[House Hearing, 110 Congress]
[From the U.S. Government Publishing Office]
THE PRESIDENT'S FY08 FEDERAL AVIATION ADMINISTRATION'S BUDGET
=======================================================================
(110-10)
HEARING
BEFORE THE
SUBCOMMITTEE ON
AVIATION
OF THE
COMMITTEE ON
TRANSPORTATION AND INFRASTRUCTURE
HOUSE OF REPRESENTATIVES
ONE HUNDRED TENTH CONGRESS
FIRST SESSION
__________
FEBRUARY 14, 2007
__________
Printed for the use of the
Committee on Transportation and Infrastructure
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COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE
JAMES L. OBERSTAR, Minnesota, Chairman
NICK J. RAHALL, II, West Virginia JOHN L. MICA, Florida
PETER A. DeFAZIO, Oregon DON YOUNG, Alaska
JERRY F. COSTELLO, Illinois THOMAS E. PETRI, Wisconsin
ELEANOR HOLMES NORTON, District of HOWARD COBLE, North Carolina
Columbia JOHN J. DUNCAN, Jr., Tennessee
JERROLD NADLER, New York WAYNE T. GILCHREST, Maryland
CORRINE BROWN, Florida VERNON J. EHLERS, Michigan
BOB FILNER, California STEVEN C. LaTOURETTE, Ohio
EDDIE BERNICE JOHNSON, Texas RICHARD H. BAKER, Louisiana
GENE TAYLOR, Mississippi FRANK A. LoBIONDO, New Jersey
JUANITA MILLENDER-McDONALD, JERRY MORAN, Kansas
California GARY G. MILLER, California
ELIJAH E. CUMMINGS, Maryland ROBIN HAYES, North Carolina
ELLEN O. TAUSCHER, California HENRY E. BROWN, Jr., South
LEONARD L. BOSWELL, Iowa Carolina
TIM HOLDEN, Pennsylvania TIMOTHY V. JOHNSON, Illinois
BRIAN BAIRD, Washington TODD RUSSELL PLATTS, Pennsylvania
RICK LARSEN, Washington SAM GRAVES, Missouri
MICHAEL E. CAPUANO, Massachusetts BILL SHUSTER, Pennsylvania
JULIA CARSON, Indiana JOHN BOOZMAN, Arkansas
TIMOTHY H. BISHOP, New York SHELLEY MOORE CAPITO, West
MICHAEL H. MICHAUD, Maine Virginia
BRIAN HIGGINS, New York JIM GERLACH, Pennsylvania
RUSS CARNAHAN, Missouri MARIO DIAZ-BALART, Florida
JOHN T. SALAZAR, Colorado CHARLES W. DENT, Pennsylvania
GRACE F. NAPOLITANO, California TED POE, Texas
DANIEL LIPINSKI, Illinois DAVID G. REICHERT, Washington
DORIS O. MATSUI, California CONNIE MACK, Florida
NICK LAMPSON, Texas JOHN R. `RANDY' KUHL, Jr., New
ZACHARY T. SPACE, Ohio York
MAZIE K. HIRONO, Hawaii LYNN A WESTMORELAND, Georgia
BRUCE L. BRALEY, Iowa CHARLES W. BOUSTANY, Jr.,
JASON ALTMIRE, Pennsylvania Louisiana
TIMOTHY J. WALZ, Minnesota JEAN SCHMIDT, Ohio
HEATH SHULER, North Carolina CANDICE S. MILLER, Michigan
MICHAEL A. ACURI, New York THELMA D. DRAKE, Virginia
HARRY E. MITCHELL, Arizona MARY FALLIN, Oklahoma
CHRISTOPHER P. CARNEY, Pennsylvania VERN BUCHANAN, Florida
JOHN J. HALL, New York
STEVE KAGEN, Wisconsin
STEVE COHEN, Tennessee
JERRY McNERNEY, California
(ii)
Subcommittee on Aviation
JERRY F. COSTELLO, Illinois, Chairman
BOB FILNER, California THOMAS E. PETRI, Wisconsin
LEONARD L. BOSWELL, Iowa HOWARD COBLE, North Carolina
RICK LARSEN, Washington JOHN J. DUNCAN, Jr., Tennessee
RUSS CARNAHAN, Missouri VERNON J. EHLERS, Michigan
JOHN T. SALAZAR, Colorado STEVEN C. LaTOURETTE, Ohio
DANIEL LIPINSKI, Illinois FRANK A. LoBIONDO, New Jersey
NICK LAMPSON, Texas JERRY MORAN, Kansas
ZACHARY T. SPACE, Ohio ROBIN HAYES, North Carolina
BRUCE L. BRALEY, Iowa SAM GRAVES, Missouri
HARRY E. MITCHELL, Arizona JOHN BOOZMAN, Arkansas
JOHN J. HALL, New York SHELLEY MOORE CAPITO, West
STEVE KAGEN, Wisconsin Virginia
STEVE COHEN, Tennessee JIM GERLACH, Pennsylvania
NICK J. RAHALL, II, West Virginia MARIO DIAZ-BALART, Florida
PETER A. DeFAZIO, Oregon CHARLES W. DENT, Pennsylvania
ELEANOR HOLMES NORTON, District of TED POE, Texas
Columbia DAVID G. REICHERT, Washington
CORRINE BROWN, Florida CONNIE MACK, Florida
EDDIE BERNICE JOHNSON, Texas JOHN R. `RANDY' KUHL, Jr., New
JUANITA MILLENDER-McDONALD, York
California LYNN A WESTMORELAND, Georgia
ELLEN O. TAUSCHER, California MARY FALLIN, Oklahoma
TIM HOLDEN, Pennsylvania VERN BUCHANAN, Florida
MICHAEL E. CAPUANO, Massachusetts JOHN L. MICA, Florida
DORIS O. MATSUI, California (Ex Officio)
MAZIE K. HIRONO, Hawaii
JAMES L. OBERSTAR, Minnesota
(Ex Officio)
(iii)
CONTENTS
Page
Summary of Subject Matter........................................ vi
TESTIMONY
Blakey, Hon. Marion C., Administrator, Federal Aviation
Administration, U.S. Department of Transportation.............. 15
Dillingham, Gerald L., Ph.D, Director, Physical Infrastructure
Issues, U.S. Government Accountability Office.................. 15
Scovel, Hon. Calvin L., III, Inspector General, U.S. Department
of Transportation.............................................. 15
PREPARED STATEMENTS SUBMITTED BY MEMBERS OF CONGRESS
Boswell, Hon. Leonard L., of Iowa................................ 47
Carnahan, Hon. Russ, of Missouri................................. 49
Cohen, Hon. Stephen I, of Tennessee.............................. 50
Costello, Hon. Jerry F., of Illinois............................. 51
Matsui, Hon. Doris, of California................................ 55
Mitchell, Hon. Harry, of Arizona................................. 57
Oberstar, Hon. James L., of Minnesota............................ 62
Salazar, Hon. John T., of Colorado............................... 66
PREPARED STATEMENTS SUBMITTED BY WITNESSES
Blakey, Hon. Marion C........................................... 69
Dillingham, Gerald L............................................ 85
Scovel, Hon. Calvin L., III..................................... 106
SUBMISSION FOR THE RECORD
Dent, Hon. Charles W., a Representative in Congress from
Pennsylvania, letter to Hon. Marion C. Blakey, Administrator,
Federal Aviation Administration, U.S. Department of
Transportation, February 14, 2007.............................. 11
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
THE PRESIDENT'S FY08 FEDERAL AVIATION ADMINISTRATION'S BUDGET
----------
Wednesday, February 14, 2007
House of Representatives,
Committee on Transportation and Infrastructure,
Subcommittee on Aviation,
Washington, DC.
The committee met, pursuant to call, at 2:00 p.m., in room
2167, Rayburn House Office Building, the Honorable Jerry F.
Costello [chairman of the committee] presiding.
Mr. Costello. If we can get Jimmy Miller from not talking
to the witnesses, we can begin this hearing.
[Laughter.]
Mr. Costello. Let me first call the Subcommittee hearing to
order and ask members, staff and everyone here to turn off
their electronic devices or put them on vibrate, please. I want
to welcome everyone here today to the first hearing of the
Aviation Subcommittee. In particular, I want to congratulate my
friend who is now the Ranking Member of the Subcommittee, Tom
Petri. Mr. Petri and I have worked closely together when he
chaired the Subcommittee on Highways and he was very good to me
in the markup process and to our State. We worked closely
together in that endeavor and we are going to work very closely
together on this Subcommittee. So I welcome my friend, Mr.
Petri, as the Ranking Member of the Subcommittee.
Obviously this year is going to be a very busy year for the
Subcommittee. We have the FAA reauthorization, as well as a
number of other issues that are important to me and to other
members of the Subcommittee concerning a whole host of issues
from safety to a lot of other things that we will get into in
the coming weeks and the coming months. I will give my opening
statement in just a few minutes and I will then call on the
Ranking Member, to give his opening statement or any comments
that he wants to make.
Then we will give members an opportunity to make an opening
statement or a comment. I would ask members, in the interest of
time, to one, consider submitting their statements into the
record when possible. But I do want to assure every member that
you will have the opportunity to either give an opening
statement or make a comment. At this time, I would ask
unanimous consent that any member wishing to insert their
statement into the record in its full entirety may be able to
do so, and that we keep the record open for 30 legislative days
to submit comments.
Hearing no objection, so ordered.
Mr. Mica. Does that exclude my--------
Mr. Costello. You know, I thought we were going to get
through at least the first 10 minutes of the hearing without
the Ranking Member of the full Committee being here. But
welcome to my friend from Florida.
[Laughter.]
Mr. Costello. Also let me say, before I give my opening
statement, I would like to ask unanimous consent that the
majority members be recognized in order of attendance for
questions. What we will DO is we will keep a list of members on
the majority side as they come in. They will be recognized
according to when they show up. I ask unanimous consent that we
recognize members on the majority side in that order. Hearing
no objection, so ordered.
I want to welcome everyone to the first hearing of the
Aviation Subcommittee. Let me say that I am pleased that the
Administrator of the FAA is here with us today, Marion Blakey;
the new Department of Transportation Inspector General, Calvin
Scovel, and Dr. Gerald Dillingham of the Government
Accountability Office. Dr. Dillingham has appeared before this
Subcommittee many times in the past.
I would also note that the FAA just released its
reauthorization proposal this morning, and this Subcommittee
will be reviewing the details of that proposal in detail in
coming hearings in the month of March. On March 14th, we will
look at the FAA's reauthorization proposal. On March 21st, we
will look at the FAA's financing proposal. March 22nd, we will
have a hearing on the FAA's operational and safety programs.
And on March 28th, we will look at the FAA's airport
improvement program.
However, this afternoon, the hearing will focus on the
Administration's proposed budget for the FAA. The
Administration's fiscal year 2008 FAA budget request has been
received and it has received much attention in the last week,
as it proposes to transform the FAA's current excise tax
financing system to a cost-based user fee system. Under the
fiscal year 2008 budget request, and as detailed in the FAA's
reauthorization proposal, FAA's financing sources will shift
from a mix of fuel taxes other than excise taxes, and a general
fund contribution to user fees, fuel taxes and a general fund
contribution. This proposal would take effect in 2009.
As I stated at the outset, the Subcommittee will hold a
hearing on March 21st to discuss in detail the Administration's
financing proposal and its present and future implications.
However, I would at this time make at least one initial
observation about the proposed user fee financing proposal.
While the FAA has cited the need to finance a major new air
traffic control modernization initiative as a reason for
reforming the current tax structure, the Administration's data
indicates that in fiscal year 2008, user fees and excise taxes
under the new proposal would hypothetically yield approximately
$600 million less revenue than maintaining the current tax
structure, and over $900 million less from fiscal year 2009
through fiscal year 2012.
I question the wisdom of moving to a new financing system
that will not generate as much revenue as the current tax
structure when we clearly need to make critical investments now
to ensure that our Nation's air traffic control infrastructure
is robust for the future. I also believe that the fiscal year
2008 FAA budget request falls short in several respects.
Facilities and equipment, the capital program in 2003, the FAA
requested and received from the Congress an authorization of
approximately $30 billion per year for its capital program. Yet
for the past three years, the Administration has requested
roughly $2.5 billion per year for the capital program.
For fiscal year 2008, the Administration is once again
requesting $2.46 billion for capital spending. The
Administration identifies a $173 million of its $2.46 billion
request, about 7 percent, as being directly related to the Next
Generation system.
The Department of Transportation Inspector General has
stated that the FAA cannot achieve its goals of technologically
transforming the national airspace system with $2.5 billion in
the F&E budget, and that a $2.5 billion funding level goes
toward primarily sustaining the existing system, not new
initiatives. Moreover, the Administration's fiscal year 2008
capital spending request appears to be at odds with its own
preliminary NGATS F&E cost estimates of a little more than $3
billion.
The airport improvement program. The fiscal year 2008
budget request provides $2.75 billion for the airport
improvement program, $950 million less than the level
authorized by Vision 100 for fiscal year 2007 and $760 million
less than the House passed in the 2007 continuing resolution,
H.J. Res. 20. Under the current formula for distributing AIP
entitlement funding, virtually every airport that currently
receives AIP entitlement in funding will have its entitlement
reduced. Additionally, small airports might particularly be
hard hit by the Administration's proposed AIP cuts, because AIP
grants are a larger source of funding for smaller airports.
Essential air service. Although it is not an FAA program,
the fiscal year 2008 budget provides only $50 million for the
essential air service, $77 million less than authorized by
Congress, almost $60 million less tan provide in the House-
passed continuing resolution. As a result of this dramatic cut,
almost half the communities that received EAS funding, 73 out
of 147, would be dropped from the program.
Staffing. In addition, I am very concerned about future
staffing levels for the FAA controllers and safety inspector
work forces. In particular, over the next 10 years,
approximately 70 percent of the FAA's nearly 15,000 air traffic
controllers will be eligible for retirement. The FAA estimates
that it could lose more than 10,300 air traffic controllers by
the year 2015. The FAA will need to hire approximately 11,800
controllers over the next 10 years to have enough recruits in
the pipeline to meet the positions lost.
Although the FAA hired 1,116 controllers in fiscal year
2006, the total loss of controllers was higher than the FAA
projected. The increase in retirements could be directly
attributable to the imposition of the FAA contract on the
controllers. In fiscal year 2007, the FAA plans to hire more
than 1,386 controllers and the fiscal year 2008 request
provides for another 1,420 air traffic controllers. However,
hiring new controllers is a complex process and task.
Controllers are highly skilled professionals and it takes
several years to train a controller.
According to the FAA, the failure rate for controller
trainees in both the FAA academy and in the ATC facilities is
approximately 5 percent and 8 percent respectively. Replacing a
controller who retires must begin several years in advance. In
addition, the Department of Transportation Inspector General
will testify today that the FAA controllers workforce plan
still has some major shortcomings, including a lack of facility
level staffing standards and associated cost implementation. It
is imperative that the FAA have a feasible plan to hire and
train new controllers today. Otherwise, we will be left with a
system that is woefully short-staffed and unable to accommodate
the future demands for air transportation. I look forward to
hearing more from the Department of Transportation IG in this
regard.
I am also concerned about the potential attrition in the
FAA safety inspector work force. It is my understanding that
over one-third of the FAA safety inspectors will be eligible to
retire by the year 2010. While the FAA's fiscal year 2008
request provides for hiring an additional 177 safety inspectors
over the next two years, I am concerned that the FAA does not
have an accurate assessment of its staffing needs.
Last year, the National Research Council reported that the
FAA lacked staffing standards for inspectors and recommended
that the FAA undertake a holistic approach to determine its
staffing needs. In addition, the Department of Transportation
IG has noted in the past that the rapidly changing aviation
environment, from the increased use of outside maintenance
vendors to new classes of air space users, such as unmanned
aerial vehicles and very light jets, will place greater demand
on the FAA inspector workforce.
It is imperative that we make these investments in the
FAA's workforce now so that they can meet the new challenges
for maintaining the highest level of safety in this ever-
changing aviation environment.
With that, I want to again welcome our witnesses here
today. I look forward to hearing their testimony. And I would
recognize the Ranking Member, Mr. Petri, now for his opening
statement or any remarks he would like to make.
Mr. Petri. Thank you very much, Chairman Costello. Let me
begin also by congratulating you on your new assignment. It is
a big one. This Subcommittee, as I think all the members are
aware, has a very full plate this Congress. We are determined
to work with you to make it as productive a session as we
possibly can, knowing that the Senate also may have something
to say about it as well as the Administration.
I would like to thank you for calling this important
hearing to start off the year. The budget request from the FAA
before us sets on the course for reauthorization, in which we
will examine the request in depth. While we await the details
that will help us flesh out the agency's proposal, today we
will address the issues raised by the President's budget
request for this budget year.
Among the most complex is the proposal to shift the FAA's
revenue sources from the current assortment of excise taxes to
a combination of general aviation fuel taxes and cost-based
user fees for commercial users intended to better align system
cost with system usage. With the current tax structure's
expiration date set for September 30th of this year, we have to
carefully consider the funding options available to best
provide for the safety and efficiency of the Nation's airspace
system.
Modernization of the national airspace system will be of
critical importance over the next 10 or 20 years as demand on
the system grows. For modernization to be successful,
development and deployment of cutting edge technologies and
performance standards must not be delayed. I am interested in
hearing about what specific modernization initiatives the
Administration proposes for budget year 2008 and subsequent
years.
To keep pace with rising demand, the FAA must also continue
to support airport capacity capital projects with the
continuation of a robust airport improvement program. The
President's budget request of $2.750 billion for the airport
improvement program and although this request is some $950
million less than what was authorized for last budget year, I
hope you are going to try to figure out how to stretch it as
best we can. Nonetheless, I am concerned about the impact that
reduced funding will have on our airports' ability to keep up
with capital project needs, particularly at small and medium
size airports that are unable to rely on sizeable passenger
facility charge receipts to complete the needed projects.
The aviation industry's safety and efficiency is not only
achieved by technology and funding, but also by the highly
trained safety inspectors and air traffic controllers. As we
move forward with the budget and with reauthorization, we must
be sure to provide adequate funding for these critical elements
of the FAA's safety oversight mission. I am pleased that its
budget proposal addresses the coming wave of workforce
retirements and supports a hiring plan that will keep pace with
expected attrition.
I would like to thank Administrator Blakey for being with
us today, as well as the other witnesses from the GAO and
Inspector General's office, and look forward to your testimony.
Mr. Costello. I thank the Ranking Member for his opening
statement and comments. At this time, under the five minute
rule, we would recognize the gentleman from Colorado, Mr.
Salazar.
Mr. Salazar. Thank you, Mr. Chairman. I want to thank the
witnesses for coming here today, and thank you for holding this
important hearing.
I want to associate my comments with yours, Mr. Chairman,
as well. And I will keep my comments brief. I will submit my
full statement for the record.
But there are several things that are of concern to me.
One, of course, is the user fee issue, and how it would
basically cut the receipts down to $11.5 billion. I would like
the FAA, or the Administrator, to actually give us a
justification for this net loss of $600 million, if there is a
great need for funding today, why should we want to go to a new
structure that basically reduces the investment in our Nation's
air transportation system?
And of course, something that is very near and dear to my
heart, in Colorado there are three essential air service
airports. All three of them are in the Third Congressional
District, my district in Colorado. I would like to understand
or have an explanation made to me as to what justification is
being used, what formula are you using to cut almost half of
the funding for the EAS program. Is it going to be cut? Is it
going to be straight across the board, or are there going to be
certain airports that are going to be cut out of the program?
Many of us are from rural communities. And the EAS program
is vital to economic opportunities in rural communities.
So with that, Mr. Chairman, I will yield back and I look
forward to the witnesses' testimony today. Thank you.
Mr. Costello. I thank the gentleman.
At this time I will recognize, first let me congratulate,
it is my first opportunity publicly to congratulate the former
chairman of this Subcommittee, who is now the Ranking Member of
the full Committee. We worked very closely together in our
prior positions and I remember at one of our last hearings, one
of the witnesses said something, and you said, well, I hope as
we come back next year, and I said, Mr. Chairman, I hope you're
sitting in my chair and I am sitting in your chair. Well, I am
sitting in your chair, but you are elevated now to be the
Ranking Member of the full Committee. And I congratulate you
and recognize you at this time.
Mr. Mica. Thank you, Mr. Costello. There are a lot of new
faces in Congress, but you never know where you are going to
end up in the system, in this great institution. I came here as
a freshman member and Mr. Oberstar was the chairman of Aviation
some 14 years ago. And then for six years I did get to chair
that, and several of the past years, of course I had DeFazio
for several years, God gave me him for a while.
[Laughter.]
Mr. Mica. Then I was blessed--is he here? OK, there he is.
Any time you can withstand that long with Mr. DeFazio, you have
a special elevation to sainthood in the next life.
[Laughter.]
Mr. Mica. A great working relationship with Peter, just
kidding. And of course, you couldn't ask for anyone better to
have as a friend. I have known our new Chairman and his wife,
Georgia, since I think first coming here. So we are very proud
of you and know you will do a great job.
I had a few comments, though, that I did want to make.
Because this is a very important hearing, and again, we have
spent a lot of time on aviation in the past with some of these
members, as I said. We do have a bit of a challenge ahead of
us. As you know, the fees and taxes that fund FAA expire on
September 30th, 2007. And I think it is critical to sustaining
our current system, which has had a great safety record. But it
is starting to get stretched a bit at the seams. We look for
reauthorization, we look for a good way to finance that system,
keeping it safe and keep us in business and our economy and
aviation industry on the move.
I do want to say first of all, I support the attempts of
the Administration and FAA to revisit the whole way we are
financing the aviation system. To move to a hybrid system I
think is important, with some reliance on fuel taxes for
general aviation and a cost based user fee system for
commercial aviation users. One of the challenges we have, and I
brought my little model today, I always have to have a model,
but we have to look too at how we are now funding the system.
Most of you know 7.5 percent ticket tax is really the way we
fund this.
So this airplane, commercial passenger aircraft, actually
contributes, and our flying public today, contributes most of
the money to fund the system. And is that truly fair? We have
to ask some questions. Because I think we have about 7,000 of
these aircraft, then we have about 16,000 jets and other craft
that only carry maybe a few folks, but take up the same time
and space. And how they pay their fair share is very important
to the system.
So we have to find the fairest way possible. I think the
hybrid approach is very good.
I do have some questions about the Administration's budget
request, it provides $2.7 billion for the AIP, the airport
improvement program in 2008. That is $950 million less than the
level authorized in Vision 100. I have some concerns there.
I do support also, some of you know me, I am a right wing,
no-tax kind of guy. I do support, however, increasing the PFC
and providing our airports with some flexibility with which to
use those funds. The airlines, commercial airlines, have
increased their fares over about a 12 month period about 16
times, is what I am told. But we need to find a way to increase
the money to support the infrastructure that also supports
these passenger aircraft.
So the final thing I will close on is, I commented at the
beginning, we have a safe system and we need to keep it that
way. I want assurance from FAA that in this new funding that we
don't divert any of the funds necessary to keep the system
safe, that we have safety inspectors and that we start moving
to the next generation of air traffic control. We go from human
to human, to data to data systems, which is expensive. They
have, I think, a multi-billion dollar bonding proposal in here,
which I look favorably upon, and other means of paying for that
next generation system. But we have to make certain that again,
we do not compromise safety.
Thank you, Mr. Chairman.
Mr. Costello. Thank you.
We now recognize for five minutes the gentleman from
Arizona, Mr. Mitchell.
Mr. Mitchell. Thank you, Mr. Chairman.
As we examine the President's FAA budget proposal, I want
to express my concern about a couple of issues. First and
foremost, I want to express my concern about safety. According
to the FAA, over the next 10 years, 70 percent of its air
traffic controllers will become eligible to retire. We need to
make sure that FAA has the resources it takes to recruit, train
and maintain controllers to replace those retirees and to keep
the public flying safely.
Second, I want to express my concern about efficiency. Last
week's Washington Post reported some sobering statistics.
According to the paper, airlines' on-time performance dropped
for the fifth year in a row in 2006, with one in four flights
arriving late or not at all, according to the data released
yesterday by the Bureau of Transportation Statistics. It goes
on to say, the airlines also mishandled a massive amount of
luggage, 4 million bags, or 6.7 for every 1,000 passengers, and
it is the industry's worst rating since 1990. We can do better.
Lastly, I am concerned about airport maintenance and
growth. The President's budget seeks a 21.7 percent cut in the
airport improvement program, which funds capital improvements
at commercial airports. This program funds everything from
runway and taxiway improvements to noise abatement projects.
Noise abatement is critically important to communities that
surround Sky Harbor Airport in my district, an airport which
serves as a hub for its Tempe-based U.S. Airways. Sky Harbor
has requested more than $10 million for noise abatement
projects in fiscal year 2008. A drastic cut to the airport
improvement program could put this funding at risk.
I encourage my colleagues to keep this issues in mind as
they consider the FAA's budget request. I thank you, Mr.
Chairman, and I yield back my time.
Mr. Costello. I thank you.
At this time, we recognize Mr. Hayes for five minutes.
Mr. Hayes. Thank you, Mr. Chairman. Thank you and welcome,
Mr. Dillingham, Mr. Scovel. We have been friends for years.
I have looked at the proposal. There is no way that I can
come to the conclusion that this user fee approach to funding
the next generation is fair, equitable or is going to work. I
would simply ask that the FAA and others sit down with those of
us, and a number of have spoken already, who are pilots, who
have some concept of what the proposals are going to do. At the
same table I would love to see the controllers and folks from
the FAA sit down and really look at hands-on, nuts and bolts,
here is the good stuff, here is where you can save money, we
need this, we don't need that, and really come up with
something other than absolutely deadly user fee, huge tax on
gas.
So with all due respect, I again welcome you here, and look
forward to that opportunity. I think Sam and Mr. Salazar and
others, Leonard, can bring some wisdom to the table. And let's
bring NATCA to the table and hear what they are saying as well.
Thank you very much. I yield back.
Mr. Costello. I thank the gentleman. And at this time for
five minutes we recognize Mr. Lampson from Texas.
Mr. Lampson. Thank you, Mr. Chairman. I appreciate the
opportunity for just a minute or so. First let me say thanks to
you and to Ranking Member Petri for the leadership on this
particular hearing. I am looking forward to the comments that
are being made.
Our Nation's aviation system faces some daunting
challenges. This Committee and this Congress must rise to the
occasion in helping to craft policy that will deliver a
sustainable aviation infrastructure. Southeast Texas faces many
of the same challenges other major cities and areas of the
United States face. We are rapidly changing, rapidly increasing
the volume of passengers and commercial aviation. I am
concerned that the current level of infrastructure will not be
sufficient to sustain the growth if we don't act preemptively.
I am pleased that Congress and our Federal agencies have
continued to explore solutions to both near-term and long-term
issues, bringing public and private organizations together in
forums such as the Next Generation Air Transportation System.
As we move closer to the Federal Aviation Administration
reauthorization, which this Committee will soon consider, we
must focus on smart growth, planning for future congestion
mitigation, ensuring that our air traffic control systems
remain viable and providing sufficient resources to grow our
aviation infrastructure to the necessary levels.
I firmly believe that a congested and inefficient system
hampers economic prosperity and productivity. I look forward to
working with the Chairman and the Ranking Member as well as the
Administration to ensure we are both crafting policies that
make sense and providing adequate funding to secure the
viability of our aviation infrastructure.
I thank you, Mr. Chairman, and I yield back the balance of
my time.
Mr. Costello. I thank the gentleman.
Mr. Coble.
Mr. Coble. Thank you, Mr. Chairman. I will not consume five
minutes. I just want to echo what the distinguished Ranking
Member said about you and Mr. Petri being in leadership roles
on this very important subcommittee. I have two other meetings
simultaneously, so I may have to leave. I want to welcome the
witnesses here.
But I want to mention, Mr. Chairman, I came in late, but I
know that we are blessed with the presence of at least two very
adept aviators, the distinguished gentleman from Iowa, Mr.
Boswell, the distinguished gentleman from North Carolina, Mr.
Hayes. At least they tell me they are adept aviators, Mr.
Chairman, I can't refute that. But I think it is good to have
some expertise on the Subcommittee, and I look forward to
working with you and Mr. Petri this session. I yield back.
Mr. Costello. Thank you.
At this time we recognize the gentleman from Iowa, Mr.
Boswell.
Mr. Boswell. Thank you, Mr. Chairman.
I would like to associate myself with the remarks of Mr.
Hayes and save a little bit of time for witnesses. Ms. Blakey,
I too appreciate very much, in spite of the fact that we are
not in agreement with what you are proposing, we think you are
sincere in what you are trying to do and we appreciate your
doing it. But I think you have heard a very sincere plea, let's
sit down together. I want to join with that, I think it must be
done. I think we would get a lot more done if we work together
than if we just bump heads.
So we respect you and ask that you might respect us, and
let's see if we can work it out. I am pleased that we are this
session and process. I just don't see how we can't continue the
functions that we have to do with our present funding
mechanism, we can do it. So as has been stated, I am a user of
the system, not as much as some, but I do use it and appreciate
it and I feel comfortable using it. We have some real pros
sitting behind those screens and safely moving us across some
very busy skies at times.
So I would hope that you do that, I again associate myself
with Mr. Hayes and others. I think this is an unfair approach
and an unwise approach, and I don't think we have to do it. So
I would hope that this discussion would open the door and take
us to a point where we can figure out what we can do and we all
understand it and work at it together. With that, Mr. Chairman,
I yield back.
Mr. Costello. Thank you.
At this time the Chair would recognize for five minutes Mr.
Dent.
Mr. Dent. Thank you, Mr. Chairman.
I have some questions about a specific issue in my district
that I will submit for the record, with your approval. With
that, I will yield back the balance of my time.
[Mr. Dent's letter to Administrator Blakey follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Mr. Costello. I thank the gentleman.
At this time I would recognize Ms. Norton for five minutes.
Ms. Norton. I thank you very much, Mr. Chairman, and I
thank the Administrator and her staff for appearing.
I note that you have heard from Mr. Boswell, who uses this
airport. There are a number of members who fly. This Committee
had to take quite extraordinary action in order to open small
plane and charter service at Ronald Reagan National Airport. It
was a disgrace that although the Committee was clear, for about
three years, that with small plane service up everywhere,
including almost immediately in New York after 9/11, there was
no excuse for the Government and the Administration,
recognizing that there were other parts of the Administration
involved, to ignore the clear wishes of this Committee that
service be resumed as well at Ronald Reagan National Airport.
It took a specific piece of legislation, passed by this
Subcommittee, and only when Chairman Young threatened to hold
officials in contempt did a plan come forward that finally
opened the service at Ronald Reagan for small planes. This
Committee could not be more cognizant of what the
responsibility was and how difficult it was. But it certainly
made the greatest power in the United States look small, that
we could not open part of the airport for our own capital.
And when it was opened, and here is my complaint, Madam
Administrator, the trappings that surround the ability to fly
into this airport are unworthy of the United States, where
people had to come armed on small planes, and a whole set of
paraphernalia and extra expense that in effect dis-invited such
planes to land in the capital of the United States. Because I
will not be here for the entire testimony, I want to go on
record again to say that I hope that you will work with others
in the Administration to normalize service for small planes in
the Nation's capital, so that it does not become almost
impossible to travel to the Nation's capital, not only a major
region because our capital is located here, but because this is
one of the great economic engines of our Country.
So I ask you to give your concerted attention to relieving
the burdens that attach to flying in with small plane service
to Ronald Reagan National Airport.
Thank you, Mr. Chairman.
Mr. Hayes. Will the gentlelady yield?
Ms. Norton. I will be pleased to yield.
Mr. Hayes. I appreciate your remarks, you are absolutely on
target. I would be happy, along with Mr. Graves, Mr. Boswell
and others, it is not the FAA's fault alone. I have asked the
Secret Service to revisit, TSA needs to revisit. I am sure you
will, and Ms. Blakey will help us get the folks back to the
table and get away from ``it's not us, it's them,'' make sure
they all come to the meeting.
But Ronald Reagan, except in a technical sense, is not open
to general aviation this day. On paper, yes, but try to do it,
you won't. Thank you.
Ms. Norton. I thank the gentleman for his remarks, and I
yield back the balance of my time.
Mr. Costello. I thank you.
The Chair would propose that we recognize one more member
on this side of the aisle and then move to the witnesses, if
there are no objections. At this time, we would recognize Mr.
Graves for five minutes.
Mr. Graves. Thank you, Mr. Chairman, add thank you,
Administrator Blakey, for coming in. You have always been a
pleasure to work with and easy to work with. You are always
responsive whenever we call.
I have to tell you, I am terribly disturbed by this
proposal. I kind of went through the process and figured up,
and I know we are depleting the aviation trust fund. But
revenues into the aviation trust fund are actually increasing.
We are trying to fund a system, I know it is a next generation
system, we are going to make the skies safer.
So I kind of put all this into perspective, and I realize,
too, that we haven't figured out what that system is yet and we
don't know when we are going to implement it. We don't know how
much it is going to cost. So I think, well, we are going to
build up the fund, we are going to try to build it up in
advance of that point.
So I am sitting here, and we first got word of the proposal
two weeks ago, I think, or last week. My staff person walks
into my office, and I know there is going to be a gas tax hike,
so I am bracing myself. I know it is 21 cents, just a little
less than 21 cents now. I am thinking, maybe it is going to go
up a nickel, you know, 29 cents. And my gosh, I hear 70 cents
and it just floors me. I don't even know where to begin. I
don't even know where to talk about that, and I can't even tell
my pilots back home about this, because I am going to get
pelted the minute I say it.
And then to know that the fact that this is open-ended, and
it is indexed for inflation, and there are so many other broad
proposals out there that we are not even sure about that are to
be determined later, it really, really disturbs me. Then I have
to ask, and I have talked to a couple of my pilots about this,
and the question they have is, what do I get for that?
Obviously, I know the airport improvement program is a part of
this. The proposal is to eliminate the standard rate for the
States that do use that.
But again, the airport improvement program is in there, so
they are getting something for that. But next generation air
traffic control system, these guys are out there flying in
Class D air space and Class E air space and whatever the case
may be, they are just not a burden on the system, they are not
using the system, and they want to know what they are getting
for this incredible increase.
Then I had another pilot tell me, and he was exactly right,
this is going to make the skies safer because nobody is going
to be able to fly any more except the commercial carriers. They
can't afford it. It is a 300 percent increase in aviation fuel.
I know everybody has to do their part and be a part of
this. But I am truly at a loss. I don't know where to start. I
understand that we come in with the negotiation process and we
start at one end and the other side starts at the other end and
we try to find our way to the middle. But even the middle is
unheard of, at least in my opinion.
I don't know what to do. I am truly at a loss. I am
bothered. I am flustered. I don't even know where to begin.
I vented in the full Committee last week, and now, since I
have seen the proposal, I am venting even more. I have a lot of
pilots out there that I have to represent, and a lot of folks
out there that depend on aviation, they have small businesses
that cater to general aviation, they relate indirectly--there
is just a lot of people out there that their livelihood hangs
on this proposal. I don't see anything but bad news for
everybody. I don't see how anybody can afford to fly with that
kind of an increase. It is not going to stop there, it will be
indexed and it will go up. And we all know it is going to go
up.
Mr. Ehlers. Will the gentleman yield?
Mr. Graves. Yes.
Mr. Ehlers. Thank you very much.
First of all, I want to comment, you are also an adept
pilot, and we have to add you to the list of adept pilots here,
and we appreciate your input. But in terms of your question,
where do we start, I have a suggestion. I think the proposal
that has been formed is dead on arrival. We can all save a lot
of time, instead of arguing about that, getting a working group
together from this Committee, a working group together from the
FAA and explore the possibilities. I don't think there is any
other branch of the Federal Government that is in such need of
coherent, long-term planning as the aviation sector. They
simply cannot make moves quickly. As you well know, the
Congress doesn't make moves quickly.
But we have to sit down and talk about the next 20 years of
aviation sector and the only way to do it is to get some people
from the Congress, some people from the FAA sitting down and
trying to work on the long-range picture, rather than having
the FAA come up with proposals we shoot down, they come up with
others we shoot down, I think this is so important to the
Nation that we really have to sit down and thresh it out
together in some informal manner and come up with some ideas.
I appreciate the comments that you made, and I yield back.
Mr. Graves. Thank you, Mr. Chairman.
I am glad it is you, Administrator, because I would have
lost my temper if it hadn't been you. I hope you understand
what I am saying. Thank you.
Mr. Costello. I thank the gentleman, and would like to move
on to our witnesses. Again, we welcome you here this afternoon.
We would ask all of you to summarize your testimony in a five
minute period if possible, so that we can move on to questions.
The Chair would recognize the Administrator, Ms. Blakey.
TESTIMONY OF THE HONORABLE MARION C. BLAKEY, ADMINISTRATOR,
FEDERAL AVIATION ADMINISTRATION, U.S. DEPARTMENT OF
TRANSPORTATION; GERALD L. DILLINGHAM, Ph.D, DIRECTOR, PHYSICAL
INFRASTRUCTURE ISSUES, U.S. GOVERNMENT ACCOUNTABILITY OFFICE;
THE HONORABLE CALVIN L. SCOVEL, III, INSPECTOR GENERAL, U.S.
DEPARTMENT OF TRANSPORTATION
Ms. Blakey. Good afternoon, and thank you, Chairman
Costello. It is a true honor and a privilege to address you,
Congressman Petri and the Members of this Subcommittee. This is
the first time that I am appearing before the 110th Congress.
Let me say that I am really looking forward to working with all
of you, and certainly with the aviators, the pilots on this
Committee. We are very lucky to have so many people who know
aviation first-hand. I am very pleased about that, and do look
forward to the discussions that we are going to have, because
it will be a very busy year.
I will tell you that my statement today is focused on the
issue of the 2008 budget, as that was the topic of the hearing.
And of course, we did not know whether the timing would be
coincident, as it is, with the Administration submitting the
new financing reform legislation, which we submitted to
Congress this morning. However, I am very happy to address some
of the concerns and issues that a number of you have raised in
your opening statements as we go forward. My statement will
focus on the budget.
The final thought I might have also is that a number of
concerns were expressed, such as concerns about essential air
service and the security requirements for general aviation at
Reagan, which do fall outside the FAA's purview. They fall
outside of our authority. So I would caution about that fact as
well, although it is helpful, certainly, to hear the concerns.
Let me just start with noting something that I think we all
can take a great deal of credit for, and that is that this is
the safest period in the history of aviation. I believe the
President's 2008 budget provides the framework to keep it that
way. We believe strongly that the budget and the
reauthorization proposal released this week are how we are
going to reach the Next Generation Air Transportation System.
We believe that the current financing structure will make it
extremely difficult to get there.
As you are aware, the 2008 budget is structurally very
different from previous years. It supports changes in our
financing and these in turn support the development and the
launch of NextGen. In a nutshell, the new financing system will
allow the FAA to operate in a more businesslike fashion, with
the ability to make long-term plans and investments that won't
be tripped up by the fluctuations in ticket prices and the
other changes that occur in the shape of the aviation industry
that aren't related to our workload at all. Of course, here I
am referring to things like the increase in the number of small
planes, the regional jets, the VLJs, and all of the various
other changes that are happening in the system that really
don't have to do with the change in our workload.
Frankly, the plan to tie FAA revenues to the price of a
ticket has long outlived its usefulness. The creators of the
Airport and Airway Trust Fund had no way of anticipating the
bumpy economic road ahead or that airlines would shift to
smaller planes in an attempt to stay competitive in business.
The new reauthorization proposal suggests a hybrid funding
system that distributes more fairly and equitably the cost to
operate the system. The airlines, passengers and other
commercial users pay the lion's share of taxes today. They pay
more than 95 percent, while accounting for less than 73 percent
of the air traffic system's cost.
High end general aviation aircraft impose similar costs on
the FAA in the en route high altitude environment, but they
currently pay far less into the system than commercial users
for comparable flights. The new funding mechanism addresses
this inequity.
The Administration's proposal respects not only the
concerns of people flying the planes, but the taxpayers flying
in them as well. Turbine commercial flights will pay their fair
share of the cost through user fees. But we have listened very
closely to the general aviation community. And general aviation
flights will pay their fair share through fuel taxes. This is a
hybrid system, and we believe it strikes the right balance.
The general fund will finance the cost of services provided
to the public and programs that are in the public's interest,
such as safety regulation, air traffic costs driven by the
military and air ambulances, and flight service stations. And
we are going to replace the ticket tax and four other aviation
excise taxes, which further tie our costs to our revenue. That
equals fewer taxes added on the cost of a passenger's ticket.
This is all crucial to the success of NextGen. But let me
turn quickly to the 2008 budget because the 2008 budget fully
funds the next step in technology, ADS-B. This satellite-based
aviation system is designed to increase safety, capacity and
efficiency. Even as ADS-B is the future, its capabilities are
already being demonstrated. ADS-B provides automatic broadcast
of aircraft position, altitude and velocity, and simply put, it
offers both pilots and controller enhanced visibility, not just
in the air but on the ground as well.
The budget also fully funds another innovation: System-Wide
Information Management, SWIM. This is an aviation internet,
essentially, with the ability to move information within the
FAA and to other Government agencies faster, better, cheaper.
Much like the World Wide Web revolutionized American commerce,
SWIM lays the aviation information superhighway. It is going to
lead to dramatic improvements in air transportation, safety,
security and capacity.
Let me touch quickly on two other aspects of this, because
our budget request for the new safety and operations account is
$1.9 billion. This level supports increasing the 2006 actual
onboard AVS safety work force by 177 inspectors and 173 other
safety staff. Our budget request for the new ATO account is
$9.3 billion and calls for the hiring of 1,420 controllers. By
year-end, we expect to have 14,951 controllers onboard, and
4,045 inspectors as well.
Our airports remain the primary focus in the 2008 budget,
also a primary area of focus. The budget request of $2.75
billion with our proposed programmatic changes for the Airport
Improvement Program will enhance capacity, security, safety,
and environmental mitigation. The budget also boosts capacity
with a request of $3.6 billion. As you know, we bolstered
capacity with Domestic Reduced Vertical Separation Minimum,
DRVSM. This effort adds six additional lanes for flight at
cruise altitudes, increasing capacity by exponential factors.
It is going to save the airlines $5.3 billion in fuel. And we
see that just going up as the cost of fuel, the price of a
barrel of oil goes up as well.
We are also enhancing our air traffic control over the
ocean with ATOP, Advanced Technologies in Oceanic Procedures.
This covers the Atlantic, 24 million square miles of air space.
And we see the airlines again saving 6.5 million pounds of
fuel, that is about $8 million a year.
I could talk a bit more about other important aspects of
this. RNP, Required Navigation Performance, which allows pilots
to take advantage of satellite technology to fly a much more
precise flight path into an airport, and tell you that we are
going to be advancing this rapidly with this budget. We plan to
publish at least 25 RNP approaches this year, including 10 in
Atlanta in May. These are huge advances.
What is without doubt, though, is that NextGen is a
necessary step that we have to take without delay. As the
system continues to experience an influx of smaller, newer
jets, microjets, air taxis, it becomes more and more clear that
we can no longer rely on yesterday's technology to keep things
moving. Without the Next Generation Air Transportation System,
we will all be looking back at the summers of 2000 and 2006 as
the good old days. The tarmac is where you are supposed to get
ready to take off. It is not supposed to be a holding tank.
Our 2008 budget and the new reform proposal ensures a
smooth takeoff and a terrific trajectory to the NextGen. Thank
you very much.
Mr. Costello. Thank you, Administrator Blakey.
At this time we would recognize Dr. Dillingham.
Mr. Dillingham. Thank you, Chairman Costello, Mr. Petri,
Mr. Duncan, members of the Subcommittee.
I believe that we all here agree that the U.S. has one of
the safest air transportation systems in the world. It is,
however, a system under strain. In 2006, one in four flights
arrived late, matching the record delays of 2000. And in the
next ten years, demand for air travel is expected to increase
by over 300 million passengers. Furthermore, the consensus of
opinion is that the current ATC system cannot be expanded to
meet the forecasted traffic demands.
Mr. Chairman, my testimony today will identify some of the
progress FAA has made in two broad areas as it attempts to
address this growing capacity problem, as well as some of the
challenges that will need to be addressed in the 2008 budget
year and beyond. I will focus specifically on FAA's progress
and challenges related to ensuring the continued safe and
efficient operations within the national airspace system and
FAA's progress and challenges in managing the development of
the current ATC system, while leading the transition to the
next generation.
I will also briefly discuss the importance of a timely
reauthorization.
First, with regard to system safety. In the current system,
and certainly as the system has expanded to meet demand, it is
unlikely that FAA will have enough resources to directly
oversee every aspect of aviation safety. FAA has determined
that it can best achieve its safety mission by using risk-
based, data-driven safety programs. GAO agrees that this is a
rational approach for monitoring safety.
However, for this approach to be effective, FAA must have
accurate and complete safety related data. FAA has made
progress in this area, but as examples in our written testimony
show, problems with the quality and availability of data
continue to negatively affect its ability to achieve its safety
program goals.
Another challenge to meeting this goal is FAA's ability to
hire, train and deploy its primary safety workforce of
inspectors and air traffic controllers. For example, FAA plans
to more than double the number of air carriers in its risk-
based air carrier safety oversight program. This will result in
significant workload shifts for its inspector workforce.
Actions such as these make it critical that FAA improve its
safety inspector staffing process, including the development of
a staffing model.
In addition, FAA's ability to replace as many as 10,000 air
traffic controllers or about 70 percent of its controller
workforce over the next 10 years, will also need to be
monitored closely. In recent years, controllers have been
retiring faster than FAA anticipated, thereby exacerbating this
hiring challenge.
With regard to the management of the current ATC
modernization program and transitioning to NextGen, the
implementation of several GAO recommendations and best
practices from the private sector has led to significant
improvements in the outcome of FAA's acquisition and oversight
processes for major ATC acquisitions. As a result, for the
first time, FAA has reported meeting its acquisition cost and
schedule goals for major systems in each of the last three
years.
Another outcome in this area was the establishment of an
agency-wide cost savings and cost avoidance initiative, which
resulted in a total of nearly $100 million in cost savings for
the last two fiscal years.
In regard to the transition to NextGen, FAA and JPDO are
working toward a single plan for modernizing the air traffic
system under its operational evolution partnership. The
principal challenges for FAA in this area are
institutionalization and integration. By institutionalization,
it means doing what is necessary to maintain and improve on the
culture transformation that has been initiated at the agency.
Research shows that this kind of cultural change takes about
five to seven years, and requires sustained leadership to take
a firm hold in the organization.
ATO has been in place a little over three years. And the
tenure of FAA's principal cultural change leaders,
Administrator Blakey and the COO of the air traffic
organization, are drawing to a close. FAA will also be
challenged to obtain Congressional support for controversial
cost savings and efficiency measures, such as additional
facility closings and consolidations.
The integration challenge is the effort that will be
necessary for an efficient and cost-effective transition of the
current ATC program with JPDO and NextGen. Some key elements of
this challenge include working with JPDO, airlines and Congress
to complete a valid consensus cost estimate and funding method
for NextGen. A time-critical part of the funding challenge is
how to replace funds for research and development that were
previously thought to be coming from NASA. Another element of
this challenge is that FAA will need to determine whether it
has the technical and contract management expertise that will
be required to implement NextGen. The next generation air
transportation system must also include adequate airport
infrastructure to meet the forecasted air traffic demands.
In the 2008 budget proposal, the Administration has
proposed reducing funding for the airport improvement program
and changing the allocation formula. Other changes being
considered by FAA, such as adjustments to the passenger
facility charges, could increase available funds for airport
development. The net effect of all these changes on the amount
of funding available for airport development is uncertain.
Mr. Chairman and members of the Subcommittee, my final
point this afternoon is with regard to the completion of FAA
and trust fund reauthorization. As you know, 80 percent of
FAA's budget is funded from the Aviation and Airway Trust Fund.
That authorization expires September 30th, 2007. FAA estimates
that the tax lapses in 1996-1997 cost the trust fund about $5
billion in revenues. Additionally, since the uncommitted
balance of the trust fund is at one of its lowest points, there
is very little cushion to absorb any lapse. It is very critical
that the reauthorization take place in a timely fashion.
Thank you, Mr. Chairman.
Mr. Costello. Thank you, Dr. Dillingham.
Inspector General Scovel.
Mr. Scovel. Chairman Costello, Ranking Member Petri,
members of the Subcommittee, I appreciate the opportunity to
testify this afternoon regarding FAA's fiscal year 2008 budget
request.
The U.S. operates the safest and most complex air
transportation system in the world. In 2006, FAA facilities
that manage high altitude traffic handled 46 million
operations. This level of activity approximates levels in 2000,
when air travel was at its peak. Safety is and must remain
FAA's number one priority. Notwithstanding a very impressive
safety record, the August 2006 ComAir flight 5191 accident
serves as a reminder that we all must work together to make a
safe system even safer.
Our testimony today will focus on the key issues that will
frame FAA's financial requirements over the next several years.
Clarifying those requirements early this session is important,
as Vision 100 and the current ticket taxes expire and Congress
and the Administration begin deliberations regarding the next
FAA reauthorization. FAA's $14.1 billion budget request is
presented in a new format and structure that mirror its plans
to reform how FAA is financed. Currently, FAA is financed by
excise taxes and the general fund. We understand that FAA's
reauthorization proposal will be the subject of another series
of hearings.
An important message of our testimony, Mr. Chairman, is
that regardless of the funding mechanism ultimately decided by
Congress, a number of front and center issues require attention
and will shape FAA's requirements over the next several years.
These include the following. One, addressing the expected surge
in air traffic controller retirements. Last Friday, we issued
the results of our review of FAA's progress in implementing its
controller workforce plan as directed by Congress. The plan
details FAA's strategy for hiring approximately 11,800 new
controllers to replace those expected to leave over the next 10
years.
Overall, we found that FAA continues to make progress in
implementing a comprehensive staffing plan. For example, FAA
has made significant improvements in its hiring process and in
reducing the time and cost to train new controllers. Further
progress, however, is needed in several key areas. First, FAA
is in the process of developing accurate, facility-level
staffing standards, which is a foremost necessity in
effectively placing newly hired controllers where they will be
most needed. Planning by location is critical, because FAA has
over 300 terminal and en route air traffic control facilities,
with significant differences in the types of users they serve,
the complexity of air space they manage, and the levels of air
traffic they handle. We recommended, and the agency agreed,
that FAA report in its next annual update to the plan, progress
in validating standards, including the number of facilities
completed.
Second, FAA has not identified the estimated total costs
associated with the plan. We recommended that FAA develop
detailed cost estimates so that the agency's stakeholders
clearly understand the resources required to execute the plan.
This is particularly important, as deliberations begin over
FAA's next reauthorization.
Two, having sufficient safety inspectors to provide
oversight of a dynamic aviation industry. While controller
staffing represents a significant challenge, FAA must not lose
sight of safety. Potential attrition in its inspector
workforce, along with a rapidly changing aviation industry,
presents FAA with substantial challenges in its safety
oversight.
FAA currently has 3,865 inspectors. Over one-third of these
inspectors will be eligible to retire by 2010. FAA is
requesting $71 million more than last year's request to fund
safety-related functions. With this additional funding, FAA
plans to hire 203 inspectors. Sir, I will note that yesterday
FAA advised us that in view of anticipated funding in H.R. 20,
it expects to be able to hire an additional 87 inspectors, for
a total of 290 new hires in fiscal year 2008.
FAA will never have an inspection workforce that is large
enough to oversee all aspects of aviation operations. But it is
critical for the agency to ensure that its inspectors are
located in areas where they are most needed.
The National Research Council recently completed its study
of FAA's current methods for allocating inspector resources,
and concluded that the agency's current method is ineffective.
FAA must develop a reliable staffing model to ensure it has the
right number of inspectors at the right locations. This is an
important watch item for this Committee.
Three, keeping existing modernization efforts on track and
reducing risks associated with the Next Generation Air
Transportation System, or NGATS. FAA is requesting $2.4 billion
for capital efforts in 2008. The majority of these funds are
for the air traffic organization. FAA is requesting funds for
key next generation initiatives, such as automatic dependent
surveillance broadcast, commonly referred to as ADSB. At the
request of this Subcommittee, we are reviewing progress on 18
projects worth about $17 billion.
Mr. Chairman, I see I have exceeded my time. If I might ask
for a couple more minutes, I should be able to wrap this up.
Mr. Costello. Please proceed.
Mr. Scovel. Thank you.
At the request of this Subcommittee, we are reviewing
progress on 18 projects worth about $17 billion. We are not
seeing the massive cost growth and schedule slips with FAA's
major acquisitions that we did in the past. However, several
projects, such as FAA's telecommunications infrastructure
program, are at risk of not achieving expected cost savings
because of schedule slips and diminishing benefits.
The overarching question facing FAA's capital account is
how to transition to the Next Generation Air Traffic Management
System. This is one of the most complex efforts that FAA has
ever undertaken. We have seen cost estimates suggesting that
FAA would need $500 million to $1 billion annually over
existing planned funding levels for the Next Generation system.
However, there are significant unknowns with respect to
requirements for new software, intensive automation systems and
data communications. Also considerable development will be
required to refine concepts.
In a report done at the request of this Subcommittee, we
made recommendations aimed at reducing risk with this
extraordinarily complex effort. These include developing
realistic cost estimates, quantifying expected benefits and
establishing a road map for industry to follow; reviewing
ongoing modernization projects and making necessary cost,
schedule and performance adjustments; and developing approaches
for risk mitigation and systems integration. FAA agreed with
our recommendations and we will continue to monitor this
important effort.
Finally, using the agency's cost accounting system to
improve operations. Regardless of the financing system Congress
decides upon, FAA must have an effective cost accounting
system. A multi-billion dollar operation like FAA must have
such a system in order to shape decisions and establish
priorities. Since 1996, FAA has spent over $66 million to
implement a cost accounting system which now covers all lines
of business and captures the annual labor costs of
substantially all its personnel, the single largest cost item
for FAA.
Overall, FAA's cost accounting system is properly designed
to assign costs to the agency's lines of business and can be
used for measuring performance. However, FAA must ensure the
accuracy of financial data in the cost accounting system.
That concludes my statement, Mr. Chairman. I would be
pleased to answer any questions you may have.
Mr. Costello. Thank you very much.
Administrator Blakey, I have a few questions. Obviously we
have a number of members still that have questions as well, so
if we can be as brief as possible in our questions and answers,
so that we can get as many as possible in the time that we
have.
In my opening statement, I mentioned and will say again
that in our review of the Administration's 2008 budget request,
the financing proposal would hypothetically yield about $600
million less in fiscal year 2008 than maintaining the current
tax structure. Over the period of 2009 to 2012, it would be
about $900 million less than the current tax structure. Is that
an accurate statement? Would you agree that is correct?
Ms. Blakey. That is correct under the figures in the
President's budget. I am very grateful to you though for
raising this, because I think it is a matter of some confusion
and has been raised by a number of Members. I think what is
important to understand is that the hybrid financing system
that we are proposing is cost based. The cost that the Congress
determines in terms of the appropriations for the various
categories of our expenses are what will then drive the
mechanism to recover those costs.
The proposal that we put forward has AIP at $2.75 billion.
As we know, the Congress has chosen historically to set AIP
levels at a very different figure. The costs that AIP drives
will, of course, cause us to adjust that figure. And if in fact
Congress should choose to support AIP at a different level,
then the costs will exactly match that.
Mr. Costello. But aren't you saying in your cost estimates
that you need less revenue?
Ms. Blakey. No, we are saying we need the revenue that is
proposed in the President's budget. The President's budget, of
course, is addressing the deficit. It is looking at the
tremendous demands we have on the Federal budget overall. We
are trying to be very careful, therefore, in the requests we
are making. But the proposal we have made for the new financing
system matches that request.
Mr. Costello. Well, let me ask another question, then,
maybe in a different way. If the user fees and excise taxes
under your financing proposal would yield less than the current
tax structure, isn't it possible, possible that we could
finance the next generation system under the existing tax
structure? Are you unequivocally saying that it is not
possible?
Ms. Blakey. No, I am not unequivocally saying it is not
possible. I think we can limp along and at some point get
there.
What I do fear, though, and I think there is a tremendous
liability in this, that if we continue with the current
financing system, which has tremendous variations in the
revenue coming in, and which has caused real problems in the
FAA's ability to make capital investments over the years, we
will hit that point where there are a billion passengers
somewhere around the year 2014. We will be attempting to fund
the NextGen, and we will be getting there.
But unfortunately what will happen is we will hit that wall
of operators and passengers when we are way too late at that
point. That is the real problem here. We need the ability to
have a cost-based system that can match the needs, the revenue,
with the costs, so that we can, on a dynamic basis, support
those capital investments. And they are significant to get to
the NextGen on the time frame we need to get there.
Mr. Costello. So I take that as saying that it is possible
to get there?
Ms. Blakey. If you don't, if you are not concerned about
delays and tremendous congestion in the system, and possibly
real gridlock when you get out into another five years plus,
that is where you really hit the problem. I think at that
point, those who are trying to fly then will be looking at us
and wondering why it was that we could not come up with a
system for financing what is clearly a new and very different
system.
Mr. Costello. Thank you.
Mr. Scovel, you state in your testimony and your office has
repeatedly said that at $2.5 billion in the F&E budget, that
there is no way to achieve the next generation system, that you
would basically be maintaining the current system. Do you still
believe that?
Mr. Scovel. Yes, sir, we do. We note that in the fiscal
2008 budget request, FAA's request, $2.46 billion for
modernization. Of that, however, about $2.3 billion is
dedicated toward sustainment. We think FAA will be hard pressed
to sustain the existing system and develop NGATS within a $2.4
billion to $2.5 billion capital budget. An investment level of
$2.5 billion will provide funding for ADSB, SWIM and
demonstration projects, as FAA has requested for the coming
fiscal year. But it will not address the automation,
communication, integration and development efforts as
envisioned for NGATS by FAA in the JPDO.
The numbers we have seen suggest that FAA would need $500
million to $1 billion over the existing capital funding levels
of $2.5 billion beginning in 2009 and for several years
thereafter. These estimates are not too far removed, as you
know, from the authorized levels called for in Vision 100.
I offer the following cautionary notes, however. First, FAA
requirements for new NGATS automation systems are not yet well
defined. Second, we don't know the extent to which FAA can
successfully leverage R&D efforts from other Government
agencies, such as NASA and DOD, particularly when some of the
information that we have received from NASA indicates that they
seem to be looking more to basic research in the future, rather
than applied.
As we have stated in our testimony, there are significant
adjustments needed for existing programs, such as ERAM and FTI.
These are existing programs, Mr. Chairman, that must fit within
the Next General Air Traffic Management System. They will need
adjustments; those adjustments may be costly. They serve as
platforms for the next generation systems.
Mr. Costello. Mr. Scovel, if I can ask another question.
Your office reported that last year, the FAA prepared a
preliminary F&E cost estimate for NextGen and shared it with
the industry. How did the preliminary cost estimates compare to
the level of funding that the Administration is requesting for
fiscal year 2008?
Mr. Scovel. Yes, sir. FAA's F&E funding request for fiscal
year 2008 is consistent with estimates for currently funded
programs that we have seen, and includes funds for NGATS
demonstration projects. However, there is some difference with
respect to when the increase in funds would be needed. The most
recent estimates we have seen suggest that FAA will need a $500
million to $1 billion annual plus-up annually for fiscal year
2009 through fiscal year 2012 to fund NGATs over the current
capital investment, as I mentioned.
Earlier estimates shared with industry in the April 2006
time frame are in the same range, but suggested that
significant increases would begin in 2008. Critical decisions
are needed in the near future that will impact how quickly
those new capabilities may be deployed. These decisions include
establishing requirements for ERAM software releases,
investment decisions on sustaining existing radars and
incorporation of weather information.
Mr. Costello. Thank you.
Dr. Dillingham, I have a few questions for you as well and
a couple of other questions concerning your work with the air
traffic controllers and other things. I will come back to that
in a second round. I want to be able to get to other members.
Let me recognize the Ranking Member, Mr. Petri, at this
time.
Mr. Petri. Thank you, Mr. Chairman. I have a couple of
questions for this round, too.
Administrator Blakey, could you discuss the
Administration's cost allocation study some, particularly in
relationship to its assessment of whether commercial aviation
is paying its full share, more than its share or less than its
full share of the existing trust fund? Could you explain the
situation?
Ms. Blakey. Certainly, I would be happy to. The FAA of
course at this point does have, as our other witnesses have
noted, a very sophisticated cost accounting system. We have
worked with this Congress for a number of years to put that in
place, and it is one of the finest anywhere. It certainly is
one of the finest in Government.
So we are very acutely aware, therefore, of the costs in
the system, and we have very accurate activity data. We have
worked with Price-Waterhouse Coopers and other consultants on
the cost allocation study, which looks at over 600 different
factors in terms of the air traffic control system, and looks
at the various levels of facilities and the kinds of costs that
are imposed there, and also, of course, takes into account the
various type of aircraft and the activity that is there.
What we have seen is that the commercial aviation arena is
paying over 95 percent of the costs currently. Under the
current cost allocation study that we have just issued today,
they are paying about 95 percent, a bit over that, when 73
percent is what their actual use of the system would cost.
In contrast, the general aviation community is paying
between 3 and 4 percent of the cost, and they are imposing 16
percent of the cost. Now, we have very detailed breakdown, and
there is a great deal of background behind the cost allocation
methodology and study. We do intend to brief Committee staff
and Members as they would find helpful on this, because again,
obviously it is a very detailed activity.
Mr. Petri. Did the different communities or their
associations have an opportunity to review and comment on the
study? In particular, one point I am interested in getting your
take on, and that is the argument that there is a kind of a,
that partly this situation exists because there is, with the
hub-spoke system, there is peak demand and intensive use of the
system, and there is congestion pricing in effect, that because
of the fixed schedules, there is less flexibility and therefore
more cost from commercial aviation than from some of the other
users. Could you discuss those factors, rather than just
movements of planes and this kind of thing, the marginal cost,
if you have to have a system that is robust at certain times of
the day, rather than being able to spread it out, would it
presumably fairly on those who are less flexible in causing
that increase in use at that particular time?
Ms. Blakey. I would be happy to. To your first point, we
have been working on this proposal, the Administration's
proposal, for more than 18 months and have done a lot of
consulting with the various aviation stakeholder groups. Now
that we have brought forth our proposal and the newest cost
allocation study, we are certainly briefing all of the groups
involved and will be working with them in great detail on this.
But we have also taken into account their views and
methodology, which goes to the second part of your question,
which is no, the cost allocation study does not consider a blip
on the radar screen to be a blip, and all activity is even. In
fact, we do accept the premise that the general aviation
community has presented that there is a difference in the use
of the system in terms of peaks, the hub system, demand, and
congestion_all those issues, they are costs that the commercial
aviation arena poses that the general aviation doesn't.
There is also the argument that the system was not
initially built entirely around the demands of general
aviation. That is all quite true. So is there an argument to be
made that they are more marginal users of the system? We think
that there is a significant difference there. And therefore, at
every point in the cost allocation study where you could go to
the side of saying, if it is general aviation it is more
marginal use, and therefore you do not account for as great a
cost, we have done so. I think it is fair to say that the cost
allocation study we have done leans very heavily to the
arguments of the general aviation community that they are more
marginal users.
Mr. Costello. Thank you, Mr. Petri.
Mr. DaFazio is recognized for five minutes.
Mr. DeFazio. Thank you, Mr. Chairman.
Administrator, good to see you again. You have such
southern gentility to say what a pleasure it was to be before
the Committee today. I am sure you have had more pleasurable
days. But as you can see, there is tremendous concern about
this new proposal.
I haven't seen the allocation study, I have been arguing
over this issue for the 20 years or so I have been on the
Committee. It obviously depends on certain assumptions. You say
you consulted with the stakeholders. I mean, tell me, what was
the consultation with GA like? Was it as warm and friendly as
today's hearing? And did they ultimately accede to your
conclusions, or are you just registering their objections and
moving forward?
Ms. Blakey. You know, I think at the heart of this, of
course, is no one wants to pay more. And I do understand that.
But what I would say is this: that we have worked very hard to
listen to the concerns of general aviation. That is why we are
proposing a hybrid system. Most systems around the world, as
you know, go to a straight user fee system. And we are
proposing to you that there be a fuel tax for general aviation,
because we accept that the burden that they are concerned about
with a fee system would be greater than they should bear.
We have also, as I said, in the cost allocation, listened
very much to the concerns of general aviation. And at any point
where we felt that we could move to that in terms of specific
costs, we have done so. Some parts of the stakeholder community
have done a very sophisticated analysis of ways to approach
cost allocation. And frankly, they have argued against certain
earlier forms of cost allocation. Ramsey pricing, for example,
which again, we accept, and we have moved very strongly to one
which is very transparent, is entirely cost-based and frankly,
makes us extremely accountable for the costs involved.
Mr. DeFazio. I guess the question would be, why would we go
through an extraordinary battle, reallocate costs to raise less
money?
Ms. Blakey. In the long run, you will not be raising less
money. You will be enabling us to make the kinds of--------
Mr. DeFazio. Well, in the short run, we are raising less
money. You must be making some assumptions about future
enplanements or costs of tickets. Tickets are going up,
enplanements are going up. So I am puzzled as to why you think
that this other system would raise more money, unless you are
intending to raise the tax even further and you don't think a
gas tax of 50 cents a gallon, 56.4 cents for general, plus the
13.6, 70 cents a gallon, is going to have a depressive effect
on the GA community. Supply and demand, I would assume that a
lot of people are going to choose to fly less, so I would
assume that you are not taking current levels of GA, but you
must be projecting some downturn in GA. I don't know what you
are projecting in commercial, but if we maintain the current
system from the projections I see, we would raise more money
every year for the indefinite future.
Ms. Blakey. When you look at the history of revenue coming
into the Trust Fund, you will see wild fluctuations in the
revenue coming in. It has not been predictable, and it has been
a problem from the standpoint of the balance in the Trust Fund.
Right now, the Trust Fund balance, an uncommitted balance, is
at an historic low. I don't think that is arguable. It has been
a decade since it has been this low.
Mr. DeFazio. In part because Congress mandated, because
were concerned a number of bills ago, about there being too big
of a balance and we mandated that it be spent down. So if we
want to have an objective of having a large reserve or trust
fund, we can say, no, we want to build the trust fund again and
sort of redirect your efforts in that area. And if you could
really raise $500 million or $600 million more with the current
structure, and you can live on $500 million or $600 million
less, then we could say, well, let's put that $500 million or
$600 million in here, if we think we need a larger reserve,
which I am not convinced we do. But we would be open to that
argument. I certainly want to have a prudent reserve for
potential downturns.
Ms. Blakey. I think the problem we are dealing with is
there is no relationship between the price of a passenger
airline ticket and the cost of running the system.
Mr. DeFazio. If I could, madam, there is very little
relationship between anything known to mortals and the price of
an airline ticket, the way the system works.
[Laughter.]
Ms. Blakey. I couldn't agree with you more, Congressman,
having paid a few of those myself and been mystified.
So I think that is right. While I would agree with you that
currently, right now, ticket prices are going up, the long-term
forecasts and projects that we and others in the airline
industry and the manufacturing industry are that ticket prices
are going down. So again, this is one of those things that we
could probably debate, but you could look at the fluctuations
on revenue and it is very erratic. And there is no
relationship. Every business in America wants to tie its costs
to its revenue. It is a very basic principle that we are
adhering to here. We want it to be stable, we want it to be
predictable. And as the costs of the NextGen go up, and we, the
Congress and the user community believe--------
Mr. DeFazio. I am out of time.
Ms. Blakey.--you should, that you have to reduce the costs.
Mr. DeFazio. And I won't be quite as blunt as my colleague,
Dr. Ehlers, but I will say, I agree with his sentiment, but
express it more delicately. I think we probably are belaboring
it.
Let me ask one other question very quickly. PFC, I was sort
of the father on the Democratic side of PFC many, many years
ago. My idea for that was in particular, since I saw two
airports in my State, one being in my home town, where one city
had to raise all the revenue to build a new terminal and I live
in the other city, so hey, I didn't have to pay the taxes.
Wasn't that great. Well, I didn't think that was quite fair,
because I use it a lot.
And then Portland, where we had people coming over from a
neighboring State to use the airport. So I fostered this idea,
and I think it has worked relatively well. I am concerned about
both the increase proposed, and I assume that if you are
increasing the segment, are you going to increase the total? I
mean, right now it can't be more than $18 per round trip at
$4.50 a segment. So if it is going to $6 a segment, are you
proposing $24 per round trip? Because we are about to eat up
all the money that you might save the airlines over here. They
consider that a tax, you know, and they consider it to be their
money. You are about to eat up all the money you might save
over here in your new fee structure over here in higher PFCs.
Ms. Blakey. PFCs, yes, we are proposing that they go from
$4.50 to $6 and there would be the same structure there as
currently.
Mr. DeFazio. Twenty-four dollars?
Ms. Blakey. Yes. I would say that, of course, they are
locally determined and project-based, and they have been very
successful, frankly, in advancing infrastructure.
Mr. DeFazio. One last quick question. I am concerned that
you are proposing to expand eligibility. In particular, I would
look at, one of the expansions, I understand, is parking. Now,
if I fly Eugene-Denver-Dulles and I pay a fee at PFC, I agree,
I should pay a PFC to contribute to the terminal and other
related activities. I never, ever have walked out of the Denver
airport, probably never will, never parked a car there. Why
should all of those people transiting that airport pay for a
parking project? I am very concerned about any expansion in the
scope.
We had to fight mass transit proposals that really weren't
related, I mean, we had to fight a whole host of things when we
started this program. We really have it fairly narrow, I think
acceptable to the public. We are not seeing revenue diversion,
which is the original reason PFCs were killed off 25 years ago
or 30 years ago. I really am concerned about any expansion. I
just would leave that with you. Thank you.
Thank you, Mr. Chairman.
Mr. Costello. I thank you.
Mr. Graves is recognized for five minutes.
Mr. Graves. Thank you, Mr. Chairman.
I have gotten indications, I know we keep talking about the
trust fund is at the lowest point it has ever been. And it was
just pointed out so eloquently, that we move to draw down the
trust fund. But revenues into the trust fund are increasing,
isn't that correct?
Ms. Blakey. Currently revenues are increasing, that is
correct.
Mr. Graves. So revenues into the fund are increasing, but
the trust fund is being drawn down, I am trying to get some
things figured out here.
Mr. Scovel, you said that this next generation system is
going to be anywhere from $500 million to a billion? That is a
pretty broad anywhere between.
Mr. Scovel. Yes, sir, it is. That is what we estimated
based on what we anticipated funding needs to be from 2009 to
the next several, over the next several years.
Mr. Graves. And in the funding proposal, Administrator, we
are going to pay for 25 activities related to, in terms of
fees, some aircraft are going to pay 25 activities related to
the FAA's regulation and certification activities, which only
12 of these have been defined. We don't know what the rest of
them are, or at least they are not in the proposal, right? So
we don't know, we are not sure which fees are going to be out
there for certification and some of those other areas.
Ms. Blakey. I am sorry, I am not following you. We are
going to work with the stakeholder community to actually set
those. It is permissive and allows us to do it in that form.
Not all of them were dollar set. The ones that are dollar set
are the ones that are very specific to customers, individual
customers.
Mr. Graves. And then we have, the FAA is going to then be
able to adjust costs for inflation or whatever their allocation
formula dictates. And I know you have an elaborate allocation.
What I am getting at, the big picture here is, we don't know
what this thing is going to cost, we don't know what it is
going to be, we don't know when it is going to be put in place,
we don't know what all the fees are going to be. There are so
many things we don't know, Mr. Chairman. I would venture to say
that, I have a hard time talking about funding anything when we
don't know, we don't know what it is. We don't know what any
part of it is. We have a great idea. It really sounds good.
Ms. Blakey. No, it is much more than an idea. It is much
more than an idea. I can be much more specific about costs if
that would be helpful to the Committee.
We are projecting, in fact, for NextGen costs, over the
next five years, a cost of $4.6 billion for infrastructure.
That is approximately running at a billion dollars a year. I
can also give you figures that will go out to the year 2025,
which is when we are hoping to complete the entire plan for the
NextGen.
Now, I don't think the fact that we cannot tell you
precisely what the capital investments will be all the way out
to 2025 is unreasonable, because there is not a corporation in
America that could tell you what their capital investments are
going to be that far out. There are changes in technology. But
we do have out the concept of operations now, and we will be
presenting this spring the enterprise architecture, which does
give you the blueprint. And we have a number of demonstration
programs, which are the backbone of the NextGen going right
now.
Mr. Graves. Well, let's talk about the airports. If we are
going to talk about, and we keep talking about congestion and
all these delays in the system. Really, the fact of the matter
is, congestion comes from just a few airports. It really does.
I have been flying now every single week back and forth from
DCA to Kansas City and then various places in between. Those
are two airports that probably are under-utilized airports,
Kansas City Center in the midwest probably doesn't have nearly
as much traffic, because if I ask for a flight following I can
get it. They don't have to tell me to wait.
But I know that there is congestion in some areas. And I
would venture to say it is more a function of those runways and
the amount of activity at that airport than it is necessarily
the air traffic control system. I think we ought to be talking
about fixing those areas specifically, instead of overhauling
the whole system based on congestion in some of these under-
utilized places.
I do have a little bit of problem too, Mr. Scovel, when you
mention things like ComAir crashes meaning the backdrop for why
we need to do this. That had nothing to do with the air traffic
control system, absolutely nothing to do with it. And I resent
the fact that we are using things like that to try to further a
system like this and justify a system like this.
I am still extremely frustrated, Mr. Chairman. I apologize.
But I am, this has really got me in a wad, it really does, for
the entire aviation community. I know what to do about it, I
don't think we ought to be talking about it if we don't know
what it is we are talking about.
Mr. Costello. I appreciate the gentleman's comments. Let me
make two comments quickly before we recognize the next member.
And actually, ask a point of clarification from the
Administrator. When you mentioned the $4.6 billion over the
next five years, is our assumption correct, then, that in your
budget projections under the user fee system, that $4.6 billion
is included?
Ms. Blakey. Yes, in fact, if you look at the out years in
our projections, the investment in NextGen ramps up
significantly. I think it is very accurate to say that, as with
a system of this type, an approach of this type, you have the
beginning, R&D stages and demonstration projects, and then you
move into the implementation stage, when significant
infrastructure investments have to be made.
Mr. Costello. Your revenue requirements and projections
meet that?
Ms. Blakey. They do.
Mr. Costello. OK. And then the second point, if I can, Mr.
Graves, to respond to the point that you made about ComAir, and
it wasn't an air traffic control issue, the only thing I would
point out is that it was very clear that two controllers should
have been on duty and only one was. I understand the cause. I
understand. But the report clearly pointed out that it may not
have had anything to do with the accident, but there should
have been two controllers on duty and there was only one.
Let me recognize the gentleman from Illinois, Mr. Lipinski,
for five minutes.
Mr. Lipinski. Thank you, Mr. Chairman. I want to start out
by congratulating you on becoming chairman of the Subcommittee.
I know you are going to do a great job. Certainly your wisdom
was shown by one of the first things you did, I know, was come
out to Midway Airport in my district. It shows your great
wisdom in coming out there. I also want to congratulate Ranking
Member Petri and I look forward to working together with you in
this Congress.
I also want to thank Administrator Blakey for coming out
there to Midway Airport. I appreciate your coming there and
viewing the safety improvements and appreciate the cooperation
and the help that you have given in helping to put in the EMAS
system in there and make Midway Airport more safe. I just want
to also take this opportunity to reiterate a point I made to
you there in a letter in January, that I will oppose any
expansion of Midway Airport, it is a very important issue back
in the district. I think with the safety improvements there, we
see things really looking up at Midway Airport.
I wanted to briefly mention, I know Chairman Costello is
going to come back to this. I am concerned about the number of
air traffic controllers and the impact that it is going to have
on the system. I know Mr. Costello is going to come back to
that in a second round.
So I just wanted to mention and ask a question, my concern
here with the proposed budget is cutting the AIP. And with the
capital improvements going on at Midway Airport and the program
going on, the O'Hare modernization program, its tremendous
impact, and not only locally in the Chicago area, but for the
entire Nation, it would seem that by cutting the AIP funds that
it would have a detrimental impact on this program. So I wanted
to know what the impact is going to be and if you tell me it is
not going to have a detrimental impact.
Ms. Blakey. Congressman, I appreciate your bringing up
O'Hare, because I know we both share the commitment to making
certain that we do everything possible to keep that project on
track. O'Hare is the nerve center in terms of our
transcontinental traffic all across the U.S., as we know. When
O'Hare sneezes, all the rest of us get a cold, and right now,
it has a pretty big cold. I was looking at it this morning in
terms of delays and cancellations because of the weather.
Mr. Lipinski. I don't know if we can do anything about the
snow in Chicago.
[Laughter.]
Ms. Blakey. That is beyond me, I will tell you that.
The level of AIP that we are proposing will absolutely keep
our commitments, such as those to O'Hare, on track. Our letters
of intent, our investments that are required there, will
absolutely remain intact. In fact, the $2.75 billion will allow
us to cover all of the high priority safety, capacity,
environmental and standard-setting work that we are committed
to right now.
Mr. Lipinski. Thank you. I will yield back the balance of
my time.
Mr. Costello. The Chair would recognize Ms. Fallin for five
minutes.
Ms. Fallin. Thank you, Mr. Chair. Administrator Blakey, it
is always good to see you.
Oklahoma is a very rural State, and we have over 100
federally-designated airports in our State. Our small airports
depend upon the stability of funding for the AIP program. I
know the Administration has proposed to cut the funding for
that program by almost a billion dollars, almost in half. And
Oklahoma estimates that it would lose a substantial amount of
money for our smaller airports. In Oklahoma, we attract a lot
of companies and jobs by expanding our airports in the rural
communities, and have a lot of commercial and private aviation
that goes in and out of our rural airports that helps bring in
companies and jobs.
I also understand from our people in Oklahoma that the
Essential Air Service grants program, which helps fund some of
our commercial locations, airports, could also possibly be at
risk of losing funding if the AIP programs are cut. So in light
of us believing that there is a direct relationship between
helping expand our airport service in our rural communities and
economic development, the people of Oklahoma in the aviation
industry have asked, what do you recommend or what do you think
would happen if we do slash these funds and these programs to
the rural communities who depend upon these programs,
especially in light of economic development?
Ms. Blakey. I appreciate your question, because I certainly
do recognize that rural airports in Oklahoma and in a lot of
States are very critical, and they are part of the engine of
expansion for the economy. I would highly recommend that we
look together at greater length at the Administration's new
reform proposal, because there is a tremendous amount of
advantage for small airports in the way we are proposing to
change the approach we take to AIP. What we have seen is that
AIP is particularly critical to small airports. The larger
airports are able to raise money through PFCs, bonding and
other things, and do not rely on it as much of a critical
source as do small airports.
So what we have done, therefore, is look at the formulas
that are inherent in the current system, and they are very
outdated, and look at the fact that we do need to support our
smaller airports with more of the kind of funding that they can
count on from AIP, on an entitlement basis, and we are able to
do that, we think, much better and with much more targeting
under a new system we are proposing than what we have before.
So I would point you to that, because there is a good bit
of detail there, and I would like very much to talk with you
about it.
Ms. Fallin. OK. Thank you, Mr. Chairman. I yield back my
time.
Mr. Costello. Thank you. At this time, the Chair recognizes
the gentleman from New York, Mr. Hall.
Mr. Hall. Thank you, Mr. Chairman, and thank you to our
distinguished panel.
Administrator Blakey, I was wondering, and looking at the
staffing numbers for air traffic controllers, which are low
around the Nation, it seems to me that the FAA should have seen
its controller crisis coming some time ago. When you have
controllers who were hired between 1981 and 1984, and they are
eligible to retire at age 50, anyone could have seen this
retirement trend coming down the pike decades in advance. Yet
the FAA only hired 13 controllers in 2004.
This year, the FAA is going to hire 1,420 after the FAA
self-imposed work rules for controllers took effect. It would
appear as though the FAA waited to handle the staffing crisis
until after a new, disadvantageous pay structure was put in
place in order to cut labor costs. Was this the motivation
behind FAA's staffing strategy?
Ms. Blakey. No, not at all. In fact, of course the FAA has
known for many years that because controllers retire at age 56_
it is the mandatory age_we knew that we were going to have a
large wave of controller retirements coming, and we had to
prepare for it. That is the reason we have a very detailed
controller staffing plan that we will be providing you an
update on about the first of March.
In fact, the number of controllers that were hired back in
2004, that 13 figure, was because we were under real
constraints in the budget that Congress was aware of_we were
all aware of it_and it did not allow us to ramp up as much as
we would have liked. Since then, however, we have been
addressing that. And you will see in the controller hiring plan
that we are going to be steadily doing this so that we will
have a net increase each year as we need to to staff to the
projected retirements as well as to the growth in traffic and
to the fluctuations that we will see in various parts of the
Country.
In response to the Inspector General's concern, and I think
we agree with this, that we provide facility by facility
estimates of what staffing should be, that will also be a part
of that plan, which I think will be helpful to you. Because as
you look at it, you will see that in parts of the Country we
have significant requirements coming up, and in other parts we
don't. There are parts of the Country where we have
overstaffing, just like we have understaffing. On average,
throughout the Country, we are hitting our staffing
requirements.
It is frequent that the controllers union will be using
figures that go back to 1998. They are very old figures that
they call authorized figures. They were set as a part of a
contract negotiation, not because of current staffing and
retirement levels.
Mr. Hall. Well, that raises a question. Do you anticipate
continuing forward with a rule that is imposed, or do you see
the FAA at some point going to binding arbitration? Do you
think that the work rule or the pay structure has anything to
do with the retirements?
Ms. Blakey. Let me go to the first part of your question,
then I will address the second. The FAA did just as the
statutory requirement set by Congress mandated, which was that
when we entered into contract negotiations_and the FAA has a
very unusual requirement that is not true of most parts of
Government_and that is that we negotiate for pay. It is an
extraordinarily difficult thing to do. But we went through a
long period of negotiations with NATCA, with our controllers
union, attempting to get a voluntary agreement. When we were
unable to do so, and there were several key parts of the
contract negotiation that were outstanding, all of which had to
do with pay and various forms of compensation, as well as
several key work rules, we then did as the statute requires and
presented it to Congress. we presented our proposal, they were
able to present theirs. And this was reviewed for 60 days by
Congress.
Should Congress have wanted to step in and increase the
amount of the contract, that was a possibility that could have
happened. It did not happen and we moved forward with the
current contract. We do not anticipate reopening the contract.
Mr. Hall. Thank you for that explanation.
Ms. Blakey. But I would suggest to you this, that I think
there has been a phenomenon that we saw in the latter part of
the year in terms of controller retirements. We saw 116 more
controllers retire in the latter part of the fiscal year than
we anticipated. It is not a big percentage, it is less than 1
percent of the workforce, but nevertheless, we have adjusted
our retirement projections up, because we want to be certain
that if the contract is having an effect on some controllers
who choose to leave early, and remember that our veteran
workforce was held harmless financially, but if they do, we
have adjusted the numbers up on retirements.
Mr. Hall. Thank you.
Just one more quick question if I may. It looks as though
the President wants to cut the airport improvement program,
looking at this budget. How can the FAA meet current needs,
like for instance at Stewart, the airport in my district, which
is looking at hopefully expansion and infrastructure that needs
to be added? I am just curious how those things can happen at
the same time.
Ms. Blakey. Well, as you know, we have had a lively
interest in Stewart, because, of course, it is a former
military base. We have been very interested in the recent
phenomenon of the Port Authority then moving back there,
because we too see that Stewart has tremendous potential.
I don't think there is any doubt about the fact that we
will continue to be financially available to Stewart and the
needs there, as the plans for the airport develops and
specifics are put forward by, I expect at this point it will
probably be, by the Port Authority. Is that correct?
Mr. Hall. I think so, yes.
Ms. Blakey. But we will be looking forward to working with
you on that, because again, we know in the New York area that
Stewart has an increasingly important role to play.
Mr. Hall. Thank you very much.
Ms. Blakey. You are welcome.
Mr. Hall. Thank you, Mr. Chairman.
Mr. Costello. Let me mention, as the gentleman knows, we
have discussed the issue of the contract between the FAA or the
lack thereof and NATCA, and we intend to address that in this
Congress.
Let me recognize at this time the gentleman from Michigan,
my friend Mr. Ehlers, for five minutes.
Mr. Ehlers. Thank you, Mr. Chairman. I have a question for
each of the inspector generals. First of all, for Mr. Scovel,
some comments about ADSB. How do you see ADSB changing the
current system, and what do you see as the likely time frame
for adoption and implementation of ADSB?
Mr. Scovel. Thank you, sir. ADSB represents a tremendous
step forward in terms of the technology available for both
aircraft and ground control to understand where aircraft are,
and frankly, to reduce separation between aircraft when it is
fully implemented. There are two types of ADSB, as you may well
know, ADSB in and ADSB out. They will be implemented at
different time frames. But when it is fully operational, it
will permit, under NGATS, significant improvements in capacity.
I think that is the primary goal, certainly of FAA, in
presenting that forward.
ADSB, we estimate, is a system that is on target, it is
properly funded for the current fiscal year, in order to move
it forward. I don't know what the current timetable is for its
full implementation. I would defer to Administrator Blakey for
that information. Perhaps she can respond to your question on
that score, sir.
Mr. Ehlers. I am concerned about the financial aspects.
Will that save our system money, compared to our current
system, and if so, do you have any estimates of how much it
would save?
Mr. Scovel. I don't have estimates on that, sir. It would
be difficult for me to say at this point, will it save the
system money. When we talk about improvements in capacity,
arguably improvements in safety as well, it is hard to put a
price tag on those achievements, should they come to pass, as
we hope that they will.
We think, as I said, that ADSB, at least for the coming
fiscal year, is properly funded. I don't have estimates going
forward as to how much it will cost and whether it represents
an improvement over the current system.
Mr. Ehlers. Long term, would you expect it to reduce the
number of controllers needed?
Mr. Scovel. Possibly, yes, sir.
Mr. Ehlers. But you are not sure?
Mr. Scovel. I am not sure.
Mr. Ehlers. All right, thank you.
Mr. Dillingham, your comments about the NASA gap in your
testimony, I am very concerned about that. Because the 10 to 20
year future of aviation is going to depend tremendously on
resurface and development. There are so many things coming down
the pike. That could affect us, could affect the system,
certainly could affect the economic aspects of the industry
itself. But right now I am just thinking about our role in
this. If NASA is not keeping up with it, we don't really have
enough money scheduled for FAA to do all the research, do we?
Mr. Dillingham. I think the 2008 budget does call for an
increase in the monies that would be available to do early
demonstration work in NGATS, both in the research and
engineering and development part of it, as well as in the F&E
account. Whether it is going to be enough or not, I couldn't
say. But it has been recognized that there is that gap in terms
of technology and demonstration. It also has been recognized
that this is something that has to be addressed very soon.
Mr. Ehlers. OK, I appreciate it, because I totally agree
with that, and it is very frustrating that so much of the NASA
budget is being devoted to space programs that some of these
other programs are being shortchanged.
Finally, Ms. Blakey, I continue to admire your work. I hope
you are not offended by my comment earlier about the proposal
being dead on arrival. But I do know the Congress.
And I am very sincere about an offer to try to work with
you and try to work out--I think it is entirely too easy for us
in the Congress to sit here and fire away at proposals that the
Administration brings here. I would like to lay some of the
burden on the Congress itself to come up with ideas to address
the problems. There is no question the problems are there, no
question they have to be addressed. And if we just fire salvos
at you all the time, we are not going to solve the problems. So
I hope you understand, my suggestion was offered in the spirit
of trying to reach some agreement with a good result.
With that I will yield back.
Mr. Costello. I thank the gentleman.
The gentleman from Tennessee, Mr. Cohen, is recognized for
five minutes.
Mr. Cohen. Thank you, Mr. Chairman.
Ms. Blakey, I am a freshman, so I don't know where you are
from. It is obvious you are from a garden spot, but which one?
Ms. Blakey. Tupelo, Mississippi and Montgomery, Alabama. I
claim both.
Mr. Cohen. Well, Tupelo is more like greater Memphis, so
that is a garden spot.
[Laughter.]
Mr. Cohen. And being from Memphis, I was a little concerned
about this information here that the accident rate for cargo
carriers is over six times higher than commercial passengers.
Being that I am a commercial passenger, I was kind of happy.
But being that I am from Memphis, I am absolutely, positively
concerned about the cargo rate. Why is that rate six times what
it is for passenger traffic?
Ms. Blakey. I think you have to start with the fact that
the accident rate and commercial fatal accident rate is at a
remarkably low level. It is such a tiny, tiny percentage, that
you are backed up against that, would be one point.
But secondarily, of course, cargo as you well know flies at
night, and flies under difficult IFR conditions. You often have
flights from small airports from where you are picking up cargo
and flying back into the hubs. There are a number of challenges
involved in the cargo arena. We have been working on this
within the FAA and with not only the big cargo carriers, FedEx,
UPS, et cetera, but a number of the smaller ones, and with
their association, looking at good ways that we can help in
terms of both pilot awareness, as well as the physical issues
that go with the overnight delivery system. Some of it, of
course, is day as well, but a lot of it does go to, as I say,
more challenging circumstances and environment.
Mr. Cohen. So it is not due to maintenance of the aircraft,
it is more with the circumstances of the flights?
Ms. Blakey. I think on the whole, you have a very safe
maintenance record there. There are probably differences,
again, among specific carriers.
Mr. Cohen. You mention in your remarks that the tarmac
should be a takeoff area and not a holding tank. And that
caused me a little concern there, because some folks have been
kept on airplanes for like a long time, as if they are on a
holding tank. I discussed with Representative DeFazio a bill he
had some years ago, a passenger bill of rights that I think I
am considering introducing this session. What do you think is a
reasonable amount of time to be crammed in as cargo in a
passenger plane on a tarmac as if you are in a holding tank,
before the Government would want you to get off and be able to
use the facilities?
Ms. Blakey. Well, I will tell you, as far as the FAA is
concerned, we are striving to have on-time performance hit
above almost 90 percent of the time.
Mr. Cohen. Yes, but this is when you are not having on-time
performance.
Ms. Blakey. I understand. It is not, of course, the role of
the FAA to tell the airlines what their customer service should
be. But we do believe that the delays that we are experiencing
right now in the system are a terrific problem. There is no
question about it. We also understand that the airlines at this
point need to step up to address some of the circumstances that
have occurred recently that have really made headlines and I
think have caused some genuine, legitimate concern and outcry
from passengers.
Mr. Cohen. And since passengers pay most of the fees, it is
the passengers who pay the fees, don't you think maybe three
hours is beyond a reasonable time that somebody should be a
hostage?
Ms. Blakey. As a passenger, I can tell you, three hours is
way too long for me.
Mr. Cohen. I would like to thank you. Let me ask you this,
too, about cell phones. I had lunch with Senator Alexander
today. He is a friend and he also shares the idea that cell
phones could be a cacophonous connection there. What can you
assure us, your concerns about not seeing that there are 90
different people carrying on conversations at the same time?
Ms. Blakey. There is a lot of concern about that. It is
surprising to me the amount of over the transom traffic I get
on that particular point. Let me just tell you that where
things stand right now is that whether or not there will be a
move toward the possibility of cell phones on aircraft
additionally is a call of the FCC. It goes to spectrum issues
and other things.
After that, then it is the FAA's considered judgment that
safety comes first before anything else. And any carrier that
would propose to us that they wanted to allow cell phone usage
on board the aircraft after the doors are shut would have to
demonstrate that it would have no effect on the avionics and no
effect on safety. That would be something that we would require
as a threshold issue before we went any further.
Mr. Cohen. Thank you. I would suggest just from my own
sensitivities, maybe, that if you allow that, you are going to
have a lot more air marshals and air deputies.
[Laughter.]
Mr. Cohen. They will just take up too many seats, and you
won't have those fees, those 750 fees, because I guess they fly
for free. Do you have any proposals for consumer issues on
passenger aircraft? Is that something you consider, things
where maybe those people that pay all those fees get a little
bit better peanuts or potato chip or something?
Ms. Blakey. I will tell you, as much as I am a passenger
and am very, very concerned about the kinds of issues that are
behind your question here, the FAA is a regulator. We have as
our mission primarily the safety and the running of the NAS,
and the system and capacity is our focus. When it comes to
those kinds of consumer and significantly economic issues, we
are prohibited from getting involved. The Department of
Transportation and others do address some of those issues but
they are not ones that we can address.
Mr. Cohen. Who prohibits you? It is not law, is it?
Ms. Blakey. If you have the regulatory enforcement role,
that also has an economic sway and economic decision making, it
really does run into points where you do have a conflict
between those potentially. I think many, many years ago, the
determination was made that others should have the authority,
for example, on questions on consumer concerns, routes, what
routes are warranted internationally, and a number of economic
issues.
Mr. DeFazio. Will the gentleman yield for a moment?
Mr. Cohen. Yes.
Mr. DeFazio. Thank you.
Madam Administrator, until the ValueJet crash, despite my
best efforts, the FAA was charged with promoting and regulating
the industry, something which I always pointed to as an
inherent conflict. The amendment was never accepted until after
ValueJet, when Secretary Pena was very embarrassed after he had
said how great the airline was, and the next day he grounded
it, because in fact neglect and outsourcing of mechanical had
caused death.
So people came to me and said, well, how about that
amendment, where do you want it in the bill? So we stripped
away that, but there is nothing to say that Congress could not
charge the FAA with protecting the public, the traveling
public, and charge you with that duty. There is no prohibition.
If we were to say that we think it is a safety issue when you
keep people on a plane for five hours on the tarmac or other
issues that relate to that, smoking, historically, those sorts
of things, those are regulatory issues that could fall within
the purview of your agency.
Ms. Blakey. I have long since learned not to duel with
Congressman DeFazio or Chairman Oberstar when it comes to the
history and development of the FAA, because believe me, they
can reach back into a lot of this, and certainly do. I would
suggest this, that right now we have our hands pretty full. But
if you all see fit to give us additional responsibilities,
obviously we will step up.
Mr. DeFazio. Then we would have to give you a little more
staff. Thank you, Madam Administrator.
Mr. Cohen. Thank you, Mr. Chairman. If I could just have
one more minute, I would like to encourage the Committee to
consider something about consumers--------
Mr. Costello. Can I just point you are already three
minutes over your five. But please.
Mr. Cohen. That was it, just I think there should be some
consumer concern. That is who pays the fees. I would like to
make the observation that Elvis went from Tupelo to Memphis and
I am surprised you went the other direction.
Ms. Blakey. I will keep that in mind.
Mr. Costello. The Chair recognizes Mr. Dent for five
minutes.
Mr. Dent. Thank you, Mr. Chairman.
Administrator Blakey, great to be with you. As you know,
the Lehigh Valley International Airport is located in my
district, LVIA. The Lehigh-Northampton Airport Authority, which
owns and operates the airport, has recently updated its master
plan. One of the major projects identified on that authority's
airport layout plan is in response to the FAA's runway safety
area program.
In order to achieve the current RSA standards for each
runway, one of the airport's runways must be reconfigured at
considerable expense. The use of the engineered materials
arresting system, the EMAS, in this case, is not practical. So
the scope involves bridging across a State road, placing
overhead utilities underground and acquiring homes in the
relocated runway protection zone and noise exposure area.
Even more, there are potential impacts to a nearby
elementary school. The airport authority is in the process of
completing an environmental assessment for the project, and all
indications are that with the mitigation measures included,
that the project is feasible to construct.
The primary concern that I have relates to the considerable
funding that a project of this magnitude requires. It is
possible that this work could require in excess of $40 million
of Federal funding from the Agency's airport improvement
program. That is on top of other AIP grant funding needs at
LVIA.
At a time when the Administration is requesting a
considerably lower amount of funding for the airport
improvement program than has been typically authorized by
Congress, how can my local airport authority and others
throughout the Country, with deficient RSAs, reasonably expect
to fund projects of this scale? That is my principal concern.
We go through this whole process, the community gets alarmed,
all the mitigation is done, the environmental assessment is
complete, and then we get to the point of doing something and
there is really not funding to deal with the issues.
So how would you respond? How should I respond to my
airport on this issue?
Ms. Blakey. I would have to look in much greater detail at
the specifics there to be more specifically helpful. But I
would say this, that runway safety areas are a very high
priority for us. We are striving around the country, wherever
possible, to see that those meet the current standards that we
have set, because we do believe that this is an important
aspect of safety at our airports.
I am disappointed to learn that the EMAS system may not be
feasible for Lehigh, because what we have found is that as
airports are continuing to evaluate that, it has proven to be
quite a good alternative. For example, Midway, for a number of
years, did not feel that that was the direction that they could
go. And recently, just as Congressman Lipinski was noting and
applauding, we have worked with them to install EMAS at Midway
and it is working out quite well.
So I don't know, again, the specifics, but what I can tell
you is we work very hard to fully fund the requests for RSAs,
because we do see them as being important, and at the same
time, trying to address the capital needs that airports may
have for expansion and other kinds of enhancements.
Mr. Dent. I appreciate your willingness to work with the
airport on this issue. Because quite understandably, the
community does become quite alarmed when they hear about runway
expansions or relocations or improvements. We raise quite a
public disturbance. Then when the funding is not available, the
question becomes, why are we going through the process.
Ms. Blakey. Well, again, RSAs are a very high priority. So
we would certainly want to work with you to see what we can do
to address the specifics there.
Mr. Dent. Thank you, and I will take you up on that offer.
Mr. Costello. The Chair recognizes the gentleman from
Missouri, Mr. Carnahan, for five minutes.
Mr. Carnahan. Thank you, Mr. Chairman, and welcome to the
panel. It looks like we have had a good discussion here today.
I really want to focus on the issue, as you mentioned,
numerous times, that safety was a primary concern, as it should
be. I think we all agree with that.
But there is an issue, I think, with regard to our air
traffic controllers that is really a vital part of that safety
mission. In my home State of Missouri, we have 163 air traffic
controllers, 38 of those at St. Louis TRACON. They are
essential to me, my family, all of us that fly, the flying
public. They have had a long history and service to aviation,
with new technologies. Their training and retention is going to
be even more important.
But I have a serious concern that many of us here on the
Committee do of a lack of a contract, the high rate of
retirements, and really their poor treatment and work
environment. I think that all those things combined are a
safety concern.
With regard to retention and recruitment, my question is
really, what can you do, what do you plan to do to improve the
work environment, the morale, the professional treatment of our
air traffic controllers to be sure that we can retain and
recruit and train those that we need for the future?
Ms. Blakey. Congressman Carnahan, I could not agree with
you more that our air traffic controllers are an absolutely
vital aspect of the safety of our system. They are consummate
professionals and they do a terrific job every day. We are
working very hard to ensure that the work environment, the
circumstances in which they are trained and recruited, are all
such that we will have the best and the brightest coming into
the system, as well as holding onto the veterans that we have.
That is why we did not change the compensation for our veteran
workforce in terms of reducing what is a very generous salary
structure right now. On average, with salary and benefits, our
current controller workforce makes over $170,000 a year.
Let me talk to you a moment about new recruits, because I
am sure you are concerned about how they come into the system.
We have over 2,000 people who have volunteered and qualify that
on the list, wanting to come in to become air traffic
controllers, right now. At the end of the first year, on
average, their compensation, cash compensation, and I am not in
this case including the retirement benefits, will be on average
$50,000. That is after the first year. After five years, they
are going to hit just short of $95,000, cash compensation.
Now, as you can imagine, because I am sure looking at your
overall constituents' workforce, it is not difficult to recruit
people with that compensation. But I do want to assure you that
in terms of work rules, in terms of basic fairness, in terms of
the best technology for training and the best technology for
them to work with, that is one of the great reasons we are so
concerned about moving to the Next Generation system. Because
we do see that the constraints in the system and the
requirements that are going to be placed on controllers, we
have to move to the new technologies and provide them with all
the tools they are going to need to do the job that is really
vital to all of us.
Mr. Carnahan. And do you see that anything additional can
be done or should be done to really help to improve that
overall environment?
Ms. Blakey. Well, certainly. I can tell you this: when I go
into a brand new facility and our controllers are in a brand
new tower and they have all of the best equipment, that is
obviously a terrific boon to them. And we are working very hard
to address those kinds of capital investments as we go along.
We also are making significant changes to training, so that
we actually have simulators, just like pilots use, in some of
our terminal facilities now. And we are making a much greater
use of simulators in Oklahoma City, which is where our recruits
and our Academy is. There are a number of things we are trying
to do from that standpoint.
But I will also assure you of this: we will be working with
NATCA because we see the controllers union having a very
important role to play in terms of advising us. We can make
changes that improve the work environment and improve morale.
We are going to be working closely with them in the weeks and
months and years to come. That is a commitment that is there
and Pat Forrey and I have met on a number of occasions to
discuss concerns that they have with the new contract and
things we might do to again make improvements that will make a
real benefit and a different style workforce. We are very
interested, believe me.
Mr. Carnahan. Well, I would encourage that dialogue. Again,
I think it is in all of our interests, and certainly the flying
public to maintain that confidence, to maintain that work
environment. Because they do need to make those kinds of split
second decisions in their work that we all depend on. So thank
you very much.
Mr. Costello. I thank the gentleman.
At this time, Mr. Petri, I have a few remaining questions
and then we will ask you if you have questions. There are no
other members requesting time.
Dr. Dillingham, in your testimony, and we all have clearly
documented, and I think the FAA has acknowledged that they
experienced a higher rate of retirements from the air traffic
controllers than expected. In your work, have you identified
any factors that might have contributed to that situation,
specifically the lack of a contract or the contract that has
been imposed by the FAA or any other factors?
Mr. Dillingham. Mr. Chairman, I think the discussion that
was just completed supports the information that we have, as we
looked into why the retirement sort of popped up the last
couple of years, and that is, there was some dissatisfaction
with the agreement, as well as the work rules that are being
implemented at this point in time.
Mr. Costello. Any other factors that you would want to
point to?
Mr. Dillingham. No, that was the main factor that was
pointed to.
Mr. Costello. So that was the major factor. Very good. The
next question, on the Administration's proposal of $2.75
billion for the AIP program, I wonder if you might talk about
the implications of if the Congress adopted $2.7 billion for
the AIP, what are the implications for the small airports in
this Country?
Mr. Dillingham. Mr. Chairman, we are at sort of a
disadvantage, because we have not been able to see the proposal
that was submitted earlier this morning. But generally, from
what we understand, the large and medium hubs will do all
right. They will be able to find support for their
infrastructure development through the private sector. It will
be the smaller airports that would be most affected by it.
But again I say, we don't have the full picture in terms of
the other elements that are in the proposal that might mitigate
some of those effects on small airports. I want to point out
though that small airports are really going to be important in
the coming years, because as we look toward bringing in VLJs or
very light jets, as we look toward making better use of the
airports that we have, those small airports and regional
airports are going to assume increasing importance.
Mr. Costello. Very good. Thank you.
Administrator Blakey, this is the last question I have.
This is on the 2008 financing part of the budget proposal. But
I want to ask one more question, because you had talked about
going to the hybrid user fee financing proposal. You mentioned
about flexibility. I wonder if you might talk about, you have
said a couple of times that revenue versus cost, you have to
generate the revenue to meet your costs. And then you also
talked about flexibility. I wonder if you might define what you
mean, the flexibility in the hybrid system.
Ms. Blakey. The intent we had in creating the system, and
this is from working very closely with this Committee and with
the Congress, as well as the stakeholder community, is to put
forward an annual budget that will cover the costs of the
operation of the system, very precisely, and will also cover
the costs of making the capital investments that are needed as
we ramp up to the NextGen system. We see the stakeholder
community having a huge involvement there, and there is a new
stakeholder board that has real responsibility in all of this.
And again, Congress has the exact same oversight that they do
now, and we would be working very closely together through the
appropriations process, as well as through the authorizing
process, to ensure that we are sensitive to the kinds of
concerns that have been expressed today.
But the cost in the revenue, therefore, can be tied on a
fee system on an annual basis. You simply adjust those, using
the cost allocation. If they don't need to be adjusted, fine.
If the unit costs go down, that is great. If they have to go
up, they have to go up. The tax system, the fuel tax system is
not quite as flexible as a fee system. But what we are
proposing is on an every two year basis to be able to make
adjustments to that, to match as closely as possible, again,
the costs that that portion of the community is imposing on the
system. That is the kind of flexibility I am referring to.
Mr. Costello. You mentioned about the users being involved
and you mentioned about Congressional oversight. I think that
there are some people who are very concerned about who will
have the final say in increasing fees. In other words, if the
next generation costs are not contained and they continue to go
up, does that mean that the FAA continues to raise fees for the
users to meet those costs?
Ms. Blakey. I don't think there is any way you get to
NextGen without it being a collaborative engagement with the
stakeholder community. There is too much of it, frankly, that
involves their own decisions, equipage and other things. For
example, on ADS-B, we will be proposing a rulemaking this fall,
an NPRM, that will go to how fast do you all feel that you can
equip and how quickly should we require the capability to fly
with ADS-B.
Those are collaborative decisions that have to be made
together. And they have to be made with the full work and
analysis that this Committee and others will apply. So there is
no way to make this an arbitrary decision on the part of
bureaucracy at 800 Independence Avenue. We have established,
and I think really grown in, a cooperative engagement with the
aviation community in a way that really is making a tremendous
partnership there. That is what the NextGen is going to
require, and that will determine how fast you make those
investments.
I will tell you this, though_I think we also need to
recognize the international environment in which we are
engaged. U.S. leadership, U.S. technology has always been at
the forefront in aviation. Europe is moving out smartly on
their generation of the NextGen, SESAR. They are proposing very
similar costs to the kind that we are projecting ourselves.
Others around the world, Australia is already moving to ADS-B.
We can't really sit back and sort of dither and say, well, we
are not able to figure this out and we can't get our financing
together, because we will be left behind and those technologies
and those standards and those approaches will begin to really
drive it. That is an environment that we cannot change, and
that is happening.
So it is not just the tremendous congestion that we are
facing, that billion passengers by 2015, but it is also the
world in which we are living.
Mr. Costello. I guess the point that I am making, that
everyone is concerned about that I have heard from about user
fees is the flexibility to raise those user fees and the
incentive to control costs, if in fact you increase the user
fees to match whatever your costs are. So that is a point that
I wanted to make for the record, and that I have heard from
many people who are concerned about turning this system over to
a user fee system and giving the agency and others the ability
to increase user fees at any time to match the costs.
At this time, I would recognize the Ranking Member, Mr.
Petri for any questions or comments he may have.
Mr. Petri. Thank you, Mr. Chairman. I have just a couple
quick questions. The first is for Inspector General Scovel. We
have been talking about cost-based user fees. My question is,
does the FAA have a cost accounting system and a cost
allocation system capable of supporting the development of
cost-based user fees currently?
Mr. Scovel. Sir, as I noted in my opening statement, FAA
does have a cost accounting system. It is designed primarily to
support management decisions regarding performance. We believe
that in its present configuration, this cost accounting system
may not meet all user fee requirements. We can cite, I can cite
one example for you, sir, and that is that FAA is proposing to
charge airlines for services provided at the 30 largest
airports, for instance. Some of those airports house both the
air traffic control tower and the associated TRACON, the
terminal radar approach control facility. In that case, the
cost accounting system assigns costs to the joint facility
without distinguishing, as I understand it currently, without
distinguishing tower services from TRACON services, even though
that TRACON may support several airports.
If deemed to have a significant impact on user fee
calculations, we would recommend that FAA revise that aspect of
the cost accounting system. There may well be other instances
which my staff and I have not yet had an opportunity to
address. But we would be happy to work on that for the
Committee's benefit, sir.
Mr. Petri. I would be interested in, perhaps, if you have
some recommendations or concerns that we can get. What
resources are available and geared up to go ahead and get
things in place? Because we are going to be arguing a lot, and
then we will put something in effect, and it may be stuff that
won't really--you know what I am saying, we will be getting
ahead of ourselves.
Mr. Scovel. And I don't mean to say that it cannot be done.
I am simply saying that in its current configuration and
certain specific aspects, it may not support user fee
calculations. So looking ahead, and as FAA fine tunes its
proposal, we would expect that the agency would be able to
address those points.
Mr. Petri. And then I guess my last question is for Dr.
Dillingham. I just would be interested if you could give us
your own, if you have done it, your projection as to the growth
of corporate aviation, where you have an assessment or a figure
as to what you expect that growth to be. There are new
companies out there with new planes.
Mr. Dillingham. We have not looked specifically at the
growth of corporate aviation. However, linked to your last
question, we are right now conducting an analysis of the cost
allocation system that FAA is using with regard to the user fee
proposal. As a part of that, we are examining part of the basis
of that cost allocation system, which includes the number of
different types of GA aircraft that traverse the system, the
corporate aircraft as well as the turbine. So to that extent,
we will have some information reporting to this Subcommittee
shortly about the point you just asked.
Mr. Petri. Very good. Thank you.
Mr. Costello. I thank the Ranking Member. And I thank our
witnesses today for appearing before us.
I will give you a last opportunity to make a comment. I see
the Administrator is about to come over the table. She has
something to say. So I will give you the opportunity to make a
brief statement if you would like.
Ms. Blakey. Well, I wish I had the energy at this point to
come over the table. I am not quite sure that I could manage
that.
But I did just want to add one thought. We are looking
forward to briefing you all, briefing the staff at length on
the cost accounting methodology and all the details there. And
certainly, there may be some fine tuning that should be
required before we move forward.
What I would say, though, is that our last audit did say
that the cost accounting system that we have is suitable for
use in terms of a user fee system. We do believe that when you
get down to 600 different units that we are analyzing that
there is a tremendous amount of granularity and accuracy here
that we believe can be relied on. So we will be working very
carefully with you all to make certain that that is all
transparent.
The final point I would make, Mr. Chairman, is that in
terms of the flexibility that you mentioned, I think it is
important to note that we are talking about a system which
requires the FAA to be very transparent, very accountable for
its costs in a way we don't have to be now. So there is
downward pressure on costs, and there is real accountability.
That is one of the great advantages in a system where we are
cost-based and fees are at stake. And every year we have to, as
you say, open our books and be accountable. And if people don't
want to pay for the services that we are providing at the cost
we are providing, then we have got to really work with that
concern on the part of the customer stakeholders. So it is a
two-way street.
Mr. Costello. I did not intend to comment, but I think I
have to at this point. I won't go into some of my past
experiences, but frankly, the users have no place else to go.
It is not like they can shop around. They either get the
services from you or they stay on the ground. But I appreciate
your comments.
Dr. Dillingham?
Mr. Dillingham. Just a couple of things, Mr. Chairman. I
think it certainly is important to recognize that regardless of
the funding mechanism that the Congress eventually approves, it
is very important that some kind of reauthorization take place
within a timely manner. We certainly, we don't have that
cushion to fall back on as we have in the past. I think it is
important to recognize that the way FAA has been able to manage
its acquisitions over the last three years is important as we
move forward into the next generation. Because that is going to
have a lot of acquisitions as well. The linkage there is the
leadership or the cultural change agents, that have brought FAA
to this point have a very short time left. The Administrator's
tenure is short, and we know that Mr. Chew is leaving very
soon. And that kind of leadership gap can definitely have an
effect on the ability of the agency to keep moving forward and
not sort of fall back to where it was in past decades. So I
think it is important from both of those perspectives.
Mr. Costello. Thank you. Mr. Scovel?
Mr. Scovel. Thank you, sir. If I may make tow points, and I
will make them brief. To respond to Mr. Graves, sir, I regret
if my opening statement left the impression with Mr. Graves or
with any other member of the Committee that I cited the ComAir
accident, that unfortunate event, as a commentary on the
controllers' performance on that morning. I did not intend
that. I think you were correct, sir, when you interpreted my
remarks, sir, simply as highlighting the importance of safety,
in the fact that that event was a reminder to all of us of the
importance of that.
I should say that NTSB, of course, has the primary
responsibility for investigating that accident, not my office.
Although we have undertaken an examination of FAA's policy
regarding two controllers in the tower rule and how it was
implemented at Lexington and other facilities during the time
period in question.
My second point, sir, refers back again to the cost
accounting system. And to clarify a point attempted to be made
by both me and Ms. Blakey concerning the audit, as the officer
in the department responsible for the department's audits, it
is my understanding that the audit supports the conclusion that
the cost accounting system is sufficient to assign costs within
or to service delivery points. It is rather a fine point, but
it is one that I think needs to be made. Because when we are
talking about user fees, that is really the next step down the
line. Once we have assigned costs to service delivery points,
then how are those costs to be allocated among users. And the
audit itself did not address that question.
My earlier comments regarding the cost accounting system
had to do with its present configuration, how it might support
user fees and my opinion as stated, sir, was that while there
may be some points that need fine tuning, as Ms. Blakey said,
it is largely sufficient to do that. But we would urge the
agency and the Committee, of course, to examine that question
carefully.
Mr. Costello. There is an advantage to going last.
[Laughter.]
Mr. Costello. I thank the witnesses for being here today
and there is no further business before the Subcommittee, so
the hearing is adjourned. Thank you.
[Whereupon, at 4:30 p.m., the subcommittee was adjourned.]
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