programs have put total U.S. airport capital spending — combining federal grants, airport revenue bonds, passenger facility charges and other financing — in the range of $130 billion to $140 billion across the current multi-year cycle, a figure that includes far more than federal grants but reflects the scale of construction activity the federal money has helped catalyze or de-risk for airport operators seeking their own financing.

Whether that pace continues into fiscal 2027 now depends on decisions still pending on Capitol Hill. For now, September's round of 191 grants offers a snapshot of an airport-funding system operating at full tilt in its final authorized year — runway safety area work in Atlanta, an apron rebuild in El Paso, a taxiway extension in Milwaukee — while the question of what replaces it, and at what funding level, remains open.

The pattern behind the grant list

Looking at how this round's money is earmarked reveals something about where the AIG program has concentrated its spending as it winds down. Of the five largest awards in the September 3 round, three — Atlanta, Louisville and San Diego — are directed at terminal or runway/taxiway reconstruction rather than new capacity, reflecting a broader shift in how the program has been used over its five years. Early rounds under the 2021 law leaned more heavily toward expansion-oriented projects; more recent allocations, including this one, have increasingly gone toward bringing aging pavement, terminal buildings and safety areas up to current standards rather than adding gates or runways outright. Atlanta's $100 million award, for instance, is explicitly tied to runway safety area improvements alongside reconstruction work, a category the FAA has prioritized as airports approach the end of the IIJA funding window.

That distinction matters for the debate in Washington. Groups like ACI-NA have argued that a funding lapse would not simply delay new construction — it would slow down maintenance-driven safety work that airports have restructured their capital plans around, on the assumption that IIJA-level funding would continue through the full five-year window. Because many of these projects are multi-year efforts involving phased construction, an abrupt drop in available federal funding in fiscal 2027 could leave some already-underway reconstruction projects only partially funded, forcing airport operators to either find replacement financing quickly or pause work mid-project.

What happens if the funding isn't extended

If Congress does not act, airports would still receive AIP entitlement funding under the 2024 reauthorization's baseline schedule, meaning the system does not disappear entirely. But airport operators that have built five-year capital plans around the added IIJA money would need to either scale back projects, seek alternative financing such as passenger facility charge increases or bond issuances, or delay work — a scenario ACI-NA and its partner organizations have specifically warned against in their advocacy to lawmakers. Smaller general-aviation and regional airports, which often lack the bonding capacity or passenger volume to self-finance major projects, are generally seen as more exposed to a funding gap than large hubs like Atlanta, which can draw on multiple revenue streams beyond federal grants.

The FAA has not indicated it will accelerate or restructure the remaining FY2026 obligations in anticipation of the deadline, and officials have continued to frame each grant round in the same terms used throughout the program's life — safety, capacity and modernization — rather than as a wind-down. The September 3 announcement made no explicit reference to the program's looming expiration, a fact reporters covering the funding fight in Washington have noted as the more significant story running alongside the individual grants themselves.

$481 Million and Counting Down: Inside the Last Year of America's Airport Grant Boom