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SB 1788

SB 1788 - This act restricts expenditure of any local taxes collected by a political subdivision on aviation fuel or the revenues generated by an international airport that is the subject of federal assistance or the subject of assistance from the Missouri Department of Transportation for purposes other than the capital or operating costs of the airport, the local airport system, or any other local facility that is owned or operated by the person or entity that owns or operates the airport that is directly and substantially related to the air transportation of passengers or property. Provisions of this act do not apply to any taxes collected by a political subdivision for sale of a private airport to a public entity if the sale is approved by the Secretary of the U.S. Department of Transportation, funding is provided under federal law for any portion of the public entity's acquisition of airport land, and an amount described in the act under federal law to that airport for purposes other than land acquisition, is repaid to the Federal Department of Transportation by the private owner. Repayments referred to in this act shall be treated as a recovery of prior year obligations. Nothing in this act may be construed to prevent the use of a state tax on aviation fuel to support a state aviation program or the use of airport revenue on or off the airport for a noise mitigation purpose. JOSH NORBERG

2026 Regular Session

Missouri SB 1788 restricts local aviation fuel taxes and airport revenues to airport-related capital or operating costs, with an exception only when selling a private airport to a

Second Read and Referred S Transportation, Infrastructure and Public Safety Committee
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Bill Summary · SB 1788

Overview

Missouri Senate Bill 1788 (2026) adds a new section to Chapter 385 governing airport revenues. It restricts how local taxes collected on aviation fuel or revenues from an international airport that receives federal assistance or Missouri Department of Transportation (MoDOT) assistance can be spent. The bill focuses on ensuring these funds are used only for airport-related capital or operating costs or for related local facilities, with specific exceptions involving private-to-public airport sales.

Main purpose and intent

  • Limit the expenditure of local taxes on aviation fuel and revenues tied to international airports that receive federal assistance or MoDOT assistance.
  • Ensure such funds are used only for airport-related capital or operating costs or for related local facilities owned or operated by the airport owner/operator.
  • Create a specific exception framework for the sale of a private airport to a public entity, detailing conditions under which repayments to the Federal Department of Transportation (DOT) are required and treated as recovery of prior year obligations.
  • Preserve existing uses of aviation fuel taxes that support state aviation programs and noise mitigation uses, clarifying that the restrictions do not bar these activities.

Key provisions and changes

  1. Section 385.281, subsections 1 and 2:

    • Local taxes collected on aviation fuel or revenues from an international airport with federal or MoDOT assistance cannot be expended for purposes other than:
      • Capital costs of the airport
      • Operating costs of the airport
      • The local airport system
      • Any other local facility owned/operated by the airport owner that is directly and substantially related to air transportation of passengers or property

  2. Subsection 2 (exception for sale of a private airport to a public entity):

    • Applies when:
      • The sale is approved by the U.S. Secretary of Transportation
      • Federal funding is provided for any portion of the public entity’s acquisition of airport land
      • An amount equal to (a) the remaining unamortized portion of any federal airport improvement grant (made for purposes other than land acquisition) amortized over 20 years, plus (b) the due federal share of the current fair market value of land acquired with an airport improvement grant on or after Oct 1, 1996, is repaid to the Federal DOT by the private owner
    • These repayments are treated as recovery of prior year obligations

  3. Subsection 3:

    • Clarifies that nothing in the section prevents:
      • Use of a state tax on aviation fuel to support a state aviation program
      • Use of airport revenue on or off the airport for noise mitigation purposes

Who/what is affected

  • Local political subdivisions (cities, counties, special districts) that collect taxes on aviation fuel or that have revenues from an international airport with federal or MoDOT assistance.
  • Owners/operators of international airports in Missouri, particularly where federal or MoDOT funding is involved.
  • Private airports undergoing sale to a public entity, subject to specific DOT approvals and repayment requirements.
  • State aviation programs may continue to use aviation fuel taxes, and airport revenues may be used for noise mitigation, notwithstanding the restrictions.

Procedural and timeline aspects

  • Legislative action history:
    • Introduced in 2026 (Second Regular Session).
    • February 26, 2026: First Reading.
    • May 7, 2026: Second Read and Referred to S Transportation, Infrastructure and Public Safety Committee.
  • Effective date: Not specified in the text provided; typically, such provisions become effective upon enactment or a future effective date as designated in the bill or subsequent implementing rules.

Practical implications

  • Local governments will need to align expenditures of aviation fuel taxes and airport-related revenues with airport-specific capital or operating costs or closely related local facilities.
  • The sale of a private airport to a public entity could trigger repayment obligations to the federal government, potentially altering the financial modeling of such transactions and requiring coordination with DOT approvals.
  • States can continue using aviation fuel taxes for state aviation programs and can maintain noise mitigation funding, even under the broader restrictions.

If you’d like, I can provide a side-by-side comparison with current law or draft a one-page plain-language briefing for policymakers or the public.

Compiled from official sources — confirm details with the bill’s official record.

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