Can a city impose a policy that entirely prevents the establishment of a second Fixed Base Operator (FBO) at an airport?

• A. Yes, to protect the established FBO
• B. No, due to requirements for reasonable competition
• C. Yes, if it aligns with federal grant terms
• D. No, if the second FBO provides better services

Answer: (B)

The answer is correct because federal law, specifically the Federal Aviation Act and policies from the Federal Aviation Administration (FAA), emphasizes the importance of promoting competition among Fixed Base Operators (FBOs) at airports. This legal framework is designed to prevent monopolies and allow for a competitive environment that can lead to better services and lower prices for users, such as pilots and aircraft owners.

When a city imposes a policy that entirely prevents the establishment of a second FBO, it potentially violates these principles of reasonable competition. The law requires that airports, particularly those that receive federal funding, do not restrict entry to new operators without justifiable reasons that align with promoting efficiency and public interest.

Thus, a policy that completely prohibits additional FBOs cannot be justified simply to protect an existing operator since it would hinder competition and limit choices for consumers in the aviation market. This aligns with the general principle that competition is considered beneficial for both the airport and its users.