(1)Where an authority to whom Part VIII of the [1980 c. 65.] Local Government. Planning and Land Act 1980 applies own any airport (which is accordingly not an airport operated by a public airport company within the meaning of Part II of this Act), then, for the purposes of that Part of that Act—
(a)the amount of any grant or advance of a capital nature made by any person for the purposes of the authority's airport undertaking shall be treated as prescribed expenditure of the authority, but
(b)no expenditure by the authority for the purposes of that undertaking other than any amount expended on the making of any such grant or advance shall be treated as prescribed expenditure of the authority ;
and any amount repaid in respect of any such grant or advance as is mentioned in paragraph (a) shall be treated for the purposes of section 72 of that Act as a receipt of the authority which, by virtue of section 75(1) of that Act, is a capital receipt of the authority for the purposes of Part VIII of that Act.
(2)The profits to which any such authority are entitled from their airport undertaking shall not be taken into account for the purposes of subsection (3)(e) of section 72 of that Act; and accordingly—
(a)in subsection (3)(e) " trading undertaking " shall not include an airport undertaking ; and
(b)subsection (4)(iii) of that section shall cease to have effect.
(3)Any amount received by any such authority in respect of the disposal of any assets held by the authority for the purposes of their airport undertaking shall not be taken into account for the purposes of section 75(1) (b) of that Act.
(4)This section shall apply in relation to an airport owned jointly by two or more authorities to whom Part VIII of that Act applies as it applies in relation to an airport owned by one such authority alone (references to the airport undertaking of a particular authority being read as references to the airport undertaking of the authorities in question), but the provisions of subsection (1) requiring any amount to be treated as prescribed expenditure of any authority, or (as the case may be) as such a receipt of an authority as is there mentioned, shall have effect only in relation to such one of the authorities in question as may be determined by agreement between those authorities.
(5)This section applies to England and Wales only.