A bill to amend the Airport and Airway Improvement Act of 1982 for the purpose of extending the authorization of appropriations for airport and airway improvements, and for other purposes.

Title I: Airport and Airway Improvement Act Amendments - Airport and Airway Improvement Amendments of 1987 - Amends the Airport and Airway Improvement Act of 1982 to authorize appropriations for FY 1987 through FY 1992 for air navigation facilities. Sets forth minimum obligation levels for certain fiscal years for the purchase and installation of instrument landing systems at primary, reliever, and other airports. Authorizes appropriations for FY 1988 and 1989 for specified research, engineering and development, and demonstration projects.

Authorizes the Secretary of Transportation to transfer funds among such projects according to prescribed guidelines. Requires the Secretary to submit a written explanation to specified congressional committees regarding certain proposed transfers. Sets forth minimum expenditure guidelines for airport capacity enhancement. Requires the Administrator of the Federal Aviation Administration to transmit to specified congressional committees a report demonstrating compliance with such minimum expenditure guidelines. Sets forth funding limitations.

Requires that a minimum of ten percent of funds authorized for airport development be expended with small businesses owned and controlled by socially and economically disadvantaged individuals. Mandates that each State annually survey and compile a list of such business concerns. Outlines the minimum criteria to be established by the Secretary of Transportation for use by State governments in certifying whether a concern qualifies under this Act.

Prescribes formulas for the apportionment of funds (including funding levels for airport capacity enhancement, safety, and security).

Revises the definition of "primary airport" to encompass those airports having more than 18,000 passengers enplaned annually (thus increasing the number of airports eligible for Federal assistance).

Revises the limitations on the use of funds earmarked for: (1) noise compatibility planning and programs; and (2) integrated airport system planning.

Cites circumstances under which a State may submit, as sole sponsor, an application for certain airport development projects.

Authorizes the Secretary to increase certain terminal development project costs if such increases are in the public interest. Precludes the cost of decorative landscaping or the installation of sculpture or art works as allowable project costs. Authorizes the Secretary to provide reimbursement through letters of intent for certain advance expenditures for airport development projects. Prescribes guidelines for such letters.

Sets forth the assurances required of airport development project sponsors, including: (1) nondiscrimination provisions; (2) terminal airspace; (3) revenue; (4) land disposal; (5) airport layout plans; (6) contracts for engineering and design services; and (7) approval of nonaeronautical closing of airports.

Permits the use of: (1) State taxes on aviation fuel to support a State aviation program; (2) airport revenue for noise mitigation purposes; and (3) land disposal funds for certain airport lands, including airport noise compatibility lands. Revises the percentage by which the maximum Federal grant obligation for airport development lands may be increased.

Directs the Secretary to make available ten percent of the funds apportioned for public-use airports to local governmental units and public agencies for noise compatibility program grants if the Secretary finds that such public-use airport is not making reasonable progress towards development and implementation of a noise compatibility program.

Amends the Aviation Safety and Noise Abatement Act of 1979 to authorize the Secretary to make grants to airport operators and local governmental units to soundproof public schools and hospitals which have been determined to be adversely affected by the airport noise impact area surrounding the airport.

Requires the Administrator of the Federal Aviation Administration to report to the Congress the results of a study determining whether or not noise abatement proposals under consideration by airport operators and local governments should be made eligible for Federal assistance.

Requires the Secretary to provide grant applicants and recipients notice and opportunity for a hearing before withholding either approval or payment due to noncompliance with the assurances required under this Act. Authorizes judicial review of such withholding action.

Prohibits the Secretary from closing flight service stations or reducing their operation hours unless substitute service will be provided by an automated flight service station with specified equipment.

Changes from mandatory to discretionary the Secretary's authority to provide by grant for the continuation of the Explosive Detection K-9 Team Training Program.

Expresses the sense of the Congress that any regulation under which the Administrator of the Federal Aviation Administration limits the number of instrument flight rule takeoffs and landings should be phased out and eliminated at the earliest time consistent with aviation safety.

Deems heliports to be airports for purposes of the Airport and Airway Improvement Act of 1982.

Directs the Secretary to conduct a study, and report its results to the Congress by January 1, 1990, regarding a long-term overall airport system plan. Authorizes appropriations.

Authorizes the Secretary to release: (1) the city and county of Denver, Colorado, from the terms in each deed of conveyance under which the United States conveyed property containing portions of Stapleton International Airport; and (2) such airport sponsor from any assurances made for a grant for a certain project at such airport. Cites conditions for the granting of such release.

Prohibits the Secretary from making a grant for an airport development project involving the Burbank-Glendale-Pasadena Airport Authority in California unless such Authority meets specified conditions.

Prohibits the Federal Aviation Administration from taking any action to: (1) compel the city of Pompano Beach, Florida, to redesignate as nonaviation use land at the Pompano Beach Airpark as of November 1, 1966; or (2) revert such land to the Federal Government.

Title II: Extension of Aviation-Related Taxes and Airport and Airway Trust Fund Spending Authority - Airport and Airway Revenue Act of 1987 - Amends the Internal Revenue Code to extend from 1988 to 1993: (1) aviation excise taxes regarding transportation of persons and property; and (2) certain transfers into the Airport and Airway Trust Fund.

Extends from December 31, 1987, to December 31, 1992, an excise tax imposed upon certain non-commercial aviation fuels.

Extends from October 1, 1987, to October 1, 1992, certain spending authority of the Airport and Airway Trust Fund.

States that no tax will be imposed on: (1) any air transportation by helicopter for the purpose of providing emergency medical services under specified circumstances; or (2) any liquid for use in such helicopters.

Specifies circumstances in which certain aviation-related taxes will be reduced in proportion to appropriations which are significantly below authorizations.