(a) Purpose. The purpose of an agreement between the sponsor and the department is to define the respective responsibilities of the sponsor and the department in implementing the project and to define the requirements, terms, conditions, type of funds, and considerations attendant upon each party to the agreement. Prior to the disbursement of any funds by the department, the sponsor shall execute the agreement in a manner provided by law for entering into binding contractual agreements.
(b) Airport Project Participation Agreement (APPA). Except as provided in subsection (c) of this section, when the commission has approved a sponsor's request for financial assistance, the APPA:
  (1) shall name the department as agent for the purpose of applying for, receiving, and disbursing federal funds, if applicable;
  (2) may name the department as agent for the purpose of contracting for and supervising the planning, acquisition, development and construction of the airport project;
  (3) may provide for the department to receive and disburse the local sponsor's share of project costs;
  (4) shall provide a general description of the proposed project, the amount of state, federal, and/or local sponsor project share, and the total estimated cost;
  (5) shall include, as a separate attachment, an attorney's certificate of airport property interests title if necessary; certification of availability of sponsor share; and existence of an airport fund; and
  (6) shall include a list of both the sponsor's and the state's responsibilities.
(c) Loan agreement. Where the commission has offered financial assistance to a sponsor in the form of a loan, the sponsor and the department shall enter into a loan agreement defining the consideration, the terms, and conditions under which the loan will be made, and the responsibilities of the sponsor. The loan agreement shall:
  (1) provide a general description of the proposed project, the amount of state funds to be loaned, and the estimated total project costs;
  (2) provide the length of the loan and amount of simple interest, along with the schedule of payments;
  (3) include an attorney's certificate of airport property interests title as a separate attachment;
  (4) disclose the source of all funds for the project;
  (5) certify that the sponsor has the ability to finance and operate the airport or air navigational facility; and
  (6) include other provisions and terms as deemed necessary by the department.
(d) Covenants, terms, and conditions. In addition to all other requirements imposed by law or by this subchapter, all intergovernmental agreements made by the department shall be subject to the following terms and conditions and any additional terms and conditions necessary to effectuate the program.
  (1) The term of the agreement shall be no longer than 20 years from the date of a sponsor's acceptance.
  (2) The airport or navigational facility shall remain under the sponsor's control during the term of the grant or loan agreement.
  (3) At least 10% of the total project cost will be provided from sources other than the state.
  (4) The airport or navigational facility shall be maintained by the sponsor in a safe and serviceable condition during the term of the agreement.
  (5) Consistent with safety and security requirements, a sponsor shall make the airport or navigational facility available to all types, kinds, and classes of aeronautical use without discrimination between such types, kinds, and classes and shall provide adequate public access during the term of the agreement.
  (6) The sponsor shall not grant or permit another to exercise an exclusive right for the conduct of any aeronautical activity on or about an airport landing area. Aeronautical activities include, but are not limited to, scheduled airline flights, charter flights, flight instruction, aircraft sales, rental, and repair; sale of aviation petroleum products, and aerial application. The landing area consists of runways or landing strips, taxiways, parking aprons, roads, airport lighting, and navigational aids.
  (7) Property interests identified in the agreement and attorney's certificate of Airport Property Interests shall be pledged to airport use and shall not be removed from such use without prior written approval by the commission.
  (8) A sponsor, if requested by the division, shall submit to the division annual statements of airport or air navigational facility revenues and expenses.
  (9) All fees collected for use of an airport or navigational facility constructed with funds provided under the program shall be reasonable and nondiscriminatory. The proceeds of such fees shall be used solely for the development, operation, and maintenance of the airport or navigational facility. A sponsor, however, shall not be required to pledge income received from the mineral estate to airport use unless state and/or federal funds were used to acquire the mineral estate or any interest therein.
  (10) All development of an airport constructed with program funds shall be consistent with the airport layout plan approved by the staff and maintained by the sponsor. A reproducible copy of such plan, and all subsequent modifications thereto, shall be filed with the division for approval by the staff.
  (11) Following completion of a project where airport lighting is part of the project, the sponsor shall operate such lighting from sunset to sunrise either manually or by radio control.
  (12) The department shall not be a party to any contract or commitment outside of the mutually agreed upon contracts, which a sponsor may enter into or assume in carrying out a project.
  (13) A sponsor shall adopt and enforce airport hazard zoning regulations to restrict the use of land, adjacent to or in the immediate vicinity of the airport, to activities compatible with normal airport operations. A sponsor shall also acquire and retain easements or other interests in, or rights to, the use of land or airspace unless a sponsor can show the acquisition and retention of such interest will be impractical or will result in undue hardship to a sponsor. No sponsor shall be eligible for a subsequent grant or loan under the program unless the sponsor has adopted and has, as called upon to do so, enforced the airport zoning ordinance/order approved by the division.
  (14) Unless the division has given prior written exception, a sponsor shall not enter into any agreement nor permit any aircraft to gain direct ground access to or from the sponsor's airport form private property adjacent to or in the immediate area of the airport, a practice commonly known as a "through the fence operation."
(e) Amendments and cancellation. A major amendment to or cancellation of a grant or loan requires majority vote of the entire commission. Minor amendments to a grant or loan agreement may be made by the director at his discretion. The director shall determine what constitutes a major or minor amendment. The sponsor may appeal the director's determination to the commission by filing with the executive director a written statement of its specific objections. The executive director shall forward the statement of appeal to the commission. The commission shall make a final decision as to whether the amendment is major or minor.

Source Note: The provisions of this §30.210 adopted to be effective September 27, 1990, 15 TexReg 5366; transferred effective September 1, 1993, as published in the Texas Register August 27, 1993, 18 TexReg 5768; amended to be effective May 24, 1995, 20 TexReg 3575; amended to be effective February 21, 1996, 21 TexReg 979.