[House Hearing, 110 Congress]
[From the U.S. Government Publishing Office]
THE FEDERAL AVIATION ADMINISTRATION'S OVERSIGHT OF OUTSOURCED AIR
CARRIER MAINTENANCE
=======================================================================
(110-23)
HEARING
BEFORE THE
SUBCOMMITTEE ON
AVIATION
OF THE
COMMITTEE ON
TRANSPORTATION AND INFRASTRUCTURE
HOUSE OF REPRESENTATIVES
ONE HUNDRED TENTH CONGRESS
FIRST SESSION
__________
MARCH 29, 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
Barimo, Basil J., Vice President, Operations and Safety, Air
Transport Association of America, Inc.......................... 32
Brantley, Tom, President, Professional Airways Systems
Specialists, AFL-CIO........................................... 32
Campbell, David, Vice President for Base Maintenance at Alliance
Fort Worth and Kansas City, American Airlines.................. 32
Filler, Marshall S., Managing Director and General Counsel,
Aeronautical Repair Station Association........................ 32
Goglia, John J., Director, Center of Integrated Emergency
Management, Parks College of Engineering, Aviation and
Technology..................................................... 32
Little, James C., International President, Transport Workers
Union.......................................................... 32
Sabatini, Nicholas, Associate Administrator for Aviation Safety,
Federal Aviation Administration, Accompanied by: James J.
Ballough, Director, Flight Standards Service, Federal Aviation
Administration................................................. 5
Scovel III, Hon. Calvin L., Inspector General, United States
Department Of Transportation................................... 5
Valeika, Raymond, Independent Aviation Advisor................... 32
PREPARED STATEMENTS SUBMITTED BY MEMBERS OF CONGRESS
Carnahan, Hon. Russ, of Missouri................................. 51
Cohen, Hon. Steve, of Tennessee.................................. 52
Costello, Hon. Jerry F., of Illinois............................. 53
Johnson, Hon. Eddie Bernice, of Texas............................ 56
Kagen, Hon. Steve, of Wisconsin.................................. 61
Matsui, Hon. Doris O., of California............................. 62
Mitchell, Hon. Harry E., of Arizona.............................. 63
Oberstar, Hon. James L., of Minnesota............................ 68
Salazar, Hon. John T., of Colorado............................... 71
PREPARED STATEMENTS SUBMITTED BY WITNESSES
Barimo, Basil J.................................................. 72
Brantley, Tom.................................................... 84
Campbell, David.................................................. 94
Filler, Marshall S............................................... 99
Goglia, John J................................................... 115
Little, James C.................................................. 120
Sabatini, Nicholas............................................... 128
Scovel III, Hon. Calvin L........................................ 137
Valeika, Raymond................................................. 155
SUBMISSIONS FOR THE RECORD
Filler, Marshall S., Managing Director and General Counsel,
Aeronautical Repair Station Association, FAA Repair Stations on
Foreign Soil by Country Code Listing........................... 113
ADDITIONS TO THE RECORD
Federal Aviation Administration, Aviation Safety/Flight Standards
- Repair Station Inspections and Results, response to request
for information from Subcommittee.............................. 163
International Federation of Professional and Technical Engineers
AFL-CIO & CLC, remarks of Louis Lucivero, Vice President, IFPTE
Local 20....................................................... 226
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HEARING ON THE FEDERAL AVIATION
ADMINISTRATION'S OVERSIGHT OF OUTSOURCED AIR CARRIER MAINTENANCE
----------
Thursday, March 29, 2007
House of Representatives,
Committee on Transportation and Infrastructure,
Subcommittee on Aviation,
Washington, DC.
The Subcommittee met, pursuant to call, at 10:00 a.m., in
Room 2167, Rayburn House Office Building, the Honorable Jerry
F. Costello [Chairman of the Subcommittee] presiding.
Mr. Costello. The Subcommittee will come to order. The
Chair will ask all Members, staff and everyone in the room to
turn off electronic devices or turn them on vibrate.
The Subcommittee is meeting today to hear testimony on the
Federal Aviation Administration's oversight of outsourced air
carrier maintenance. Let me say that the Chair will give an
opening statement. We will call on the Ranking Member for his
opening statement or comments.
I want to make note of the fact that the Ranking Member
takes his responsibilities so seriously with this Subcommittee
that instead of going to the White House this morning, he is
here to hear your testimony. We appreciate Mr. Petri being
here.
I welcome everyone to this hearing on the Federal Aviation
Administration oversight of outsourced air carrier maintenance.
This hearing is the first in a series of hearings on aviation
safety and the Federal Aviation Administration's oversight of
outsourced maintenance.
Although the United States has the safest air
transportation system in the world, we must not be complacent
about our success. The Department of Transportation's Inspector
General lists aviation safety, performing oversight that
effectively utilizes inspection resources and maintains
aviation system safety, as one of the Department of
Transportation's top 10 management challenges. Over the last 10
years, there is a growing trend by airlines looking to trim
costs to outsource their maintenance work to both domestic and
foreign repair stations.
The DOT IG will testify today that over the last 10 years,
air carriers continue to increase the percentage of costs spent
on outsourced maintenance from 37 percent to 62 percent in that
10 year period. The IG also notes that more and more work is
being outsourced to foreign repair stations.
A July 2005 Wall Street Journal article stated that U.S.
carriers pay between $65 and $75 per hour, including wages and
benefits, while outside repair stations in North American,
Europe and Asia pay about $40 to $50 an hour, and Latin
American repair stations pay as little as $20 to $26 an hour.
As a result, U.S. airlines are relying more heavily on foreign
contractors to perform everything from routine maintenance to
major overhauls. We must make certain that the FAA has a sound
system to oversee maintenance work conducted outside the United
States.
According to the FAA, there are 4,231 domestic and 697
foreign FAA-certificated repair stations with approximately 801
FAA safety inspectors overseeing them. Both the DOT IG and the
Government Accountability Office have expressed concerns about
potential attrition in the FAA's inspector workforce. I am told
that over one-third of the FAA inspectors will be eligible to
retire by the year 2010. I am also told that since the end of
fiscal year 2006, the FAA has already lost 77 inspectors.
In addition, I am concerned about the level of staffing in
the FAA's international field offices, which are responsible
for overseeing foreign repair stations. The Singapore IFO only
has 7 inspectors to oversee 103 repair facilities. In September
of last year, this Subcommittee held a safety hearing where we
had Mr. Sabatini who testified, among others. I asked the
question at that time if in Mr. Sabatini's opinion we had
adequate inspector staffing in Asia out of the Singapore office
to inspect the 103 repair facilities. The answer was that we
could always use more staff, but we have adequate staffing.
When I asked the question, can you in fact tell this Committee
that each of those facilities, the repair stations, the 103,
had a physical visit, on-site visit by one inspector in a 12
month period, he could not say that that was the case. When I
asked if he could testify that those 103 facilities at least
had a visit, physical visit, one time in a 2 year period, a 24
month period, he could not state that they had.
There is no question that we must make the investments in
the FAA's work force now, so that they can meet the new
challenges for maintaining the highest level of safety in this
changing aviation environment, including ensuring proper
oversight of domestic and foreign repair stations. 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.
It is incumbent upon the FAA to act on this recommendation, so
that we can have a sufficient number of inspectors in the right
places.
Over the last few years, the DOT IG has made several
recommendations with regard to the FAA's oversight of foreign
and domestic repair stations, suggesting that inspectors focus
their oversight on high-risk areas. The FAA has since moved to
a high-risk based system for maintenance oversight. But full
implementation has not happened yet.
In a December 2005 report from the DOT IG, they found that
an increasing amount of scheduled airline maintenance is being
performed at non-certificated repair facilities and that the
FAA was unaware of the extent of this practice. Non-
certificated facilities are not required to meet the same
standards, such as quality assurance and training programs, as
certificated FAA repair stations. The DOT IG made a
recommendation to the FAA that it should consider limiting the
type of work that these contractors can perform. I look forward
to hearing from both the IG and FAA on the progress of that
recommendation.
The FAA inspector workforce has also raised concerns about
staffing and insufficient funding for travel and their impact
on conducting inspections, as well as moving to a risk-based
oversight system. Mr. Tom Brantley, the President of the
Professional Airway System Specialists, PASS, represents the
FAA safety inspector workforce. He is here today and we will
hear from him in greater detail about these concerns as he
testifies on the second panel.
Some have suggested that perhaps moving to some form of a
standardized maintenance practice might improve safety. Each
airline has different standards for maintaining their aircraft
with repair stations required to perform their maintenance work
in accordance with each individual air carrier's manual and
maintenance program. I would like to hear from our witnesses as
to how they feel about moving to some type of a standardized
system.
In contrast to the growing maintenance outsourcing trend,
Mr. David Campbell from American Airlines has a commendable
story to tell, as American performs 100 percent of their own
heavy maintenance in-house. In addition, American has actually
in-sourced work and I think we will hear his testimony this
morning that in fact American will do about $175 million in
third party revenue this year. So we look forward to hearing
his testimony on quite a success story at American Airlines.
In March of 2005, a joint team from American's aircraft
maintenance and overhaul base in Tulsa announced a breakthrough
goal to generate $500 million in value creation which would
turn the maintenance facility base into a profit center. The
Tulsa base announced just last month that it had reached the
$501 million mark, exceeding its goal. American's innovation
and cooperation between the airline and its unions demonstrates
that in-house maintenance is working and is profitable.
We must provide proper funding, close oversight and real
standards of accountability to ensure that our aviation system
remains the safest in the world.
With that, I want to thank all of our witnesses for being
here today and I look forward to hearing their testimony.
Before I recognize the Ranking Member for his opening
statement, I would ask unanimous consent to allow two weeks for
all Members to revise and extend their remarks and to permit
the submission of additional statements and materials by
Members and witnesses. Without objection, so ordered.
At this time, the Chair would recognize the Ranking Member
for his opening statement or comments, Mr. Petri.
Mr. Petri. Thank you, Mr. Chairman. I appreciate your
holding this important hearing.
Today we will explore how air carriers conduct and the
Federal Aviation Administration oversees aircraft maintenance.
We are holding this hearing at a time when the Nation's
aviation system is the safest it has ever been in our Nation's
history.
Nevertheless, safety must be the number one priority for
this Committee, for the FAA, for the airlines and for repair
stations. Therefore, I look forward to hearing from
representatives of all these groups today.
It is no surprise that in reaction to and recovering from
September 11th, severe acute respiratory syndrome, increasing
air fuel prices, bankruptcies, a $35 billion net loss for 2001
through 2005 as well as other impacts to the marketplace, the
airline industry has made adjustment to how they conduct their
business. Due to aggressive restructuring, we have a leaner
airline industry, 800-plus fewer airplanes taken out of the
system, 28 percent fewer airline employees and 26 percent less
airline debt, sometimes through bankruptcy restructuring.
At the same time, the aviation industry has become one of
the most global-oriented markets in the world. U.S. carriers
buy foreign-manufactured aircraft and foreign air carriers buy
U.S.-manufactured aircraft. Both of the major commercial
aircraft manufacturers have component parts made all over the
world. The international influence of the industry is also
present in aircraft maintenance. Aircraft repair facilities are
a highly regulated and vital part of our economy, employing
over 195,000 people in each of our 50 States and approximately
697 foreign FAA-certificated repair stations. There are also
over 1,000 European aviation safety agencies, certificated
repair facilities, in our Country. Air carrier restructuring
has also seen a shift in how aircraft maintenance is conducted
by air carriers.
While reducing costs is one reason for the shift, an
argument is made that repair stations provide specialized
expertise in areas such as engine repairs that the air carriers
do not have in-house. According to the Bureau of Transportation
statistics, in 2005 combined major national and regional air
carriers, including cargo carriers, spent 35 percent of their
$13.8 billion maintenance spending on outside maintenance
companies. According to the National Transportation Safety
Board, since 1997, only 8 percent of all commercial, commuter
and on-demand air carriers accidents were attributable, at
least in part, to maintenance issues.
Representatives of the FAA and air carriers are here today
to explain how maintenance oversight for both domestic and
foreign repair stations is conducted in light of the changing
and internationalized marketplace. I understand that in the
past there have been some questionable maintenance practices at
facilities, both in the United States and elsewhere. Obviously,
the FAA should take appropriate and swift action in these
situations, and I look forward to hearing how they address such
situations.
Likewise, I hope to gain better understanding of the
allegations that the FAA does not have the manpower to inspect
repair stations, particularly foreign repair stations. While
these issues are not new to the Subcommittee, it is important
that we receive periodic updates from the FAA and the industry,
particularly in light of the changing marketplace.
I look forward to hearing the witnesses' testimony, and Mr.
Chairman, I yield back whatever time I have remaining.
Mr. Costello. I thank the Ranking Member for his opening
statement.
Let me say to all Members that we did a unanimous consent
request to enter opening statements into the record and we
would ask you to do so. Is there any Member at this time that
has an opening statement they want in the record? Mr. Carnahan,
I understand you have a statement that you will enter into the
record.
Mr. Carnahan. Yes, Mr. Chairman, thank you.
Mr. Costello. Thank you.
Let me introduce our first panel of witnesses. Mr. Nick
Sabatini, who has been with us many times, is the Associate
Administrator for Aviation Safety at the FAA. He is here and
has brought another valued member of his team at the FAA, Mr.
Ballough. We also have the Inspector General of the U.S.
Department of Transportation, who has testified before this
Committee before, Mr. Scovel.
I would ask at this time, Mr. Sabatini, you will be
recognized. Your full statements all will be entered into the
record. We have your statements and I have had an opportunity
to review them. So we would ask that you summarize your
statements in five minutes or less, so that we can have plenty
of time for questions from Members.
So at this time, Mr. Sabatini, you are recognized.
TESTIMONY OF NICHOLAS SABATINI, ASSOCIATE ADMINISTRATOR FOR
AVIATION SAFETY, FEDERAL AVIATION ADMINISTRATION, ACCOMPANIED
BY: JAMES J. BALLOUGH, DIRECTOR, FLIGHT STANDARDS SERVICE,
FEDERAL AVIATION ADMINISTRATION; THE HONORABLE CALVIN L.
SCOVEL, III, INSPECTOR GENERAL, UNITED STATES DEPARTMENT OF
TRANSPORTATION
Mr. Sabatini. Good morning, Mr. Chairman Costello,
Congressman Petri, Members of the Subcommittee. As you said, I
am assisted here today by Jim Ballough, the Director of the
Flight Standards Service.
I am pleased to appear before you once again, this time to
discuss FAA oversight of air carrier maintenance that is
outsourced to repair stations, both domestically and abroad. I
know the industry trend to outsource more of its maintenance in
recent years has been a concern for some of you. The concern is
that carriers are making maintenance decisions to cut costs,
and that less costly maintenance is less safe maintenance.
This assumption implies that safety is being compromised as
more maintenance is being outsourced. I am here today to
reassure you that the quality of maintenance is not compromised
simply because it is not being done by an air carrier. No less
an authority that the former Department of Transportation
Inspector General, Ken Meade, testified before Congress that
use of these stations is not a question of quality of
maintenance, but rather an issue of oversight. We agree, which
is why the FAA is continually improving and refining our
oversight of maintenance, no matter where it is performed or by
whom.
Let me start by stating the obvious: the system is safe. As
the Subcommittee well knows, this is the safest period ever in
the history of aviation. Even so, our goal as always, is to
continue to improve safety. I would like to share with you a
chart that goes to the hearing of this hearing. The lines
represent the percentage of maintenance that is being
outsourced and the accident rate per 100,000 departures. I
think this picture is worth 1,000 words.
Although the percentage of outsourcing has never been
higher, the accident rate has never been lower. These
statistics amply demonstrate that aviation safety is not
dependent on airlines performing their own maintenance. In
recent years, we have refined the way in which we provide
maintenance oversight. Previously, our oversight was based
largely on inspector knowledge and information that was
available as a result of individual inspections. This approach
was the best we could do at the time, but it was far from
comprehensive. The effectiveness of our oversight could vary
from facility to facility.
What we are doing now is managing risk and requiring system
safety. Let me explain what I mean by system safety. System
safety is extremely comprehensive. It is a sophisticated
approach to ensuring that everything is in place to obtain the
information that can identify areas of vulnerability in time to
address it before safety is compromised. It must be clear who
is responsible for different aspects of the operation. The
responsible person must have the authority to take necessary
action. There must be procedures in place to execute required
actions. There must be controls in place to ensure that the
system consistently provides the service or product it was
designed to produce.
There must be oversight and auditing procedures in place to
independently evaluate the effectiveness and consistency of the
operation. And lastly, there must be interface procedures in
place to ensure that different parts of the organization are
effectively talking to each other. Consistency is the goal.
I would now like to turn my focus to foreign repair
stations, because I know they have been of particular interest
to this Subcommittee. As is the case with domestic repair
stations, there is an incorrect perception that a carrier's use
of a foreign repair station is somehow unsafe or done solely to
reduce maintenance costs. I know there have been a number of
efforts to restrict U.S. air carriers' ability to use foreign
repair station.
But I do not believe that these efforts would enhance
safety. The foreign repair station must meet the same standards
that we apply to repair stations in the United States, or we
will simply not certify them. Safety is addressed because we
require that all aircraft that are registered in the United
States be maintained to U.S. standards, regardless of where
they operate. Due to the global nature of aviation, we must
have repair stations that meet U.S. standards throughout the
world.
Finally, keep in mind, as is the case when a carrier uses a
domestic repair station, the carrier has the ultimate
responsibility to ensure that the maintenance is being
performed appropriately. All of this adds up to a great deal of
supervision. The repair station has internal controls, foreign
government oversight, airline oversight and FAA oversight. In
fact, it is important to remember that by its nature, aviation
is truly an international enterprise.
An aircraft, especially in commercial aviation, contains
parts manufactured all around the world. The original equipment
manufacturer, the OEM, has a wealth of expertise in repairing
their products. In addition, their parts have warranties. It
would be extremely unwise to restrict a U.S. air carrier's
ability to use OEM maintenance, even if the OEM is abroad. In
fact, the expertise of OEMs is so considerable and their work
so consistent that maintenance is often outsourced to them
regardless of whether the maintenance being performed is on a
part they manufacture.
Just as aviation safety is in no way compromised by
allowing U.S. carriers to fly aircraft made in Europe and
Brazil or in Canada, so too is safety in no way compromised by
allowing other countries to conduct repair and maintenance on
our aircraft. I understand and appreciate this Subcommittee's
concern about the increased use of repair stations in this
Country and abroad. Obviously, we share a common goal to find
ways to improve safety at a historically safe period in U.S.
aviation.
I can assure you that my office is totally committed to
making whatever adjustments the situation demands when it comes
to safety oversight. Hearings like the one today are a
necessary dialogue. I think the refinements we have made to how
we oversee maintenance in recent years are good ones. But we
cannot sit still. There will always be ways to improve, and we
will continue to look for them.
This concludes my statement, Mr. Chairman. I will be happy
to answer your questions at this time.
Mr. Costello. We thank you, Mr. Sabatini. Are you prepared
to make a statement as well, Mr. Ballough?
Mr. Ballough. No, Mr. Chairman.
Mr. Costello. Very good. The Chair then recognizes the
Inspector General, Mr. Scovel.
Mr. Scovel. Chairman Costello, Ranking Member Petri,
Members of the Subcommittee, we appreciate the opportunity to
testify this morning. At the outset, it is important to note
that while the United States has the most complex aviation
system in the world, it is also the safest. Multiple layers of
controls and air carrier operations and maintenance process,
along with FAA's oversight, are largely responsible for the
high level of safety that we have seen in the last five years.
Air carriers have outsourced maintenance for years, because
external repair facilities can complete repairs for less cost
and provide services such as engine repair that would otherwise
require air carriers to have specialized expertise and staff.
However, in recent years, the use of external repair
facilities by air carriers has become prevalent. From 1996 to
2005, nine of the largest air carriers increased the percentage
of their outsourced maintenance from 37 percent to 62 percent,
or nearly $3.4 billion of the $5.5 billion spent on
maintenance.
Mr. Chairman, it is important to note that the issue is not
where maintenance is performed, but that maintenance requires
effective oversight. Our past efforts have identified
challenges in FAA's ability to effectively monitor the increase
in outsourcing. For example, in July 2003, we reported that FAA
had not shifted its oversight of aircraft maintenance to the
locations where maintenance was being performed. FAA has taken
a number of steps to improve its oversight.
However, the continuous growth in outsourcing underscores
the need for FAA to remain vigilant in its efforts to
continually improve oversight. Today I would like to discuss
three areas for strengthening FAA's oversight of outsourced air
carrier maintenance.
First, advancing risk-based oversight systems. FAA
recognizes the challenges posed by increased outsourced
maintenance, and has taken steps to move its oversight for air
carriers and repair stations to risk-based systems. Both
systems are designed to help FAA inspectors focus their
oversight on areas that present the greatest safety risks,
based on analysis of data. FAA is clearly on the right path.
However, the risk-based systems are not yet at an end
state. FAA's risk-based system for air carriers must be more
comprehensive. In March 2006, FAA issued new guidance to aid
inspectors in evaluating air carrier changes. By the end of
this year, FAA plans to complete implementation of this risk-
based system to all carriers. Currently on 57 of the 118
commercial air carriers are subject to it. As more air carriers
are added, effective use of the risk-based system will become
even more important.
In September 2006, FAA began using an automated risk-based
oversight system for repair stations. To avoid repeating the
implementation problems experienced with its air carrier
system, FAA must ensure that inspectors are well trained on the
new system and effectively use it to oversee repair stations.
Second, FAA must determine where the most critical
maintenance is performed and how it should be monitored. FAA
cannot effectively implement a risk-based system for oversight
of aircraft maintenance if it does not know where the
maintenance is performed. In July 2003 and December 2005, we
reported that FAA did not have good systems for determining
which repair facilities air carriers were using to perform
their most critical maintenance.
There are over 4,000 domestic and nearly 700 foreign FAA-
certified repair stations. In addition, there are about 900
repair facilities in Canada that can be used by U.S. carriers.
Air carriers also use domestic and foreign non-certificated
repair facilities. In response to our 2003 report, FAA
implemented a system in fiscal year 2007 for air carriers to
report the top 10 critical maintenance providers used each
quarter. However, this process is ineffective, in our
estimation, because the reports are voluntary and FAA does not
have inspectors to verify that information. As long as the
process is voluntary, FAA cannot be assured that it is getting
the accurate and timely information needed to determine where
it should focus its inspections.
FAA must also develop a mechanism to identify non-
certificated repair facilities performing critical maintenance
for air carriers. Prior to our December 2005 review, FAA was
unaware that air carriers were using non-certificated
facilities to perform critical repairs, such as engine
replacements. FAA does not know how many non-certificated
maintenance facilities air carriers currently use. In our
review, we sampled 19 air carriers and found that all 19 were
using non-certificated facilities to some extent. FAA must
determine which non-certificated facilities perform critical
and scheduled maintenance and then decide if it should limit
the type of work these facilities perform.
Mr. Chairman, if I may ask for another minute? Thank you,
sir.
Third, ensuring inspectors are well positioned and properly
trained to adequately oversee maintenance outsourcing. FAA has
approximately 3,865 inspectors located in offices throughout
the United States and in other countries to oversee air carrier
maintenance operations, a task made more difficult by the
rapidly changing aviation environment. This makes it imperative
for FAA to maintain a sufficient number of inspectors to
perform safety oversight. By 2010, 44 percent of the work force
will be eligible to retire.
However, maintaining an adequate work force is only one of
the challenges FAA faces with its inspectors. FAA needs a
process for determining the number of inspectors needed and
where they should be placed. We found some inspectors were not
assigned to locations where they were needed most and we also
found inconsistencies in inspector work loads.
At the request of this Subcommittee, in September 2006, the
National Research Council completed a study of FAA's current
methods for allocating inspector resources. The Council found
FAA needs to develop an effective staffing model. The Council
stressed that FAA must ensure that its safety inspectors are
sophisticated data base users with knowledge of system safety
principles and an analytical approach to their work.
This concludes my statement, Mr. Chairman, and I would be
happy to answer any questions that you or other Members of the
Subcommittee may have.
Mr. Costello. We thank you for your testimony.
Mr. Sabatini, before I ask some questions, let me respond
to a comment you made in your opening statement. You indicated
that there is a perception that foreign repair stations are not
safe and that you would contend that they in fact are. Let me
just say that, let me go back to the point that, I don't think
anyone is saying that there are repair stations that are
unsafe.
But the fact of the matter is that the last time you
testified before this Subcommittee, in September, when I asked
you the question, foreign repair stations, 7 inspectors for 103
facilities, could you tell this Subcommittee that in fact,
physically each of those 103 facilities received a physical
inspection on-site by an inspector at least one time in a year,
and you could not tell us that. And number two, when I asked
the question, could you in fact testify and tell this
Subcommittee that in a two year period that each of the three
facilities had an inspector on-site and you could not tell us
that.
So it leaves the impression, certainly to me, and I think
many others, that foreign repair stations do not come under the
same scrutiny as domestic repair stations here in the United
States. If it is because you do not have adequate staff, then
we ought to get to that point and try and address it.
But having said that, let me get into questions. We are
going to have, I understand, our first vote at 10:45. So I
would ask you, I have a series of questions, I would ask you to
be very brief if you could in your answers.
First, I am going to submit to you a list of questions and
ask you to give us a written reply to the Committee. I plan on
submitting several questions requesting data about foreign
repair stations, the inspections, on-site inspections,
locations of facilities and a number of other questions. We
will get those to you and ask that you respond to them in a
very short period of time.
Mr. Costello. My first question today though is, you have
heard the IG just state here again, he stated in his testimony
and stated here that the FAA has to develop a process to
determine where air carriers are sending their critical
maintenance. Without this maintenance information, where the
facilities are located, you cannot effectively come up with a
risk-based oversight system that works.
One, what have you done to identify, what has the FAA done
to identify where these foreign repair stations that are
performing critical maintenance are located?
Mr. Sabatini. Thank you, Mr. Chairman. We have done a
number of things, and we certainly welcome the recommendations
that are made by the Office of the Inspector General.
In a moment I would like to turn to Jim Ballough, the
Director of Flight Standards, to address the specifics in terms
of what we have done. But if I may, Mr. Chairman, on the points
that you made from my earlier testimony, my response was, as
you described it, accurately, sir, I will add, that in the
moment, while I believe personally that we do have FAA presence
on an annual basis, I did not have the data before me to answer
for the record that in fact we do.
Having followed up on that question, I can tell you that
today, we have at the very least, presence once a year at
repair stations. I would ask Jim to expand on that question you
asked.
Mr. Ballough. Mr. Chairman, in regard to the oversight of
foreign repair stations and our once, at least once a year
visit, there is a requirement on foreign repair stations to
renew for the first time after 12 months and then 24 months
thereafter. So that process is in place. We also have a
requirement which we call----
Mr. Costello. Let me interrupt you. I understand the
processes in place. But the question is, have in fact those
facilities had an inspector physically go to those 103
facilities at least one time in the first year and at least one
time in a two year period?
Mr. Ballough. Yes, Mr. Chairman. I can definitely state for
the record that we have a metric in place that our regions
review the amount of completion. I can tell you that the
activities for oversight of repair stations would indicate a 99
percent, without checking the data and presenting the data in
front of you, but I can tell you that our metric shows 99
percent completion of all of our required inspection items for
repair stations, yes, sir.
Mr. Costello. So your testimony is that those 103
facilities received at least one physical inspection by one of
the 7 inspectors in a 12 month period?
Mr. Ballough. Yes, Mr. Chairman, and I can provide that
data.
Mr. Costello. We would request that you please do that.
Let me follow up on that point. The data that you have at
the FAA as far as physical and on-site inspections, how far
does it go back? Is it your testimony that this has been a
process that has been taking place for some time or just in the
last year or so?
Mr. Ballough. The process has been in place for many years.
I rely, obviously, on our management and our inspectors to
fulfill the requirements that we put in front of them in
policy. So I would expect that that was carried out, yes. It
has been in place for years.
Mr. Costello. Just so I understand here. You are relying on
your managers, I understand that. Do you have records that
indicate where they have filled out forms or some type of
evidence that those facilities did receive a visit by an
inspector?
Mr. Ballough. Yes, we would have a record of that, sir.
Mr. Costello. How far do those records go back?
Mr. Ballough. I would say, the real time we could probably
provide five years worth of that information and archive, I
would say we could go back almost ten years.
Mr. Costello. I would request that you go back five years
and give us that data, to show us each facility, when they were
visited in the five year period. You can go ahead and continue
to answer the question that was posed to you by Mr. Sabatini.
Mr. Ballough. Okay, so that is the response to the
oversight we have of the repair station.
In terms of the recommendations the OIG made to us in their
two audits, we have concurred with those recommendations and
have resolved a number of them. Let me state that the
regulatory structure is in place today for us to know where
that work is done. The carrier is required to list in its
manual system every contract or every person that they arrange
to perform maintenance on their aircraft. It is true that our
inspectors don't have a copy of that in our field office.
However, at a request of the carrier, they can certainly review
that list and find out every carrier or every contractor that
that carrier uses.
Mr. Costello. Would you clarify that point for me? You were
saying that the process is in place for the FAA to know where
these facilities are located. But the question is, do you know?
Mr. Ballough. A field office could not identify where each
and every case, where that maintenance is performed, no, sir.
They would have to go to the carrier and ask, request to see
the list and go through the list themselves.
Mr. Costello. So you would rely on the carrier to tell you
where these facilities are located that are doing the
maintenance in foreign repair stations?
Mr. Ballough. The foreign repair station information we
would have, what I was referencing is all the contractors that
that air carrier users. We know every foreign repair station,
our data will show every foreign repair station and what
carrier uses that repair station. My previous reference was to
a non-certificated facility, sir.
Mr. Costello. The IG talked about the need for the FAA to
determine which non-certificated facilities are performing
critical and scheduled maintenance. Mr. Sabatini, what is your
response to that, and what have you done to implement their
recommendation?
Mr. Sabatini. Well, the Flight Standards organization,
under Jim's leadership, has undertaken positive steps to assure
that the carriers share that information with the local field
office. So we have procedures in place that are explicit,
sufficiently explicit to make it clear that a field office is
expected to know when they ask of an air carrier where these
certificated or non-certificated entities are located and what
type of work they are performing.
So to address just a little bit of what Jim was speaking
of, an air carrier certainly can contract for services either
with a repair station or another facility that performs certain
very specific functions, such as welding or coating of certain
components. We know where those are, and if we don't have an
active list at the point in time, we can certainly get it from
the air carrier. So an inspector can, at any time, require the
air carrier to provide that information.
Mr. Costello. Mr. Scovel, this will be my last question, at
least on this round. I have many others. There are other
Members who have questions.
Mr. Scovel, you just heard what the process is at the FAA.
Is that sufficient?
Mr. Scovel. Thank you, Mr. Chairman. No, we don't believe
it is. And if I may refer back to an earlier statement in this
hearing, it was offered for the record that domestic certified
repair stations and foreign certified repair stations have
equivalent standards in all respects. For the record, our
research shows that that is not the case, in fact, because
employees at foreign-certified repair stations are not
required, generally, to undergo drug and alcohol testing.
Employees at U.S.-based repair stations are required to undergo
that kind of testing, and we think it is a good idea. We
understand that for sovereignty reasons, it may not be entirely
possible to impose that requirement on repair stations in
foreign countries, but nevertheless, we would be in favor of it
in every case where it is possible.
To directly answer your most recent question, sir, from our
July 2003 report, we recommended that FAA develop a process to
effectively determine where air carriers send their
maintenance. The FAA representatives here today have referred
to a list that air carriers are required to provide which
indicates substantial maintenance providers. My staff has
reviewed those lists and we find that they are incomplete. In
fact, in one instance, a carrier listed as a maintenance
provider a repair station that it hadn't sent maintenance to in
three years.
So in fact, what we think some carriers have done in order
to satisfy FAA's requirement is simply to list all facilities
and repair stations where they may have contracts and where
they may intend to send business. But there is no showing that
they have indeed done so.
So when we are talking about the integrity of the risk-
based oversight system, and FAA's ability to target its limited
resources on the actual locations where maintenance is being
performed, this substantial maintenance provider list is
inadequate. In addition, in the first quarter of fiscal year
2007, FAA instituted a request, if you will, that carriers
provide quarterly utilization reports. The first such report
was due December 31st.
We do not believe that that is adequate to address our
recommendation, either. The reason for that is first, as I
mentioned, this has been a request from FAA, it is not
mandatory. Until it is mandatory and until FAA has in place a
system to validate or verify the information, perhaps only on a
sampling basis, the information that has been provided by air
carriers, then the agency can't be assured that the information
is accurate. We know that as of the end of last week, two of
the nine carriers who had been requested to provide this
information had not done so. Those seven carriers who had
provided information on the quarterly utilization reports had
been inconsistent and incomplete in the information that they
were providing to the agency.
For those reasons, sir, we don't consider that either the
standardized substantial maintenance provider list or the
quarterly utilization reports satisfies our recommendation.
Mr. Costello. That is a pretty troubling report, Mr.
Sabatini. Do you want to respond?
Mr. Sabatini. Let me begin by saying, Mr. Chairman, that
this is an incredibly complex and dynamic industry. This safety
record that has been achieved has been achieved because of the
responsibility the individual certificate holders place upon
themselves. We primarily have in this Country a system of
voluntary compliance. I would offer to you, Mr. Chairman, that
what the IG is describing would require essentially that I have
FAA inspectors at the turning of every wrench. That would
simply not be physically possible.
We are striving and working very hard to respond to the
recommendation that has been made where we can ascertain where
the maintenance is being done. It seems to me that there has
been an impugning of the integrity of the individual carriers
who may have listed repair stations, or facilities that they
may choose to use but have chosen not to use as to indicate
some sort of nefarious reason for doing so. I really question
that, because that is not an unsafe practice.
And as far as standards are concerned, Mr. Chairman, all
the safety standards that are required of a U.S. repair station
are precisely the same as those required of a foreign repair
station. Insofar as drug testing is concerned, if we could, we
would do so, Mr. Chairman. Sovereignty is an issue and it goes
far beyond the authority that the FAA has to impose that
requirement.
Mr. Costello. Let me say that I didn't take the IG's
comments by any means to impugn anyone's character at any of
the airlines. But let me ask just a final question, and I have
other questions that I will go to on a second round.
Is it your testimony today that the FAA gives the same
scrutiny to foreign repair stations as domestic repair
stations?
Mr. Sabatini. I would say that the oversight and the
approach that we take to ascertain, in combination, when we are
talking about foreign repair stations, we not only rely on our
own inspectors providing the oversight, which is equivalent to
what we have here in the States. In fact, a foreign-based FAA
inspector has less responsibility than a domestic-based
inspector. Someone based abroad has the sole responsibility for
the oversight of those repair stations. So when one draws an
analogy of numbers to repair stations, one needs to keep that
in mind.
Mr. Costello. Is that a yes or a no?
Mr. Sabatini. I would say, yes, sir, it is affirmative that
we have the same oversight of those repair stations and apply
the same standard.
Mr. Costello. Very good. The Chair recognizes at this time
the Ranking Member, Mr. Petri.
Mr. Petri. Thank you very much, Mr. Chairman.
It is a fascinating subject. I am sitting here listening,
and I think there may be an elephant in the room that no one is
talking about, and that is that all of these people who lease
and own airplanes have insurance. There is a huge international
insurance industry whose money is very much at risk if a plane
goes down or there is a crash. They would not insure a plane if
it is was poorly maintained or operated unsafely.
So there has to be a big system of private regulation that
you are not even really mentioning that hopefully you are
coordinating with. They are not going to rely on occasional
government inspection, whether it is the American Government or
Italian government or any other government. They are going to
have their own systems and they may coordinate with you if it
is cost-effective and they are sure it is going to produce good
results.
Could you discuss how that is working? There are billions
of dollars involved for the insurers if there is an airplane
crash with a lot of passengers. I would think that duplicating
or doing something that is secondary and not as effective as
what is already going on in the industry doesn't make a whole
lot of sense. Or are they just happily writing insurance
policies for a billion dollars on a plane without any
confidence that they are well maintained and insured? Could you
comment on that, Mr. Scovel or Mr. Sabatini?
Mr. Scovel. Thank you, Mr. Petri. I regret I do not have
the research available to answer your question directly. I
believe that your point is very well taken, however, and the
private insurers in this Country and elsewhere would not
underwrite insurance for aircraft were they not satisfied that
maintenance was being properly done.
Mr. Petri. So before recommending that we hire more
inspectors and we do all this sort of thing, shouldn't we at
least sort of see what is going on in the real world, so that
we don't waste a lot of taxpayers' money duplicating in a less
efficient way what is already being done?
Mr. Scovel. That is an outstanding suggestion, sir. I would
welcome the comments of the FAA representatives to see whether
they have undertaken that study and have attempted to
coordinate their oversight efforts with those of the insurance
industry.
Mr. Sabatini. Mr. Chairman, I don't have a study that I can
refer to, since we have not undertaken that type of a study.
But it is a point well taken. Certainly I can tell you that in
the operations world, before pilots would even be considered to
be employed, they have to demonstrate that they have a level of
experience required by the insurance companies that are far and
above what we require for initial entry into a particular level
of pilot certification. I do know, although I cannot provide
you with factual information, but anecdotally and from my
personal experience, certainly insurance plays a very
significant role in the equation that is at play for safety
when one is operating an airplane, maintaining an airplane or
transferring parts across the Country via air carrier.
Mr. Petri. I guarantee you, the reinsurers in the aviation
industry or the insurers directly, will quote much higher rates
or will not insure unless there are various standards that are
met. And it would be cost effective for the carriers to meet
those standards. That is a pretty efficient way of having a
flexible but modern insurance regulatory mechanism that keeps
up with technology. They are competing with each other, so it
is a competitive regulatory regime, which can be much more
sensitive than what we can do where we review things every five
years or the like.
Yes, I think you are doing something like that with your
ISO or certification or procedures there, if you would care to
discuss that, Mr. Sabatini.
Mr. Sabatini. Thank you, Congressman Petri.
In fact, this past August, the Aviation Safety Organization
achieved what is a world-renowned international standard, ISO
9001, which basically is an international standard that
distinguishes organizations that have achieved such
standardization in terms of consistency and standardization in
the processes that are in place. In essence, what has really
taken place here is 6,500 inspectors, well, not 6,500
inspectors, but 6,500 employees in the Safety Organization are
now under a single quality management system, which means we
have documented processes and have metrics applied to it so
that we can in fact determine how well we are performing
against what it is that we say we are doing.
So we have a process in place that is recognized by an
international body that has granted certification to the AVS
organization which I will tell you is unprecedented in the
Federal service. No other government entity has, given the
size, scope, complexity and diversity of services and products,
and the dispersion of our folks spread around not only the
United States but also globally that have been granted that
accreditation.
So it has metrics in place, it has customer feedback for
the internal customer, it has customer feedback for the
external customer and it is constantly being audited. I would
use as an example an organization like the Flight Standards
Organization, where approximately one-third of that
organization on an ongoing basis is going through the audit
process in order for us to sustain and maintain this
accreditation.
Mr. Petri. My time is up, but let me just say that I visit
a lot of manufacturing facilities in my district. I am very
familiar with the ISO standards, that are global standards in a
variety of different business processing operations. They are
international and companies have to get their records, every
procedure in place so that parts, what they do can be audited,
and it is at the highest and a uniformly high standard. This is
something companies will take five or six years struggling with
to achieve, because once they achieve it, everyone who deals
with them knows they are a first class outfit and there a lot
of overheard costs that can be eliminated over time by getting
to these common standards between manufacturers. You have done
this, so you should be congratulated for it.
Mr. Sabatini. Thank you.
Mr. Costello. The Chair thanks the Ranking Member and
recognizes the gentleman from Oregon, Mr. DeFazio.
Mr. DeFazio. Thank you, Mr. Chairman.
I would like to go to the point that was raised by the IG
when we talked about whether or not we can track where the
planes are going. We know a lot more planes are going to
facilities that are not certificated in the United States for
critical procedures. And, as I understand it Mr. Sabatini, we
do not inspect those facilities, is that correct?
Mr. Sabatini. Well, the answer to that question,
Congressman DeFazio is, we can, we do, but we are not required,
because they are not certificated under our----
Mr. DeFazio. That's correct, okay. That's fine. I think we
have a problem here between certificated and non-certificated.
Why should someone who is doing critical work be non-
certificated? Certificated has to have a quality control
system, establish and maintain a quality control system. Non-
certificated, no requirement. Report failures, malfunctions and
defects. Required at a certificated facility. Not required at a
non-certificated facility. Personnel, got to have supervisors,
inspectors, wow, supervisors and inspectors? No, that is not
required at non-certificated. Training program? It is required
at certificated. Not required at non-certificated. There has to
be one FAA certified mechanic wandering around the facility
somewhere. And we aren't regularly inspecting them, are we? We
are not, we don't go in and regularly inspect them?
Mr. Sabatini. Well----
Mr. DeFazio. How many are there, non-certificated, that are
doing critical work on aircraft components?
Mr. Sabatini. We can get that data, but I would have to
provide it for the record.
Mr. DeFazio. Okay, so we don't know how many there are.
That is a little disturbing. And of those who are doing
critical work, can you tell me every one that does critical
work has been inspected on a regular basis, like a certificated
facility? Why would someone want to be at a certificated
facility, if you can do the same work over here? The trend is,
the airlines are pushing this stuff downstream, and they are
pushing it downstream because it is cheaper. That is how
ValuJet happened. It is waiting to happen again.
Yes, you have some great trend lines there. It only takes
one ValuJet to kind of blow that whole thing out of the water.
And I really just can't understand why we have a parallel
system of non-certificated facilities doing critical work. Why
don't we just say non-certificated facilities cannot do
critical work? Why do we have--or why don't we just say, since
the airlines you say are responsible, why don't we just do away
with the whole system? Why certificate some and not certificate
a whole bunch of others who are doing the same work? Why? Why?
Just give me a brief answer if you could.
Mr. Sabatini. Well, uncertificated entities is really a
misnomer. One can require work or ask that work be done, but
that work will ultimately be done by a certificated mechanic.
Mr. DeFazio. Or overseen by a certificated mechanic?
Mr. Sabatini. No, actually performed by a person who has an
A&P. So I would like to ask Jim to give you----
Mr. DeFazio. So if we aren't there watching them, how do we
know that is going on?
Mr. Sabatini. We do have a percentage of that system that
is known to us, and we do perform surveillance----
Mr. DeFazio. Known? A percentage is known? I would hope
that 100 percent is known. Nick, I just don't understand it.
You can't tell me that the airlines aren't pushing stuff to--
are the non-certificated facilities cheaper, generally, than
the certificated facilities?
Mr. Sabatini. Well, sir----
Mr. DeFazio. Is the maintenance work less expensive? Yes or
no.
Mr. Sabatini. Well, I don't have financial data. I will
tell you this----
Mr. DeFazio. But the point is, why would the FAA tolerate
that kind of a system? Why would you allow that to exist? If we
need these things to be certified at certified repair stations,
why don't we just say, well, you can be certificated if you
just have an A&P mechanic do the work? I mean, why? Why do you
have a parallel system?
Mr. Sabatini. We really don't have a parallel system. A
certified repair station is authorized to do specific work. No
one else can do that kind of work. That----
Mr. DeFazio. Yes, but isn't critical, critical work_work
that would be in category 1, that could take a plane down_done
at non-certificated facilities?
Mr. Sabatini. Well, someone introduced the choice of word
of critical work. That has a very specific meaning and----
Mr. DeFazio. Well, you have a category 1, category 2 and
those sorts of things in terms of parts. So how about we use
that for maintenance? Category 1 is a critical component if it
fails, it could cause emergency procedures or the plane to go
down for an unapproved part. Let's apply that to air stations.
Do we allow work that would be the same as a category 1
unapproved part be done at non-certificated facilities? Yes or
no?
Mr. Sabatini. We would not permit someone who is not
qualified----
Mr. DeFazio. No, but do we allow it at the non-certificated
facilities? Yes or no?
Mr. Sabatini. The answer is that we would not allow anyone
who was not properly authorized and certified to perform a work
on a particular component. Now, someone can send a blade to be
coated to a facility that doesn't need to have FAA
certification to do plasma coating.
Mr. DeFazio. I know, but you can't trivialize this concern.
I think as just sort of, again--my time has expired. But we, a
non-certificated facility with an A&P mechanic could do
critical component work on an airplane that could take a plane
down if it failed, and that is true, is that correct?
Mr. Sabatini. I disagree, Mr. DeFazio.
Mr. DeFazio. Oh, they couldn't do the work? It wouldn't be
allowed? Is it barred?
Mr. Sabatini. I would disagree with how you characterized
that question, sir.
Mr. DeFazio. No, I am not characterizing. I am just asking,
over here at a certificated facility, you can do this work. It
goes to a critical component, you have all these other
requirements in place. But that same plane could be taking to a
non-certificated facility, yes, correct? And an A&P mechanic,
without any of these other strictures or controls in place that
are required at certificated facilities, could do that same
work if they were trained in that? Yes, that's true, isn't that
correct?
Mr. Sabatini. I would answer, sir, that an A&P mechanic who
is on call for service to be provided to an air carrier would
receive the instruction and the training that is required to do
that very specific work. And an A&P mechanic is qualified to do
that work? Although that person may not work in a facility that
we would call a repair station.
Mr. DeFazio. I know, but the point is, you have to look at
it one or two ways. You say it is ultimately the carrier or
owner's responsibility for the aircraft. If we are just having
a faith-based system here that they are going to do what is
necessary and they are going to oversee it, then why bother to
have certificated repair stations at all? Why maintain that
structure if the same work can go to a non-certificated--that
is the point I am trying to get at here, and I just don't
understand that. Because if we need these things to make things
work out right at a certificated station, doing the same work,
why don't we need all of those same things at a non-
certificated station? I just don't think that that is right.
There is a lot to ask, I will have another round on foreign
stations.
Thank you, Mr. Chairman.
Mr. Costello. Thank you.
The Chair recognizes the gentleman from Wisconsin, Mr.
Kagen.
Mr. Kagen. Thank you, Mr. Chairman. I apologize from the
beginning, my voice has been transported elsewhere.
Mr. Sabatini, thank you for being here. You have a very
challenging and difficult job, and I certainly wouldn't want to
be sitting in your chair, at least today. It is certainly very
difficult, everyone here in the room would agree that it is
hard and perhaps impossible to inspect places when you don't
know where they are. So it would be a great idea to find out
where all these facilities are, to at least identify what needs
to be inspected.
Others here, our job as I see it as Congresspeople, our
duty really is to help guarantee the safety of the traveling
public and the people that work in the transportation industry.
It really isn't to guarantee the profits of insurance companies
or the airlines themselves. So having heard the testimony of
our Inspector General, will you recommend that the quarterly
utilization reports become mandatory? That's a yes or no.
Mr. Sabatini. At this point in time, it is not required by
regulation to report where these uncertificated entities may be
located. It is being provided to us on a voluntary basis.
Mr. Kagen. So will you recommend that it will become
mandatory so we can move it away from a voluntary
participation?
Mr. Sabatini. We will certainly consider that.
Mr. Kagen. So that is not yes.
Mr. Sabatini. Well, rulemaking is a significant undertaking
and we would like to assess the risk-based foundation upon
which we would make such a recommendation, whether it would be
warranted or not.
Mr. Kagen. Thank you. In your mind, is there any difference
between a licensed and non-licensed inspector or a licensed or
non-licensed mechanic?
Mr. Sabatini. That is a difficult question to answer the
way it was asked.
Mr. Kagen. Well, I can tell you, being a physician, there
is a real difference between a licensed specialist and non-
licensed specialist.
Mr. Sabatini. Of course, a repair station is certificated
and has been granted authorization because they have
demonstrated they have the competency and the qualifications.
An individual holding a pilot's license, a doctor's license,
can certain operate as an individual or can certainly operate
within the context of a repair station. Each are properly
certified to do the work that they would be doing.
Mr. Kagen. So when you go to the doctor and have a
procedure or a surgery performed, you would like someone who is
very well skilled and licensed in that process, wouldn't you?
Mr. Sabatini. I would choose a general practitioner for
general health and a specialist if I needed a specialist.
Mr. Kagen. Okay. Is it true that the FAA really has no
process to determine the number of inspections that are
necessary and where these people should be placed, is that
true?
Mr. Sabatini. Well, sir, I am assuming you might be
referring to the recent study that was provided to us by the
National Research Council of the National Academies. They have
pointed out how we can improve in our staffing models. And I
would agree, it is a science, and we need to improve on the
methodology that we have today.
Mr. Kagen. All right, thank you. I yield back my time.
Mr. Costello. I thank the gentleman.
The Chair now recognizes the gentleman from Missouri, Mr.
Carnahan.
Mr. Carnahan. Thank you, Mr. Chairman.
And to the panel, while I think we are all pleased to see
the trend lines of safety and accidents going down, I don't
think anyone would be satisfied until those numbers get down or
approach zero, that that is a continuing effort. I guess what
strikes me is that there appears to be giant loopholes in the
system that oversees our maintenance in terms of where it is
done, how it is done, different standards in how things receive
oversight.
Ronald Reagan had a great phrase back during his
presidency, trust but verify. We can't have a system that we
just think is getting safer, and if we can identify areas that
need improvement, we need to do that. I guess I would like to
ask to Mr. Sabatini, what does the FAA intend to do to consider
limiting the work that can be done at non-certificated
facilities and how that will be, what kind of oversight and
inspections that process would have?
Mr. Sabatini. We have taken the recommendations along those
lines that the Inspector General has made. We have put in place
some procedures to begin to address that. I would like to turn
to Mr. Ballough to give the specifics on what is what is being
done in the Flight Standards Service.
Mr. Ballough. Mr. Carnahan, in the IG's report on repair
station oversight, it made nine recommendations. Of those nine,
we concur, and we have closed all but two. Those two we are
still working with the IG to come up with a solution we both
would agree to.
Mr. Carnahan. What are those two? I am curious.
Mr. Ballough. One dealt with financial data and who should
be collecting financial data. The second one is to develop a
process to identify repair stations and carriers that perform
aircraft maintenance. That is the recommendation we feel we
have agreement on our approach, but we continue to work with
the IG to close that one out as well.
And the other seven are closed out with numerous things, or
accomplishments that we have made regarding policy correction,
policy enhancement, with better ways to analyze data with our
safety performance and analysis system. That was one of the
criticisms in that report, was that repair station data that
was recorded by inspectors are overseas repair stations and air
carrier data that is recorded by inspectors that oversee the
air carriers, that both inspector work forces couldn't see the
other data. The data was not merged, so to speak.
We have enhanced that to where now, we can take a repair
station such as Haeco in Hong Kong and identify every carrier
that uses that facility, everybody that has been there. So that
has been a huge enhancement for us in the past.
Mr. Carnahan. Hold that thought, because I want to get a
chance for the IG to weigh in on this as well. And I guess I
would like you to comment on those outstanding items that were
mentioned and any other items that were not in terms of
limiting that scope of work at non-certified facilities.
Mr. Scovel. Thank you, Mr. Carnahan.
Our major concern was the second outstanding
recommendation. As I mentioned in an earlier response to a
question, we do not consider FAA's efforts to address our
concerns adequate. I refer to the quarterly utilization reports
and to the vendor or contractor lists which carriers are
required to provide. We don't consider that answers our
concerns in order to identify, first, where maintenance is
going and second, which non-certificated facilities are
performing critical maintenance.
A point was made by Mr. DeFazio and Mr. Kagen, and I know
it is a concern of yours, sir, with regard to non-certificated
facilities. Before our December 2005 report, we surveyed 19
carriers. All 19, as I mentioned in my oral statement, had used
non-certificated facilities to some extent, 1,400 of them, in
fact, 1,400 different non-certificated facilities. One hundred
four of those were overseas. Of the 1,400 facilities, we found
that 21 had performed critical maintenance. Of the overseas
facilities, non-certificated, FAA inspectors had never visited
them.
Mr. Carnahan. Is there any safety data that would
distinguish those different types of facilities?
Mr. Scovel. I would need to check with my staff, sir. I can
tell you generally that it is a concern of ours that as we go
along the maintenance continuum, if you will, looking first
from in-house maintenance performed by carriers themselves and
moving along the axis to repair stations, certificated repair
stations, and further out when we talk about non-certificated
repair facilities, the level of oversight becomes more diffuse.
As I mentioned in my statement, it is not where the maintenance
is performed that is of concern for us, it is the oversight and
the degree that is appropriate in order to ensure the safety of
the traveling public.
Mr. Carnahan. Thank you. I see my time has run out. But I
would request, Mr. Chairman, that if your staff could gather
any of that safety data that makes a distinction along that
maintenance continuum, I think it would be helpful to this
Committee. Thank you.
Mr. Costello. I thank the gentleman from Missouri. We will
announce to the Members that there is a vote on the Floor right
now. We are down to about five minutes, so we will recess, go
over. My understanding is we should expect one vote only, and
come back immediately and continue our questions for the first
panel.
The Committee stands in recess.
[Recess.]
Mr. Costello. The Subcommittee will come to order.
We would ask the witnesses to be seated and the Chair
recognizes the gentleman from Oregon, Mr. DeFazio on a second
round of questions. I have some questions but I am going to
hold them until Mr. DeFazio is finished with him.
Mr. DeFazio. Thank you, Mr. Chairman. I did want to get to
the overseas issue.
But I just want to return, Nick, we are having a failure to
communicate, as they would say in Cool Hand Luke. Let me read
from the IG's report and maybe this will make my point. Page
14, it is talking about non-certificated facilities. In our
view, it goes on to say, non-certificated facilities are not
required to employ designated supervisors, inspectors, while
their maintenance is being performed. Relying solely on the
expertise of an individual mechanic to ensure the repairs are
completed properly is an inadequate control mechanism. In our
view, this is the reason FAA requires added layers of
oversight, such as designated supervisors, inspectors and
certificated facilities.
That is one point I was trying to make. Perhaps I didn't
articulate it well.
Then the second point is critical work is being done in
these non-certificated facilities, and they go on to use an
example where people died. The importance of this issue became
evidence in the aftermath of the January 2003 Air Midwest crash
in Charlotte, North Carolina. Independent contract mechanics,
certificated by FAA and working for a non-certificated company,
completed maintenance on the aircraft the day before the
accident. Mechanics incorrectly adjusted a flight control
system that was ultimately determined to be a contributing
cause of the crash. This work was approved by an FAA-certified
mechanic employed by the non-certified company.
We didn't have the other levels of fail-safe that we have
at certificated facilities. That is the point I am trying to
make. So the question is, why do we allow, I mean, given that
crash, and the potential problems, why wouldn't we just say to
the airlines, we certificate facilities for a reason, we
believe it gives us a higher level of assurance that the work
is supervised and reviewed, there is less possibility of
killing people as we did at this case. And we are going to tell
you that you can't take anything that involves critical
components to a non-certificated facility.
Now, why can't we do that? Congress could mandate that. Why
doesn't the FAA do that as the safety watchdog?
Mr. Sabatini. We in fact have very good controls over that.
Mr. DeFazio. Well, what happened in this case? They died.
People died, and this was an--this is making my point, Nick.
Stop defending the indefensible at the agency. Just give me an
honest answer. Why should we have this secondary system that
can do--I mean, you want to have them out there and they want
to take care of the seats or they want to do this or they want
to wax the plane or paint it, I don't care. But why allow,
people died in this case. I think it is arguable that if that
had been done at a certificated facility that had supervisors
and more regular work procedures that they might not have died.
Why do we allow that to exist?
The only reason the aircraft operators are going there is
because it is cheaper. And you won't admit that, either. It is
cheaper to go to a non-certificated facility. They don't have
the overhead. They don't have that pesky supervisor. They don't
have all these other requirements.
Can't you just tell me that the system would be safer if we
said, if the work is on a critical component, something that
can cause either emergency procedures to be required or the
aircraft to fail in flight, it must be performed at
certificated facilities? Wouldn't that give us a safer system?
Mr. Sabatini. I am all for putting in place any procedures
that will continue to improve on the system safety. But I must
tell you, Mr. DeFazio, that we have absolute control over the
air carrier, and it is the air carrier's responsibility, or the
repair station's responsibility, who is contracting out for
that service with an entity that may not hold an FAA
certificate. That product or component that has been repaired
by that entity or that person must go back----
Mr. DeFazio. I understand. But what is the recourse of the
people who have died? Do we put anybody in jail because of
this? Did we give someone the death penalty because of this?
No. The point is, this is an industry that is desperately
trying to survive or make a profit. They are going to seek out
the cheapest maintenance they can find and they are going to
hope, it is their responsibility, they are going to hope it
holds together and works, or at least until that chief
executive officer gets his bonus and moves on somewhere else.
Mr. Scovel, since this is in your report, can you answer
that question I asked? Would we have a system that had
potentially a higher level of safety if we required critical
work, as I have defined it, to be done at certified facilities?
Mr. Scovel. Thank you, Mr. DeFazio. Before the recess, when
you posed the question concerning non-certificated facilities
and repairs and so forth, of course, our example from our
testimony came to mind, the Air Midwest tragedy from several
years ago.
Mr. DeFazio. Not so many, only four.
Mr. Scovel. Too recent, indeed. The question of what type
of work non-certificated facilities should perform and whether
it should be limited by law or regulation I believe is a policy
question for you and for the Administration. I view the role of
the IG as to pose that question and to pose it repeatedly. I
don't view it as my role, however, to take a stand on that
particular policy question.
To the extent that we can, if we can provide data, safety-
related data to show that repairs performed by certificated
facilities, especially with regard to critical maintenance, are
indeed done more frequently, correctly, then we can bring that
kind of information to the debate.
Mr. DeFazio. Okay, thank you. My time has again expired.
The Chairman has been generous. I assume that the Chairman will
get more into the foreign facilities, or the full Committee
Chairman I think will visit that issue.
Mr. Costello. I thank the gentleman, and the Chair now
recognizes the distinguished Chairman of the Full Committee,
Chairman Oberstar.
Mr. Oberstar. Thank you, Mr. Chairman, for the very
substantial work you put into crafting this hearing, gathering
the data, setting the stage. Mr. DeFazio, for your ever-
persistent advocacy of ever higher standards of maintenance and
maintenance oversight.
I think the context in which this hearing takes place is
that of airline losses of over $35 billion over the last years
since September 11th, elimination of 27,000 airline maintenance
jobs at the mainline carriers since September 11th, closing of
maintenance bases at the principal commercial airliners,
outsourcing of maintenance. And what is particularly troubling
is outsourcing of heavy maintenance, which now is reaching over
40 percent, 42 plus percent of the $9 billion-plus that
airlines are spending. That is a considerable amount of money.
In the beginning of the 1990s, there was about $5 billion being
spent by the airlines on maintenance.
But we are seeing in the IG's report up to 60-plus percent
of heavy maintenance outsourced by the airlines, by our
commercial carriers. That was unthinkable in the 1980s. In the
early and mid-1980s, airlines were the source of maintenance
business coming to the United States from foreign carriers,
being performed by the U.S. because of the high quality of
maintenance performed at U.S. shops. United, American,
Northwest, Delta, all were looking to foreign airliners as a
source of business.
Only American Airlines, among the major carriers, has kept
its maintenance in-house, working with the Transportation
Workers Union, they have set a goal of saving half a billion
dollars in costs of operation. But they have done it in-house.
Why the others have chosen to outsource is a continuing
puzzlement to me. But it is clear that if you look at the
contractual arrangements by other carriers, their costs of
outsourced maintenance compared to doing it in-house is half.
The answer to the question Mr. DeFazio asked of Mr. Sabatini is
that indeed, cost is a huge factor. It is the reason they are
outsourcing. The breakdown of the International Association of
Machinists Union internally resulted in outsourcing by carries
to other facilities.
So in looking at the volume of outsourcing, the amount, we
have 4,200-plus MROs in the domestic U.S. and nearly 700
foreign repair stations. That is up from 440 in about 1990. And
only 734 domestic inspectors. Is that right, Mr. Sabatini?
Mr. Sabatini. Yes, sir.
Mr. Oberstar. After the investigations that we conducted in
the Subcommittee investigations and oversight on significant
aviation failures due to maintenance in the 1980s, the then-
Chair of the authorizing committee, I was Chair of the
Investigations Subcommittee, Mr. Mineta and I took to the Floor
an appropriations bill, an increase of over $10 million a year
to hire up to 1,000 inspectors. We succeeded. The inspector
workforce was increased.
But then, in your own testimony, that number is down, so
you have gone to a risk-based and even that was recommended by
the IG's office, not as an option but in light of the
circumstances of a smaller workforce, more outsourcing of
maintenance. In 2003, the IG said, well, you could do this job
by shifting to what internally is known as ATOS, or a risk-
based system.
I like your statement, Mr. Sabatini, that you have achieved
the ISO 9001 certification. But I am troubled that you say, we
adhere to the same safety standards as the businesses we
regulate. That is not good enough. FAA is the standard. Those
businesses you regulate are not. You are the standard. You make
them come up to FAA.
The opening paragraph of the 1958 organic act creating the
FAA says, ``Safety shall be maintained at the highest possible
level,'' not the level airlines can afford, not what they want
to pay, not what they can outsource to pay, but the highest
possible level. FAA is that guardian. You say consistency is
the goal, inconsistency is troubling. But the inconsistency is
in the IG's report, as Mr. DeFazio has insisted on, where you
have different standard for differing facilities. In the non-
certificated and certificated--are you going to reconcile those
two?
Mr. Sabatini. Absolutely, Mr. Chairman. There is in essence
no different on safety standards between a foreign repair
station or a domestic repair station. The only difference that
was pointed out this morning was that we require drug and
alcohol testing in our Nation and that is not required in other
sovereign states. If we could impose that, we would.
Mr. Oberstar. In the foreign repair station arena, it is,
the mode of operation of FAA is to accept a country's own
standard, if they adhere to the ICAO standards, right? And
accept the host country's certification of a facility? Is that
correct?
Mr. Sabatini. Not correct, sir. What we do in foreign, in
issuing a certificate to a foreign repair station, that
applicant at that point in time must demonstrate to the FAA
that they in fact meet the very same regulatory requirement,
FAR Part 145, to be certificated as a repair station abroad. So
the certification rules are precisely the same, whether it is
domestic or foreign-based.
Mr. Oberstar. Now, does that mean that in that repair
station that not only the facility must be certificated and
meet U.S. FAA standards and ICAO standards, and that all of the
maintenance personnel must be A&P equivalent certificated
maintenance providers?
Mr. Sabatini. Take a country like France, certainly a
sophisticated and advanced society in terms of aviation safety,
built some very fine airplanes and again, very sophisticated.
That particular country does not require that they have what
would be in our parlance an A&P certificate. But rather, it is
an education level in the discipline of aviation maintenance.
So in that regard, they would not require an A&P of that
person there.
Mr. Oberstar. How about El Salvador?
Mr. Sabatini. Well, you know, Mr. Oberstar, Mr. Chairman,
several weeks ago you brought that to my attention. Following
that conversation, I asked Jim Ballough to go down to El
Salvador and validate what we know from data to be data that
suggests that it is performing in accordance with expected
standards. I asked Jim if he would go down there and make a
personal visit, and with your permission, sir, I would like to
have Jim tell you about that visit.
Mr. Oberstar. Proceed.
Mr. Ballough. Thank you, Mr. Chairman. As Nick mentioned, I
visited the TACA facility a few weeks ago and I would be glad
to share what my views and thoughts were on that issue. Before
I begin that, I would just like to make the point that
regardless of what type of outsource or contract maintenance we
are talking about, there are definite responsibilities for
three entities. And I will demonstrate that when I talk about
AEROMAN. Those three entities are obviously, the air carrier
that is using that facility, they have some responsibilities.
They can't just wash their hands of the activity because it is
going to a repair station. Obviously a major role for the
repair station as well, in making sure that they have the
properly trained personnel, the equipment, and all the manuals
and all the things that are required by our certification.
And thirdly, it is our FAA oversight. We play a major role
in making sure----
Mr. Oberstar. That is all accepted. Tell me about what you
found in El Salvador.
Mr. Ballough. Very good. In that facility, you mentioned
the certificated mechanics. Every technician, every mechanic
that works on an airplane in that facility, is certified under
the El Salvadoran process. That process is not a mirror image
of ours, but it is closely aligned with the requirements that
we have----
Mr. Oberstar. Do they have an A&P mechanic certification
system?
Mr. Ballough. Yes, sir. Yes, they have----
Mr. Oberstar. On what system is it patterned, since El
Salvador--I made trips to El Salvador in the early 1980s, in
the days of human rights abuses. I am quite familiar with this
country. So tell me, where are they getting this?
Mr. Ballough. It is based on our system. Not necessarily a
mirror image.
But they go a step further as well. They have 25 percent of
their technicians, their mechanics, and they would do more if
they could obtain more visas, but they have 25 percent of their
mechanics they have sent to the U.S. who have tested and have
received A&P certificates. So out of a workforce, mechanic
workforce of 879, they have 167 that are in fact certificated
A&P mechanics. They would like to have more certificated A&P
mechanics. So we are working with them to see what it would
take to provide them the opportunity to certificate more of
those folks.
Also, they are an ISO 9001 certified organization as well.
They achieved that certification in 2003. They are a certified
Airbus MRO network maintenance organization. If you think of
the Airbus, the global nature of aviation today, Airbus
recognizes just a handful of facilities that are qualified to
repair their aircraft. And they recognize them as an Airbus MRO
network operation.
Mr. Oberstar. FAA performs oversight of that facility then,
from the Miami FSDO, you call it something else?
Mr. Ballough. Yes, sir, the Miami IFO. We in fact, my
inspectors are in that facility once a quarter, they visit that
facility.
Mr. Oberstar. Once every three months?
Mr. Ballough. Once every three months, they are there, yes,
sir.
Mr. Oberstar. But those inspectors from the Miami, you call
it IFO now----
Mr. Ballough. International Field Office, Mr. Chairman.
Mr. Oberstar. I still call them FSDO. For 53 facilities in
Central and South America?
Mr. Ballough. Yes. We have, the number of personnel we have
in the Miami office are 16 inspectors.
Mr. Oberstar. They are on the road a lot going to one of
these every quarter.
Mr. Ballough. Yes, they are. In fact, fortuitous as my
visit was, the inspectors were there when I was on scene as
well. They do spend an awful lot of time on the road, yes, sir.
Mr. Oberstar. Well, coming back to your personal
observations and what you reported about, you are saying that
the Salvadoran maintenance personnel, at least one-fourth of
them have been trained in the U.S., FAA A&P standards?
Mr. Ballough. Yes, sir.
Mr. Oberstar. And they have an A&P certified supervisor in
the shop who is overseeing the work, signing off on the work?
Mr. Ballough. Yes, sir, Mr. Chairman. Also, there is
another element here are as well. There are two major air
carriers that use that facility today. And both of those air
carriers have been seven and eight personnel on scene, so that
every moment that airplane is in a check, they have their own
airline personnel on staff, overseeing the work as well.
Mr. Oberstar. Have you completed a written report on this
for Mr. Sabatini?
Mr. Ballough. No, I have not, sir.
Mr. Oberstar. Are you going to?
Mr. Ballough. I will, yes, Mr. Chairman.
Mr. Oberstar. When you do that, submit that to the
Committee. I think it is very important for us to have the
facts. That would be very useful and we would like to evaluate
it.
There are facilities, though, MROs in the U.S. where there,
where not all the mechanics are A&P certificated, where the FAA
considers it sufficient for a supervisor to sign off. Is that
not the case, Mr. Sabatini?
Mr. Sabatini. There are circumstances where work can be
performed by someone who may not have an A&P certificate, in a
repair station context, who is trained and has been issued a
repairman's certificate. But sign-offs are done under the
supervision of a supervisor who would have authorization, such
as an A&P and also authorized by the procedures manual to do
that particular kind of oversight and sing-offs.
Mr. Oberstar. I am concerned about that type of
arrangement. I think FAA needs to raise the bar for those
facilities, especially when you have so few inspectors. I will
consult with Mr. Costello, the Chairman of our Subcommittee,
and with the Ranking Member, about moving in the appropriation
process to increase funding for the inspector workforce. I
think you are way understaffed.
Mr. Scovel, in the history of FAA oversight maintenance,
record-keeping is critical. When an airline has either gone out
of operation or has outsourced its maintenance, all the
maintenance records, boxes and boxes of them, were transferred.
In this day of electronics, however, I suppose those are CDs
that are transferred.
And now you have major airlines contracting maintenance out
to the lowest cost provider. And then they re-bid the contract
a year or so or two years later, sometimes it is three years.
And the records are supposed to be transferred. Are you
watching, is FAA watching over the transfer of records to be
sure that they go from one facility to the next, and that trend
lines are being followed and that down to the last detail, the
surveillance is in place?
Mr. Scovel. Thank you, Mr. Oberstar. I can speak from our
experience in conducting surveys at a number of carriers. We
have found that the carrier's maintenance records generally are
good. And we are able to determine how their maintenance has
been contracted out back over a number of years. It is based on
that research that we have been able to determine when, for
instance, non-certificated facilities have been used on certain
repair operations versus repair stations, either here or
overseas. And back to the days when some carriers were using
in-house maintenance more extensively.
Mr. Oberstar. So you are confident that, and Mr. Sabatini,
are you confident that record-keeping is being transferred and
sustained by subsequent maintenance providers as aircraft,
airlines increasingly bid out their maintenance jobs, including
heavy maintenance?
Mr. Sabatini. Mr. Chairman, I am convinced that there are
complete records on aircraft, no matter where that aircraft
maintenance is performed or who owns that airplane. But I would
ask Jim to give you more specifics on how that system works.
Mr. Ballough. In the case of the AEROMAN visit, Mr.
Chairman, there are records that are transferred both
electronically in the moment as well as every hard copy record
goes with that aircraft as it leave the check. More globally,
when our certificate management office inspectors review the
maintenance records, they will look at a work package,
regardless of whether it is done in the States, done in-house
or done overseas. So that is a responsibility that our
certificate management office inspectors have as well, looking
at those records. And they in fact make visits to those
facilities as well.
Mr. Oberstar. I think that is a very critical aspect, and I
am not totally comfortable with ATOS, or risk management
systems, that will increasingly rely upon record-keeping rather
than hands-on. It is emblazoned in my mind, testimony that came
in a hearing in the 1980s, from, well, I am quite sure it was
the Miami FSDO, who said, we are so overworked, we are only
looking at paperwork, we are not looking physically at engine
work and airframe work. We are not on the shop floors as we
need to be. And when the FAA oversight becomes distanced from
the shop floor and is relying only on records, then you lose
contact with the reality that this is an aircraft, not a piece
of paper, not a document popping up on a computer screen. And I
am much more comfortable with the hands-on than I am with the
fingers on the keyboard and pop-up screens.
Mr. Sabatini. Mr. Chairman, to put it perspective, we
initiated risk-based before it was suggested that we continue
in that direction. ATOS was introduced in 1998, which is system
safety. It was an evaluation of what we have been doing for
many years. And what we have today is a combination of touching
metal and kicking tires, because that is how inspectors collect
on-site information.
But what is also very important to understand, that in a
global, complex system like ours, where it is based on a system
of voluntary compliance, where air carriers, repair stations,
any entity that is certificated by the FAA is required by
regulation to provide us with records which they must maintain.
And it is a combination of looking at records, being on the
shop floor and also rolling it up into what we call today
system safety.
And what we have required of the airlines is to redesign
their system such that there are those attributes of system
safety that come to play each and every moment, so that the
system design produces the service or product in a consistent
way. Unlike what we did in the past, when we see data, a
combination of data collected by ourselves and combination of
data provided because of the records that are required to be
provided to us, we identify areas of risk and that is where we
focus our attention.
So we are smarter about where we bring our people. So it is
a combination of in fact, touching metal and kicking tires, as
well as the sophistication of system safety that brings
auditing to bear.
Mr. Oberstar. Thank you.
Mr. Chairman, you have been generous with the time here,
and I appreciate the opportunity to spend some time on this. It
will take a good deal more inquiry.
Just a parting thought, and that is, reconcile the
differences in FAA certificated repair stations and non-
certificated, bring those together so there is no gap, as you
said earlier. Consistency is the key to success in aviation
safety oversight. Increase, we will work to increase the
inspector workforce, to ensure that they have adequate numbers
of inspectors and that the oversight work is being performed in
a consistent manner.
Thank you very much. Thank you, Mr. Chairman.
Mr. Costello. Thank you, Chairman Oberstar.
As Chairman Oberstar indicated, it will take a number of
hearings in the future to address some of these issues. As I
said from the outset, this is the first in what we expect to
have other safety hearings concerning the outsourcing of
maintenance as well as other issues.
At this time, the Chair recognizes the gentlelady from
Oklahoma.
Ms. Fallin. Thank you, Mr. Chair.
In Oklahoma, we have a maintenance repair organization for
American Airlines. I had the opportunity to visit with them
yesterday about their inspections and the FAA. They were
staying that usually they have around 37 FAA inspectors who
come to that facility and inspect it at different times. And
they were also visiting with me about the outsourcing and
maintenance to foreign countries.
My question is, and I may have missed some of the testimony
already and I apologize, but how to we assure, between the FAA
inspectors in America versus the FAA inspectors who are going
out of the country to inspect the foreign outsourcing of
maintenance, how do we assure the same level of inspection?
Mr. Sabatini. The regulation upon which a repair station is
certified is the very same regulation that is used here in the
States and abroad. The inspectors receive the very same
training and the inspectors abroad are dedicated to solely
oversight of those repair stations that they are responsible
for in that geographic area. Here in the States, we do not have
inspectors who have the sole responsibility for the oversight
of a repair station. They may have a combination of other
responsibilities as well.
So in essence, the oversight is using the same standard,
the same training, the same policies across the board. There
are no differences. And as you said, you missed an earlier
point that was made. There is a distinction between here and
abroad. We require drug and alcohol testing here. We cannot
impose that upon another sovereign state. And if we could, we
would. But we don't have the statutory authority to do that.
Ms. Fallin. Mr. Chairman, if I could do a follow-up. Is the
ratio between the inspectors here and the inspectors in foreign
countries, are they the same as far as numbers of inspectors?
Mr. Sabatini. We do have some data, and I will ask Jim to
share that with you.
Mr. Ballough. Ms. Fallin, what I would like to mention is,
the domestic repair station world, and I will make a
distinction between repair station and air carrier oversight,
since you mentioned American Airlines, in a moment.
Domestically, we have 801 inspectors that oversee 4,231
repair stations. Overseas, we have 697 repair stations, and
they are overseen by 67 inspectors. So the ratio, and it is
much more complicated than just dividing out and coming up with
a ratio. Because the work assignments are very different. The
folks in the States that have repair station oversight
responsibility are inspectors, also have responsibility for FAR
Part 135 operators, maybe flight schools, so a host of other
activities. The inspectors that are assigned strictly to
foreign repair stations, that is their primary work function.
They have additional duties that may require oversight of a
designated airway and its representative or another inspection
authorization mechanic, but not near the complexity or the
amount of certificates for the domestic repair station
oversight personnel.
But the issue that you raised regarding American Airlines
and the 37 folks, those folks are from what we term a
certificate management office or CMO. So there is a large
number of folks that are inspectors dedicated for oversight of
all of American Airlines. So in this case, where they use
Tulsa, the program managers that have responsibility for
certain fleet types visit Tulsa. In the case of an airline that
outsources their heavy checks, outside the U.S., those same
program managers also have a responsibility for oversight even
though those checks go out of the Country.
So no matter where those checks are done, and I will admit,
not near to the level that you would see in Tulsa with it being
such close proximity, but nonetheless, the oversight does get
done by the certificated management office as well when that
work is outsourced, that heavy check.
Ms. Fallin. Mr. Chairman, if I could have one more. That
brings up another interesting point, if the levels are a little
different, have you ever compared or audited the safety records
of the aircraft, the incidents that they might have, compared
to the foreign operations and maintenance versus the U.S.
operations and maintenance?
Mr. Ballough. In the case of, I will use one example, one
experience that I witnessed. That is the facility in El
Salvador. When the checks leave that facility, that repair
station, as well as the airline, tracks that aircraft for 30
days. And they track that aircraft to see what type of
discrepancies are written, what kinds of malfunctions the
aircraft is having, to assure themselves that the quality of
the work coming out of that repair station is as good as it can
get. As a result, they do a customer survey of every customer
that uses that repair station and consistently, they score in
the 9.4 out of 10 in terms of the quality of product being
released by that repair station. So the repair station also
takes an active role in looking at the quality of the
maintenance that is done once it leaves that facility.
Ms. Fallin. One more question, Mr. Chairman.
The cost of the inspectors going to the foreign MROs, what
is the cost to the United States as far as the FAA and having
those inspectors travel out of the Country?
Mr. Sabatini. There are some figures that we do have, and
just generally speaking, a domestically based inspector, fully
loaded figure, would be approximately $100,000 a year, on
average. A foreign-based inspector is slightly over $200,000
per year.
Ms. Fallin. So there are some that just live in the foreign
country that inspect?
Mr. Sabatini. I'm sorry?
Ms. Fallin. There are some that just live in the foreign
country that inspect?
Mr. Sabatini. We have inspectors who live abroad. We have
inspectors who are assigned to those geographic areas, in
Frankfort, London, Singapore and well, those locations.
Ms. Fallin. Thank you.
Mr. Costello. The Chair thanks the gentlelady and
recognizes now the gentlelady from Hawaii.
Ms. Hirono. Thank you, Mr. Chairman.
Since oversight is critical to the system and we clearly
don't have enough inspectors, we need to deploy our resources
as effectively as possible. The IG in his testimony noted that
FAA needs to develop an effective staffing model. I would like
to know whether you are in the process of developing such a
staffing model as described the IG, and two, if you are doing
that, whether you are involving affected persons such as the
current aviation inspectors, and three, what would be your time
frame for completing this model?
Mr. Sabatini. We have followed up on the recommendation,
and we are following the recommendations made by the National
Research Council, which is a group within the National
Academies of Sciences. I will turn it over to Jim, who was
directly responsible in leading this effort for the contracting
of the services to do exactly what you have asked.
Mr. Ballough. We have recently entered into a contract with
an organization that will begin to work, they have done some
preliminary work for us already. So that will be in full swing
here shortly.
We had a few issues early on with the continuing resolution
and we now have the contract in place and the work has begun.
Ma'am, right now, I do not have an estimated time of completion
of that. I would expect to have that and could supply that to
the Committee at a later date, when I get that information.
Ms. Hirono. What about my question relating to involving
the people who would be impacted by such a staffing model,
i.e., the aviation, the inspectors, safety inspectors?
Mr. Ballough. I think that they will have to be involved.
Obviously for a contractor to be able to develop for us a
staffing model, they have to certainly understand our
complexity and the contractor that is doing the work for us,
has involved our work for us in some of the activities that
they have been doing recently. So I fully expect that the
stakeholders, all our inspectors will be involved.
Ms. Hirono. I am a little bit confused as to why you would
enter into a contract that does not have a completion time
frame. So what is your time frame?
Mr. Ballough. At this point in time, we have modified the
statement of work, and they have not come back to us at this
point in time yet with what a time line or what the action plan
is to complete the activity. This is all recent developments,
in the last month, once we receive our budget.
Ms. Hirono. Mr. Chairman, since this model is very critical
to the oversight capability of FAA, I would like to ask the
Chair for you to follow up with FAA and give us that time frame
for this model to be completed.
Mr. Costello. The Chair will make that request and
announce, I mentioned earlier that we will have written
questions to submit to the FAA. We will put a time frame as to
when we want the response back. I have several questions, five
or six, that I am going to put in writing and we certainly will
add your request to that as well.
The Chair would like to thank all three of our witnesses
for being here today and presenting their testimony. We look
forward to additional responses from the FAA. At this time, the
first panel is dismissed and we would ask the second panel to
come forward. Thank you.
I will begin introductions as the witnesses are moving
forward, in the interest of time. The second panel will consist
of Mr. Tom Brantley, the President of the Professional Airways
Systems Specialists, AFL-CIO; Mr. James Little, International
President of the Transport Workers Union; Mr. John Goglia, the
Adjunct Professor of Aviation Science, Parks College of
Engineering, Aviation and Technology, St. Louis University; Mr.
Basil Barimo, the Vice President of Safety and Operations, Air
Transportation Association of America; Mr. Marshall Filler,
Managing Director and General Counsel of the Aeronautical
Repair Station Association; Mr. David Campbell, the Vice
President for Base Maintenance at Alliance Fort Worth and
Kansas City, with American Airlines; and Mr. Ray Valeika, the
Independent Aviation Advisor, Senior Vice President of
Technical Operations with Delta Air Lines, Retired.
Let me say to our witnesses, first, we welcome you and we
thank you for being here today. You have submitted your written
testimony and it will be entered into the record in full. Let
me ask you, in the interest of time and so that we can get to
questions, we have a number of questions, and hopefully in your
remarks you will address some of the issues that were brought
up with the first panel.
But I would ask you to summarize your written statement in
five minutes or less. The Chair will recognize Mr. Brantley for
five minutes.
TESTIMONY OF TOM BRANTLEY, PRESIDENT, PROFESSIONAL AIRWAYS
SYSTEMS SPECIALISTS, AFL-CIO; JAMES C. LITTLE, INTERNATIONAL
PRESIDENT, TRANSPORT WORKERS UNION; RAYMOND VALEIKA,
INDEPENDENT AVIATION ADVISOR; JOHN J. GOGLIA, DIRECTOR, CENTER
OF INTEGRATED EMERGENCY MANAGEMENT, PARKS COLLEGE OF
ENGINEERING, AVIATION AND TECHNOLOGY; BASIL J. BARIMO, VICE
PRESIDENT, OPERATIONS AND SAFETY, AIR TRANSPORT ASSOCIATION OF
AMERICA, INC.; MARSHALL S. FILLER, MANAGING DIRECTOR AND
GENERAL COUNSEL, AERONAUTICAL REPAIR STATION ASSOCIATION; DAVID
CAMPBELL, VICE PRESIDENT FOR BASE MAINTENANCE AT ALLIANCE FORT
WORTH AND KANSAS CITY, AMERICAN AIRLINES
Mr. Brantley. Thank you. Chairman Costello, Congressman
Petri and Members of the Subcommittee, thank you for inviting
PASS to testify today.
PASS represents approximately 11,000 FAA employees,
including approximately 2,800 flight standards aviation safety
inspectors. In addition to other oversight responsibilities,
airworthiness inspectors are responsible for ensuring that
maintenance work performed at more than 4,900 certificated
repair stations in the United States and overseas is done in
accordance with airline and/or manufacturer instructions and
FAA regulations.
In recent years, the overall dynamic of the aviation
industry has been one of dramatic change, including airlines'
increasing their reliance on outsourced maintenance. In fact,
the IG has stated that the outsourcing of air carrier
maintenance to repair facilities has grown to 62 percent of air
carriers' maintenance costs in 2005.
PASS and the inspector workforce that we represent have
serious safety concerns regarding this escalating trend and the
FAA's ability to oversee the outsourced work. Of primary
importance, there must be an adequate number of experienced and
trained FAA inspectors in place with appropriate support to
accomplish the agency's mission of safety oversight. Inspector
staffing has not kept pace with the explosion of outsourcing
and nearly half of the inspector workforce will be eligible to
retire by 2010.
The FAA claims that it is impossible for the inspector
workforce to increase at the same rate that the aviation
industry is changing and is moving toward a risk-based approach
in which data will be the primary tool to determine potential
safety threats. We agree that the changing environment makes it
essential to focus on anticipating risks. However, that does
not reduce the need to raise staffing levels for the inspector
workforce. As explained in our written testimony, risk analysis
is only as good as the data upon which it is based. When
inspectors are not doing enough inspections, the amount of
needed data is simply not available.
Therefore, PASS is requesting that Congress direct the
agency to develop a staffing model for inspectors and follow
the recommendations outlined in the recent study by the
National Academy of Sciences with a deadline for completion.
The inadequate level of inspector staffing is making it even
more difficult to address other problems, with oversight of
outsourced air carrier maintenance. For example, there are over
690 foreign repair stations certificated by the FAA. However,
due to a lack of inspector staffing and the abundance of
bureaucratic red tape an inspector must cut through to gain
access to these repair stations, many inspectors say they are
not confident with the level of oversight.
After an inspector waits a month or longer for
authorization to visit a country, the repair station is fully
aware of the visit and the element of surprise is non-existent,
reducing the visit to a tour rather than an inspection. In
addition, inspectors tell us of problems regarding the
regulations governing foreign repair stations and the security
at these facilities. If a foreign repair station wants to work
on U.S.-registered aircraft or any aircraft that operate in
this Country, those repair stations should be required to meet
the same safety standards and regulations as domestic repair
stations. Part of the growing threat is that repair stations
are themselves sub-contracting out more and more maintenance
work to other facilities, many of which are not certificated by
the FAA and are therefore not subject to direct FAA oversight.
Recent IG reports have highlighted the dangers involved
with the escalating use of non-certificated repair facilities,
empathizing that these facilities are performing far more work
than minor services, with some even performing maintenance
critical to the airworthiness of the aircraft. Despite the fact
that these facilities are performing safety-critical work, FAA
oversight is practically non-existent. This practice cannot
continue without a significant increase in risk to aviation
safety. PASS believes the most effective way to correct the
disparity between work performed at certificated and non-
certificated repair facilities is for Congress to require that
air carriers outsource maintenance work only to certificated
repair stations, a standard that should apply to both domestic
and international facilities.
Oversight of outsourced maintenance is in critical need of
attention and improvement. For too long, the FAA has responded
to critical IG and GAO reports with sophisticated plans but no
real action. In order for inspectors to continue to provide
adequate oversight for the aviation system, the FAA must take
immediate steps to increase staffing and funding for its
inspector workforce so they are able to continue to ensure this
Country's status as having the largest, safest and most
efficient aviation system in the world.
Thank you, and I would be happy to answer any questions.
Mr. Costello. We thank you, Mr. Brantley.
Mr. Little, you are recognized for five minutes.
Mr. Little. Thank you, Mr. Chairman, and thank you, Members
of the Subcommittee. I appreciate the opportunity of being here
today.
In 1989, the TWU testified before this same Subcommittee
against the FAA elimination of our long-established
geographical restrictions on performance of scheduled
maintenance in favor of legislation to reverse that rule
change. At that time, we predicted that the elimination of
limits on movement of maintenance would result in the
outsourcing and loss of tens of thousands of jobs to overseas
facilities. The FAA would not have the capacity to follow the
overseas work, and the work and the workers who performed it
would not be subject to the same regulatory requirements that
U.S. mechanics must function under.
At that time, we were accused by the FAA and industry
officials of grossly exaggerating those possibilities. I would
suggest to the Committee that if it reviews the testimony it
would find that in virtually every concern we expressed,
unfortunately it has been validated. In particular, as pointed
out in today's written testimony, the majority of heavy
maintenance accomplished for scheduled U.S. carriers is no
longer performed by those carriers, but is outsourced, and an
ever-increasing portion is outsourced overseas.
As my brother from PASS points out, this situation has been
generated, at least in part, by the absurd system of double
standards the FAA has created. Carriers seeking to limit
exposure to costly regulations governing the performance of
maintenance can do so by outsourcing the work, especially
overseas.
Rules comparable to the FAA rules on drug and alcohol
testing is only one thing. Security, background checks,
exposure to unannounced, and I underscore unannounced checks,
are covered by legal enforcement which subjects persons
performing maintenance to not only licenses suspension, there
is revocation, there are fines for improper performance, either
do not exist or are not really as rigorous as those in this
Country.
The system of double standards is an increasing disservice
to U.S. airmen, the flying public and as PASS points out, makes
the job of their Members far more difficult. At American, after
extraordinarily difficult negotiations that were conducted in
the shadow of potential bankruptcy filing, the TWU managed to
secure contractual protections that maintained aircraft
maintenance work in-house. There are 18 heavy checks performed
at American, all are done in-house in bases of Tulsa, Kansas
City and Alliance Fort Worth. I believe at present, American is
one of the only major carriers that still does the majority of
its own maintenance.
However, while our contract protects such work over the
long term, it is under continuing jeopardy if we retain the
present regulatory system. Likewise, the chances of bringing
work, as we have successfully done, in-house will be more
limited over the long term.
If this Committee believes that the desire of the situation
we should continue the regulatory status quo. However, I
believe that is not acceptable. We ask the Committee to
comprehensively examine and remedy the system of double
standards, and re-impose some sensible limits on the movement
of aircraft.
Again, I thank you for the opportunity to address this
Committee, and I welcome any questions you may have.
Mr. Costello. The Chair thanks you, Mr. Little, and would
recognize under the five minute rule Mr. Valeika.
Mr. Valeika. Good afternoon, Mr. Chairman, Members of the
Committee. Thank you very much for the opportunity to air my
views about aircraft maintenance and the changes and challenges
that are occurring.
First of all, just a brief background. I have spent 40
years in aircraft maintenance, 20 of those years plus running
maintenance operations at three major airlines, the last of
which was Delta Airlines, where I retired as senior vice
president. By the way, we did $300 million worth of in-sourcing
before I left. Just to let people know that the streets have
two lanes on it, going both directions. I have been involved in
all of those activities that created this great maintenance
system, such as MHG, aging aircraft, human factors, et cetera,
over my career.
The issues of outsourcing are not new. What is new is that
the airlines in the past had extensive in-house capability that
they are shedding in a very dramatic fashion. The other factor
that is new is that it is happening on an unprecedented level
in a very, very short period of time. Lastly, it is much more
global than at any other time before.
In the past, outsourcing from the major carriers occurred
on an ad hoc basis and usually for very specific items. Labor
agreements prevented wholesale outsourcing and most of it was
accomplished either in the U.S. or Europe. Now, however, the
scope, both in the content and geography has changed. There are
many reasons for this, but most of them boil down to economics,
obviously. Since deregulation, two types of airlines have
existed: the legacy airlines, which have the burden of
infrastructure and entrenched high costs; and the so-called low
cost carriers, which do not. To shed costs, airlines have taken
extreme measures and the results in many cases have been to
outsource maintenance.
Unfortunately, maintenance was burdened with many
intractable rules and regulations, and management and labor
were at odds, often resulting in bitter battles. For a variety
of reasons, focus in the U.S. on in-house maintenance is
diminished greatly. At the same time, globally it has
flourished in parts, especially where low-cost maintenance is
available. If you look at the investments in maintenance, the
Middle East and the Far East and certainly Europe are making
major investments in airline maintenance, where in the United
States, for the most part, we have been diminishing those
investments.
As stated by most of the testimonies, the safety system
which we have created has not been impaired, as witnessed by
all the available data. This is due to many layers of safety
and oversight that is in place. First of all, the quality of
maintenance that is performed is very important. The standards
that the airlines have had, the cushions that have been built
into these airplanes of course is very important. The aircraft,
and this has not been said too much today, but we really do
have very good aircraft today, compared to what we relate to in
1989 and so forth. We are looking at airplanes that are
fundamentally much better, much easier to maintain and require
fewer man hours and they are much safer. So there is a big
change in aircraft.
When you look at engines, it is phenomenal what an engine
does today. When I was at Pan Am, we used to remove an engine
every 600 hours or 700 hours in a 747. An engine now can go for
30,000 hours without a removal. These factors are phenomenal.
So there is a big change.
It is also very important to point out that much of the
work that is performed or outsourced is not critical from a
safety standpoint. Most of the hours spent on a heavy check on
aircraft are restorative, such as cabin upgrades, cleaning,
opening and closing. Thus, treating outsourcing generally as
being all critical misses the point. But there are many
critical functions, and these must have the highest standards
and oversight. And these are the areas that need focus and
specific attention.
Part of the economic problem that U.S. carriers have faced
is the cost of the lower skill tasks versus the higher skill
tasks. We tended to blur that distinction, and that is where a
lot of our labor and management issues occurred, because for
many of the lower skill tasks, we were paying very high wages.
These were creating high costs.
Outsourcing is here to stay, and in my opinion will grow
even more as the new generation of aircraft and engines come on
board. The issue clearly is not who does the maintenance but
how it is done. In the past, it was quite easy to oversee the
performance and maintenance as it tended to be accomplished at
one or two locations under uniform standards and procedures.
Now it is being dispersed and under different standards,
procedures, different languages and different cultures. Most of
the regulations in the past evolved from the way we did
maintenance. Thus, the FAA evolved its many rules based on best
practices, and these were relatively easy to enforce since most
of the airlines were both centralized in their work performance
and record keeping.
What airlines have created was an integrated system
approach of providing total support, albeit for themselves.
What is currently happening is the disintegration of that
system. The path that the airlines are taking today is
dispersing the various functions and no one is amalgamating
them into a one stop shop. As the airlines outsource more----
Mr. Costello. If you could summarize very quickly, we have
a vote on the Floor and we are going to try to get to Mr.
Barimo as well.
Mr. Valeika. Let me just get to what the FAA, in my
opinion, really needs to do. The current operating
specifications, which are totally in the house of the airlines,
I believe, need to be expanded to the providers. It is clear
now to me that the rules and the regulations have to include
the providers of maintenance, so the reliability of maintenance
programs, engineering, your question on standardization, a lot
of these things have to change. The providers of maintenance
will have to share much more in the information technology,
record keeping and so forth, which right now is only in the
airlines' purview.
Mr. Costello. We will have some questions concerning those
issues.
Mr. Valeika. One last point I do have to make, though.
Mr. Costello. It has got to be quickly.
Mr. Valeika. It is very quick. I think that with good
information technology, there is no reason why the United
States cannot be the premier provider of maintenance services.
I think we are arguing over labor rates, not arguing over the
cost of the process.
Mr. Costello. Thank you.
Mr. Barimo, if you could summarize in five minutes or less.
We do have a vote on the Floor, we are going to get your
testimony in, and if you can do it in less than five minutes,
we will go vote, there will be one vote on the Floor, we will
immediately come back and resume the hearing.
Mr. Barimo. We will do an on-time arrival.
Good afternoon. I am Basil Barimo, Vice President of
Operations and Safety for the Air Transport Association of
America. I appreciate the opportunity to join you this morning
as you consider how the expertise of highly qualified third
parties can be applied to air carrier maintenance programs.
Long and varied experience confirms that contract maintenance
can be both safe and efficient, and we shouldn't be hesitant to
accept its use.
Before going any further, though, I want to emphasize that
a starting point for any discussions that have aviation safety
implications is this: safety is the constant, overriding
consideration in our members' activities. They understand their
responsibilities and they act accordingly. The U.S. airline
industry's stellar and improving safety record is evidence of
that.
Thus, we have a commitment to safety, we have the
operational and regulatory structures to fulfil that
commitment, and the results, our safety record, confirm that
commitment. Maintenance contracting in the airline industry is
overtaken in this over-arching context of dedication to safety.
It is no different than any other activities in our industry in
that respect.
Consequently, it is not a shortcut by which shoddy
maintenance is tolerated. It is not a stray cutoff from an
airline's overall maintenance program. And it is not adrift,
detached from regulatory moorings. More decisively, the safety
data don't offer a reason to question the use of contract
maintenance. Outsourcing has increased over the past decade,
but as this chart clearly shows, and this chart in fact goes to
zero, the U.S. airline industry's maintenance safety record is
the best it has ever been. If there were a systemic problem
with contract maintenance, the safety data would have exposed
it. This favorable outcome is expected and once again, context
is crucial. Contract maintenance occurs in a highly structured,
safety-oriented environment.
To begin with, the decision to outsource is for each
airline to make. An airline makes that decision as the
certificate holder, the regulated entity that is ultimately
responsible for the safety of its operations. If the airline
elects to use third party maintenance, the airline is not
sloughing off any of its statutory or regulatory obligations.
On the contrary, the airline is making a well thought-out
determination that outsourcing will contribute both in terms of
results and efficiency to the airline's maintenance program.
Contract maintenance is common and commonly accepted in the
industry. Virtually every airline to some degree relies on
contract maintenance, whether in the form of line, heavy or
engine maintenance. And aircraft operators with demanding and
sophisticated maintenance needs, including the various branches
of the U.S. military, contract for maintenance services.
We should also understand that highly respected aviation
firms, including airlines, one of which is seated next to me
today, performs third party maintenance. It is not an exotic
practice wherever it is done. Oversight of contract maintenance
is multi-layered and continuous and fully integrated into FAA's
regulatory structure. The FARs explicitly recognize it. The FAA
also certificates repair stations which must comply with an
airline's FAA-approved maintenance program.
In addition, as a certificate holder, the airline must
monitor the quality of the maintenance that is performed. To do
so, airlines conduct in-depth and frequent audits of the repair
stations that they use. They employ independent auditors, they
assign their own on-site representatives to monitor repair
station performance. Finally, they measure the reliability of
the products produced. Then the FAA has a compliance program
that oversees both the performance of the airlines and the
repair stations.
Continued access to third party maintenance is the one
ingredient in some airlines' efforts to remain competitive both
here and abroad. That competitiveness is what enables
passengers and shippers to receive the services that they want
at prices that they are willing to pay. Compromise of safety
can never be tolerated.
But neither should efforts to limit airlines' ability to
obtain necessary services consistent with the highest degree of
safety as economically as possible. This search for efficiency
has meant that some airlines have shifted where their
maintenance work has done. Sometimes it meant moving the
location of in-house facilities, other times it has meant
contracting with a third party to perform certain maintenance
functions.
Neither type of change is pleasant. Both can adversely
affect workers and their communities. It has, however, also
meant job opportunities for some workers and new economic
benefits for new communities. Far from resulting in the export
of the majority of U.S. maintenance jobs overseas, it has meant
that we have been able to retain those jobs in the United
States. This is a key point in evaluating the effects of
contract maintenance.
Thank you for allowing me to briefly express our views this
morning, and we look forward to more discussion.
Mr. Costello. We thank you, and the Subcommittee will stand
in recess. I would expect if we have the one vote and no
unexpected votes, we will be back in about 20 minutes. The
Subcommittee stands in recess.
[Recess.]
Mr. Costello. The Subcommittee will come to order, please.
The Chair recognizes Mr. Campbell.
Mr. Campbell. Thank you, Mr. Chairman, and good afternoon.
Thank you for inviting American Airlines to participate in
today's hearing on outsourced air carrier maintenance. My name
is David Campbell, I am the vice president responsible for two
of our three maintenance bases at Alliance Fort Worth and in
Kansas City, Missouri. Our third maintenance base is located in
Tulsa, Oklahoma.
I cannot emphasize enough that safety is American's number
one priority. As such, we welcome the diligent and continuous
oversight of the FAA, and believe that it is an important
component of our commitment to safety. I will explain in a
moment our day to day activities with the FAA.
First, however, I would like to describe how we have taken
a substantially different path than other airlines in an
industry where outsourcing is a trend. With employee
cooperation and productivity improvements, we have been able to
avoid bankruptcy and restore our company to a position of
financial stability. We still have substantial amount of debt.
We have been able to greatly improve our balance sheet and our
economic future.
We have achieved this financial turnaround in large part
because of the partnership that we formed with the Transport
Workers Union, or the TWU. Three years ago, American Airlines
and the TWU committed to transforming our maintenance business
from a cost center to a profit center. Today, we perform over
90 percent of all maintenance work, and 100 percent of our
heavy maintenance work at American Airlines facilities.
Approximately 9,750 employees are working at our three
maintenance bases, repairing and maintaining our fleet of 700
large aircraft, as well as working on aircraft for dozens of
other carriers.
By partnering with our employees and by implementing
continuous improvement processes, we have reduced costs, gained
efficiencies and optimized operations. We have also been able
to acquire and perform maintenance work for other airlines,
despite the fact that we pay higher salaries and better
employee benefits than virtually non-airline vendor.
Two years ago, a joint team from our Tulsa maintenance base
announced a breakthrough goal to generate $500 million in value
creation. Last month, a Tulsa team proclaimed that they not
only made the goal, but they beat it by $1 million. This year,
we have a target of $175 million of additional third party
revenue. In order to make that happen, I am proud to announce
and pleased to announce that our board of directors agreed
yesterday to invest $100 million into our maintenance and
servicing groups. Over the next five years, American will
update its maintenance facilities, invest in technology, make
process improvements and increase productivity in order to
offer world class, state of the art technical service and
attract new customers. In other words, while many of our
competitors have outsourced work to low labor cost regions
around the world, we have actually in-sourced work from many of
those same regions and look forward to acquiring more work.
Now I would like to turn to our relationship with the FAA.
The United States Code states that it is the duty of the air
carrier to provide service with the highest possible degree of
safety in the public interest. To assure that we meet this
obligation, we work very closely with the 37 inspectors
assigned to American Airlines. Every morning at 8:15, a safety-
related conference call is held with the FAA three principal
inspectors. On this call, we have representatives from our
maintenance and engineering team, flight, safety, security and
environmental departments. We discuss mechanical issues, safety
issues and any other relative concerns of the day. These same
departments also participate in a weekly call where long-term
issues and concerns are addressed.
In addition to that, we also have executive roundtable
meetings that we hold with senior management or senior
executives from American and the principal inspectors.
Inspectors who are assigned to American maintenance bases are
dispatched from the agency to Dallas Fort Worth airport's
certification office. They often arrive at our bases
unannounced. Our employees know that the inspectors may talk to
whomever they wish and review all records and logs without
interference.
We also agree with the FAA to adhere to a safety risk
management program that allows our records and reports to be
shared to enhance the oversight of the carrier by identifying
risks and mitigating hazards. Inspections, unannounced reviews
and oversight by the FAA are an integral part of our continuous
improvement process, and we welcome their involvement. We
believe that rigorous FAA oversight should be a critical part
of any maintenance program, regardless of where the maintenance
is being performed and by whom.
I will be happy to take any of your questions. Thank you.
Mr. Costello. Mr. Campbell, thank you for your testimony.
Mr. Goglia, you are recognized under the five minute rule
at this time.
Mr. Goglia. Thank you, Mr. Chairman. It is a pleasure to be
here in front of you today.
I would like to announce to you that I have conducted a
thorough review of the paperwork that you provided to us today
outside on the table. I have observed your operation here today
and I certify you to go forward for the next year and conduct
these hearings.
[Laughter.]
Mr. Goglia. And that is about as thorough as a foreign
repair station gets from the FAA, because we can't come back
again, because we don't have any travel money, and we can't
stay overnight, because we are not going to get reimbursed on
the per diem. So as we talk about what the FAA does, keep that
in mind, because that scenario is accurate.
Now, we had a nice chat up in the hall in the very
beginning about safety standards, safety records. A gentleman
by the name of Jerome Lederer, who happened to be the person
who founded the Flight Safety Foundation, is known as Mr.
Safety. He passed away not to long ago at 100 years old. He
came back from retirement to do the Challenger accident in the
1980s. He has said repeatedly, and I don't know if this was an
original statement of his or not, but he said that the absence
of an accident is not an indicator of a safe operation. That is
100 percent correct.
Although I am a firm believer that the ATOS system and the
SMS system is needed, that we can make great gains with it, it
doesn't replace the physical presence. You have hit around the
edges of it, but I want to share something with you. In my
past, working for an air carrier, one of the tasks that I
performed virtually every day at the end of the shift was a
review of the paperwork. Because we were dinged repeatedly by
the FAA on paperwork violations. So that paperwork, when it
left my hands, was pristine, signatures in every box. I got
creative writing 101 down to a science. Everything was done.
If you base your monitoring system, ATOS, SMS, on what came
out of my hands, you would think that operation was perfect and
pristine. It was far from that. The operation was just like
everyone else's operation, we had problems. So the paperwork
review is not the only answer. You have to be there. Those
inspectors have to be there when the work is done, and when the
airplane, if it is nose to tail work, is finished. The number
of complaints or gigs or non-routines that occur after we think
the airplane is done and we start checking it, maybe a taxi
check, maybe a ferry flight, a maintenance ferry flight to
check things out, the number of items that come back from those
events can be staggering. Yet most of them don't ever find
their way into the data collection system. That is why the
physical presence of an inspector is so important at the end.
Now, maintenance is based upon good paperwork. That
paperwork foundation comes from the instructions for continued
airworthiness found in the certification requirements that are
imposed upon the manufacturer. In the past, right to this
minute, all the previous airplanes have lots of problems with
those manuals. We call them maintenance manuals. Those
maintenance manuals, those procedures are not verified, they
are not validated. Unlike the flight deck, before a pilot can
use a procedure, it is thoroughly vetted. The maintenance
procedures are not vetted. Some are, but they are not 100
percent vetted.
That gives us, as a mechanic, and you go through the
process, and you can't follow the procedures, after a while you
don't even look at the procedures, whether or not they are good
or not. Because you know how to do your job. We have become
very good at doing our job looking at the illustrated parts
catalog, we are very good at taking things apart and putting
them back together the way we did it. The problem there comes
from when I take it apart and he puts it together. There is a
big disconnect there. And we have had a lot of problems in that
area.
To the FAA's credit, they have been working on this. There
is a partnership in the works with SAE, which is an engineering
organization, not for profit, PAMA, the Professional Aviation
Maintenance Association, they are working on voluntary
standards with the industry to try to raise that. But there
needs to be a requirement up front that those procedures are
validated, verified and known to be good. That was the reason
why we killed those people in Charlotte, the Air Midwest crash
that Congressman DeFazio mentioned earlier. That is why we
killed a couple of people, with the exact same issue a few
months later, in Hyannis, Massachusetts.
The list goes on, I could go on and on about the fatals and
the accidents and the role of procedures and manuals. We need
to get a handle on it. SMS will help, but it needs to be
robust. The FAA needs to get a higher buy-in in that process
than they have today. We need to get more involvement by
people, be it ASIs, the inspectors, involved with that system,
especially the ones that don't agree with it.
And I know I am out of time. I am a Washington windbag.
[Laughter.]
Mr. Costello. We thank you for your testimony and we will
have some questions for you.
The Chair recognizes Mr. Filler under the five minute rule.
Mr. Filler. Thank you very much, Mr. Chairman.
A couple of points I would like to make at the outset. I am
Marshall Filler, Managing Director and General Counsel of the
Aeronautic Repair Station Association. I have spent my 34 years
in aviation and safety regulation, that is my line of work. I
know it is very tempting to look at certain accidents as
perhaps proving a global point. But I do want to just point out
to the Subcommittee that no one, no one aspect of our industry
has a monopoly on accidents. Indeed, when accidents happen and
people are killed because of mistakes by anybody, it is tragic.
Whether those mistakes are made by certificated mechanics,
employees of a repair station, people who design aircraft or
produce them, it is all something that we need to look at.
So I think we just need to be careful about examining or
giving too much credence perhaps to single events as possibly
proving a greater point.
I would like to also mention, Mr. Chairman, that you were
very interested this morning with the FAA in where the air
carriers contract out their maintenance to. One thing that I
don't think came across as loudly as it should have is that
every airline that I have ever been around has something called
an approved vendors list, an AVL. That approved vendors list
includes all of their maintenance vendors. Most of them, or
virtually of them, have to undergo a pre-qualification audit.
This is part of the FAA maintenance program that every airline
has.
I know that some carriers, even some in this room, provide
on a quarterly basis to their FAA office a copy of that
approved vendor list, showing them in very neat, nicely divided
sections which of their vendors do substantial maintenance,
which of them do component maintenance, et cetera. So I think
that the FAA could certainly ask the airlines for this
information.
Another point that came up was the notion of critical work
being done by these so-called non-certificated repair
facilities. I do want to point out that there is a built-in
limitation under Part 65 of the regulations so that when work
is done by a certificated A&P mechanic under his own
certificate, that person may not approve a major repair or a
major alteration for return to service. So that must be done by
a repair station, or it must be done by an air carrier. So that
is a built-in limitation in the regulations.
With respect to the Charlotte accident, there was a
required inspection item which is by definition a critical
inspection in Part 121 that was indeed performed by
certificated people individually, not affiliated with the
repair station. And certainly one of the things this Committee
could explore is whether they wanted to expand that limitation
in part 65 to include required inspection items. The vast, vast
majority, Mr. Chairman, are done by repair stations and
airlines' own employees.
As far as foreign repair stations go, I know there is an
awful lot of interest in this. A couple of points I would like
to make about that. In Europe, and more than half of the
foreign repair stations are actually located in the European
Union, they require type ratings for their technicians, type
ratings. We don't require that here. So that is an example, you
can make an argument, that perhaps that is a higher level of
safety. We look at it at ARSA as that is an equivalent level of
safety. It is simply a different system. But it certainly gets
us to where we need to be from a safety perspective.
We disagree that an airline will go to a low-cost provider
simply because they are a low-cost provider. If you are dealing
in particular with airplanes, if that low-cost provider does
shoddy work and something breaks, then by law what breaks has
to either be fixed or deferred, as a matter of law. When that
airplane has to be fixed and taken out of service, it doesn't
make money.
So before you know it, the air carrier that may have saved
some money by contracting out to a cheaper provider, be it a
U.S. or a foreign provider, now has eaten up that entire
savings, if you will, because they have paid for it on the back
end.
I wanted to make the point also, and I know my time is--can
I have one more minute, Mr. Chairman, and I will wrap it up?
Mr. Costello. How about 30 seconds.
Mr. Filler. All right, I will take 30 seconds. Thank you.
With respect to security, the background check requirement
in our security regulations attaches because people have
unescorted access to the security identification display area
at an airport. So if I work for a repair station and I need to
have access to that SIDA area, I have to have a background
check, every bit as much as if I were an airline mechanic. If I
work in an industrial park 25 miles away, working on
components, the risk from a security perspective is different.
So we just should avoid the one size fits all tendencies
sometimes that are based on, well, there is no security
requirements for repair stations as there are for carriers.
I know that I have exceeded my time. I would be very happy
to answer any questions you have. Thank you, sir.
Mr. Costello. Thank you. We wish that we had unlimited time
as well, because there are a lot of issues we need to go into.
That is why we are going to hold additional hearings at a later
date.
Let me begin by asking a few questions. Mr. Brantley, in
your testimony you talk about when a problem is detected that
because of a lack of time and reduced staffing that it is very
difficult to follow up to make sure that the problem is
corrected. I wondered if you might expand on that and tell us
what can be done to change that, so when a problem is detected
there is sufficient time and sufficient personnel.
Mr. Brantley. Thank you, Mr. Chairman.
What we are being told by our inspectors in the field is
that one, the inspections of a repair facility, an outsource
facility, are going to be pretty rare, maybe one or two a year,
maybe a handful where they are able to get there more often.
And when they go, they are not going to be there for a few days
to do anything in-depth. They are going to be going for the
day, which means with travel time, it really cuts down the
amount of time they can spend at the facility.
So if they do find something, one, they need to do their
investigation and gather any materials they need, whatever they
think they are going to need to follow up with at that time,
because they are not going to be there tomorrow and they are
not going to come back next week. And then depending on the
problem, the appropriate actions will be taken. But it is very
rare that the inspector will be allowed to go back and actually
see if the problem has been corrected. It is identified, but it
is not something that is followed up on by the agency.
Mr. Costello. The issue of insufficient funding for travel,
you brought it up in your testimony and Mr. Goglia brought it
up in his testimony. I wonder if you might touch on that and
tell us, is that in fact a problem, the lack of sufficient
travel funding available?
Mr. Brantley. Yes, absolutely, Mr. Chairman. Again, it is,
there are times when an inspector is going to a facility that
they, they actually plan out an inspection ahead of time based
on why they are going there. It may be that two or three people
are needed, at a minimum maybe two, a maintenance and an
avionics inspector and that they are going to need a couple of
days to do the kind of in-depth review that they feel they need
to do.
And more often than not, if they are allowed to go, they
are told, one of you are going, you are going to go for the
day. And they are told it is because there is not enough money
for the travel.
Mr. Costello. So you are actually told, the inspectors are
told that, look, you can go, but you can only go for a day
because we don't have enough travel money?
Mr. Brantley. Yes, sir. Many times they are told, there is
not enough money for it.
Mr. Costello. Does this happen on a regular basis, or is it
at a particular time of year, at the end of the fiscal year, or
is it a constant problem?
Mr. Brantley. No, sir, it is a constant problem. An
inspector will say they request the funds to go do an
inspection. It may take a couple of months even before they are
told no. But it is a continuous problem.
Mr. Costello. You talked about some of the repair
facilities, and they may be visited once or twice or a few
times a year. Are there unannounced visits ever? Do they always
notify the facility that hey, we are coming next Wednesday, or
do they ever do unannounced visits?
Mr. Brantley. Something I would like to touch on that I
heard from the FAA this morning, several times, that they can
do unannounced inspections or the regulations allow unannounced
inspections. That is true. But what I am talking about is what
they actually do. It is extremely rare for an inspector to do
an unannounced inspection.
Quite frankly, if they do, they are more likely than not to
be punished for it. A customer service initiative can be filled
out against them, claiming they are disrupting the operation
showing up unannounced. And that inspector is going to be
reassigned, they won't be going to that facility any more. So
they have learned that regardless of what the regulations say,
this is how you are going to conduct business.
Mr. Costello. Mr. Goglia, I wonder if you might follow up
on that question, both the issue of unannounced inspections and
also the travel, lack of funding for travel, both of those
issues.
Mr. Goglia. I will start with the travel. Oftentimes the
travel budgets are stripped out of some of these FSDOs to fund
other projects within the agency. Sometimes that can occur very
early in the fiscal year.
The unannounced visits, it is very difficult for an
inspector to just start an unannounced visit. But under the
CMO, certificate management office process that the FAA has,
there is much more latitude. There is one little bright spot in
what is going on in the FAA today, in that Mr. Ballough is
actually trying the certificate management office process for a
larger repair station. I happen to believe that the certificate
management office concept should be at every repair station
that does nose to tail work. Nose to tail means the airplane is
in the hangar when they are working on it. Not that you have
taken an engine off and sent it to a repair facility or any
component and sent it to a repair facility, because that is a
different oversight process. I think that we do a pretty decent
job of that.
But the nose to tail work is where we see the biggest
number of problems. It is the most difficult to oversee, and it
is the one where the FAA really needs to have a presence while
that work is going on.
Mr. Costello. Let me follow up with a couple of quick
questions, then I will go to Mr. Petri and Mr. DeFazio. I
mentioned in my opening statement that it has been suggested
that we should standardize the procedures and the manuals in
order to save time and to bring more efficiency to the process.
I wonder if you might comment on that.
Mr. Goglia. That has been a goal of the Air Transport
Association and many in the industry for a long time. Many of
the airlines believe that they are unique, that they need their
own set of procedures to do things. It has been my experience
when I have visited facilities and look at people accomplishing
certain tasks that I have accomplished as a mechanic or as an
inspector myself, that regardless of the paperwork, we tend to
do them all the same. In other words, the work is accomplished
the same way, regardless of what the paperwork says. I think we
can benefit by a real concerted effort to standardize
procedures.
Mr. Costello. Mr. Barimo, a quick question. PASS has
suggested that air carriers should only be allowed to outsource
their maintenance to certificated repair stations. I wonder if
you might comment on that.
Mr. Barimo. I am glad to, Mr. Chairman. I have read the IG
report that addresses non-certificated repair stations. We have
gone back to our members and confirmed that ATA members are
using that type of maintenance service for strictly low level,
on-call service type of repairs, not scheduled maintenance, not
critical maintenance, as it has been defined today.
So let me start by saying, I think we have a misconception
out there that this is a widespread practice. Having said that,
air carriers use certificated mechanics for ad hoc work. It is
at locations where an airplane might break and they need to
just move the airplane to the next station, and we are talking
about maybe deactivating a system, checking fluid levels,
something very straightforward.
I am not familiar with any of our members out there
changing engines or replacing critical flight controls using
this type of low-level maintenance service.
Mr. Costello. The Chair recognizes the Ranking Member, Mr.
Petri.
Mr. Petri. Thank you very much.
I apologize for missing the underlying testimony. So maybe
the questions have been asked already, but I have a couple of
questions. I don't know if you are exactly the people to ask
them of.
Mr. Campbell, I am kind of interested in the issue of
safety and maintenance of planes and Government inspection, I
guess, as the subject of this hearing. American Airlines
clearly insures its planes, people who will lose money if they
crash have some interest in the safety of the operations and
the maintenance of the operations. Are you at all familiar with
that?
Mr. Campbell. No, sir, I am not.
Mr. Petri. Okay. Well, because it seems to me that there is
a whole, huge, regulatory private system out there, there has
to be. They are not going to insure a plane unless they are
pretty confident everything is being done to make sure it is
operated as safely as possible. That airline gets a lower rate
if they do that, and they are going to pay a high rate or not
get insurance if they don't.
Yes, sir?
Mr. Goglia. Mr. Petri, while I was at the NTSB, and after
the ValuJet accident in 1996, I had the opportunity to see the
precursor to ATOS, which was a work that was done out of
Rutgers University and TSI was a contractor at Volpe in
Massachusetts, where I live. So I was interested in that
process. And they actually had ten areas which they could
identify risk in any airline. Those indicators showed at that
point in time that ValuJet was a ten times greater risk than
U.S. Air.
So I found that to be more than fascinating. And I pursued
that line of thought that you just had with the insurers,
starting with USAIG and AAAU in New York, and quickly found out
that it had to go to a higher level, which meant Lloyds in the
secondary market. Over about a two year period of time, I made
repeated visits to London, to Lloyds, pitching this program at
the very highest levels of the underwriting. And the bottom
line to all of that is that they would accept the certification
of the FAA as the standard, if you had a certificate, that is
all they looked for.
One of the things that I found really painful was the fact
that their own attorneys said that if they were to stick their
nose in and require their assureds to collect this information
and report it to the CEO, was what I was asking, because he has
the fiduciary responsibility for the corporation, that they
would then become involved in the lawsuits. So it was just a
total hands-off from the insurers. As long as they held a
certificate from the FAA, that is as far as they wanted to go.
Mr. Petri. You are not aware, then, of any insurance
industry councils or studies or, you would think there would be
some feedback, they would at least want some input on what
those standards are. And they insure, of course, fleets all
over the world. You would think there would be a competitive
advantage for one of these insurers as opposed to another to
select the safer flights. They must have some way of doing
that, or maybe they just decide they will take that risk
without--it doesn't make sense to me.
Mr. Goglia. It didn't make sense. And they do have some
internal looks that they do, but nowhere near the depth that we
are talking about here today.
I will share with you one other thing that was said to me
during those meetings. It was after the hurricane hit
Homestead, Florida and we had all that devastation. One of the
people that was present, in a rather small group of that
insurance group, I am talking about senior management, one of
them had taken a considerable hit with payments in Florida. He
had low-balled his bid to a U.S. operator for the insurance. A
U.S. operator that I knew, that I worked for, and I don't hold
in high regard. He told me face to face that he was rolling the
dice because he could use the premium money.
So that is a whole different set of drivers in that
business that doesn't make sense to you and me to go off and
buy insurance in this rate shots and this risk and all of that.
It doesn't equate in this business.
Mr. Petri. Mr. Valeika?
Mr. Valeika. In my role both at Delta as a senior VP and
Continental and Pan Am, all three where I was in charge of
maintenance, we did have meetings, the insurance people would
meet with me. I would, I don't want to say certify, but they
certainly would verify some of the data where the maintenance
was done, things of that nature. We did have those meetings. It
was part of a standard operating procedure. I can only speak
for those airlines because that is where I was involved in it.
But I personally, as the head of the maintenance division,
met with the insurers, usually on an annual, maybe a semi-
annual basis. And the questions would be asked, where are your
airplanes maintained, what kind of problems you have had, just
a general kind of discussion. But that did happen on a routine
basis.
Mr. Costello. The Chair thanks the gentleman and recognizes
the gentleman from Oregon, Mr. DeFazio.
Mr. DeFazio. I thank the Chair.
So Mr. Barimo, then is it the ATA's position that it would
be acceptable for the FAA and/or Congress to restrict non-
certificated facilities from doing what I earlier described as
critical maintenance?
Mr. Barimo. Sir, I would argue that based on the feedback
that I have received to date, that is already happening. The
restriction is there.
Mr. DeFazio. Well, it is not happening on the part of the
FAA, clearly. To them it is like, as long as there is an A&P
mechanic there, it is okay, it doesn't matter. And even when I
cited an instance where people died, it is still okay, that met
all the rules. I am just trying to nail you down here. We do
have testimony here from Mr. Brantley saying that there are 21
domestic and foreign non-certified facilities that perform
maintenance critical to the airworthiness of the aircraft. And
we just worry about the slippery slope down here. So anyway, it
seems like yes, you would support that.
Mr. Barimo. Really, from our standpoint, we talk about
insurance providers. We are talking about FAA oversight. The
carriers take their safety responsibilities very seriously.
Mr. DeFazio. I understand that. But there is always a bad
apple in the barrel, often there is. I remember when Mr.
Lorenzo kept trying to drag the industry down. We have to worry
about those sorts of things.
So Mr. Goglia, I am disturbed about the manuals, which as I
understand it are called the Instructions for Continued
Airworthiness. It sounds pretty important to me, sometimes
called maintenance manuals. You are saying they are neither
validated, verified nor validated, meaning they contain
procedures that won't work, don't work or won't ensure the
continued airworthiness of the aircraft, is that correct?
Mr. Goglia. That is correct, they are not 100 percent
verified or validated, unlike the flight manuals.
Mr. DeFazio. Okay. I guess I can think back to that Chicago
crash, DC-10, where the engine dropped off. That would have
been perhaps a problem in the manual?
Mr. Goglia. It was an attempt to circumvent the manual
proceedings.
Mr. DeFazio. So in that case the manual was correct and the
maintenance was incorrect?
Mr. Goglia. Right.
Mr. DeFazio. Okay. But we do require that the flight
operation manual that the pilots have up there to refer to
does, is verified and validated?
Mr. Goglia. Yes. In fact, the pilots cannot use a procedure
unless has been vetted.
Mr. DeFazio. So what would be the bar to getting better
manuals?
Mr. Goglia. All it is is a process, sir. When you build an
airplane, you have to fly it for about a year, the
manufacturer. It is a nice new airplane, nothing much breaks.
When something does break, when they have occasion to change an
engine, a wheel, a brake, anything, at that point they will
verify those procedures.
But because it is new, they don't get to do a lot of that.
What happens is after it is in service with an airline, now the
procedures that have been written by some person within their
organization get to be done by the average person on the line,
the average maintenance person. At that point, we find the
problems.
Mr. DeFazio. The jack screw on the DC-9 issue, that one?
Mr. Goglia. I was afraid of that. That was the most painful
accident I have ever worked. From a maintainer's point of view,
to kill 88 people because we couldn't grease--excuse me.
Mr. Filler. Mr. DeFazio?
Mr. DeFazio. Yes.
Mr. Filler. If I could just add to what Mr. Goglia said,
with respect to the certification process and the development
of ICAs, all focusing on the ICAs at least at the airplane
level or aircraft level, they are all based on so-called
approved technical data, which is data that has been shown to
comply with the airworthiness standards. So if it is a large
airplane, Part 25.
In addition to that, when the maintenance manuals are
created, there is a unit of the FAA called the aircraft
valuation group that specializes in the review of ICAs. Now, do
they go out and actually try every repair that is listed in the
airplane maintenance manual? No, they don't. But they do review
it, and they are reviewed by people who are knowledgeable about
maintenance procedures. It is one of those things that we just
have not achieved perfection yet.
Mr. DeFazio. Well, but I mean, if you make a plane, you
think, okay, I am making this plane, it will take a year to
certify, I will take one of them over here, I will take the
engines off an align, I will take this part out, I will do
that, and I will verify what I am telling people they should do
to remove those parts and maintain them.
Apparently that is not being regularly done. Mr. Goglia had
an example of Airbus and Jet Blue and the fact that they were
having problems with engine changes. They were following the
manual, it just didn't work. Then apparently, finally, Airbus,
after many people complained, finally sent a team over, and
they said, oh, yes, you are right, it doesn't work, we will
rewrite the manual.
Mr. Filler. In some cases, you are absolutely right, sir,
that does exist. These manuals are----
Mr. DeFazio. I would think that would be part of the
certification process, you made it, you take it apart, put it
back together and you verify what you put down here as
directions. That does not seem unreasonable to me. I was a bike
mechanic, not a plane mechanic. But the manuals pretty well
worked for me. Someone had vetted that stuff.
Mr. Filler. Repair development engineers do engage in that
practice. But if the question is, does the FAA review all these
repairs to make sure that they actually work, the answer to
that is just no. There are just too many of them, sir.
Mr. DeFazio. Okay.
Mr. Goglia. But you know, they all have to review them
beforehand. Maintenance is a process. Don't lose sight of the
fact that everything we do has order in it. If you have a list
of, let's say the list is 500 items long, they are in the
maintenance manual, procedures in the maintenance manual, you
simply can ask the airlines, as a manufacturer, the first time
you accomplish any one of the items on this list, to report
back to us that it worked or didn't work, and improvements.
Mr. DeFazio. Sort of like we do with doctors and drugs.
Mr. Brantley, I was just really disturbed, we had
allegations and Mr. Goglia I think was sort of making fun, but
is it accurate to say we are really constraining our actual
physical inspections because there aren't enough people, there
is huge concern about overtime and there is not an adequate
travel budget? You talked about people just trying to go from
one State to another, let alone a foreign country.
Mr. Brantley. Yes, sir, that is absolutely accurate. It is
a shame, because it doesn't need to be that way. Again, if the
agency were truly looking at the work that needed to be done,
the resources needed to do it, and where people needed to be to
apply those skills, much of that could be avoided. They would
be asking for the money they need rather than asking for the
money they are willing to ask for. Those are two very different
numbers, as you well know.
Mr. DeFazio. It has been a frustration, and I am just
summarizing here, Mr. Chairman. My entire time in Congress I
keep having regulators come before me and I say, look, I know
you are being threatened by your political bosses, but just
tell us what we need, not what they will let you ask for over
at OMB. I am very sorry to hear that in this critical area of
inspections and safety, that that prevails. I hope we can pry
an honest number out of FAA on what they need and we can
authorize it in the upcoming bill. I would love to have
contributions from your folks on what they think we need.
Mr. Brantley. Thank you, sir.
Mr. DeFazio. Thank you, Mr. Chairman.
Mr. Costello. The Chair thanks the gentleman from Oregon.
We thank all of our witnesses today for your testimony. It
has been very interesting. As we go through the reauthorization
process, we certainly will take into consideration what we have
learned here today.
With that, the Subcommittee stands adjourned.
[Whereupon, at 1:33 p.m., the Subcommittee was adjourned.]
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