Santa Monica Airport Accused of Federal Revenue Law Violations by FAA
The Federal Aviation Administration (FAA) has ruled that the Santa Monica Municipal Airport violated federal law. The violation occurred due to the improper accumulation of airport revenues intended for non-aviation city services. This ruling significantly impacts the city’s plans for the airport’s closure in 2028.
On December 22, 2025, FAA Director Michael Helvey issued a Director’s Determination. This document, made public this week, found that the city’s actions do not align with federal grant assurances and revenue use restrictions. As a result, the ruling requires Santa Monica to revise its fee structure within 30 days and implement new aeronautical rates within 60 days.
The case originated from a complaint filed in July 2024. The complainants, pilot Mark Smith, Kim Davidson Aviation, and the National Business Aviation Association, alleged that the city improperly distinguished between aeronautical and non-aeronautical revenue surpluses. They claimed that the city planned to reserve a projected $19 million non-aeronautical surplus for general municipal purposes upon the airport’s scheduled 2028 closure.
Federal law mandates that all airport revenues—both from aviation activities and non-aeronautical uses like leases—be spent on airport capital costs, operations, or facilities directly related to air transportation. The FAA found that Santa Monica’s plan to accumulate and reserve surplus for non-aviation purposes violates these requirements.
Under a 2017 settlement agreement, Santa Monica received permission to close the historic airport on December 31, 2028. However, the FAA ruling clarifies that revenue restrictions apply throughout the period the city remains obligated under federal agreements. The city now has 30 days to appeal the determination.
The Santa Monica Municipal Airport, established in 1923, is one of the oldest airports in the United States. It has long been a contentious issue between aviation advocates and local residents. The latter group seeks to convert the valuable real estate into parkland.
Source: https://avweb.com/aviation-news/faa-finds-santa-monica-broke-federal-rules/