[House Hearing, 110 Congress]
[From the U.S. Government Publishing Office]
THE PRESIDENT'S FISCAL YEAR 2009 FEDERAL AVIATION ADMINISTRATION
BUDGET
=======================================================================
(110-94)
HEARING
BEFORE THE
SUBCOMMITTEE ON
AVIATION
OF THE
COMMITTEE ON
TRANSPORTATION AND INFRASTRUCTURE
HOUSE OF REPRESENTATIVES
ONE HUNDRED TENTH CONGRESS
SECOND SESSION
__________
FEBRUARY 7, 2008
__________
Printed for the use of the
Committee on Transportation and Infrastructure
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40-696 PDF WASHINGTON DC: 2008
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COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE
JAMES L. OBERSTAR, Minnesota, Chairman
NICK J. RAHALL, II, West Virginia, JOHN L. MICA, Florida
Vice Chair DON YOUNG, Alaska
PETER A. DeFAZIO, Oregon THOMAS E. PETRI, Wisconsin
JERRY F. COSTELLO, Illinois HOWARD COBLE, North Carolina
ELEANOR HOLMES NORTON, District of JOHN J. DUNCAN, Jr., Tennessee
Columbia WAYNE T. GILCHREST, Maryland
JERROLD NADLER, New York VERNON J. EHLERS, Michigan
CORRINE BROWN, Florida STEVEN C. LaTOURETTE, Ohio
BOB FILNER, California FRANK A. LoBIONDO, New Jersey
EDDIE BERNICE JOHNSON, Texas JERRY MORAN, Kansas
GENE TAYLOR, Mississippi 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
TIMOTHY H. BISHOP, New York JOHN BOOZMAN, Arkansas
MICHAEL H. MICHAUD, Maine SHELLEY MOORE CAPITO, West
BRIAN HIGGINS, New York Virginia
RUSS CARNAHAN, Missouri JIM GERLACH, Pennsylvania
JOHN T. SALAZAR, Colorado MARIO DIAZ-BALART, Florida
GRACE F. NAPOLITANO, California CHARLES W. DENT, Pennsylvania
DANIEL LIPINSKI, Illinois TED POE, Texas
DORIS O. MATSUI, California DAVID G. REICHERT, Washington
NICK LAMPSON, Texas CONNIE MACK, Florida
ZACHARY T. SPACE, Ohio JOHN R. `RANDY' KUHL, Jr., New
MAZIE K. HIRONO, Hawaii York
BRUCE L. BRALEY, Iowa LYNN A WESTMORELAND, Georgia
JASON ALTMIRE, Pennsylvania CHARLES W. BOUSTANY, Jr.,
TIMOTHY J. WALZ, Minnesota Louisiana
HEATH SHULER, North Carolina JEAN SCHMIDT, Ohio
MICHAEL A. ACURI, New York CANDICE S. MILLER, Michigan
HARRY E. MITCHELL, Arizona THELMA D. DRAKE, Virginia
CHRISTOPHER P. CARNEY, Pennsylvania MARY FALLIN, Oklahoma
JOHN J. HALL, New York VERN BUCHANAN, Florida
STEVE KAGEN, Wisconsin VACANCY
STEVE COHEN, Tennessee
JERRY McNERNEY, California
LAURA A. RICHARDSON, California
VACANCY
(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, Vice Chair 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
ELLEN O. TAUSCHER, California York
TIM HOLDEN, Pennsylvania LYNN A WESTMORELAND, Georgia
MICHAEL E. CAPUANO, Massachusetts MARY FALLIN, Oklahoma
DORIS O. MATSUI, California VERN BUCHANAN, Florida
MAZIE K. HIRONO, Hawaii JOHN L. MICA, Florida
LAURA A. RICHARDSON, California (Ex Officio)
JAMES L. OBERSTAR, Minnesota
(Ex Officio)
(iii)
CONTENTS
Page
Summary of Subject Matter........................................ vi
TESTIMONY
Dillingham, Gerald, Director, Physical Infrastructure Issues,
U.S. Government Accountability Office.......................... 7
Punwani, Ramesh K., Assistant Administrator for Financial
Services, Chief Financial Officer, Federal Aviation
Administration, accompanied by Gene Juba, Senior Vice President
for Finance, Air Traffic Organization, Federal Aviation
Administration................................................. 7
Scovel, III, Hon. Calvin L., Inspector General, U.S. Department
of Transportation.............................................. 7
PREPARED STATEMENTS SUBMITTED BY MEMBERS OF CONGRESS
Carnahan, Hon. Russ, of Missouri................................. 32
Costello, Hon. Jerry F., of Illinois............................. 33
Mitchell, Hon. Harry E., of Arizona.............................. 45
Oberstar, Hon. James L., of Minnesota............................ 52
Richardson, Hon. Laura A., of California......................... 58
Salazar, Hon. John T., of Colorado............................... 60
PREPARED STATEMENTS SUBMITTED BY WITNESSES
Dillingham, Gerald L............................................. 62
Punwani, Ramesh K................................................ 95
Scovel, III, Hon. Calvin L....................................... 110
SUBMISSIONS FOR THE RECORD
Federal Aviation Administration:
Response to request from Rep. Costello......................... 13
Response to request from Rep. Costello......................... 16
Response to request from Rep. Duncan........................... 20
Response to request from Rep. Hall............................. 27
Responses to requests from Rep. Richardson..................... 30
Responses to questions directed toward the Honorable Robert
Sturgell, Acting Administrator, from Rep. Mica............... 141
Consolidated listing of FAA facilities requiring repairs....... 144
Mold remediation projects...................................... 176
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HEARING ON THE PRESIDENT'S FISCAL YEAR 2009 FEDERAL AVIATION
ADMINISTRATION BUDGET
----------
Thursday, February 7, 2008
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 would ask all Members, staff, and everyone to turn their
electronic devices off or on vibrate.
The Subcommittee is meeting today to hear testimony on the
President's fiscal year 2009 FAA budget. The Chair will give an
opening statement, recognize the Ranking Member for his opening
statement or comments, and then we will get to our witnesses.
The Chair would note that Mr. Petri, the Ranking Member of
the Subcommittee, was snowed in and, unfortunately, can't be
here today, but we are fortunate to have, in his place as the
Ranking Member today, the former Chair of this Subcommittee,
Mr. Duncan from Tennessee, and after my opening statement I
will recognize him for his comments.
I welcome all of our witnesses here today. This
Subcommittee is, of course, having our first Subcommittee
hearing of this year on the President's fiscal year 2009 FAA
budget. I am pleased to welcome the Chief Financial Officer for
the FAA, Ramesh Punwani, who is accompanied by Gene Juba, the
Senior Vice President for Finance of the FAA's Air Traffic
Organization; the Department of Transportation's Inspector
General, Mr. Scovel; and Dr. Gerald Dillingham of the
Government Accountability Office.
The Administration's fiscal year 2009 budget again proposes
to transform the FAA's current excise tax financing system to a
user fee system. Under the fiscal year 2009 budget request, as
detailed in the FAA's reauthorization proposal submitted last
year, the FAA's financing sources would shift from a mix of
fuel taxes, other excise taxes, and a general fund contribution
to user fees, fuel taxes, and a general fund contribution. This
proposal would take effect in 2010.
Last year, however, this Subcommittee, the Full Committee,
and the House soundly rejected the Administration's user fee
proposal during consideration of H.R. 2881, the FAA
Reauthorization Act of 2007, which passed the House of
Representatives on September 20th, 2007. We, of course, are
still awaiting the Senate to act on the reauthorization
proposal.
As everyone knows, this past year we experienced record
delays. It is very difficult for me to understand why the
Administration wants to cut the FAA's total funding request by
1.8 percent at the same time it predicts that by 2014, without
any change to the current air traffic system, delays will be 62
percent higher than today. The Administration's fiscal year
2009 FAA budget request is simply inadequate to meet the
growing demand in air travel and to keep pace with
infrastructure needs of our aviation system.
Let's begin with looking at the F&E account, facilities and
equipment, capital programs. In 2003, the FAA requested and
received from the Congress an authorization of approximately $3
billion per year for its capital program. Yet, through fiscal
year 2005, 2006, 2007, and 2008, the Administration requested
roughly $2.5 billion per year for its capital program. For
fiscal year 2009, the Administration is requesting an 8.4
percent increase in the F&E account over the fiscal year 2008
enacted level.
While I am pleased to see the Administration has asked for
increased funding, I do not believe that it is enough to
modernize the current air traffic control system. Moreover, the
Administration's fiscal year 2009 capital spending request
appears to be at odds with its own preliminary Next Generation
transportation system F&E cost estimate of $3.246 billion,
which is also the funding level authorized in H.R. 2881.
While it is important that funding is provided to make
NextGen happen, NextGen is not just about financing. I am
concerned with reports the FAA has yet to set near-term
expectations for the NextGen system and establish funding
priorities. We have learned from the past that the NextGen
system must evolve incrementally through sound contract
management by the FAA coupled with aggressive oversight by the
Congress. To move forward with NextGen, the FAA must provide a
clear road map detailing both short-and long-term goals and
investment priorities. Moreover, the Administration must
develop a plan on long-term NextGen costs.
Last year, the Department of Transportation Inspector
General reported that there are still unknowns regarding
NextGen costs which will depend on, among other things,
performance requirements for new automation, weather
initiatives, and the extent to which the FAA intends to
consolidate facilities.
I am also concerned about the condition of our air traffic
control facilities. In our hearing last year regarding ATC
facility conditions, the Subcommittee found that the facilities
were poorly maintained and had unsafe working conditions,
jeopardizing the health of its employees. I have asked the FAA
for a list of facilities that it will remediate in fiscal year
2008, as well as under the fiscal year 2009 budget, and FAA has
not yet given the list to the Subcommittee. I expect the FAA to
provide this information to the Subcommittee within seven days
from today. The facilities that will be remediated in fiscal
year 2008, as well as under the fiscal year 2009 budget, this
Subcommittee wants a list of those facilities within seven days
from the agency.
I have said before that we can't put the cart before the
horse when it comes to modernization. While the FAA continues
to lay the groundwork for modernization, it must also make
certain that the current system can continue to operate in a
safe, reliable way to properly invest in maintaining and
upkeeping the existing structure. The FAA must also provide
safe and healthy working conditions for its employees.
In the AIP program, the Airport Improvement Program, the
fiscal year 2009 budget request provides $2.75 billion for the
Airport Improvement Program, $1.15 billion less than the level
authorized under H.R. 2881 and $765 million less than the
fiscal year 2008 enacted level.
Increasing investment in aviation infrastructure is
necessary to enhance capacity and reduce delays, and one way of
achieving that goal is through the new runway and runway
extensions in this Country. The AIP levels set forth in the
Administration's fiscal year 2009 proposal will not provide the
investment needed to reduce congestion and delays. Under the
current formula for distributing AIP entitlement funding,
virtually every airport that currently receives AIP entitlement
funding will have its entitlement reduced.
Let me repeat that. Under the current formula for
distributing AIP funding, virtually every airport in the
Country that currently receives AIP entitlement funding will
have its entitlement reduced.
Additionally, small airports may be particularly hard hit
by the Administration's proposed AIP cut because AIP grants are
a larger source of funding for smaller airports.
Staffing. I am concerned about future staffing levels for
the FAA's controller and safety inspector workforces. In
particular, the FAA estimates that, by 2016, approximately 60
percent of the FAA's roughly 15,000 air traffic controllers
will be eligible for retirement. The FAA plans to hire
approximately 16,000 controllers over the next 10 years to have
enough recruits in the pipeline to backfill the positions lost
and to accommodate the increase in air traffic.
The Inspector General will testify today that since 2005,
3,300 controllers have left the agency and that the total rate
of attrition was 23 percent higher than the FAA had projected.
I will repeat that again. The rate of attrition is 23 percent
higher than the FAA projected. If anyone doubts that we have a
problem in the system, all they have to do is to take a look at
the current staffing level and the projections that the FAA had
made in the past.
The National Air Traffic Controllers Association states
that three veteran controllers have retired per day since the
end of fiscal year 2007. The acceleration of retirement is no
doubt directly attributable to the imposition of the FAA work
rules on its controller workforce. We are more than a bit
strained in our system. We are headed toward a crisis if the
FAA does not acknowledge that it has a serious controller
staffing problem. Hiring new controllers is a complex process,
and there is a significant difference between a trainee and a
certified controller.
Replacing a controller who retires must begin several years
in advance, and I am concerned that the FAA does not have an
effective program to ensure both efficiency and quality of the
trainee. Moreover, I have concerns about reports that some ATC
facilities have more controllers in training than they can
realistically handle. I think we will hear about that today
from both the IG and the GAO as well.
The FAA extension. Finally, this Subcommittee is well aware
that the FAA is potentially facing significant fiscal year 2008
budget problems due to the lapse in funding for the AIP
program, and the upcoming expiration of both the aviation
excise taxes and the authority to make expenditures from the
aviation trust fund. The House acted on three separate
occasions to extend the FAA's authorities, including passage of
H.R. 2881, the four-year FAA reauthorization legislation. We
are working with the Ways and Means Committee in the House to
develop legislation that extends not only the aviation taxes
and expenditure authority, but also AIP contract authority. We
will work with the Senate to pass this extension as soon as
possible.
We must make the investments in our aviation infrastructure
and workforce now so that they can maintain the highest level
of safety and efficiency in our aviation system.
With that, I will recognize, again, the Ranking Member who
is sitting in for Mr. Petri today, but before I recognize Mr.
Duncan, 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.
The Chair now recognizes the Ranking Member from Tennessee,
Mr. Duncan.
Mr. Duncan. Well, thank you very much, Mr. Chairman. I
thought you would make a great Chairman of this Subcommittee
and you certainly have, and I am privileged to sit in on behalf
of Mr. Petri and make a few remarks both on his behalf and
mine.
The fiscal year 2009 FAA budget request is a stark reminder
of the need to get the FAA reauthorization bill signed into
law. I anticipate that the witnesses will share with the
Subcommittee the ramifications of further delay in passing the
FAA reauthorization bill and the impact of repeated short-term
extensions of the FAA's authorities. I would encourage all
Members to pay particular attention to the concerns raised in
this regard and keep in mind that the House passed its
reauthorization bill back on September 20th of last year.
We will also explore the issues raised by the President's
budget request for fiscal 2009. Despite the fact that both the
House of Representatives and most of the aviation community did
not accept it, the proposal assumes a shift in the FAA's
revenue sources from the current assortment of excise taxes to
a combination of general aviation fuel taxes and cost-based
user fees for commercial users. While it seems to be a foregone
conclusion that the FAA's proposal will not be adopted at the
end of the day, I admire the agency's commitment to their
cause.
Like last year, I am particularly interested in how the FAA
budget proposal addresses the much needed modernization of our
national air space system. As we all know, air traffic control
modernization will be a critical importance over the next 10 to
20 years, as demand on the system is projected and certainly
will grow dramatically. The budget request includes $631
million for the transformation to NextGen. However, for
modernization to be successful, development and deployment of
cutting-edge technologies and performance standards must not be
delayed. Congress must be assured that NextGen planning and
investment decisions are being coordinated.
Additionally, the Federal Government must work closely with
aviation stakeholders, including industry and labor, to ensure
that new technologies and operational changes are thoroughly
vetted and that critical investment decisions are fully
addressed and supported. This is a difficult thing for this
Subcommittee, particularly with some of these very expensive,
high-tech projects, and in that regard, so that we won't be
embarrassed by huge cost overruns and not do our duty to the
taxpayers, we need much help in this regard from the witnesses
who are here today, System Administrator Punwani and especially
Inspector General Scovel and Director Gerald Dillingham, on
whom we have relied so much in the past.
I am interested in hearing what specific modernization
initiatives the Administration proposes for fiscal years 2009
through 2015, as well as beyond. To keep pace with the rising
demand, the FAA must also continue to support airport capacity
capital projects with the continuation of a robust air
improvement program. The President's budget requests $2.75
billion for AIP.
This request is some $765 million less than was enacted for
fiscal year 2008 and almost $400 million less than what was
authorized for fiscal year 2008 in our House-passed
reauthorization bill. I am concerned about the impact that
reduced funding would have on our airports' ability to keep up
with capital project needs, particularly at small and medium
sized airports, as the Chairman has mentioned, that are unable
to rely on sizable passenger facility charge receipts to
complete the needed projects.
In the aviation industry, safety and efficiency is not only
achieved by technology and funding, but also by the dedicated
and highly trained employees of the FAA. As we move forward
with the budget, we must be sure to provide adequate funding
for recruiting, hiring, and training FAA's future safety
professionals and air traffic controllers, and the Chairman,
once again, went into this. Ensuring the right investment now
is essential to maintaining the FAA's critical safety mission
and impressive safety record.
I want to thank all of the witnesses for joining us here
today, and I look forward to hearing your testimony, and I
yield back the balance of my time.
Mr. Costello. The Chair thanks the Ranking Member and
recognizes the gentleman from Colorado, Mr. Salazar.
Mr. Salazar. I want to thank you, Mr. Chairman, for having
this very, very important hearing. Today, I want to say that I
associate myself with your remarks and the Ranking Member's
remarks, and I am very concerned about the dramatic $765
million cut to the Airport Improvement Program. I find that
very, very troubling. Despite the increasing delays and
congestion, you want to take funding out of these current
infrastructure projects that many of them are underway right
now, and we all know that for every billion dollars that we
spend on our transportation and infrastructure projects in this
Country, it creates 47,000 jobs. At this time, while we are
having to deal with an economic stimulus package, this is one
way to make sure that we keep America's workforce in play.
The regional and smaller rural airports in Colorado
actually provide the communities with the ability to enhance
economic development, something that we could use quite a bit
of these days. The FAA states that the cuts in the AIP program
will be offset with the funding outlined in the FAA
reauthorization bill. Well, I know that I have a brother in the
upper house, but he is also very frustrated in how the Senate
moves, and there is no telling when they will reach an
agreement and bring that to the floor.
We, as a Committee, have determined that the appropriate
level of AIP funding to meet the needs of this entire airport
system is $3.8 billion. I think that any proposal short of that
will be met with opposition from me and hopefully others in
this Committee. I know that the Colorado Department of
Transportation does not support this level of funding. The
communities who own and operate these airports do not support
this level of funding. I do not support this level of funding.
So I would like to hear today your justification for these
cuts.
And with that, Mr. Chairman, I yield back.
Mr. Costello. The Chair thanks the gentleman.
Do any other Members wish to be recognized for an opening
statement or comments? Mr. Lampson from Texas.
Mr. Lampson. Thank you, Mr. Chairman. Just a quick
statement. First, thank you for holding the hearing. I am
anxious to hear what the witnesses have to bring to us.
It is troubling indeed to consider having to face the
problems that we are facing in some of our areas. Houston,
Texas, as an example, with the congestion that Houston
Intercontinental Airport and Hobby Airport and that whole
system faces down there right now, when the area is expected to
have, within the next 15 to 25 years, an additional 3.5 million
people, we are going to shut ourselves down. So this is
extremely shortsighted. I look forward to finding solutions to
it and working with this Committee to do so.
Thank you, Mr. Chairman. I yield back.
Mr. Costello. The Chair thanks the gentleman and at this
time will recognize our witnesses. First, as I said earlier, I
am pleased to recognize Mr. Ramesh Punwani, who is the Chief
Financial Officer for the Federal Aviation Administration. He
is accompanied by--but I understand will not be presenting
testimony, but will be here to answer questions--Mr. Gene Juba,
who is the Senior Vice President for Finance at the FAA's Air
Traffic Control Organization. Also, we will hear testimony from
the Honorable Calvin Scovel, III, who is the Inspector General
for the Department of Transportation, and Dr. Gerald
Dillingham, who, of course, has testified here many times, with
the GAO.
At this time, the Chair, under the five minute rule, would
recognize Mr. Punwani.
TESTIMONY OF RAMESH K. PUNWANI, ASSISTANT ADMINISTRATOR FOR
FINANCIAL SERVICES, CHIEF FINANCIAL OFFICER, FEDERAL AVIATION
ADMINISTRATION, ACCOMPANIED BY GENE JUBA, SENIOR VICE PRESIDENT
FOR FINANCE, AIR TRAFFIC ORGANIZATION, FEDERAL AVIATION
ADMINISTRATION; THE HONORABLE CALVIN L. SCOVEL, III, INSPECTOR
GENERAL, U.S. DEPARTMENT OF TRANSPORTATION; GERALD DILLINGHAM,
DIRECTOR, PHYSICAL INFRASTRUCTURE ISSUES, U.S. GOVERNMENT
ACCOUNTABILITY OFFICE
Mr. Punwani. Good morning, Chairman Costello, Congressman
Duncan, and Members of this Subcommittee. It is a pleasure to
appear before you this morning to provide an overview of the
President's budget request for the FAA for fiscal year 2009.
With me today is my colleague, Gene Juba, Senior Vice President
of Finance in our Air Traffic Organization.
I would like to use my time to first briefly address some
budget concerns for the current fiscal year and then provide a
few highlights of our 2009 budget request. We need Congress's
immediate attention to an upcoming lapse in authorities that
could significantly disrupt our normal day-to-day operations.
First, the Consolidated Appropriations Act for this year
permits us to make expenditures from the Airport and Airways
Trust Fund only until the end of this month. Second, the
authority to collect aviation-related excise taxes also expires
on February the 29th. Third, the contract authority for the
Airport Grants Program expired on December the 31st of last
year, and for all practical purposes the Airport Grant Program
is shut down.
The consequences for FAA are that no new obligations can be
made out of any capital account after February the 29th. This
covers airport grants, F&E, and the RE&D accounts, including
employees' salaries. Without action, 4,000 employees will be
sent home and the remaining 43,000 operational staff would
follow when the General Fund is fully obligated, by about mid-
June.
Mr. Chairman, it is in the best interest of aviation safety
and efficiency for these lapses to not take place, and the
consequent disruption to our programs and personnel need to be
avoided. We appreciate the efforts of this Committee to correct
this problem as soon as possible.
Turning now to the next fiscal year. Our 2009 budget
request of $14.6 billion provides funding to support all the
critical priorities of the FAA. As always, safety is our
primary concern. As you know, we are fortunate to be living in
the safest period in aviation history, and the FAA remains
committed to making it safer still. This remarkable record is
due to the combined efforts of the Administration, the aviation
community, and, as always, the support of Congress.
Sixty-seven percent of our budget request is dedicated to
our safety mission. This includes meeting our NextGen
transformation milestones, as well as hiring goals for our air
traffic controller and safety workforces. The budget will allow
us to hire and train safety personnel to enhance FAA's
oversight, surveillance, and certification activities.
With regard to controller staffing, FAA is aggressively
hiring and training controllers to ensure the right number of
controllers are in the right place at the right time. Our
budget includes funding to provide a net increase of 306 new
controllers, a level consistent with the targets being
developed in our updated staffing plan. We are staying ahead of
the attrition curve.
As we look into the future, we see an aviation system that
will need to grow to accommodate the demands of our
stakeholders and the flying public. Our 2009 budget triples the
investment in NextGen technology, proposing $688 million for
the transformation from radar-based to satellite-based air
traffic systems. That is $500 million more in investment than
in 2008. We will also invest $3.7 billion in operating and
capital funds to improve system capacity and address congestion
and delays.
With regard to AIP, which is a major concern, I realize,
for the Subcommittee, with our proposed programmatic changes,
including the proposed increase in the maximum PFC allowed, the
$2.75 billion proposed in our budget will be sufficient to fund
capital needs and meet the safety capacity and noise abatement
objectives we have identified. As CFO, I am particularly proud,
over the last five years, to say that we have improved our
financial management performance in ways that enable us to
better use the funding that Congress provides.
We are continuing to make every effort to control our
operating costs. We have improved the discipline with which
agency programs and contracts are first approved; we have
improved the tracking and monitoring of our programs; and, most
important of all, we have reduced our overhead costs so that
more of the taxpayer dollars are spent on a safe, efficient,
and accessible aviation system.
In conclusion, Mr. Chairman, with Congress' help, we can
avoid disruption to our programs this fiscal year with an
extension of critical authorities and taxes. Time is of the
essence. We stand ready to work with this Committee and others
in Congress to enact a full-fledged reauthorization bill that
is consistent with the key goals of the Administration and will
enable us to move to the NextGen transportation system.
That concludes my testimony, and my colleague and I would
be happy to answer any questions that you and Members of the
Subcommittee may have.
Mr. Costello. Thank you, Mr. Punwani. Let me say, before we
recognize Mr. Scovel, that the Administration's statement or
position that the AIP program, as you are proposing, the level
of funding, coupled with the PFC that you believe will be
adequate funding, I doubt that there is an airport operator or
airport executive in the Country that would agree with that.
But we will get into that in just a few minutes.
The Chair now recognizes Mr. Scovel.
Mr. Scovel. Good morning, Mr. Chairman, Ranking Member
Duncan, Members of the Subcommittee. We appreciate the
opportunity to testify today regarding FAA's $14.6 billion
fiscal year 2009 budget request.
As this Subcommittee is well aware, meeting the current and
forecasted demand for air travel is an important issue facing
the Nation. The airlines transported over 700 million
passengers in 2007, and this number is expected to grow to over
1 billion by 2015. Escalating numbers of severe flight
disruptions and delays are all signs of an increasingly
strained system.
Mr. Chairman, several key issues demand FAA's attention.
First, keeping existing modernization projects on track and
setting realistic expectations for NextGen. FAA's capital
account is now being shaped by NextGen, an enormously complex
effort that will cost tens of billions of dollars. We are not
seeing the massive cost growth and schedule slips of the past.
It will be important to keep existing efforts on track
because 30 projects will serve as platforms for NextGen.
However, several programs do require attention, including a key
technology to improve runway safety called ASDE-X. Thus far, 11
of 35 systems have been deployed for operational use. However,
we are concerned about FAA's ability to complete ASDE-X
deployment with all planned capabilities at the more complex
airports with less than half of the planned funds available.
FAA is exploring ways to accelerate NextGen; however, it
remains uncertain how much NextGen will cost or what can be
delivered in terms of capacity and delay reduction. Therefore,
we think a number of actions are needed. First, FAA must
conduct a gap analysis of the current NAS and NextGen. FAA's
NextGen plans for the 2025 timeframe remain at a high level and
do not detail how FAA will complete the transition to NextGen.
Until this gap is understood, it will be difficult to set
requirements and reliable cost estimates.
Second, FAA must establish NextGen funding priorities. At
this point, it is difficult for decision makers to determine
what to invest in first or what can be accelerated. FAA needs
to identify the highest priority improvements and reflect them
in budget requests.
In addition, FAA must develop an interim architecture for
what can be accomplished in the 2015 time frame. This would
help FAA determine reasonable goals, establish priorities and
make adjustments to existing systems.
Finally, the Agency needs to obtain the expertise required
to execute and manage NextGen. We believe that strong contract
management, systems integration, and system engineering skills
with an understanding of human factors will be needed.
Another key issue is addressing attrition in FAA's critical
workforces. The long-expected surge in controller attrition has
begun. Since 2005, 3,300 controllers have left the agency,
which was 23 percent higher than FAA had projected. However,
since 2005, FAA has hired 3,450 new controllers, which was 25
percent higher than it had projected. New controllers now
represent 23 percent of the workforce, up from 15 percent in
2004, and this varies by location, from 2 percent at the Boston
TRACON to 50 percent at the Las Vegas TRACON.
FAA is facing a fundamental transformation in the
composition of its controller workforce. A major challenge will
be to train new controllers to the certified level at their
assigned locations. Facility training can take up to three
years and is the most expensive part of new controller
training. Training new controllers to the fully certified level
is important for two reasons: one, only certified controllers
can control traffic on all positions of their assigned area
and, two, controllers must be fully certified for at least six
months before they can train other new controllers on the job,
a critical component of FAA's plans to hire and train 15,000
new controllers through 2016.
We recently completed an audit of FAA's controller facility
training program. Overall, we found that the program continues
to be extremely decentralized and the efficiency and quality of
the training vary from one location to another. We found
similar problems in 2004. FAA is taking steps at the national
level, but many efforts are still in the early stages.
Key actions needed include: first, establishing realistic
standards for the number of new controllers facilities can
accommodate; second, clarifying responsibilities for oversight
and direction at the national level; and, finally, following
through on key initiatives included in its 2004 workforce plan,
such as holding managers accountable for achieving timeframes
for certifying new controllers.
FAA faces similar issues in its inspector workforce. A key
issue here will be to develop a reliable staffing model for
ensuring its limited inspector resources are placed where they
are most needed.
Mr. Chairman, that concludes my statement. I would be happy
to answer any questions you or other Members may have.
Mr. Costello. The Chair thanks you, Mr. Scovel, and
recognizes now Dr. Dillingham.
Mr. Dillingham. Thank you, Mr. Chairman, Mr. Duncan,
Members of the Subcommittee. My written statement includes our
preliminary analysis of the President's 2009 budget for FAA and
identifies some of the key challenges for FAA and the Congress
associated with maintaining the current ATC system and the
transformation to NextGen.
Regarding the budget, although the Administration's budget
proposes major changes in the way that FAA is funded, we
believe that the current funding mechanism of the trust fund
and the general fund can provide sufficient resources to
support FAA activities, including NextGen. However, the
proposed changes to FAA's funding mechanism could better align
its operational costs with revenues, that is, if FAA's cost
allocation system reliably allocates cost to the users.
The budget also proposes an overall reduction of $765
million for AIP and would allow airports to increase PFCs to
$6. However, for smaller airports, the PFC increase would not
compensate for the reduction in AIP dollars. In addition, it is
not entirely clear how such a reduction in AIP funds will
affect the efforts to increase system capacity through AIP-
funded projects.
With regard to the challenges associated with the current
ATC system, FAA has determined that it can best achieve its
safety mission by using risk-based, data-driven safety
programs. GAO agrees that this is a rational approach for
monitoring safety. However, for this approach to be effective,
FAA must obtain accurate and complete safety related data.
Another challenge for FAA is its ability to continue to
hire, train, and deploy a sufficient number of air traffic
controllers. Although FAA has been able to hire several
thousand controllers in recent years, controllers have been
retiring faster than FAA anticipated, thereby making this
challenge more difficult. In some cases, FAA will have to plan
for the time and funds that will be needed for dual training
for the controllers to operate within the current ATC system as
well as in the NextGen environment.
Another immediate challenge for FAA is repairing and
maintaining the safety and physical condition of over 400
terminal facilities. Some of these facilities will need to be
operational for years to come, including being a part of the
NextGen infrastructure. The one-time cost to repair and bring
existing facilities up to standards is estimated to be about
$300 million.
With regard to the challenges associated with the
transformation to NextGen, transitioning to NextGen will mean
an increasing number of acquisitions and increasing complexity
within those acquisitions. The challenge for FAA is to continue
the organizational cultural changes that were started about
four years ago with the startup of the ATO and to maintain its
key acquisitions on schedule and within budget. This challenge
will be especially difficult because of the need to attract
managers and other staff with the technical skills to apply a
systems approach to managing the acquisitions and the
integration of NextGen systems.
FAA has already taken steps to identify the required
workforce competencies and define strategies for obtaining the
necessary expertise. The challenge that remains is the analysis
of FAA's existing staff resources, a determination of what gaps
exist, and filling those gaps in a timely manner. Another
NextGen challenge for FAA is developing a new configuration of
facilities and airspace that will support the transformed
system. Unless a plan for facility consolidation or realignment
is developed and airspace design projects are implemented, the
cost of NextGen could increase significantly and the potential
system efficiency gains will be delayed or not realized.
Finally, FAA faces the challenge of improving
communications with stakeholders with the goal of obtaining
their buy-in and support for NextGen implementation. The
stakeholders that we have talked to have expressed frustration
over not being able to obtain satisfactory responses to some of
their basic questions, such as who is in charge of NextGen, how
is NextGen going to be implemented, and what kind of capacity
or efficiency gains can be expected from various components of
NextGen. Some of the stakeholders are concerned that FAA is not
adequately focusing on NextGen initiatives that could have a
more immediate effect on the efficiency and capacity problems
of the ATC system but, instead, is pursuing a path with
benefits targeted too far in the future.
Mr. Chairman and Members of the Subcommittee, as my final
point, I would like to identify with the remarks of the
Chairman and the two previous witnesses. It is vitally
important that the FAA reauthorization legislation be completed
in a timely fashion. Progress on critical projects such as
runway safety, the hiring of safety personnel, and capacity
projects depends on timely action on the reauthorization
legislation. Thank you.
Mr. Costello. Thank you, Dr. Dillingham.
Mr. Punwani, let me begin with you and ask just a few
questions. One, in the Administration's proposed budget you are
proposing $688 million for NextGen for fiscal year 2009. That
is an increase, as you stated in your testimony and we
acknowledge, of $476 million from fiscal year 2008. However,
when you look at the capital and research budget only rising
$234 million for fiscal year 2009, something has to give here,
and my question is what other capital and research programs
within the base will have to be cut to pay the $476 million
increase for NextGen?
Mr. Punwani. Let me start by saying there are many programs
within the capital program that are winding down, and I am
going to ask my associate to give you further detail on those
programs.
Mr. Costello. Mr. Juba?
Mr. Juba. Mr. Chairman, the additional money is coming
from, as Mr. Punwani said, the wind-down of some of the
programs that we are putting in place right now, the biggest of
which is our En Route Automation Program, which would be the
platform for a number of the NextGen applications. We are also
winding down the ATOP program. This is a base automation system
for the oceanic area.
Our capital portfolio is actively managed. We look at what
we are investing in, and some of the things for which we have
reduced investments are being replaced by NextGen technologies.
For example, the biggest component of our 2009 NextGen budget
is ADS-B, or our satellite-based surveillance system. With more
surveillance being provided by satellite, we can reduce our
investment in some of the ground-based surveillance, some of
the radar programs.
Mr. Costello. So that would make up the entire $234 million
difference?
Mr. Juba. We can get you a complete detail of exactly the
programs that it comes out to, but I can tell you the ERAM, for
one, or the En Route Automation, is $165 million of that
difference.
Mr. Costello. We are pleased that you recognize the need to
increase money for NextGen. My only question is where is it
coming from to bump the number up.
Mr. Juba. Right.
Mr. Costello. And if it comes from areas that do not
jeopardize other important areas of either NextGen or other
operations, then that is fine. If you could get us that
information, I would appreciate it.
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[GRAPHIC] [TIFF OMITTED] 40696.015
Mr. Costello. Mr. Scovel, let me ask you. As you know, for
the past few years we have been expecting the Enterprise
Architecture to define NextGen's cost, and now that we have the
Enterprise Architecture, you state in your testimony that the
MITRE Corporation says that it is too theoretical. I wonder if
you might elaborate on what you have seen and what MITRE is
saying, that it is too theoretical. Elaborate on that and tell
me when you might think that we might get a more reliable cost
schedule or estimate for NextGen.
Mr. Scovel. Thank you, Mr. Chairman. I would like to give
credit to the FAA because they have made some progress on the
Enterprise Architecture_the JPDO has. The Enterprise
Architecture is their technical road map for NextGen, and it is
aimed at the 2025 timeframe, and that is an important date to
keep in mind. However, this Enterprise Architecture is very
much a work in progress, and it is difficult to develop an
accurate architecture when we are shooting out as far as 2025.
My office, on its own review, and after we have assessed
the MITRE review, which was completed last October, found some
significant shortcomings in the JPDO's first attempt at its
Enterprise Architecture. The information in the Enterprise
Architecture doesn't adequately align with NextGen's own
concept of operations; it ranges from partial alignment to
examples of no connection at all.
The difference is this, Mr. Chairman: the concept of
operations lays out how NextGen will actually operate; the
Enterprise Architecture lays out the systems that will support
those operations. Sometimes there is a mismatch. In other
cases, the information remains at much too high a level to be
effective. Some activities are insufficiently described, and
occasionally only a single sentence is dedicated to describe
those activities.
We think_and as we have elaborated in our testimony_that
there is a gap between today's system and the NextGen concept.
We think that what we are calling a gap analysis would assist
FAA and this Committee in determining what systems and what
priorities need attention between now and the out-years. We
also think that the 2025 target date is difficult for all of us
to get our arms around, and so we recommended in our testimony
today that an interim architecture targeted at 2015_perhaps
2016, 2017, that mid-decade timeframe_would be helpful. In
other words, we would like to put an island out there midstream
and find out where we need to go to get there. Once there, we
can assess, re-adjust, and shoot for the far bank.
We don't know what timing FAA will need in order to
accomplish all of this, but our discussions with them have
informed us that perhaps a year, maybe two, would be required
for them to refine the Enterprise Architecture. If they were to
adopt our recommendation for an interim enterprise
architecture, we would hope that they would be able to
accomplish that in the same time frame.
Mr. Costello. Two more quick questions, Mr. Scovel. You
cite in your testimony there is an industry analysis that you
recently have seen that suggested that the FAA could face
possibly as high as a $50 billion software development effort
with NextGen. In your view, is that estimate within the realm
of possibility?
Mr. Scovel. Mr. Chairman, we do think it is certainly
within the realm of possibility. We think it is credible.
NextGen presents FAA with the need for a very large and complex
software development, and this is certainly a major risk to the
entire NextGen effort, as it is to any particular program. The
analysis that we refer to in our statement, that you referred
to just a moment ago, was provided to us by a major industry
stakeholder. It was done under contract to them.
We have no reason at this point to doubt it. Their
methodology was based on a review of both past FAA major
programs and DOD systems that involved large software
acquisitions, and it was done with at least a broad acquisition
of what NextGen is envisioning currently. The study--and you
referred to it--pegged a figure of $50 billion, and, of course,
when we add that on top of the $15 billion to $22 billion that
FAA currently estimates for global costs for NextGen, then we
are speaking of total costs now on an order of magnitude
greater than what we have currently seen for NextGen estimates.
Mr. Costello. I wonder if you would comment, either one of
you, Mr. Juba. Have you seen this, the estimate that the
software could cost as high as $50 billion? I would like your
response.
Mr. Juba. At this point, we have not changed our long-term
projection of $15 billion to $22 billion on NextGen.
Mr. Costello. I understand that, but my question is have
you seen this industry analysis that says that it could cost up
to $50 billion, as the IG has?
Mr. Juba. No, I have not.
Mr. Costello. Okay. Is it something that you think you
should take a look at?
Mr. Juba. Yes, it is.
Mr. Costello. Well, I would ask that you take a look at it
immediately, because it is alarming to me that you have an
industry analysis out there that is saying that it could be as
high as $50 billion, which, of course, would take the cost of
the NextGen system as much as four, five, or six times higher
than the agency is estimating right now. So I would ask that
you go back and take a look at that and give us your opinion as
to if you think it is realistic and your response to it.
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[GRAPHIC] [TIFF OMITTED] 40696.016
Mr. Costello. Final question, and then I will turn it over
to the Ranking Member for his questions.
Mr. Scovel, there is no question--you know, there was an
article in The Wall Street Journal and USA Today and The
Washington Post about controller staffing issues, and I said
then, and I will say now, that the FAA does not want to
acknowledge that there is a staffing problem. We all know there
is. Everyone involved in the system knows there is. Everyone
involved in the system knows that fatigue is a factor and an
issue. Dr. Dillingham has touched on that previously.
The fact is there is a problem, and my question to you is
while the FAA has underestimated the number of retirements over
at the agency, while you correctly noted in your testimony they
have increased the number of trainees that they have hired and
put into the program, there is a problem here.
I mean, when we have one-fourth of the air traffic
controllers today coming into the workforce and we have three
controllers retiring, the most senior controllers retiring at a
rate of three a day, when the agency is now saying that we are
willing to offer up to a $24,000 bonus to keep the most senior
controllers, there is a problem.
So my question to you is, one, I would like you to comment.
Is there a problem, in your opinion? Number two, the issue of
the facilities, does the FAA have the facilities to handle the
number of trainees that they are trying to get into the program
and get them out to facilities? I can tell you I was at their
training facility in Oklahoma in November with Mr. Duncan and
other Members of the Subcommittee, and I can tell you they are
doing their best to get people in and out of the program as
quickly as possible.
But I have major concerns with what is going on. I just
want you to comment. One, are you concerned? Do we have a
problem in the system? Two, do they have enough personnel to
train the people coming in to the academy and into the training
program in order to get them out into facilities and to
supervise them properly?
Mr. Scovel. Mr. Chairman, we are concerned with the overall
state of controller staffing. However, we think it is important
to really refine the question. Everybody has known that this
surge in attrition was coming ever since the mid-1980s, when
the baby boom, if you will, of controllers was hired in the
aftermath of the PATCO strike. We knew that the day would come
when that baby boom would have fully matured, and they have
served admirably on behalf of the Nation. But now it is time
for them to take their well-earned rewards and to transition
into retirement.
There is much talk given of the overall numbers of
controllers in the workforce--14,800, 15,300--and we wish to
give FAA credit for stepping up to the problem in terms of
making the adjustment and hiring at least rookie controllers to
fill the vacancies that are coming. As you have noted, they
haven't been able to anticipate the rate at which the attrition
would materialize. They have consistently underestimated that.
However, they have adjusted on-the-fly by hiring many more new
controllers than even they projected would be needed in the
first place, and they deserve credit, great credit on the
hiring side.
As you have correctly noted, however, the problem then
shifts. We may have enough controllers overall, but what is the
composition of that workforce, veteran controllers versus new
controllers in training? And that is where we have the problem.
The focus now needs to shift to training of the new
controllers, and part of that process begins at the FAA
training academy in Oklahoma City, as you have noted. We have a
project underway, at your request, to study training attrition
and try to determine root causes for that.
It is too early in that effort for me to say at this point
whether the academy is properly staffed in order to turn out
the number of new controllers that it needs; however, we will
certainly have that information for you. Based on what we have
completed to date, I can say that when new controllers leave
the academy and go to their first air traffic control facility,
the efficiency and the quality of that training varies greatly.
New controllers in 2004 amounted to 15 percent of the total
controller workforce. Today, it stands at 23 percent. FAA
itself estimates that within four years 30 percent of the total
workforce will be new controllers. Assuming the academy can
push those students out to the field, then it becomes the
responsibility of each facility to train them according to
local rules and requirements.
What we have seen there is really a gap in training. We
have seen some facilities that are able to handle that quite
well. They have used their classrooms and simulators, which FAA
has aggressively pushed out to them_and, again, we will give
credit to the agency for that because the simulators have been
a great force multiplier in completing training quicker than
might otherwise be required.
What has happened, however, is that the agency has
neglected to follow through on a couple of its key promises in
its 2004 controller workforce. One of those had to do with
emphasizing controller training at the facility level as a true
priority, second only to critical operational requirements.
What sometimes happens at facilities, we have noted, is
that facility managers will use a controller in training who is
accredited on a particular position over and over again on that
position to the detriment of training that new controller on
other positions and pushing that new controller up to the most
desirable level of certified professional controller, CPC. That
ultimately is the goal both for the facility_which gives the
facility greater flexibility in assigning that new controller
throughout the facility--and also, frankly, for the controller
himself or herself, who would like to see the larger paycheck
that comes with being a CPC.
We have also seen confusion on the part of controllers in
the field and, honestly, some people at FAA headquarters
regarding oversight and responsibility for facility training
within FAA headquarters. As our testimony notes today, four
different vice presidents within FAA headquarters have
important roles to play in facility training.
Confusion exists, however, on the user side as to what some
of those authorities and responsibilities are. We won't presume
to tell FAA how to organize itself, but we can certainly offer
the suggestion that far greater clarification is needed on the
part of headquarters in informing all of its staff who has what
responsibilities when it comes to facility level training.
Mr. Costello. Thank you very much.
The Chair now recognizes the Ranking Member, Mr. Duncan.
Mr. Duncan. Thank you, Mr. Chairman.
Administrator Punwani, you heard me say in my opening
statement that I think it is very important that we move on the
FAA reauthorization bill as soon as possible, but I am
wondering. You know, a couple of years ago we did a series of
short-term extensions in regard to the highway bill. What
adverse impacts would there be if we had to do that in regard
to the FAA, a series of short-term extensions? You mentioned
the 4,000 you would have to furlough or send home if we don't
meet the February 29th deadline, but are there other adverse
impacts or problems that a series of short-term extensions
would cause?
Mr. Punwani. There is no doubt that an extension, short-or
long-term, would alleviate the immediate problem that we are
faced with on February the 29th. But some of the problems with
short-term extensions include, in the case of airport grants,
if you have a short-term extension of contract authority; it
leads to sub-optimal allocations of airport grants, the
entitlements are sub-optimal. The formulas that are used to
come up with airport grant allocations are very complex; they
have minimums and maximums and entitlement recoveries, and the
formulas just don't work unless you have a full year
entitlement. So it is sub-optimal.
If you extend the expenditure authority for the short-term
when we already have a full year appropriation and have less
than a full year's expenditure authority, that limits our
ability to manage effectively.
Mr. Duncan. Let me ask you another thing. We have heard a
lot over the last couple of years about the contract
negotiations with the controllers and so forth. Have there been
any benefits or savings to date from the contract that you have
with the controllers? And what would be the situation if the
FAA was forced into binding arbitration?
Mr. Punwani. Let me begin to answer that by telling you our
fiscal year 2009 budget does recognize some cost reductions
through various actions we have taken, including cost savings
related to the controller contract. But I believe Gene Juba
would be able to give you more information on that detail.
Mr. Duncan. All right. Mr. Juba?
Mr. Juba. Mr. Duncan, I can find that number. In the 2009
budget, we have taken a reduction in the operating account due
to the new contract that is in place with our controllers.
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[GRAPHIC] [TIFF OMITTED] 40696.017
Mr. Duncan. All right.
Well, let me move on to something else, then, and this is
the thing that is the most important to me, and I think I would
like to get comments from all three of you. I am really
concerned about this NextGen problem. I know that we need to do
this, have this technical progress, but what concerns me is on
almost all Federal programs we usually hear low-ball estimates
of the cost on the front end.
Yet, we have heard estimates everywhere from $14 billion to
$25 billion on this NextGen project, or probably more so in the
range of $14 billion to $22 billion, but that is a huge range.
I mean, we are talking about billions up here like it is some
small amount, but it is not; that is a huge difference.
And then my eyes really popped open when the Chairman said
$50 billion a few minutes ago. I mean, it is getting kind of
scary, really. If we don't really stay on top of this, these
costs could just explode, and I am wondering are we sure that
we are doing everything possible to make sure that we don't
have huge cost overruns in the years ahead?
I am wondering, too, Chairman Costello and I, several
months ago, got a presentation on the--is it SESAR, the
European--I am not if I pronounced that right--the SESAR system
in Europe. Are we ahead of them, behind them? Have we learned
anything from some of their preliminary experiences? I am just
wondering about where we stand on all that.
And then I notice that Administrator Scovel complimented
the FAA on the technical road map, but he also expressed
several concerns; number one, that 2025 was too far out to
really have realistic planning. I would like to know what you
say about that.
Then, Administrator Scovel, I didn't really understand what
you meant by the things not aligning with the concept of
operations. I would like to hear you comment more specifically,
in a more down-to-earth, less bureaucratic way about what you
mean by that.
And then, Dr. Dillingham, you wrap it up with what you are
saying on this NextGen progress so far.
Go ahead, Mr. Juba.
Mr. Juba. Mr. Duncan, I think the NextGen endeavor that we
are on is a complex program. It is software-intensive; it
requires careful integration with other programs across not
only the FAA, but other partner agencies. But one thing that
gives me confidence that we will manage these programs is--I
can go through a couple of reasons why I am confident. I am the
one that is tracking our progress along on our programs.
First off, we have done a better job of managing capital
programs. My colleagues at the IG and GAO have even admitted
that though there is still work to be done, that we are doing a
better job there. But there are three things there that you
might not be aware of that we are undertaking right now,
activities that I think will help us tremendously in executing
the programs.
First off, two years ago, we set out a goal to get off the
GAO's high risk list. This is the list of agencies that have
programs that are complex and there is risk of cost overruns.
We actually provided the GAO a written plan of action in April
of last year, and we are meeting with the GAO every quarter to
go over status on that.
Mr. Duncan. That is good.
Mr. Juba. And this planning includes things like best
practices in terms of program management and putting those
inside of all our programs. Talking about software, it includes
IT development best practices, which is key to managing these
software-intensive programs. Other things, it is using the
right metrics, including EVM, or earned value management, which
is another way of tracking our cost and schedule performance.
It also includes improvements in our cost estimating and
cost accounting. So that is one activity that is out there, one
that is not just an activity led by a small work group, but it
is an activity that is chaired and overseen by senior people at
the FAA, including Mr. Punwani, myself, our CIO and our chief
acquisition executive. So that is one thing.
The second thing is that--and I think it was brought up--
there is a need for the right human capital, the right Federal
employees at the agency to manage these programs. We see that.
We know that. We have actually hired, in the past two years, 40
contracting officers or specialists. Just in the last year we
hired over 40 system engineers, computer science people, and
program management people. We also are working with the
National Academy of Public Administration. They are helping us
look at what other needs that we have out there to manage a
program such as this. So we have that activity that is
underway.
Lastly, and probably most important, is we are using the
OEP, the new OEP, our Operational Evolution Partnership, to
manage NextGen throughout the agency. And let me tell you just
a little bit about OEP. OEP is composed of the lines of
business heads of all the lines of business with the FAA. It
includes the JPDO. It also includes the heads of two of our
larger unions that are affected by NextGen, NATCA and PASS. Why
this is a key activity out there? This is a group that is going
to oversee the progress and ensure that activities are
coordinated among the different lines of businesses, and this
is absolutely key with such a complex endeavor that we are on.
That is what gives me comfort, anyway.
Mr. Duncan. That is a good report and I appreciate all
those things. You know, this is my twentieth year on this
Subcommittee, and I have just seen so many of these things just
explode and, boy, when you are talking about these kind of
figures, you are talking about a really big deal.
Let me go to Mr. Scovel and Dr. Dillingham. I know, in
fairness to other Members, I will have to ask you to be fairly
short. I know I asked a lot of questions at one time, but go
ahead, Administrator Scovel.
Mr. Scovel. Thank you, Mr. Duncan. You have expressed
frustration with the imprecision in the cost estimates and, of
course, we share your great concern over that. Let me take just
a couple of examples, and perhaps this will also assist you in
understanding what I meant when I said there was a mismatch
between concept of operations and the Enterprise Architecture.
A big question mark when it comes to the cost estimates is
what will happen between NextGen, its primary system, ADS-B,
and what must be accomplished by way of terminal modernization
at air traffic control facilities. As you know from your years
on the Subcommittee, what has happened, for instance, with the
STARS program was tremendous cost growth and a reduction in the
number of air traffic control facilities that would be
modernized through that system. There is now a gap of some 100-
plus facilities, the modernization status for which is very
much up in the air. That contributes, of course, to the
imprecision in the cost estimate and it also illustrates the
question of what will happen between how NextGen is actually
supposed to operate, along with the concept of operations, and
the Enterprise Architecture, what systems or platforms will be
needed to pull that off.
One further example, sir, by way of communications, I know
too from your years on the Subcommittee you know that the
controller-pilot data link communication program ended up being
terminated a few years back, or at least suspended. Data link
communications will be a very expensive component of NextGen.
FAA intends to embark, in the next year or two, to restart the
data link communication effort, scope it out, and resume some
sort of data link communication program so that NextGen can be
fully realized. Cost estimates? Uncertain. Again, how will that
work between other NextGen programs remains to be seen.
Mr. Duncan. All right. Let Dr. Dillingham explain where he
thinks we are.
Mr. Dillingham. Mr. Duncan, I think what Mr. Juba said
about FAA being on our high-risk list for ATC modernization is
very important, because we have had them on the list for almost
15 years. But, most recently, we concluded that the changes
that FAA has made in managing its acquisitions, the outcome of
those changes, we have labeled them as making significant
progress.
We are guardedly optimistic, but still watching to make
sure that the culture that was put in place, that put those
business practices in place and those cost-saving mechanisms,
will go through with the next administrator as well as the new
chief operating officer. Progress has been made, but clearly we
have to watch it.
Also, with regard to the cost of NextGen, clearly it is
something that everybody is wondering about and, as you say, we
had estimates that run the gamut. I think, you know, the way we
look at it is that, yes, we need to be focused on what the
total cost is, but I think after you get out beyond a certain
number of reasonable years it becomes a real guess.
We look at the capital program over the next five years
that contains the NextGen technologies and we see they are
asking for $5.4 billion. We look at that and say that is a more
reasonable focus, but keep trying to project out so that
Congress can know where we are going and you can monitor it to
that extent. But, you know, as the IG has said, let's move back
a little bit and let's sort of look at what is reasonable to
make that kind of estimate about it.
We have seen, from the 15, 20 years we have been looking at
this, that--you were here, Mr. Duncan, when we had the AAS sort
of thing, and we told FAA at that point in time to go from the
big bang theory to the build-a-little/test-a-little theory, and
that is in fact what we are seeing in many cases, and we think
that is a positive development.
With regard to the Concept of Operations and the Enterprise
Architecture, those are also necessary documents, but it is
also the case that the more understandable--at least from my
perspective--document that is in the works right now is the
Integrated Work Plan, which talks about which systems when,
what steps along the way; and that is still being vetted by the
stakeholders.
So although part of what we are hearing out there is let's
start to talk about what we can do with NextGen that is going
to have a more immediate effect on system capability and
efficiency--and, by example, they talk about instead of trying
to figure out and deploy ADS-B across the Nation, maybe we
should look at some existing procedures and technologies and
deal with where we have problems that are facing us everyday--
New York, Miami, Los Angeles--and use those as both immediate
kinds of things to address as well as test beds for the larger
national layout kind of thing.
With regard to SESAR, the question that comes to us about
the European effort is the very question that you asked, Mr.
Duncan. Who is on first_who is ahead? Basically, you know, if I
had to answer that straight out, we would say the U.S., of
course. But the deal is that they are probably in the same
place. The Europeans are just finishing what they call the
definition stage, which is sort of their overall planning and
sort of what is it going to be, and they are getting ready to
move forward into some early implementation.
The major difference that we need to sort of keep in mind,
that I think is going to keep the U.S., you know, moving
ahead--because that is in important in terms of who is going to
set the standards and how is that going to play into our
economy--we in the United States have to deal with lots of
agencies to make all of this work, but over in Europe they have
to deal with 10 or 11 sovereign nations in their air traffic
control system.
So I think that idea, in conjunction with one of the
things--based on what we were asked to do by this Committee, in
fact, we talked to FAA about international harmonization, and
FAA went forward under the last administrator to establish an
MOU with the Europeans so that there could be some sharing and
lessons learned kind of thing. This is, no doubt, complicated--
the analogy has been that trying to do NextGen is sort of like
trying to go to the moon. It is that complicated, it is that
much of an issue, and it is something that we have to watch.
But I think, under the circumstances, progress is being
made. More needs to be done.
Mr. Costello. The Chair thanks the Ranking Member and now
recognizes the gentleman from New York, Mr. Hall.
Mr. Hall. Thank you, Mr. Chairman, and thanks to all of our
witnesses for being here and giving us your testimony today.
Mr. Punwani, I wanted to start by asking you if the budget
contains funds to implement the airspace redesign for the New
York-New Jersey-Philadelphia area.
Mr. Punwani. The budget does contain that allowance.
Mr. Hall. Okay. And as a result of the redesign, a number
of communities in my district, including Pound Ridge and
Bedford in Westchester County, and parts of Rockland and Orange
County, have seen or will seen an increase in air traffic. Is
there any funding in the budget for noise mitigation or other
means directed by the damage caused by the increased number of
airplanes flying over communities that previously had little or
no aircraft noise?
Mr. Punwani. We do have a provision of as much as $276
million in our airport grants program to address issues of
noise mitigation.
Mr. Hall. Thank you. And you spoke in your testimony about
offering controllers a variety of retention incentives. Could
you explain some of those incentives and how effective they
have been in attracting or retaining controllers? Mr. Juba?
Mr. Juba. Mr. Hall, we introduced a number of different
incentives or tools that we could use both to recruit new
controllers, as well as retain the seasoned controllers that we
have. One of those is the retention incentive. In areas where
we needed--this is not an across-the-board incentive, but it is
at those airports, those terminals, and those en route
facilities where we believe there is a need to keep a
controller on for training or watch-standing.
We also are actively pursuing reassignment provisions,
using a reassignment bonus to incentivize controllers to move
out of places that may be well staffed or overstaffed into
places like Atlanta. There are other things we have. We
introduced child care benefits; and also have a recruitment
bonus available that we have used to attract military
controllers.
Mr. Hall. Excuse me, I just wanted to ask since it used to
be a pattern for military controllers to come into the FAA
system, why is it necessary now to have a bonus offered to get
them to do that?
Mr. Juba. We found that to get people to go to the places
we want, sometimes a bonus actually works to incentivize
somebody to do that. There are incentives being offered at DOD
for these same employees. It is a competitive environment out
there.
Mr. Hall. Since we are speaking, Mr. Juba, I wanted to ask
you about the cost savings you referred to a few minutes ago
due to the new contract. My understanding of a contract is that
it is an agreement negotiated between two parties willingly and
signed by those two parties. Are you referring in fact to the
work rule that FAA instituted?
Mr. Juba. We are talking about the contract that was put in
place I believe a year and a half ago.
Mr. Hall. Put in place by who?
Mr. Juba. I can't answer you from the legal perspective,
but we went by the rules established by Congress in negotiation
with our controllers and have a contract in place.
Mr. Hall. So you would call it a contract.
Mr. Juba. Yes, sir.
Mr. Hall. Okay. I have yet to see a document that most
people would regard as a contract. In fact, that is why this
Subcommittee, and I believe the Full Committee, voted to
require, as our last FAA reauthorization bill that we passed,
require binding arbitration, because of the fact that there was
not in fact a contract agreed upon and that the FAA was, many
of us think, the intransigent party. I am just curious how much
the cost savings you are telling us about are offset by the
retention bonuses and by the other incentives that you have to
provide, and also by the loss of efficiency and the loss of
experience from people retiring who might not otherwise retire.
Any thoughts about that?
Mr. Juba. Just on retirements, we did project for
retirements and, as reported by a number of people, we have
under-projected. But just to give you a perspective on that, in
2007 we projected 700 retirements. Actual requirements were
828. We missed by a little over 100. To put that in
perspective, that is less than 1 percent----
Mr. Hall. Thank you, Mr. Juba. I have just a few seconds
left. I wanted to ask Dr. Dillingham for a comment on--well,
you said in your testimony that the FAA ``faces a challenge in
establishing credibility with stakeholders that the agency is
fully committed to NextGen.'' And referring back to a comment,
if I got it correctly, Mr. Scovel, you said that the cost for
NextGen is uncertain. It is also difficult to predict how much
NextGen will enhance capacity and reduce delays. Did I hear you
more or less correctly?
Mr. Scovel. Yes, sir.
Mr. Hall. Okay. So you can answer this too, but I wanted to
ask Dr. Dillingham if this perhaps has some relationship to the
difficulty in establishing credibility with stakeholders, that
the agency is fully committed to NextGen.
Mr. Dillingham. Yes, sir, that is exactly the issue. What
the stakeholders are telling us is that they need to know, in
terms of return on investment, what is it that is going to come
out of NextGen so they know how to--be it an avionics
manufacturer or an airline--how to plan their operations. And
they are saying we, as stakeholders, need to have that kind of
capacity or efficiency explanation. So, that gives us more of
an incentive to, in fact, come on board with NextGen
technologies.
Mr. Hall. Lastly, I just wanted to ask, if I may, starting
with Mr. Punwani, which corporation is the biggest corporation
for NextGen?
Mr. Punwani. I don't have that information readily
available. Do you?
Mr. Juba. In the 2009 budget, we have a line item in there
for ADS-B, which is our satellite-based surveillance system.
ITT is the lead contractor on that, and I would have to believe
that they are the largest. Of course, there are subcontractors
below them; they are not doing all the work by themselves.
Mr. Hall. Perhaps if you could reply in writing to the
question, in order of total dollars, who are the biggest
contractors, you know, maybe the top half dozen or so. I would
be curious to know who is receiving how much money for a
program that is difficult to predict the expense of and is also
difficult to predict how much it is actually going to enhance
the capacity or reduce delays.
[Information follows:]
[GRAPHIC] [TIFF OMITTED] 40696.018
Mr. Hall. And I yield back. Thank you.
Mr. Costello. The Chair thanks the gentleman and recognizes
Mr. Boozman from Arkansas.
Mr. Boozman. Thank you, Mr. Chairman, very much.
We have really been blessed. You know, when you look at our
safety record, it has been tremendous, and that reflects on you
all and your predecessors. It really reflects on our
controllers, the tremendous job they are doing and have done in
the past. I would like for the Committee to claim some credit
for that, but it is probably in spite of us that you all have
been able to do all that.
But I think we have some concerns about, you know, with so
many new people coming into the system, the quality of the
people that you are getting. So I would like you to tell us a
little bit about where those people came from in 2007 and just
kind of tell us are they former controllers from the military,
are they coming out of the schools, are they coming off the
street? If you give us some numbers as to what is going on in
that regard, I would appreciate it.
Mr. Juba. Let me talk about where we hired controllers last
year. The biggest source of new hire controllers has been
through our college training initiative, or CTI, schools. These
are two-and four-year programs. They go through a variety of
aviation subjects. Nearly, 60 percent of the over 1800 people
we hired last year came from those schools.
As a side note, we actually have expanded that program--it
has been very successful; we get very high-quality candidates--
from the 14 current schools out to 23 schools.
The second biggest source is the military. We have about a
third of our new hires last year came from the military. A lot
of those from military controllers.
And lastly, about 7 percent come from local hires. These
are people who had applied through our Web site and have been
screened and have gone to the Academy straight from there. A
lot of those have aviation experience of some sort and all are
required to meet the medical, security and cognitive testing
that we put them through.
Mr. Boozman. Thank you. On a similar note, in looking at
the budget, the $2.75 billion for the AIP funding level, which
is significantly reduced, do you think that you will be able to
meet the critical safety needs that we have in our airports
with that level of funding? And I will just throw that out to
whoever wants to----
Mr. Punwani. I will answer that. We recognize, first of
all, that this Committee is a big supporter of a robust airport
grants program. The $2.75 billion request may seem low, but we
believe it is affordable when it is coupled with some of the
formula changes that we proposed in our reauthorization
proposal, coupled with an increase in the passenger facility
charge at large airports, where we are proposing that the
maximum go from $4.50 to $6.00. That increase by itself would
generate an additional $1.5 billion of funding.
But it doesn't just end there. More importantly, the
formula changes that we are proposing will allow us to direct
airport grants and entitlements to the smaller airports that
have greater difficulty in raising funding. Taken together,
this budget will allow us to meet our major capacity, safety,
noise abatement, and environmental issues.
Mr. Boozman. So are you saying that the funding that we
have used for airport improvement in the past, that if we did
adopt the fees and those things, are you saying, then, that
that goes up to $4.25 billion for the same--are we talking
apples and apples or apples and oranges?
Mr. Punwani. Apples and apples.
Mr. Boozman. Very good. Thank you all.
Thank you, Mr. Chairman.
Mr. Costello. I thank the gentleman from Arkansas, and the
Chair now recognizes the gentlelady from California, Ms.
Richardson.
Ms. Richardson. Thank you, Mr. Chairman.
Two brief questions that I want to follow up on Mr.
Boozman's comments. One, of the categories where you are doing
your hiring, what is the average work experience, though, for
those different categories? Because I would think that if
someone is being hired from the military who is currently doing
the job, maybe they have done it for a couple years or five
years or ten years; whereas, maybe someone coming out of the
school may have the academic experience, but that may not
translate to actual work experience. So do you have some sort
of averages?
Mr. Juba. I don't have those numbers right now, but I would
believe that your assessment is probably right; the people
coming out of the school probably do not have a lot of work
experience.
Ms. Richardson. Okay. Could you supply this to the
Committee? Because I think that gets to the heart of Mr.
Boozman's question. Although the school might be great and
wonderful and, you know, we are getting a lot of good people,
the limited real-life experience might not be as strong, and
that is, I think, a concern in some of the issues that we might
be hearing about.
[Information follows:]
Ms. Richardson. My follow-up question to that would be how
do you determine who goes to what location? So what I mean by
that is an average person with limited experience, would they
typically get a Chicago assignment or a Los Angeles assignment,
or do they have to first do kind of a smaller tier location and
then work their way up, or is it just people go wherever there
is an opening?
[Information follows:]
[GRAPHIC] [TIFF OMITTED] 40696.019
Mr. Juba. Well, there are two parts to that, where people
go. One is their desires. I mean, do they bid for a job
location? We put it out by State sometimes. So it is where they
want to go. The second part is, from our operational side,
where do we put people. We put people in every level of the
facility, from the smaller towers up to the larger towers. This
is actually consistent with what some of our global partners
do.
In the case where we put somebody at a high level facility
and they can't perform up to that level, but are good employees
nonetheless, we have actually taken those people and moved them
down to lower level facilities and sometimes from en route to
terminal.
Ms. Richardson. So, Mr. Chairman, that would be a second
thing I would like to suggest we might like to pull that
further, because it is my understanding--since I do represent a
fairly active area, Long Beach Airport; we also have LAX, which
is my neighboring airport--I have heard that maybe it really
shouldn't be to the discretion of someone who wants to go to
LAX. If they don't have an extensive amount of experience,
maybe there could be some additional requirements that could be
instituted before they are able to go to some of the more
higher capacity tower facilities.
Mr. Juba. One thing I might add, Ms. Richardson, is that in
some of the larger, more complex facilities, what we have done,
as I mentioned earlier, is actually reassigned some of our
veteran controllers from other facilities into those facilities
to help out with training and standing watch there.
Ms. Richardson. Right. Because I spoke with an air traffic
controller in my district, in the Long Beach Airport, who said
he has only been on board maybe about a year and a half, and he
is already training other people, and, you know, that is kind
of a concern of mine. Someone who has only been doing the job a
year or so is training someone else, I mean, they haven't even
walked through the breadth of all potential examples that might
occur.
So I think building upon what Mr. Boozman said, this really
is at the heart of what I know a lot of my concerns are.
Thank you very much, Mr. Chairman.
Mr. Costello. The Chair thanks the gentlelady. As you might
have heard, we have been called for a vote. We have a series of
four votes.
That concludes our hearing today. I would like to remind
our friends from the FAA to--we understand the acting
administrator is on the Senate side today in a confirmation
hearing, but please remind him that we expect a report seven
days from today concerning the facilities that we spoke about
earlier, and we would expect to get that report. We have been
waiting for some time and our patience is running thin. [Note
provided by FAA: this information was provided to the Committee
at a briefing held on February 14, 2008.]
Again, on behalf of the Members of the Subcommittee, we
thank you for testifying here today, and that concludes the
hearing.
[Whereupon, at 11:33 a.m., the Subcommittee was adjourned.]
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