[Senate Hearing 106-1145]
[From the U.S. Government Publishing Office]



                                                       S. Hrg. 106-1145

                       AIR TRAFFIC CONTROL DELAYS

=======================================================================

                                HEARING

                               before the

                         COMMITTEE ON COMMERCE,
                      SCIENCE, AND TRANSPORTATION
                          UNITED STATES SENATE

                       ONE HUNDRED SIXTH CONGRESS

                             SECOND SESSION

                               __________

                           SEPTEMBER 14, 2000

                               __________

    Printed for the use of the Committee on Commerce, Science, and 
                             Transportation


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       SENATE COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION

                       ONE HUNDRED SIXTH CONGRESS

                             SECOND SESSION

                     JOHN McCAIN, Arizona, Chairman
TED STEVENS, Alaska                  ERNEST F. HOLLINGS, South Carolina
CONRAD BURNS, Montana                DANIEL K. INOUYE, Hawaii
SLADE GORTON, Washington             JOHN D. ROCKEFELLER IV, West 
TRENT LOTT, Mississippi                  Virginia
KAY BAILEY HUTCHISON, Texas          JOHN F. KERRY, Massachusetts
OLYMPIA J. SNOWE, Maine              JOHN B. BREAUX, Louisiana
JOHN ASHCROFT, Missouri              RICHARD H. BRYAN, Nevada
BILL FRIST, Tennessee                BYRON L. DORGAN, North Dakota
SPENCER ABRAHAM, Michigan            RON WYDEN, Oregon
SAM BROWNBACK, Kansas                MAX CLELAND, Georgia
                  Mark Buse, Republican Staff Director
               Ann Choiniere, Republican General Counsel
               Kevin D. Kayes, Democratic Staff Director
                  Moses Boyd, Democratic Chief Counsel


                            C O N T E N T S

                              ----------                              
                                                                   Page
Hearing held on September 14, 2000...............................     1
Statement of Senator Bryan.......................................     6
Statement of Senator Cleland.....................................     8
Prepared statement of Senator Gorton.............................    40
Statement of Senator Hutchison...................................     5
Statement of Senator McCain......................................     1
    Prepared statement...........................................     3
Statement of Senator Rockefeller.................................     4

                               Witnesses

Carr, John, President, National Air Traffic Controllers 
  Association....................................................    82
    Prepared statement...........................................    85
Carty, Donald, Chairman, President and Chief Executive Officer, 
  American Airlines..............................................    63
    Prepared statement...........................................    67
Mead, Kenneth M., Inspector General, U.S. Department of 
  Transportation.................................................    17
    Prepared statement...........................................    20
Mullin, Leo F., President and Chief Executive Officer, Delta Air 
  Lines..........................................................    45
    Prepared statement...........................................    47
Poole, Robert W. Jr., Director of Transportation Studies, Reason 
  Public Policy Institute........................................    77
    Prepared statement...........................................    79
Slater, Rodney E., Secretary of Transportation...................     9
    Prepared statement...........................................    13
Woerth, Captain Duane E., President, Air Line Pilots Association, 
  International..................................................    73
    Prepared statement...........................................    74

                                Appendix

Allard, Wayne, U.S. Senator from Coloarado, prepared statement...   105
Fanfalone, Michael D., President, Professional Airways Systems 
  Specialists, on Airline Delays, prepared statement.............   124
Hartley, Daniel B., President of SPEEA, prepared statement.......   127
Hollings, Ernest F., U.S. Senator from South Carolina, prepared 
  statement......................................................   134

 
                       AIR TRAFFIC CONTROL DELAYS

                              ----------                              


                      THURSDAY, SEPTEMBER 14, 2000

                                       U.S. Senate,
        Committee on Commerce, Science, and Transportation,
                                                    Washington, DC.
    The Committee met, pursuant to notice, at 9:35 a.m. in room 
253, Russell Senate Office Building, Hon. John McCain, Chairman 
of the Committee, presiding.

            OPENING STATEMENT OF HON. JOHN McCAIN, 
                   U.S. SENATOR FROM ARIZONA

    The Chairman. Good morning. This hearing will come to 
order.
    At one time, our nation had what was considered the 
largest, most efficient aviation system in the world. Today, 
our aviation system has reached the almost untenable position 
of gridlock predicted by the National Civil Aviation Review 
Commission in 1997. As a recent Washington Post editorial 
pointed out, people are no longer scared of flying--they're 
scared of not being able to fly.
    According to the FAA, there has been a 58 percent increase 
in flight delays over the last 5 years. Last year, flight 
delays were up 22 percent over the prior year. And 
unfortunately, the FAA has reported a 12 percent increase in 
flight delays over the first 6 months of this year compared to 
the first 6 months of 1999.
    We don't really even need these numbers. You only need to 
go to an airport or pick up the newspaper and read the horror 
stories of middle-America stranded in various airports around 
the country. As USA TODAY noted in one of its headlines, 
``Frustrated Flyers Now Expect Delays.''
    While flyers may come to expect these delays, no one seems 
to want to bear responsibility for them. It's clear that each 
segment of the aviation community, including the Congress, 
bears some responsibility for these problems.
    The fact is the airlines tend to schedule their flights at 
the same time during peak periods, and often at levels that 
they know are greater than an airport can handle. A recent 
Department of Transportation Inspector General audit on flight 
delays pointed out that for one day in January, Newark 
Airport's scheduled arrivals exceeded the airport's capacity to 
handle them during four peak hours.
    This year, more than ever, airline employees have caused 
enormous delays. Recently, the pilots at United have undertaken 
work stoppages to satisfy their personal greed. Last year, 
pilots at American engaged in similar tactics. And who bears 
the brunt of the stoppages? Middle-America. Average Americans 
plan for months to take a vacation, only to be greeted at the 
airport by canceled flights and lost vacations due sometimes to 
pilot greed. These are people who can't afford to change their 
plans at the last minute and don't take flights that can be 
billed to a client.
    In 1998, per capita income in the U.S. was $20,120. USA 
TODAY reported that the top pilots at United will make almost 
$342,000 per year in 2004 if the latest contract is ratified, 
or $355.84 per hour.
    And you know what saddens me the most? A large number of 
these pilots are former military whose code is supposed to be 
``duty, honor, country.'' Now they take actions without a 
thought for the Americans that rely upon them to ferry their 
families across the country for a family vacation, attend a 
wedding, or be at the side of a sick relative.
    I also recognize that one of the most significant problems 
is the explosion in air travel. The airlines now carry nearly 
three times as many passengers as they did when the industry 
was deregulated in 1978, and air fares are 40 percent lower 
when adjusted for inflation. Air traffic control has not kept 
up with this exponential rise in passenger traffic.
    But this has not been an unexpected development. In 1993 
the Baliles Commission Report stated that ``for too long, too 
many people . . . have been spending too much of their time 
sitting on the ground in airplanes and not enough time flying 
in them.''
    The Commission called for further development of the Global 
Positioning System (GPS) and its expedient application to the 
air traffic control system. In 1997, the White House Commission 
also advocated the utilization of GPS and the advent of 
modernization as early as possible.
    The FAA's modernization program was originally intended to 
be finished, completed, in 1993 at a cost of $12.6 billion. 
Modernization is currently not scheduled to be finished until 
2012 at a cost of more than double that. The FAA's GPS-based 
system, the Wide Area Augmentation System (WAAS), has been 
significantly scaled back, is over budget, and is not scheduled 
for implementation until the end of 2002 at the earliest. These 
delays must be rectified and we must give much greater focus to 
modernization of the air traffic control system.
    It is also clear to me that we need to pour new concrete 
and expand our capacity on the ground in order to handle the 
increasing number of flights. We are predicted to reach 1 
billion air travelers in less than 10 years. According to the 
Department of Transportation Inspector General, in the last 5 
years, only three new runways were put into service at our 28 
largest airports. Unfortunately, some of the very passengers 
that are complaining about delays are going to have to get rid 
of the ``not in my backyard'' mentality and allow new or 
expanded airports to be built.
    As I have outlined here, I don't believe that there is one 
particular solution to this problem. However, I do believe that 
we must keep the pressure on and remain vigilant in our efforts 
to meet this ever increasing demand and make our aviation 
system more efficient for the American people.
    One additional comment I made. I think there's been some 
legitimate criticism. And I will look forward to some comment 
from Mr. Mead on this as to how the Congress has authorized and 
appropriated funding. In other words, has moneys gone to 
smaller and less necessary projects in the name of pork 
barreling rather than to the places where they are most in 
need?
    I know that is a difficult question for Secretary Slater 
and Ms. Garvey to address, but I think Mr. Mead might also do 
that in his testimony.
    So if we in Congress bear responsibility for not using the 
proper priorities in wasting American taxpayer dollars and pork 
barrel spending, I think the American people need to know that 
as well. I thank the witnesses for coming.
    Senator Rockefeller. I'm sorry, were you here first, 
Senator Bryan? I apologize.
    Senator Bryan. You go right ahead.
    The Chairman. Senator Rockefeller, the ranking member of 
the aviation subcommittee.
    [The prepared statement of Senator McCain follows:]

                Prepared statement of Hon. John McCain, 
                       U.S. Senator From Arizona

    At one time, our nation had what was considered the largest, most 
efficient aviation system in the world. Today, our aviation system has 
reached the almost untenable position of gridlock predicted by the 
National Civil Aviation Review Commission in 1997. As a recent 
Washington Post editorial pointed out, people are no longer scared of 
flying--they're scared of not being able to fly.
    According to the FAA, there has been a 58 percent increase in 
flight delays over the last 5 years. Last year, flight delays were up 
22 percent over the prior year. And unfortunately, the FAA has reported 
a 12 percent increase in flight delays over the first 6 months of this 
year compared to the first 6 months of 1999. We don't really even need 
these numbers. You only need to go to an airport or pick up the 
newspaper and read the horror stories of middle-America stranded in 
various airports around the country. As USA TODAY noted in one of its 
headlines, ``Frustrated Flyers Now Expect Delays.''
    While flyers may come to expect these delays, no one seems to want 
to bear responsibility for them. It's clear that each segment of the 
aviation community bears some responsibility for these problems.
    The fact is the airlines tend to schedule their flights at the same 
time during peak periods, and often at levels that they know are 
greater than an airport can handle. A recent DOT Inspector General 
audit on flight delays pointed out that for one day in January, Newark 
Airport's scheduled arrivals exceeded the airport's capacity to handle 
them during four peak hours.
    This year, more than ever, airline employees have caused enormous 
delays. Recently, the pilots at United have undertaken work stoppages 
to satisfy their personal greed. Last year, pilots at American engaged 
in similar tactics. And who bears the brunt of the stoppages? Middle-
America. Average Americans plan for months to take a vacation, only to 
be greeted at the airport by cancelled flights and lost vacations due 
to pilot greed. These are people who can't afford to change their plans 
at the last minute and don't take flights that can be billed to a 
client.
    In 1998, per capita income in the U.S. was $20,120. USA TODAY 
reported that the top pilots at United will make almost $342,000 per 
year in 2004 if the latest contract is ratified, or $355.84 per hour.
    And you know what saddens me the most? A large number of these 
pilots are former military whose code is supposed to be ``duty, honor, 
country.'' Now they take actions without a thought for the Americans 
that rely upon them to ferry their families across the country for a 
family vacation, attend a wedding, or be at the side of a sick 
relative.
    I also recognize that one of the most significant problems is the 
explosion in air travel. The airlines now carry nearly three times as 
many passengers as they did when the industry was deregulated in 1978, 
and air fares are 40 percent lower when adjusted for inflation. Air 
traffic control has not kept up with this exponential rise in passenger 
traffic.
    But this has not been an unexpected development. In 1993, the 
Baliles Commission Report stated that ``[f]or too long, too many people 
. . . have been spending too much of their time sitting on the ground 
in airplanes and not enough time flying in them.'' The Commission 
called for further development of the Global Positioning System (GPS) 
and its expedient application to the air traffic control system. In 
1997, the White House Commission also advocated the utilization of GPS 
and the advent of modernization as early as possible.
    The FAA's modernization program was originally intended to be 
finished in 1993 at a cost of $12.6 billion. Modernization is currently 
not scheduled to be finished until 2012 at a cost of more than double 
that. The FAA's GPS-based system, the Wide Area Augmentation System 
(WAAS), has been significantly scaled back, is over budget, and is not 
scheduled for implementation until the end of 2002 at the earliest. 
These delays must be rectified and we must give much greater focus to 
modernization of the air traffic control system.
    It is also clear to me that we need to pour new concrete and expand 
our capacity on the ground in order to handle the increasing number of 
flights. We are predicted to reach 1 billion air travelers in less than 
10 years. According to the Department of Transportation Inspector 
General, in the last five years, only three new runways were put into 
service at our 28 largest airports. Unfortunately, some of the very 
passengers that are complaining about delays are going to have to get 
rid of the ``not in my backyard'' mentality and allow new or expanded 
airports to be built.
    As I have outlined here, I don't believe that there is one 
particular solution to this problem. However, I do believe that we must 
keep the pressure on and remain vigilant in our efforts to meet this 
ever increasing demand and make our aviation system more efficient for 
the American people.
    I look forward to hearing from our witnesses.

          STATEMENT OF HON. JOHN D. ROCKEFELLER, IV, 
                U.S. SENATOR FROM WEST VIRGINIA

    Senator Rockefeller. Thank you, Mr. Chairman. I want to do 
something I do not usually do. We have on our side a fellow 
named Sam Whitehorn. He has been here for a long time. And he 
wrote a briefing memo for our side and it was just an 
absolutely excellent memo. And I just want to say that.
    Second, this is a complicated subject. And I think, Mr. 
Chairman, as I heard you at the end indicate, I think we can 
finger point or we can solve. And I think our instinct is to 
try to solve. And I agree with you. I think that in meetings I 
just did with Secretary Slater and others, there is a lot of 
blame that goes to us in Congress, that we have tended to 
ignore this subject and infrastructure and the rest of it just 
because it for some reason has not caught on in terms of acting 
policy. So we try to solve problems. And AIR-21 was part of 
trying to solve those problems.
    But on the other hand, Secretary Slater, Administrator 
Garvey, Ken Mead, Don Carty, Leo Mullin, ALPA, controllers, all 
of the other airlines, they are the ones who really deal with 
this issue day-to-day. We like to criticize them. But, I mean, 
we generally have shared responsibility for this problem 
because it is incredibly important.
    Of course, it is true the passenger complaints are at an 
all time high. There are a lot of reasons for that, having to 
do with weather and having to do with overscheduling, which we 
need to talk about, and our system capacity. You know, we have 
not done anything about our system until very recently. And the 
question is, is that in time? We really do not have time to 
spend 10 years, Mr. Chairman, building a runway, which is what 
it takes now, or to take years to replace some of the 
controller workstations. It should not take new laws and 
regulations for passenger satisfaction to improve, and I hope 
it does not. But on the other hand, airlines are going to have 
to really respond very, very well and treat passengers better.
    So I would hope that we would not make this into a finger 
pointing session, but a problem solving session. And one of the 
things that I would love to see, and this could not come from 
me, it would have to come from DOT, FAA, et cetera, is a chance 
to get all of the parties together and to sit down and figure 
out how to do this, how to make this work. What is the problem 
with overscheduling, weather, construction taking five and ten 
years for these things that should not take that long, 
particularly now that we have allocated some of the money for. 
But how much money? Is it enough? And what are the problems? 
How can we all react to them in a constructive way?
    Having said that, I need to apologize because I am not 
leaving now, but I will be leaving before we get to Dr. Sue 
Bailey, David Plavin and Althena Joyner. All of them I strongly 
support, Mr. Chairman. I want to go on record saying that for 
confirmation. And I thank you for your courtesy.
    The Chairman. Thank you, Senator Rockefeller. Senator 
Hutchison.

            STATEMENT OF HON. KAY BAILEY HUTCHISON, 
                    U.S. SENATOR FROM TEXAS

    Senator Hutchison. Well, thank you, Mr. Chairman. You have 
had quite a week and I appreciate the tenacity that you are 
showing and the hearings that have come under the purview of 
the Commerce Committee.
    I am especially pleased that we are talking about the 
airline delays of this summer. I am looking forward to hearing 
from representatives of both government and industry who will 
be able to talk about this because obviously there is no single 
cause to these delays. Air traffic control and airport problems 
have been part of it, but they certainly do not tell the whole 
story.
    I want to commend the Secretary for calling a meeting when 
things got really bad to start talking about the problem and 
seeing what solutions could be done. I thought that did bring 
home to the industry that this is very serious.
    And I want to say that in the second panel we will hear 
from the industry and talk about some of the productive things 
that are being done on a voluntary basis. I understand that 
American Airlines is going to be rewarding managers and pilots 
for on time performance, giving them incentive bonuses. That is 
good. Also, American I am told is taking steps to ensure that 
delays at central hubs do not cause consequent delays 
throughout the system.
    I was also pleased to see that United Airlines announced 
that they were going to cut back on their number of flights 
during peak hours to make sure that the flights they have will 
give the service to their passengers that they deserve. I think 
that is a step in the right direction because clearly it seems 
to me they are trying to schedule too many flights with too 
little equipment. And that squeeze will cause part of the 
problems with canceled flights.
    I think part of the answer to this problem is better 
information to the passengers. Sometimes when I have been 
caught in this situation--and I certainly have many times this 
summer had the same delays that other passengers have felt and 
have missed events where I am the speaker which is very 
frustrating. Sometimes the airline will work with a passenger 
to tell them if another flight is taking off on another airline 
to the same destination. Sometimes they do not.
    And I think it is very important that the airline inform 
the passengers when they know there is going to be a delay to 
give them a reasonable timeframe for the delay and to give them 
the information for alternative flights. Because I can tell you 
as a traveling passenger that I feel much better about the 
airline I am flying if they help me get on another airline to 
get to my destination. I am going to be a loyal customer to the 
first airline that went to that trouble.
    So I hope that as we are looking at solutions here that 
information to the passenger is a big part of the answer.
    So, Mr. Chairman, I thank you for calling this hearing.
    The Chairman. Senator Bryan.

               STATEMENT OF HON. RICHARD BRYAN, 
                    U.S. SENATOR FROM NEVADA

    Senator Bryan. Well, thank you, Mr. Chairman. Let me 
preface my comments by following up on Senator Hutchisons 
observations. I could not agree with her more. I think all of 
us understand that there are circumstances beyond the control 
of a carrier in which cancellations occur, such as weather 
related and mechanical problems. That is part of travel.
    But nothing is more aggravating and frustrating than when 
as a passenger you are not provided any information. You are 
not given alternatives or information continues to not be 
posted on time. And when you race to the desk, you find out 
that the plane has not even left the city of its origin. Those 
are the kinds of things that are just totally inexcusable and 
frustrating. You have ignited a hot button with me, Senator, 
when you talked about that. Because that really is very 
frustrating.
    Mr. Chairman, let me thank you for holding this hearing. 
This is a hearing following a summer of frustrating flight 
delays, weather conflicts and a staggering amount of 
cancellations. Since becoming a member of the Senate, like most 
of my colleagues, I have made frequent trips between Washington 
and Nevada, virtually every weekend. I have traveled 
extensively, and have experienced as well as witnessed some of 
the frustrations that are increasingly a part of air travel and 
our overcrowded skies. And let me just say parenthetically that 
most of us would agree. This has been the most difficult and 
frustrating time in the 35 years that I have been a regular 
airline passenger. It is not just an incremental increase. It 
has been an exponential increase, at least in the number of 
flights canceled, delays, frustrations that I have experienced. 
And I think most Americans would share that perspective.
    While serving on this Committee, I have had the opportunity 
to address and take part in the enormous task of modernizing 
the airline industry. Recently, we were able to pass AIR-21, 
enabling a significant amount of funding to facilitate the 
growth of our airports and the air traffic control system. This 
was a major piece of legislation that I believe will help in 
correcting many deficiencies that were evident this summer. But 
there are still a number of issues to address and much to be 
done.
    Air travel has grown at a considerable pace and we now find 
ourselves when the amount of air space is becoming more and 
more restrictive. Passenger projections in the FAA have been a 
target for this growth. So we can only assume that future 
projections estimating the growth from the current 607 million 
passengers to an estimated one billion by 2010 will prove to be 
accurate.
    This growth is coming at a time when the on time arrival 
rate is declining, dropping to 66.3 percent in June of this 
year to 70.9 percent from June a year ago. Undoubtedly, these 
numbers have been affected by the cancellation of the nations 
largest carrier, United, with an on time performance record 
during this time period of 48.3 percent and an astounding 4,800 
cancellations this summer.
    Mr. Chairman, this is simply not acceptable. Congress must 
move faster and more aggressively to solve these problems to 
stem the tide of problems that the airline industry is facing 
in the wake of ever increasing passenger counts and the 
frustrations that accompany them. It is clear to me that 
weather has been more severe this summer and was considered as 
a major contributing factor to recent delays. However, the FAA 
has estimated that 75 percent of the delays is a result of 
weather this summer. But this is only slightly higher than 1999 
when the weather was much less severe in many parts of the 
country.
    Taking this into account, it is apparent that other factors 
including overscheduling, significant travel growth and 
disputes over contracts with United and ALPA and both airport 
and flight path congestion were possible contributing factors. 
The largest problem we face is current capacity. Our current 
ATC system desperately needs to be modernized. And we seem to 
be headed in that direction as funding becomes more available.
    Mr. Chairman, I once again want to thank you for your 
perseverance and your efforts for providing leadership on this 
issue. And let me just conclude, this is not just a question of 
convenience and frustration. The airline infrastructure in 
America is part of the vital arteries of commerce which make 
for our country's economic prosperity. Some of us are in states 
in which that airline travel is an absolute indispensable part. 
Thirty-five million Americans visit my hometown each year in 
Las Vegas. More than 50 percent do so by air.
    So it is not just a question of frustration. That is 
certainly a major part of it. But this is an important part of 
our economy. We must do a better job. And I look forward to 
working with you, Mr. Chairman, and others on this Committee in 
trying to seek solutions to this situation.
    The Chairman. Thank you, Senator Bryan. Senator Cleland.

                STATEMENT OF HON. MAX CLELAND, 
                   U.S. SENATOR FROM GEORGIA

    Senator Cleland. Mr. Chairman, I would just like to echo 
Senator Hutchison's thought that this has been an incredible 
week for you and this Committee tackling the Firestone tires, 
Ford suburban vehicle question. You have tackled violence in 
the media targeted at children. And now you are tackling 
airline delays. And it is not even Friday yet. So we admire 
your tenacity and being part of this panel.
    The Chairman. Thank you.
    Senator Cleland. Mr. Chairman, let me just say that strong 
storms in the midwest this week grounded almost 500 flights 
just at Chicago O'Hare alone and stranded thousands of 
passengers. This is just the latest incident in maybe our 
historic long, hot summer which the FAA has called the worst 
travel season in U.S. airline history. In a sense, the problems 
we will discuss today are an offshoot of our aviation success.
    Deregulation in 1978 transformed air travel actually from a 
specialty thing that occurs in your life into mass 
transportation. And we know with mass transportation of other 
forms, after a while you get gridlock and choke points. Pure 
and simple, America can afford an airline ticket. As a result, 
since deregulation, we have seen the number of Americans 
choosing to fly increase by some 300 percent. And the real cost 
of fares has actually dropped some 40 percent.
    So 650 million people boarded planes last year. Wow. By 
2009 though, the FAA has figured that that number will 
skyrocket to one billion passengers. That is incredible. Most 
of that increase is expected to occur at the country's 28 
largest airports. Welcome to choke point.
    Unfortunately, our capacity has not kept up with this surge 
in air travel. The alarm was sounded some three years ago by 
the National Civil Aviation Review Commission's landmark 
report. It says, ``Given the delay and congestion problems that 
already exist, anticipated growth without needed expansion of 
capacity in the air and on the ground will simply reach a point 
at which it cannot be accommodated.''
    Mr. Chairman, I think we are fast reaching that point. Some 
may attest that that choke point is already here, especially in 
the northeastern corridor. Air space is approaching gridlock. 
My latest flight on a great airline, Delta, left on time, sat 
on the runway, took off in bad weather, circled Hartsfield, 
attempted to land. But there was a plane on the runway and we 
had to make another turn around.
    That, unfortunately, is becoming more and more the norm in 
terms of transportation in this country. On the ground, we have 
built only one major airport in the last 25 years. And from 
1995 to 1999, only three new runways have been put into service 
at the 28 biggest airports in the country.
    In my home state of Georgia, we have the world's busiest 
airport, 78 million passengers annually. Hartsfield is the 
country's most delay impacted airport. It both creates delays 
nationwide and reacts and is impacted by delays nationwide more 
than any other airport in the world.
    The bottom line is that Hartsfield desperately, for one 
thing, needs a fifth runway, more air traffic controllers 
certainly, but definitely a new runway. We have to expand 
capacity or we will be that nationwide choke point.
    In 2005, with 100 million passengers projected to go 
through Hartsfield, and with just four runways, it is estimated 
each flight at Hartsfield will average 14 minutes of delay. 
That is programmed. That is planned. Double the average today. 
Most Americans are getting used to circling around Hartsfield 
and taking the tour of Atlanta from about 12,000 feet.
    Now, with the construction of the fifth runway, it is 
estimated that Hartsfield will be down to 5 minutes of delay. 
But that is planned delay. That is not zero delay. It is a 
savings of 9 minutes per flight. It is going in the right 
direction. And it will save hundreds of billions of dollars and 
it will benefit passengers not only in Georgia but around the 
country. So we need that.
    The problem is much bigger than this. We should not be 
getting into this blame game. I just appreciate Secretary 
Slater's initiative to bring parties to the table as we discuss 
this and met with the traveling public, the airlines, in 
Atlanta at Hartsfield. I appreciate that very much. That 
meeting occurred recently.
    Today, Mr. Chairman, we will hear some of these suggestions 
from our witnesses as how to move beyond gridlock, how to avoid 
choke points, terms that we normally apply to interstate 
highways. But now in the interstate highway of the air, these 
terms are more and more applicable. Let me say that I am 
extremely pleased that my dear friend Leo Mullin, the great 
head of Delta Airlines, is an extremely perceptive policy 
person and a consummate businessman. Under his leadership, 
Delta's now the worlds most flown airline, working out of the 
busiest airport in the world.
    Last year, Delta flew a record 106 million passengers 
safely and with its customers in mind. I have been a Delta 
passenger all my life. My interest in air safety is that I 
would like to extend my life.
    So, Mr. Chairman, I thank you for holding this important 
hearing. And we look forward to our witnesses.
    The Chairman. Thank you very much, Senator Cleland. Thank 
you for your kind words. Welcome to the witnesses. Secretary 
Slater, thank you for being here today.

                STATEMENT OF RODNEY E. SLATER, 
                  SECRETARY OF TRANSPORTATION

    Secretary Slater. Thank you, Mr. Chairman, Senator 
Rockefeller, Senator Hutchison, Senator Bryan, Senator Cleland 
and the other Members of the Committee that I am sure will join 
us over the course of today's hearing.
    Mr. Chairman, Members of the Committee, I and my colleagues 
appreciate the opportunity that you have afforded us to come 
and join other leaders of this magnificent industry as we 
discuss the importance of the service that we provide to the 
traveling public. And as we deal with the critical issue of 
unacceptable airline delays and cancellations and customer 
service problems that are now of the matter at hand 
accompanying me today are FAA Administrator Jane Garvey and 
also our Inspector General Ken Mead. And again, we look forward 
to the discussion that I am sure we will have over the course 
of today's session. Let me also, Mr. Chairman, commend you for 
the work of the week and the work of the Committee. I have been 
here on one occasion over the course of the week.
    The Chairman. We are sorry we missed you yesterday.
    Secretary Slater. Well, I had to rest up for today after 
the day that I was here just prior to yesterday. So I am back 
today. And again, I am pleased to be here with my colleagues.
    Mr. Chairman, last evening I was at the National Air Space 
Museum, there for a special dinner, but just above me was the 
Wright Brothers flyer and to the left as I recall the Spirit of 
St. Louis. And overhead, some hundreds of miles, Lieutenant 
Colonel Dan Burbank who is a member of the flight team of the 
space shuttle Atlantis as they now work on the international 
space station and prepare for permanent presence on that space 
station in but a few years to come.
    Really, that is the context in which then we have the 
opportunity to deal with the challenge at hand, recognizing 
that over the span of less than a century, man took to the 
wings of flight and now we construct an international space 
station in outer space.
    At the dawn then of this new century and new millennium, we 
together--government and industry, management and labor--just 
as we together in years past can build on the tremendous 
economic success that we have brought into being and also 
implement our flight plan for aviation's second century. With a 
focus on passengers first, their safety and security to be 
sure, but also the quality of service they receive.
    Many of you have made reference to the fact that a few 
weeks ago leaders of the industry responded to my request to 
meet here in Washington to discuss this issue. And I want to 
just underscore the fact that all who were invited came. All 
sat at the table of discussion and debate, aired our concerns 
and left with a commitment to put passengers first, to deal 
with matters pertaining to their safety and security, but also 
to deal with this issue of the quality of service they receive.
    As we face then this second century of aviation, three 
broad areas really challenge us, and one I am going to deal 
with specifically over the course of my remarks.
    But first the challenge of continuing to open markets and 
access to new destinations around the world. We are working to 
do just that. The challenge of enhancing access and competition 
in the aviation marketplace. This Committee has worked with us 
and with the industry to do just that. And also, the challenge 
of improving system efficiency and capacity. This Committee has 
also worked with us to deal with this important issue. And it 
is the subject of our discussion for today as we will continue 
to deal with the challenges we face in that regard.
    But clearly, this industry is in a different position than 
it was in, not only at the time of deregulation in 1978, but 
also at the time that we had our opportunity to begin our work 
together.
    When President Clinton and Vice President Gore took office 
in 1993, the U.S. airlines were collectively losing literally 
billions of dollars, some $10 billion over the previous three 
years, the first three years of the 1990's. The aviation 
industry was on the verge of slipping into an economic abyss.
    President Clinton traveled to Washington State to meet with 
airline industry and labor leaders almost immediately upon 
taking office. The President and the Vice President advocated 
the creation of and the purposes espoused by the Baliles 
Commission that has been mentioned to ensure strong competitive 
airline industry. That was in 1993. Soon thereafter, the White 
House Commission on Aviation Safety and Security in 1996, and 
then the Mineta ``National Civil Aviation Review Commission'' 
in 1997.
    And you are correct, Mr. Chairman, that all of those 
commission reports started to deal with the challenge that we 
come today to really grapple with first hand, that of gridlock.
    We know then where we stand and the distance over which we 
have come. Eight years ago, we focused almost solely on the 
health of the industry, and, of course, on continued safety and 
security.
    Today the industry is back on its feet with six consecutive 
years of growth, safety records that continue to improve, 
carriers are experiencing record level passenger demand and 
revenue growth. We have focused on opening new markets abroad 
and opening new access at home to more and more travelers 
across our nation.
    We met the Y2K challenge. We got modernization back on 
track. We implemented our Spring/Summer plan and we have 
learned a lot from that experience. And we also successfully 
worked with this Congress, and especially the leadership of 
this Committee to successfully enact one of the most 
comprehensive and significant aviation bills in recent history 
a bill that will provide record level infrastructure investment 
and that also provides management reforms and also other 
reforms that will be important to our endeavors.
    Here let me take the opportunity, Mr. Chairman, to 
especially thank you and ranking member Hollings and also the 
Subcommittee Chairs, Chairman Gordon and ranking member Senator 
Rockefeller and all the Members of the Committee for the 
wonderful leadership that you offered in helping us move 
forward, again, AIR-21, and to now have the opportunity to use 
the tools that it provides.
    Let me acknowledge also that, as has been stated, there is 
responsibility for all, shared responsibility, by government, 
the airlines, the airports, and others as we gather to deal 
with the challenge at hand. And we want to clearly step to the 
table, step to the front line in underscoring the important 
role that the Department of Transportation has to play in this 
regard and especially the FAA in addressing the institutional 
and operational aspects of our air traffic control system.
    And here I want to commend Administrator Garvey and her 
team working with the industry and really getting our 
modernization efforts back on track after a very significant 
decision frankly made early in this administration to change 
course. And we commend the leadership at that time as well.
    In summary, Mr. Chairman, let me just say that the FAA and 
the departments strategy has been to focus on strategic issues, 
modernization of the air traffic control system in incremental 
fashion and on infrastructure growth. We have also focused on 
more efficient operations such as Free Flight Phase I and II. 
Hopefully, we can get into a fuller discussion of these issues 
as we go forward.
    Administrator Garvey has also implemented an approach, an 
approach supported by industry and labor that has been 
successful as well, to build a little, test a little and deploy 
a little as relates to the awesome challenge of modernizing our 
air traffic control system.
    And here if I may, let me just say that in our in route 
centers, the equipment that we are using today is no more than 
two or three years old. This is equipment that was installed in 
1997, most of it no later than 1996, any remaining portion of 
it.
    Also, earlier this year, we announced the Spring/Summer 
plan. And again, I think that that has worked very, very well. 
The FAA has worked with NATCA and the airline industry in 
identifying ``choke points'', most of those east of the 
Mississippi. We have talked about some of those over the course 
of the morning and I am sure we will get into that a bit more 
as well.
    And then, Mr. Chairman, closing with this, as a result of 
the meeting that was held here in Washington some weeks ago 
that has been referred to, I have asked our Associate Deputy 
Secretary Stephen Van Beek to head up a task force on airline 
service quality performance that will draw on many areas of the 
Department to produce an action plan over the next few months. 
This deals with really bringing a sense of community and 
understanding around how we measure the performance of the 
aviation system. And we hope to be successful in that regard.
    I have also asked Assistant Secretary Francisco Sanchez to 
put together a report dealing with best practices. Many of you 
have made reference to the leadership provided by many 
companies, some here today, in dealing with the passenger 
service needs. We want to lift those up as well so that they 
will become commonplace practices by the entire industry.
    Also, Administrator Garvey will continue to work with the 
industry to finalize our vision for modernization as we go into 
a new century and a new millennium and we look forward to those 
efforts as well.
    Later today, I will be meeting with members of the Air 
Transport Association Board of Directors. We will continue our 
work.
    But, Mr. Chairman, let me just conclude by saying we have 
brought the industry a long way, working together with the 
leaders of the industry. There are challenges that we face. But 
these challenges in many respects are the result of the success 
that has been brought about by a strong industry that now 
enjoys record level resources, record level demand that it must 
respond to.
    Clearly, if the Wright Brothers could put man into flight, 
and clearly as our team now makes provisions for putting 
individuals into the far reaches of space on a permanent basis, 
we can deal with the ground level. And even the air level 
challenges that we face to ensure improved service to the 
American people.
    And again, we thank you and the members of the committee 
for affording us this opportunity to come and discuss this very 
important issue.
    I will be pleased to respond to any questions that you may 
have after we hear from other members of the panel and over the 
course of our work in the future together.
    The Chairman. Thank you, Mr. Secretary.
    [The prepared statement of Secretary Rodney Slater 
follows:]

  Prepared statement of Rodney E. Slater, Secretary of Transportation

    Thank you, Mr. Chairman and Members of the Committee. I appreciate 
the opportunity to address an issue of critical importance to American 
travelers, the airline industry, Congress, and the Administration--
unacceptable airline delays and cancellations and the customer service 
problems they cause. Accompanying me today is FAA Administrator Jane 
Garvey.
    At the Department of Transportation, our effort to improve customer 
service ranks second only to safety, which is President Clinton and 
Vice President Gore's highest transportation priority. Dealing with the 
mounting airline delays and cancellations we have experienced over the 
past few years, and especially during the heavy travel months this 
summer, is an issue of paramount importance for the Department. We are 
charged with consumer protection in the airline industry, and the FAA 
is charged with operation of the air traffic control system 
nationwide--24 hours a day every day of the year.
    At the dawn of this new millennium--we together--industry and 
government--must build on the tremendous economic success that we have 
created together as we implement our flight plan for aviation's second 
century. We face three broad challenges--the challenge of globalization 
beyond Open Skies; the challenge of enhancing access and competition in 
the aviation marketplace; and the challenge of improving system 
efficiency and capacity.
    When President Clinton and Vice President Gore took office in 1993, 
U.S. airlines had collectively lost $10 billion dollars over the prior 
three years. Eastern and Pan Am were already out of business and others 
were close to bankruptcy. The aviation industry was on the verge of 
slipping into an economic abyss.
    This Administration took immediate action. From Day One we 
understood the critical role aviation plays in a healthy economy. That 
is why President Clinton traveled to Washington State to meet with 
airline industry and labor leaders almost immediately after taking 
office. And that is why the President and Vice President Gore advocated 
the creation and purposes of the Baliles ``Commission to Ensure a 
Strong Competitive Airline Industry'' in 1993, the White House 
Commission on Aviation Safety and Security in 1996, and the Mineta 
``National Civil Aviation Review Commission'' in 1997.
    The 1993 plan launched by labor and the industry with the President 
at Everett, Washington worked, and the successes are many. The safety 
record steadily improves. Carriers are experiencing record-level 
passenger demand and revenue growth. We have focused on opening new 
markets abroad and on opening access to more and more travelers across 
this nation. Aviation is back on its feet, with six consecutive years 
of growth.
    In fact, the issues we face today are the result of growth and 
success, rather than economic failure. And I believe that this 
Administration and the Congress already have the basic elements in 
place to successfully deal with the strains growth has produced. The 
paramount task now is to ensure better service along with safety, and 
to continue the long-term viability and growth of this vital sector of 
the economy.
    On our part, the FAA and the Department's strategy has been to 
focus on strategic issues--modernization of the air traffic control 
system in incremental fashion and on infrastructure growth, especially 
new runways at the largest airports. We have also focused on more 
efficient operations--``Free Flight'' Phases One and Two, for example--
implementing new procedures and decision-support tools that produce 
measurable benefits, such as reduced fuel consumption and increased 
aircraft operations at some airports. We met the Y2K challenge, we have 
implemented our Spring/Summer 2000 Plan, and we worked in concert with 
Congress to enact the most comprehensive and significant aviation bill 
in recent memory. Let me take this opportunity to thank you, Mr. 
Chairman, Ranking Member Hollings, Subcommittee Chairman Gorton, and 
Ranking Member Rockefeller, along with the Committee membership and the 
entire Congress for the new tools you provided us in AIR-21. Together 
we have forged a remarkable bipartisan consensus in the Congress to 
support the necessary costs of upgrading the air traffic control 
system. However, our FY 2001 Operations levels needs your support. When 
the President signed AIR-21, he stressed the need to work to correct 
the imbalance between capital and operations levels, and I seek your 
support in the imminent conference on DOT appropriations to support 
funding FAA Operations at the President's requested level.
    Modernization has enhanced reliability and has provided the 
platform on which to ``grow the system.'' Administrator Garvey's 
approach, an approach supported by the industry and labor, has been a 
success--``build a little, test a little, deploy a little.''
    We continue to be focused on better treatment of passengers when 
delays or cancellations do interfere with flight plans. We sent a 
comprehensive bill to Congress in March 1999 that was crafted to 
collect and deliver accurate information about flight delays to the 
passenger, relying on a ``market driven'' approach to allow the 
consumer a knowledgeable choice. The Inspector General and my staff are 
now engaged in evaluating the success of the Voluntary Plans the 
airlines have undertaken to address the problems themselves. I would 
emphasize here that it was your leadership, Mr. Chairman, that forged 
this concerted effort and commitment by the airlines on behalf of 
airline travelers.
    Information is available to assist consumers in choosing flights 
that are more likely to operate on time. Each airline reservation agent 
and travel agent uses computer reservations systems that contain on-
time performance information on a flight-by-flight basis. Upon request, 
this information must be provided to consumers. Our challenge is to 
make the availability of that information better known, because it 
really can help, yet few travelers currently request it.
    Working together, I believe, remains the key to solving the issue 
of excessive delays and flight cancellations we are here to discuss 
today. Our experience to date convinces me it is the best approach. But 
it is incumbent on the industry, airlines and airports, to take up the 
challenge as well. This means putting the passenger first. We have seen 
evidence of airlines realigning their schedules at airports with heavy 
delays, and cutting back their overall scheduling to ensure the 
availability of adequate numbers of backup aircraft and crews. These 
are good first steps, and I am confident others will be taken as well. 
In this context, I commend American Airlines' CEO Donald Carty for his 
straightforward acknowledgment Tuesday that ``The accusation that 
airlines overschedule is absolutely true.''
    The factors that cause delays and cancellations are many and 
complex. They include ``predictable unpredictables''--the unsettled 
weather we have experienced this summer, inoperable runways, and 
aircraft equipment problems, for example--as well as the knottier 
issues of handling massed arrivals and departures at major hub 
airports.
    Let us acknowledge first that the responsibility for action is 
shared by the government, the airlines, and the airports, and that we 
at DOT have a large role to play in addressing the institutional and 
operational aspects of air traffic control. As we have met at airports 
across this nation on these problems, we have not been finger-pointing 
but have worked collaboratively. At DOT, we must focus on and deal with 
the many air traffic management issues we and others have identified as 
central to a solution, and we must address the infrastructure of the 
system--most significantly airport capacity and air navigation 
equipment.
    President Clinton announced on March 10 the creation of our Spring/
Summer 2000 plan. At the heart of this initiative is a collaborative 
plan developed by the industry, labor, and Government to better manage 
air traffic during severe weather. It maximizes the use of available 
air space, improves communications between FAA and aviation system 
users, and expands the use of new technology to help reduce delays. Our 
view is that this summer's experience would have been noticeably worse 
without benefit of this high-level collaboration effort.
    Each day at 5:00 a.m. Eastern Time a conference call is conducted 
to discuss potential weather problems in the air traffic control 
system. The FAA facilitates the discussion, which is joined by airline 
meteorologists and National Weather Service meteorologists. An FAA 
planning specialist monitors the conference call and begins to outline 
the areas of concern for the Strategic Plan of Operation.
    At 7:15, the first Strategic Planning Team conference call is 
conducted. The Team is made up of FAA specialists, individual airline 
representatives, and air traffic control facilities. The Team 
collaboratively develops a plan designed to respond to identified 
constraints in the air traffic control system. These constraints could 
be created by weather, airport construction, equipment problems, or 
other causes. Our objective is to reach a consensus on traffic 
management actions needed to ensure a safe and efficient operation. If 
there is not a clear agreement, FAA will make a decision. This 
conference call is convened every two hours throughout the day until 
10:15 p.m. Eastern time. During each call, the Strategic Plan of 
Operation is updated, modified or, as conditions change, new items are 
added.
    In addition to the Spring/Summer 2000 plan, the FAA, working with 
NATCA and the airline industry, identified the seven top ``choke 
points'' in the airspace system. These points all affect the highly 
traveled airspace east of the Mississippi River. The FAA has developed 
specific routes, approaches and procedures designed to reduce the 
congestion in these areas. In addition, we are working with NavCanada 
to increase the number of flights through Canadian airspace to improve 
schedule reliability.
    FAA has stepped up to the plate, we have acknowledged the areas for 
improvement, and are working in a productive and collaborative way to 
deal with them, air traffic control faces significant challenges in 
both the short and long term. The advent of regional jets offers more 
services and competition opportunities to airlines and communities. 
Some regional jets, however, are using the same runways and flying at 
the same altitudes as some of the larger aircraft and put more demand 
on the system than turboprops. These factors have the effect of 
reducing controller options, especially during peak periods. Also in 
the enroute environment, regional jets, which operate more slowly than 
the new fleet of commercial aircraft, create a mix of speeds at 
altitude that will get more complex as the number of regional jets 
increase.
    A further factor that complicates air traffic control, is that of 
airline scheduling and airport capacity. At the risk of stating the 
obvious, air traffic is a dynamic situation. Every procedural 
enhancement, every step forward in modernization, every improvement in 
efficiency, cannot be measured in a static environment, but must be 
evaluated in light of daily changes in weather, runway availability, 
and airline schedules. Consequently, the installation of an Instrument 
Landing System (ILS), enhanced radar, or a reduction of miles in trail 
requirements may not necessarily translate into a reduction of airline 
delays, even if efficiencies are achieved. The FAA clearly has an 
important role to play in the reduction of airline delays, but this 
responsibility is shared with airlines and airports. True progress can 
only be realized when all three players accept their roles and work in 
cooperation with each other.
    As the Members of this Committee know, the issue of airport 
capacity is very sensitive. Whether local communities are discussing 
new runways, new terminals, or new airports, the debate is always 
heartfelt and emotional. While FAA will continue to make those 
improvements in the NAS that are within our control, improving how 
aircraft are controlled in the air does not necessarily ensure them a 
speedy descent to the runway. Hard choices will have to be made at all 
levels of government across the country to ensure that we have the 
infrastructure in place to accommodate anticipated demand, such as the 
recent initiative to encourage lower altitude flying.
    Notwithstanding the airport capacity issue, FAA's longer-term role, 
and one in which we are currently engaged, is enhancing the system for 
a new era. The FAA is working with Mitre and a broad cross section of 
the aviation industry to develop a viable, comprehensive plan for 
system operation into the future. The plan will represent both a 
technical and operational approach to the future of air traffic control 
and will incorporate many of FAA's ongoing initiatives such as Free 
Flight Phases 1 and 2, and airspace redesign. Our goal is to establish 
comprehensive processes and procedures to ensure adaptable and flexible 
airspace that meet the demands of the future NAS. Equally important are 
the procedural changes we are making on a continual basis as the 
opportunities arise, such as the choke point initiatives.
    Another important aspect in our effort to improve the management of 
the air traffic control system is modernization. As the Members of this 
Committee know, we are well into a successful modernization plan. Taken 
as a whole, modernization will improve the controllers' ability to 
manage increasing levels of traffic. Decision support tools are being 
developed to facilitate more efficient routings and shorten airborne 
time. The reliability of the system is also being increased, thereby 
increasing confidence in the system. We continue to develop 
technologies and equipment that will result in safe reductions in 
aircraft separation.
    Major efforts are also underway in my office to address the 
problems systematically. I have asked Associate Deputy Secretary 
Stephen Van Beek to head up a task force on airline service quality 
performance that will draw on many areas of the Department to produce 
an action plan over the next few months. This was prompted in part by 
the recent report to Congress of U.S. DOT Inspector General Ken Mead, 
who is also testifying today, setting forth the extent of the problem 
and the need to act. Additionally, section 227 of the Wendell H. Ford 
Aviation Investment and Reform Act for the 21st Century (AIR-21), 
signed April 5, 2000, called for a task force to improve reporting of 
delays. The task force will coordinate action by the FAA, the Bureau of 
Transportation Statistics, our aviation office, and the consumer 
protection office, with participation by the Air Transport Association, 
consumer organizations, and others with a stake in our air 
transportation system. The task force will focus on two areas--
determining the nature and causes of delays, and how to best report 
delay/cancellation information to the public.
    Our Inspector General also provided a valuable interim report in 
June on the airlines' success in implementing their ``Voluntary Plans'' 
for improved customer service across a range of issues--including 
timely and accurate consumer notification of delays and cancellations. 
While we await the final report, I would stress that the IG recommends 
increased enforcement resources in our airline consumer protection 
office, a request that we have pending in our appropriations bill as we 
speak. I respectfully request your support for a favorable conference 
outcome that is consistent with our budget request and the increased 
funding authorized for these activities in AIR-21.
    I have also asked Assistant Secretary Francisco Sanchez, to put 
together a report on the current ``best practices'' of the airlines and 
airports in providing high-quality customer service and providing 
information to air travelers. Those ``best practices'' are being 
compiled now. The report will be released in early October for the 
benefit of the industry and the consumers they serve.
    We have taken other actions as well to address the causes of delays 
and cancellations. During August, I encouraged the pilots and 
management of United Airlines to press for agreement at the bargaining 
table over pending contract issues, to put United, the largest airline 
in the world, back on the path to providing the quality of service both 
United and the American people expect. As this agreement is 
implemented, it should go a long way to relieving the frustrations 
experienced at airports served by the United network and workforce.
    I have also recently met with the major stakeholders in the 
aviation industry--including representatives of airlines, consumer 
organizations, labor unions, airports, trade associations, travel 
agencies, consultants, and state and local governments, to discuss the 
current challenges facing the industry. Two of these meetings took 
place in Washington, but I also traveled to Newark, Atlanta, Detroit, 
Cleveland, Chicago, New York, and Miami to obtain grassroots feedback. 
In the spirit of President Clinton and Vice President Gore's challenge 
to ``put people first,'' our meetings focused on putting the consumer 
first, and through customer service and information flow. The meetings 
were spirited, insightful, and productive, and featured many excellent 
ideas for improving customer service. While a variety of ideas were 
discussed, most of them addressed the following needs:

   To be more responsive to customer needs.

   To provide better information flow--to make sure consumers 
        receive better and more timely information about flight delays 
        and cancellations, and also to create better feedback 
        mechanisms for consumers to communicate their concerns to the 
        industry and government.

   To listen to and empower front-line employees of the 
        airlines, who are often the most knowledgeable about the needs 
        of customers.

   To expand the capacity of airports and to continue to expand 
        and modernize the air traffic control system.

   To enhance airline competition in order to provide the 
        consumer with more choices, and spur the airlines to improve 
        service and reduce fares.

    Just last week, I completed trips to the seven major hub airports I 
mentioned earlier, to assess personally the factors that contribute 
most directly to delays in the field. These meetings took us out of 
Washington to meet with frontline employees around the country who have 
direct experience with the aviation industry's difficulties. We are 
seeing ``best practices,'' airport-by-airport, that we can advocate 
broadly throughout the system--such as regular, joint meetings at 
certain airports among the airline tenants and the operator to expedite 
action, and innovative techniques individual airlines are introducing 
to directly assist travelers who need to rebook flights or find 
overnight accommodations.
    Later today, I am meeting with members of the Air Transport 
Association Board of Directors to continue pursuing our efforts on many 
fronts, including those under our ``Spring/Summer 2000'' initiative to 
improve management of the air traffic control system.
    In closing, we are pursuing numerous initiatives to address the 
problem of airline delays and cancellations, and our experience to date 
has been that our partners are equally committed to achieving real 
gains on several fronts. With the continued support of Congress, I am 
confident that we can find solutions and implement them to reduce the 
delays and cancellations that burden the industry and the air traveler.
    Mr. Chairman, that completes my statement, and I would be pleased 
to respond to questions from you and the Committee.

    The Chairman. Ms. Garvey, welcome back before the 
Committee.
    Ms. Garvey. Thank you. Actually, the Secretary has given 
the statement. I think I will defer to Mr. Mead.
    The Chairman. OK. So you have no opening statement?
    Ms. Garvey. No, I will be glad to answer any questions.
    The Chairman. Thank you. Mr. Mead.
    Mr. Mead. I would be happy though to answer questions.
    The Chairman. I do not think we will let you go scot free. 
Mr. Mead, welcome back before the Committee. How many years 
have you been appearing before this Committee, Mr. Mead, out of 
curiosity?

       STATEMENT OF KENNETH M. MEAD, INSPECTOR GENERAL, 
               U.S. DEPARTMENT OF TRANSPORTATION

    Mr. Mead. It is always an honor to appear before this 
Committee. And it is also an honor to be here at the table with 
my colleagues, Secretary Slater and Administrator Garvey. And 
not just because of their positions, but because of their 
openness to oversight and willingness to discuss and air the 
problems.
    The topic of the hearing today, Mr. Chairman, is a matter 
we have discussed many, many times. And I am sure we will 
discuss it many more times.
    The first 7 months of 2000 experienced record levels of 
delays and cancellations. I think we all know that. On the 
front page of my testimony, I have included a chart. It shows 
by month delays and cancellations in 1999. That is not why I 
included the chart though. I included it because it shows that 
we have a small window of opportunity before the cycle begins 
again late this fall or early this winter. So we have about 
three months. September comparatively speaking is supposed to 
be a good month for delays and cancellations.
    The Secretary highlighted a number of important 
initiatives. I think the common thread in all those initiatives 
is people coming to work together. We testified several weeks 
ago about some of these issues--it was almost a blame game 
going on. And I think the Secretary forcefully took that in 
hand. And that is an important common thread.
    An overarching point I would like to leave with the 
Committee today is that the potential for the initiatives that 
the Secretary has announced and the efforts of the airline 
industry will be greatly constrained until a key question is 
answered.
    That question is what traffic load can the system 
reasonably be expected to handle in the immediate term (now, 
going out about 2 years), the intermediate term (next 4 or 5 
years), and the longer term (8 to 10 years)?
    Specifically, what I mean is what is the departure and 
arrival rate by time of day at our top 30 airports that can be 
accommodated under good weather conditions without experiencing 
major delays or compromising safety? I am not suggesting in any 
way that there should be scheduling controls. But for the 
benefit of everybody concerned and after the experience of the 
last several years, we need a set of capacity benchmarks to 
understand the impact of airline scheduling and what relief can 
realistically be provided by the ATC modernization effort, new 
controller procedures, and new ground infrastructure in the 
near and longer term.
    FAA can speak to this today. I think they are within a 
couple of months of being in a good position to announce such 
benchmarks publicly. But we need this information to get at the 
core issues and to work through solutions.
    The Chairman. They are going to announce what?
    Mr. Mead. Capacity benchmarks, by airport, by time of day, 
for the Nation's top 30 or so airports. And I am saying I think 
FAA, from my discussions with Administrator Garvey and others, 
will be in a position to do that within the next couple of 
months.
    The Chairman. Is that true, Ms. Garvey?
    Ms. Garvey. Yes, it is, Mr. Chairman. And we agree fully 
with Mr. Mead and are working very hard toward that. It is very 
important information to have.
    Mr. Mead. Now, the relevance of this in the timeframes I 
mentioned, immediate, intermediate and long-term, is this. New 
runways or technology that may be in place in 5 or 10 years 
holds promise for the future, but it offers little bottom line 
relief now. I also believe that FAA needs to clearly explain 
the extent to which the ATC modernization effort can 
realistically be expected to provide material relief.
    We all recognize that the answer lies in a cumulative mix 
of interdependent solutions. The role of the ground 
infrastructure--new airports and runways--cannot be 
understated.
    I would like to offer, Mr. Chairman, several data-based 
observations to illustrate just how serious the situation has 
become.
    We reported in July that one in five flights arrived late 
last year. Each delay averaged about 50 minutes. When 
cancellations are added to that, nearly one in four flights 
either arrived late or were canceled.
    The number of flights with taxi-out times of 1 hour or more 
has increased 130 percent over the past five years--from 17,000 
to nearly 40,000 flights.
    To compensate for growing delays, the airlines have 
expanded flight schedules on nearly 80 percent of their 
domestic routes over the past decade, ranging from 1 to 27 
minutes. The reason I mention that is that these expanded 
schedules also reflect system inefficiencies that do not show 
up in the delay and cancellation statistics.
    And as you know, for the first 7 months of 2000, the trends 
have gotten worse. The top chart here shows that for the first 
7 months of 2000, there were 11 percent more delays than in the 
same period in 1999. The average delay is now about 53 minutes. 
So there was a three minute increase in just one year.
    And between January and July, over 870,000 domestic flights 
either arrived late or were canceled, affecting about 90 
million passengers. This does not count August.
    Now, Mr. Chairman, the increasing number of delays and 
cancellations is occurring against the backdrop of a remarkably 
safe system, but it is one that is showing signs of strain.
    I think the Committee should know that FAA is reporting 
very significant increases between 1995 and 1999 in both runway 
incursions and operational errors. These trends continued this 
year. They are disturbing trends. FAA has actions underway to 
deal with them, but the trend lines still are disturbing.
    Runway incursions, as you know, are incidents on the runway 
that create a collision hazard. They have increased 34 percent 
(from 240 to 321) between 1995 and 1999. In the first 8 months 
of 2000, there were 288 runway incursions. If this trend 
continues, the year 2000 will be a record year for runway 
incursions.
    Operational errors occur when a controller does not ensure 
that separation standards are maintained between aircraft. 
Operational errors have increased 23 percent (from 764 to 939) 
between Fiscal Years 1996 and 1999. In the first 11 months of 
Fiscal Year 2000, there were slightly over 1,000.
    The Chairman. Does that correlate with increased traffic?
    Mr. Mead. To a degree it certainly does, Mr. Chairman. I 
have a list with me of the different facilities in our system. 
And you would recognize their names. There are in the enroute 
center and terminal environments.
    I would like to talk about the ATC modernization effort for 
a moment. I think there is a great deal of confusion over the 
extent of relief that the modernization effort can be expected 
to provide.
    Congress, industry and the traveling public need to know 
what can be realistically expected from these investments. Many 
of the modernization efforts are geared to safety or replacing 
aging equipment with modern equipment that is easier to 
operate, is easier to maintain, and is more reliable. But they 
do not in and of themselves provide capacity enhancements.
    There has been a number of important successes with those 
efforts. For example, at the Nation's enroute centers, Mr. 
Chairman, much of the equipment there is new. It is not 
antiquated. It is two, three, or perhaps four years old. There 
is a lot of good going on, particularly in the last 4 or 5 
years after we got past the Advanced Automations System and, 
the Microwave Landing System.
    The Free Flight Phase 1 program, which is about $700 
million in cost, is now the agency's key effort for enhancing 
capacity through 2004. This is an important initiative, but it 
will provide incremental capacity improvements once fully 
deployed. Free Flight Phase 1 deployment will extend through 
2002. It would be a mistake to view Free Flight Phase 1 related 
efforts as panaceas.
    And I think the extent of the impact of the capacity 
initiatives at FAA need to be quantified so we all know what 
can be expected. This is very important because of the 
projections of what lies ahead. There are two big caveats.
    One is that as we make a dent in the capacity or delay 
problem, the demand fills it up. It is like filling up a glass. 
As soon as you empty out some of the water, you pour more back 
in. And it is almost as though we are treading water. Another 
is you have to have a place to put all these planes in the air. 
And you cannot under estimate the importance of the ground 
infrastructure--new runways.
    I have a chart at the back of my testimony that shows 13 of 
15 runways under construction or planned at major airports. You 
cannot count on those within the next three years. It is going 
to be between three and seven years before we have those.
    And finally, as illustrated by Mid-America Airport, which 
is intended to be a reliever to Lambert Field. Lambert Field, 
by the way, has had a record number of runway incursions. The 
airport and FAA are trying to deal with the problem. But it was 
number one in the country for a while. Mid-America cost in the 
neighborhood of $300 million. It is a new commercial airport. I 
guess next to Denver, it is the second new commercial airport. 
But just establishing an airport out there does not guarantee 
its use.
    So I think with that, I will conclude my statement. Thank 
you, Mr. Chairman.
    [The prepared statement of Mr. Mead follows:]

       Prepared statement of Kenneth M. Mead, Inspector General, 
                   U.S. Department of Transportation

    Mr. Chairman and Members of the Committee:
    We appreciate the opportunity to discuss flight delays and 
cancellations and the implications of airline scheduling, Air Traffic 
Control (ATC) modernization, airport infrastructure, and safety.
    By all accounts, the first 7 months of 2000 experienced the highest 
number of delays and cancellations of any similar period since 1995. 
Over the next few months, we have a small window of opportunity to 
identify needed solutions and to begin acting on them. Historically, 
air travelers have experienced the most problems during the winter and 
summer months, as illustrated in Figure 1.




    Over the past year, the Secretary and the Federal Aviation 
Administrator have announced a number of actions to address the growth 
in flight delays and cancellations, including the Spring/Summer 2000 
initiative for managing air traffic. Most recently, the Secretary 
formed three task forces with mandates to determine the causes of 
delays and cancellations, to identify ``best practices'' in providing 
better service and information to air travelers, and to expedite 
investment in technology and infrastructure. These initiatives have the 
potential to make inroads in addressing the growing problem of flight 
delays and cancellations.
    Mr. Chairman, the potential contribution that can be made by these 
initiatives will be greatly constrained until a key question is 
answered and that question lies at the heart of the debate about delays 
and cancellations and what can be done about them. That question is 
what traffic load can the ATC and airport systems reasonably be 
expected to accommodate--in the immediate term (over the next l or 2 
years), the intermediate term (4 or 5 years), and the long term (8 to 
10 years)?
    More specifically, what is the traffic departure and arrival rate 
by time of day at the top 30 airports that can be accommodated without 
experiencing major delays or compromising safety? A set of capacity 
benchmarks is essential in helping understand the true impact of 
airline scheduling practices and what relief can realistically be 
provided by new technology, revised ATC procedures, and runway and 
airport infrastructure enhancements--using the funding provided by AIR-
21.\1\ We are not suggesting in any way that there should be scheduling 
controls, but the Federal Aviation Administration (FAA), the airlines, 
and the public need benchmarks to determine what can reasonably be 
expected of the system, in the near and long term, including what level 
of inconvenience.
---------------------------------------------------------------------------
    \1\ The Wendell H. Ford Aviation Investment and Reform Act for the 
21st Century (Public Law 106-181, April 5, 2000).
---------------------------------------------------------------------------
    Yet, in what may be a surprise to many, we currently do not have 
clarity on what traffic load the ATC and airport systems can reasonably 
be expected to safely and efficiently process or whether the ATC 
modernization effort should be expected to provide major relief. The 
Secretary, the task forces recently commissioned by him, FAA, the 
Congress, and the airlines must have this information to get at the 
core issues. Without it, our ability to understand the impact of flight 
volume on flight delays and cancellations, and, in turn, to make 
informed decisions is severely constrained.
    The relevance of these points, in the time frames I mentioned--
immediate, intermediate, and long term, is this--new runways or 
airports or ATC technology that may be in place 5 or 10 years from now 
hold promise for the future, but they offer limited or no bottom line 
relief over the next few years. Also, as our detailed testimony 
indicates, we think FAA needs to explain in clear terms the extent to 
which the ATC modernization effort can be expected to provide material 
relief to the current problem of delays and cancellations. This is 
because much of the modernization effort is not geared to making 
quantum leaps in increasing capacity. The answer lies in a cumulative 
mix of solutions--scheduling and technology are among them. However, 
the role played by ground infrastructure--runways and airports (and the 
airlines that use them) is of enormous importance; mainly because of 
the large impact that ground infrastructure has to play and the 
decisionmaking associated with building and locating either a new 
runway or airport requires clearance by local communities.
Flight Delays and Cancellations
    Flight delays and cancellations are key indicators for measuring 
the health of the National Airspace System. These indicators highlight 
growing problems that require immediate attention. The following 
provides some key findings from our recent report \2\ on flight delays 
and cancellations.
---------------------------------------------------------------------------
    \2\ Audit Report No. CR-2000-112, Air Carrier Flight Delays and 
Cancellations, July 25, 2000.

   FAA reported a 58 percent increase (from 236,802 to 374,116) 
        in flight delays between 1995 and 1999. The Bureau of 
        Transportation Statistics (BTS) reported an 11 percent increase 
        (from 1,863,265 to 2,076,443) in delays during this same 
---------------------------------------------------------------------------
        period.

   Cancellations grew at an even faster pace, increasing 68 
        percent (from 91,905 to 154,311) between 1995 and 1999.

   Overall, 1 in 5 flights (1,152,725 of 5,527,884) arrived 
        late in 1999, with each delay averaging about 50 minutes. When 
        cancellations are added, nearly 1 in 4 flights (1,307,036 of 
        5,527,884) either arrived late or were canceled in 1999.

   Most delays take place on the ground during gate departure, 
        taxi-out, and taxi-in.

   The number of taxi-out times of 1 hour or greater increased 
        130 percent (from 17,164 to 39,523) between 1995 and 1999. 
        Flights with taxi-out times of 2, 3, and 4 hours increased at 
        an even faster pace (that is 186; 216; and 251 percent, 
        respectively).

   Airlines have expanded flight schedules on 82 percent of 
        their domestic routes (1,660 of 2,036) between 1988 and 1999, 
        ranging from 1 to 27 minutes, to compensate for growing ground 
        and air delays.

    For the first 7 months of 2000, these trends have only gotten 
worse. For example:

   FAA reported an additional 11 percent increase (from 227,719 
        to 251,874) in delays over the same period in 1999.

   Cancellations were also up an additional 10 percent (from 
        101,814 to 112,253) when comparing the first 7 months of 1999 
        with 2000.

   The average arrival delay is almost 54 minutes.

   Overall, 877,661 domestic flights either arrived late or 
        were canceled between January and July 2000, affecting over 90 
        million passengers.

   Consumer complaints to the Department have risen 
        dramatically, more than doubling (from 7,980 to 17,381) between 
        1998 and 1999, with an additional 47 percent increase (from 
        8,697 to 12,772) during the first 7 months of 2000.

    It is important to note that FAA and BTS use very different 
methodologies for determining flight delays.\3\ These differences can 
lead to somewhat confusing results. For example, FAA collects data on 
flight delays via the Operations Network (OPSNET). OPSNET data come 
from FAA personnel who manually record aircraft that were delayed by 15 
minutes or more after coming under FAA's control, i.e., the pilot's 
request to taxi-out. As such, an aircraft could wait an hour or more at 
the gate or ramp area before requesting clearance to taxi. So long as 
the flight, once under FAA's control, took off within 15 minutes of the 
airport's standard taxi-out time, the flight would be considered an on-
time departure.
---------------------------------------------------------------------------
    \3\ A key reason for differing data maintained by FAA and BTS is in 
how each uses the information it collects. For FAA, delay information 
serves to measure system-wide ATC performance as well as to identify 
areas for improvement. For BTS, measuring delays (and subsequent 
ranking of the major airlines by on-time arrival performance) serves as 
a source of air travel information to consumers and helps to ensure 
more accurate reporting of flight schedules by the airlines.
---------------------------------------------------------------------------
    Conversely, the major airlines submit monthly flight data to BTS. 
According to BTS, a flight is counted as ``on time'' if it departed or 
arrived within 15 minutes of scheduled gate departure or arrival times 
shown in the airline's reservation system. Using this definition, an 
aircraft could wait an hour or more on the airport taxiway for takeoff 
and be reported by BTS as having departed on time if it left the gate 
within 15 minutes of its scheduled departure.
Flight Volume and Aviation Safety
    One of the driving forces behind flight delays and cancellations 
has been the growth in flight volume. Such growth must be considered in 
arriving at workable solutions--a point discussed at the Secretary's 
August Summit with the Nation's airline executives. Between 1995 and 
1999, the total number of operations at the Nation's airports increased 
over 8 percent, from approximately 115.6 million to 125.3 million.\4\ 
Similarly, since 1995, the number of passenger enplanements rose nearly 
16 percent, from approximately 582 million to 674 million.\5\ These 
trends have continued into the first 6 months of 2000, with the 10 
major airlines reporting a 3.7 percent increase in scheduled flights 
and a 5.8 percent increase in the number of passengers over the same 
period in 1999.
---------------------------------------------------------------------------
    \4\ Flight operations, as reported by FAA, include takeoffs and 
landings by all types of aircraft (e.g., commercial, general aviation, 
and military) at approximately 3,400 domestic airports.
    \5\ Operations and enplanement data for 1999 were based on FAA 
projections.
---------------------------------------------------------------------------
    Against the backdrop of increases in flight delays, cancellations, 
and flight volume is the growth in runway incursions and operational 
errors. Runway incursions are incidents on the runway that create a 
collision hazard. Operational errors occur when an air traffic 
controller does not ensure that FAA separation standards are maintained 
between aircraft. As data show:

   Runway incursions increased 34 percent (from 240 to 321) 
        between 1995 and 1999. In the first 8 months of 2000, there 
        were 288 runway incursions, a 39 percent increase from the same 
        period in 1999. If this trend continues, runway incursions may 
        surpass 400 by the end of 2000, a new high.

   Operational errors increased 23 percent (from 764 to 939) 
        between Fiscal Years 1996 and 1999. In the first 11 months of 
        Fiscal Year 2000, there were 1,053 operational errors, 
        surpassing the 939 operational errors that occurred in all of 
        Fiscal Year 1999.

    To counter trends in runway incursions, FAA held a Runway Safety 
National Summit in June and has developed new initiatives that focus on 
reducing runway incursions in the near-term. FAA must now follow 
through on initiatives at the national and local levels to reverse the 
upward trend of runway incursions. FAA must also identify and evaluate 
emerging technologies that can be advanced quickly for use by pilots 
and air traffic controllers at airports that are a high-risk for 
incursions. Likewise, FAA should determine actions needed to reduce 
operational errors at its air traffic facilities that continue to show 
increases in the number and rates of operational errors.

Airline Scheduling
    There has been much debate in recent months as to the role played 
by airline scheduling in causing delays. Fundamental to understanding 
the relationship between delays and scheduling is gaining an 
appreciation of how the ``Hub and Spoke'' system works. Following 
deregulation in 1978, most of the major airlines began using the hub 
and Spoke system. A Hub airport is analogous to a switching center. In 
its simplest form, passengers arrive on inbound routes, or ``spokes,'' 
join other passengers arriving on different flights, and transfer to 
aircraft departing on outbound spokes.
    A key aspect of this system is the concentration of flights and 
passengers into the various hub airports. For example, just five 
airports (Atlanta, O'Hare, Dallas/Ft. Worth, Los Angeles, and Phoenix) 
comprised nearly a third of the passengers handled by the 10 major 
airlines in 1999. While the concentration of passengers and flights at 
these airports is seen by the airlines as providing significant 
operational efficiencies, the Hub and Spoke system also presents some 
operational inefficiencies, especially when one or more of the hubs 
break down.
    For example, on April 3, 2000, poor weather caused a significant 
reduction in flights to and from Atlanta. Because of the 
interconnectivity of Atlanta (the hub) to various other airports (the 
spokes), the number of delays ``rippled'' throughout the system, 
affecting over 50 airports. Overall, FAA reported 1,317 delays system-
wide, of which 405 (31 percent) were due to weather conditions at 
Atlanta.
    Beyond the concentration of flights at the largest airports, we 
found that one outcome from the Hub and Spoke system is the banking of 
flights into sizeable departure and arrival ``pushes'' at most of the 
major airports. Such pushes, as illustrated by Figure 2, place enormous 
demands on the ATC system's ability to efficiently manage the flow of 
traffic, both on the ground and in the air.




    The extent to which these departure or arrival pushes exceed 
capacity, however, is difficult to quantify due to the lack of a firm 
benchmark for measuring capacity. FAA uses fluid departure and arrival 
acceptance rates. These rates exist for most of the major airports, but 
are used primarily to manage the flow of air traffic, not as a 
benchmark or gauge for measuring the relationship between capacity and 
scheduling.
    Specifically, on July 17, 2000, Newark's departure and arrival 
acceptance rates were adjusted to accommodate an increase in scheduled 
departures from 2 p.m. to 5 p.m. (see Figures 3 and 4). By adjusting 
the rates, however, Newark's ATC effectively shifted the airport's 
capacity from the arrival to the departure side, resulting in an excess 
number of scheduled arrivals. Overall, Newark experienced 75 arrival 
delays on July 17, 2000, of which 20 occurred between 2 p.m. and 5 p.m. 
It is also important to note that FAA reported good visibility at the 
airport during these three hours.




    In comparison, Seattle's departure and arrival rates were held 
constant between 11 a.m. and 3 p.m. on July 10, 2000, even though there 
was an increase in scheduled departures during the early afternoon (see 
Figures 5 and 6). Overall, Seattle experienced 96 departure delays on 
July 10, 2000, of which 23 occurred between 12 p.m. and 3 p.m. Weather 
may have played a role in some of these delays, since visibility was a 
problem at Seattle from 12 p.m. to 1 p.m.




    Flexible rates are important as a traffic management tool, since 
both FAA and the airlines need to work within existing and changing 
operating conditions; but they do little in helping measure the extent 
of excess demand. FAA (in consultation with the aviation industry) 
needs to establish a set of capacity benchmarks or gauges for the top 
airports that measure what the system can reasonably be expected to 
handle given normal operating conditions by time of day. Such 
benchmarks would go far in helping all stakeholders understand the 
impact of volume on flight delays, as well as devising the necessary 
solutions.
    Over the last 6 months, FAA has been working closely with the major 
airlines in developing the Aviation System Performance Metrics (ASPM). 
This system, which became operational in April 2000, measures the 
extent to which departure and arrival demand exceeds airport capacity 
based on fluctuating rates. With some minor modifications, ASPM could 
serve as the platform for measuring excess volume--once reasonable 
benchmarks are developed for the major airports. The information 
obtained from this effort will be critical in ensuring the success of 
the Secretary's recently announced task forces.

Air Traffic Control Equipment
    The Congress, industry, and the traveling public need to know what 
can be realistically expected from FAA's investments in new technology 
in the immediate, intermediate, and long term, exclusive of airport 
improvements. There is a good deal of confusion on this point. FAA 
spends about $2 billion annually on various ATC modernization efforts. 
Given the framework established by AIR-21, FAA will invest about $8.6 
billion on modernization initiatives between Fiscal Years 2001 and 
2003. With this in mind, there are several factors to consider.

   First, much of FAA's modernization efforts are not geared 
        toward enhancing capacity and reducing delays. The main 
        objective of some projects was to replace aging equipment with 
        modern technology that is easier to operate and maintain. For 
        example, the Standard Terminal Automation Replacement System 
        ($1.4 billion) and the Display System Replacement ($1.1 
        billion) efforts provide controllers with new computers and 
        workstations. While these systems provide the platforms for 
        future initiatives, they do not, in and of themselves, provide 
        capacity enhancements.

   Second, FAA's Free Flight Phase 1 (FFP1) initiative with an 
        estimated cost of over $700 million (Fiscal Years 1998 to 2004) 
        is now the agency's key effort for enhancing capacity in the 
        immediate and intermediate term. FFP1 is an initial step toward 
        Free Flight and is a limited deployment of new information 
        sharing technologies and automated controller tools at selected 
        locations. Expectations for FFP1 are high.

    FFP1 will help in the sense that it will provide incremental 
improvements but it should not be viewed as a panacea. For example, the 
passive Final Approach Spacing Tool \6\ is helping controllers land 
about 1.4 to 2 additional aircraft at Dallas/Fort Worth Airport during 
peak periods. Also, new collaborative information sharing systems are 
helping FAA and airlines manage the impacts of adverse weather.
---------------------------------------------------------------------------
    \6\ The passive Final Approach Spacing Tool, or ``pFAST'' for 
short, was pioneered by the National Aeronautics and Space 
Administration and helps controllers sequence aircraft for landing. It 
provides a sequencing number and runway assignment for each arriving 
aircraft.
---------------------------------------------------------------------------
    Considerable work remains with FFP1's automated controller tools, 
and FAA is not scheduled to have a firm handle on bottom line impacts 
on reducing delays and enhancing capacity from these technologies until 
2002 when FFP1 systems are fully deployed. FAA is preparing a plan for 
the geographic expansion of FFP1 technologies. It is not a question of 
whether or not to expand FFP1 initiatives to other locations but rather 
one of deciding at what pace and where to provide the most benefits in 
terms of enhancing capacity and reducing delays.

   Finally, new communication, navigation, and surveillance 
        technologies for enhancing capacity and moving toward Free 
        Flight are longer-term efforts. These efforts include, among 
        others, satellite navigation ($3.7 billion) and Controller 
        Pilot Data Link Communications ($166 million for initial 
        steps). FAA analyses show that a sizable portion of benefits 
        from satellite navigation is the time passengers are expected 
        to save once the system is in place. However, these savings 
        include small increments of time--a minute or less per trip--
        which passengers may not value and the benefits accrue over 
        many years. FAA recognizes that the true benefits of some of 
        these new systems have not been conclusively quantified.

    Obtaining benefits from these cutting-edge technologies in terms of 
reduced flight times, closer spacing of aircraft, and more flexible 
routes depends on several complex issues, including synchronized 
investments by FAA (new ground systems) and industry (new avionics).\7\ 
For example, realizing the benefits of satellite-based navigation is 
contingent upon large numbers of airspace users equipping with new 
avionics and resolving complex performance and safety issues that 
recently emerged.\8\ Moreover, the full benefits from new 
communication, navigation, and surveillance technologies will not be 
realized until new ATC procedures and airspace redesign efforts are 
implemented.
---------------------------------------------------------------------------
    \7\ For additional details about the benefits of new communication, 
navigation, and surveillance technologies, see OIG Report no. AV-1999-
057, FAA's Progress and Plans for Implementing Data Link for 
Controllers and Pilots, February 24, 1999.
    \8\ For additional information on progress and problems with FAA's 
satellite navigation efforts and anticipated benefits, see OIG Report 
no. AV-2000-113, Observations on FAA's Satellite Navigation Efforts, 
July 26, 2000.
---------------------------------------------------------------------------
Airport Enhancements
    Aside from FAA's modernization efforts, capacity can also be 
increased through new runways and airport facilities. Although FAA will 
provide, through AIR-21, about $9.9 billion in airport improvement 
funds between Fiscal Years 2001 and 2003, many of the runway projects 
being funded will not be completed for many years.
    As noted in the following table, between 1991 and 1999, a total of 
5 new runways were added at the 29 largest airports,\9\ with another 15 
either under construction or proposed.\10\ With the exception of two of 
these new runways, most will not be opened for another 3 to 7 years.
---------------------------------------------------------------------------
    \9\ In addition to these runways, the Denver International airport 
was opened in 1995.
    \10\ The 15 runways will cost approximately $4.5 billion, according 
to FAA estimates.




    FAA estimates that any increase in capacity as a result of adding a 
new runway will vary widely from airport to airport. For example, 
Phoenix airport officials estimate that its new runway, which will 
become operational on October 5, 2000, will increase capacity by 20 to 
25 percent. In comparison, airport officials in Seattle noted that 
their new runway, which is scheduled to open in 2006, will provide 
added capacity during low visibility, which occurs a significant 
percentage of time.
    Whereas AIR-21 provides substantial resources for funding these as 
well as future airport improvements, the extent to which such 
improvements will come in the form of new airports (that the airlines 
will use) and new runways remains to be seen. Moreover, unlike 
technology enhancements and revised ATC procedures, construction of new 
runways, longer runways, and new airports clearly requires approval by 
local communities. They simply cannot be accomplished independent of 
the needs and desires of the surrounding communities and airlines. As 
illustrated by the Mid-America Airport, establishing a new commercial 
airport does not necessarily guarantee its use by the airlines.
    Mr. Chairman, this concludes my statement. I would be happy to 
answer any questions you might have.

    The Chairman. So it is not a field of dreams?
    Mr. Mead. No, sir.
    The Chairman. I thank you very much, Mr. Mead. I thank the 
witnesses. Ms. Garvey, Mr. Mead makes the point that we as 
Americans have a right to expect to know what to expect. In 
other words, tragically, the modernization program was 
originally intended, as I mentioned in my opening statement, to 
be finished in 1993 at a cost of $12.6 billion. Now its about 
double and we are still some time away. Perhaps you could give 
us briefly your projections. And second of all, maybe you could 
provide in writing for the Committee some very much more 
specific detail at your convenience. Please.
    Ms. Garvey. Mr. Chairman, thank you very much. I would be 
happy to do that. First of all, the Secretary mentioned the 
decision in 1994 to scale back AAS. That was a very difficult 
decision for my predecessors, David Hinson and Linda Daschle. 
But it was the right decision. And I think it did lay the 
groundwork for the approach we are taking today which is the 
incremental approach.
    Ken Mead mentioned that in 20 of our centers we have the 
most up-to-date hardware and tools for the controllers. That is 
right. Those are the platforms that we can use to add the 
capacity, as Mr. Mead suggested.
    The Chairman. He suggests actually that these do not 
necessarily mean an increase in capacity.
    Ms. Garvey. He is absolutely right. I want to be very 
clear. This equipment is the platform. You have to have the 
foundation or the platform in place before capacity enhancement 
can be achieved. That is what HOST is. That is what DSR is. It 
is the platform.
    So as we move forward with Free Flight Phase I and Free 
Flight Phase II, we can begin to add the capacity. We have the 
platform in place at the enroute centers. We are focusing on 
the terminals now. We are going at it step-by-step, building 
block-by-building block.
    Mr. Mead also suggested that we need to measure what the 
capacity benefits are to the technologies of Free Flight Phase 
I. I am in full agreement.
    The Chairman. When can we expect Free Flight Phase I?
    Ms. Garvey. Free Flight Phase I is underway now. It is 
being deployed now. It will be in place by 2002. I am pleased 
to say we have met all of the benchmarks. But again, just to--
    The Chairman. Right now, what percentage of flights in 
America are free flight--commercial aviation flights?
    Ms. Garvey. Very few, Mr. Chairman. That again ties in with 
what Mr. Mead said. The implementation is incremental. The 
fuller deployment nationwide is part of Free Flight Phase II. 
As he suggested, that is 2002 and beyond.
    The Chairman. What can I expect by this time next year, 
what percentage?
    Ms. Garvey. I would like to get back to you with an actual 
percentage. I can tell you that we are doing what Mr. Mead 
suggested in measuring the benefits of the technologies with 
the airlines. We have got a pretty straight forward agreement 
with the airlines which is that we will deploy it. They help us 
measure it. Tell us where it is working. Tell us where it is 
not.
    One quick example. In Dallas/Fort Worth where we have 
PFAST, which is a conflict probe, we have been able to increase 
the arrival rates by about 5 per hour.
    But Mr. Mead is absolutely right. These are incremental 
steps. We agree that laying out very clearly what those 
capacity enhancements are is important.
    The Chairman. We have people like FedEx that are installing 
their own equipment.
    Ms. Garvey. That is right, Mr. Chairman.
    The Chairman. Is that one way that we can?
    Ms. Garvey. I think that is a wonderful way. We have got a 
lot of work underway with the cargo industry right now, with 
some technologies that they are putting in place. Our challenge 
is to make sure our procedures are ready. The airlines are 
right to push us on this.
    The Chairman. Do you believe that we should consider--and I 
emphasize the word consider--the privatization of the air 
traffic control system?
    Ms. Garvey. Well, certainly, Mr. Chairman, from our 
perspective we have put two proposals forward. One was the 
government corporation. The other was a performance based 
organization.
    I think it is the right debate to have. I know there are a 
number of questions associated with any of those proposals, but 
I believe they are the right proposals with which to begin the 
debate. Another proposal that was included in AIR-21 that I 
think is going to be very helpful is the provision that allows 
us to enter into a public/private partnership with airports. I 
think that holds a lot of promise.
    That proposal could permit some airlines to do some public/
private capital investments. We are excited about that. We have 
got a notice in the Federal Register and getting some comments 
on our guidance in that notice. We hope to get some 
applications by the end of this year.
    I think all of these proposals hold some potential. 
Certainly, the issue about how best to handle air traffic 
control is the right debate. I thought the government 
corporation and the PBO certainly had a lot of promise. But we 
certainly appreciate, the statutory authority we got in AIR-21. 
In addition, the CEO provision and the oversight board have 
been a tremendous help to us.
    The Chairman. Mr. Secretary, some argue that we have not 
been using the funds as efficiently as we could. For example, 
there is no limit on the amounts of money that can go to a 
smaller airport, but on the major airports there is a limit as 
to how much of the Federal dollars can go. I do not want to put 
you on the spot here, but do you not think we could do a better 
job or could have done and should in the future do a better job 
of allocating existing funds?
    Secretary Slater. I would say we can do a better job. I 
think we've been given some tools in AIR-21 to actually do 
that, Mr. Chairman.
    Not only did the administration work with the Congress to 
get record-level dollars for the AIP program, the Airport 
Improvement Program, but we are also able to work with you to 
give local aviation authorities, airports, and the like to 
raise the passenger tax as well. And that, I think, I increased 
from possibly three dollars up to four-fifty.
    The Chairman. And, yet, do we not charge every passenger, 
is it $6 per trip? I've forgotten. We just increased it. And, 
yet, corporate aircraft fly around this country for free.
    Secretary Slater. You and I have talked about that. That's 
right.
    The Chairman. Do you agree that that's really obscene?
    [Laughter.]
    The Chairman. It's really remarkable. The wealthiest people 
in America and the wealthiest corporations fly around this 
country for free, yet the average taxpaying citizen that gets 
on an airliner has to pay a tax on it. Another argument for 
Campaign Finance Reform.
    [Laughter.]
    Mr. Mead, I have one brief thing. I think Senator 
Rockefeller is right. We don't need to point fingers. We don't 
need to go back and put blame on people, et cetera. But I 
remember being startled when Governor Baliles sat in your seat 
and said, you know, unless something is done, by the Year 2000, 
every day in an airport--or 2001--everyday in an airport in 
America is going to be like the day before Thanksgiving. And 
all of us were shocked. All of us, oh, my God, this could be 
terrible.
    And, yet, almost inexorably, like watching a train wreck, 
if I might use that, we've seen this problem compound and 
compound and compound, to where people are--we now have a new 
phrase, air rage. What happened here?
    Mr. Mead. Well, I think we spent an awful lot of time 
talking about things like antiquated aircraft or other issues. 
We spent a lot of time pointing fingers at structural issues. 
You know, should we privatize, should we leave FAA alone, 
should we do something in between? I think it took us a long 
time, frankly, because what was predicted some time ago has 
certainly come true. I think we have to make some very hard 
decisions.
    You asked in your opening remarks about funding. AIR-21 has 
done an enormous job in terms of making financial resources 
available. In a sense, Congress has done its part. AIR-21, 
alone, will provide over $9 billion in airport improvement 
funds.
    I think time will tell whether the bulk of that money will 
go to your big priority, big capacity--enhancing projects. I 
think that the Department of Transportation could do a better 
job in being more forceful in doing that.
    The Department will need the support of the Congress in 
doing that, because sometimes it is going to require leveraging 
local communities. And you don't do ground infrastructure 
projects without the clearance of a local community. That's one 
issue.
    I also believe that, as I mentioned in the testimony, Mr. 
Chairman, we need to face the facts about what the capacity 
limits are.
    It's like out here on Shirley Highway in the morning. There 
are only so many cars that can go across it. We're dealing with 
the Wilson Bridge right now, as the Secretary knows, and you 
have to decide how much traffic can the Wilson Bridge handle. 
And that's what we're suggesting here.
    The Chairman. You may end up with a limitation on the 
number of flights that people can take.
    Mr. Mead. In addition, my answer is not complete without 
saying that there were some very difficult decisions made in 
the 2094-'95 timeframe that essentially pulled back on a 
direction that the FAA was going in. They had to go back to the 
drawing board, so to speak, to set a new direction.
    Now that happened just a couple of years before the Baliles 
Commission report came out.
    Secretary Slater. Mr. Chairman, if I may offer one or two 
comments?
    The Chairman. Sure.
    Secretary Slater. Also during this period, we were really 
dealing with some broader issues of importance to the nation, 
putting our economic house in order, strategically investing in 
those things that would strengthen us.
    Fortunately, transportation was a part of that and, again, 
we just passed a major bill earlier this year with the 
leadership of this Committee, to put us on the right track.
    So we have made some progress, but we are at the magical 
moment now. Our house is in order. Economic surpluses. There is 
the opportunity to really invest, to do so strategically. The 
parties have come to the table. Hearings like this continue to 
put the pressure on those of us who have a responsibility here. 
I think this is a unique moment.
    And on the point that Mr. Mead made about strategically 
investing in critical airports around the country, the 
Department of Transportation is ready to play a stronger role 
in that regard, but we do have to work with local and state 
authorities because, for the most part, those investments are 
made at that level, and the decisions about when to go forward, 
how to go forward, dealing with balancing the environmental 
concerns and the like, community concerns, are made at that 
level. But we can provide stronger leadership and are prepared 
to do so.
    The Chairman. There is a very amusing and entertaining 
article by Evelyn Brody, called ``Three Perfect Days in O'Hare 
Airport,''which unfortunately is true. It seems to me that one 
of the reasons why we remain in gridlock in Chicago is because 
of poor political forces, and unless somebody starts holding 
these politicians accountable, then things are going to get a 
lot worse at O'Hare Airport. Would you agree, Mr. Mead?
    Mr. Mead. Yes, I would.
    The Chairman. We either expand O'Hare Airport, or we build 
another airport, or both. Do you agree with that?
    Mr. Mead. Yes. Either that or change the usage profile of 
Chicago O'Hare in a fairly dramatic fashion.
    The Chairman. How do you mean?
    Mr. Mead. Well, Chicago O'Hare is obviously a major 
domestic and international hub, and it seems when things go 
wrong at O'Hare, they go wrong nationally. If a significant 
part of the traffic load at Chicago O'Hare were moved someplace 
else, that would have some effects. I'm not suggesting that, 
but that's one plausible outcome.
    I think you'll hear from Mr. Carty of American later today 
on an interesting proposal he has about the use of the airplane 
asset. Whereas a single aircraft currently goes from Chicago 
O'Hare to New York to some third or fourth location during the 
day, I think part of his proposal is that he limit the number 
of destinations. I think that's fairly intriguing.
    The Chairman. Senator Hutchinson. Excuse me. I'm sorry. 
Senator Bryan. I apologize, sir.
    Senator Bryan. Mr. Mead, let me just compliment you. I'm 
not sure how many more times I'll have the opportunity to hear 
you, but your testimony is always clear and it's concise and 
it's very helpful, so let me preface my comment by saying that.
    Let me try to explore for a moment with you. I take it that 
implicit in these capacity benchmarks, when we ascertain what 
those are, that they will tell us that's the limit at which 
flights can continue to fly in a safe manner? Is that what 
we're talking about when we're talking about capacity 
benchmarks?
    Mr. Mead. That's right. It doesn't help you on weather. 
You'll notice I said, let's do it for good weather conditions.
    Senator Bryan. No, I understand.
    Mr. Mead. Yes, that's it exactly.
    Senator Bryan. So that's what it will tell us. So when Ms. 
Garvey gets this information to us in a couple of months, it'll 
tell us that in these 30 airports, this is the capacity; beyond 
that, under the current usage, you can't add more flights to 
that airport? Is that essentially what we're saying?
    Mr. Mead. I didn't go that far.
    Senator Bryan. Maybe you can explain that for me, then. I 
don't want to misconstrue your comments.
    Where I'm coming from is once these capacities are reached, 
and they're going to be reached at the rate air travel is, what 
are the options for us to expand the number of flights into 
these critical areas of commerce?
    This isn't just a question of passenger convenience as you 
and I have talked. This is a matter that's indispensable to the 
growth of the economy, air travel, air service. Whether we're 
talking about visitor destination or cargo, it is essential to 
the expansion of our country's economic base.
    Mr. Mead. I would stop quite short of saying that they 
should be mandatory.
    Senator Bryan. No, and I'm not asking that question.
    Mr. Mead. But I think you need them at least for the next 
two or three years, and the reason is because you are not going 
to get material relief from other sources.
    Senator Bryan. Very briefly, Mr. Mead, what are our 
options? Assume in the airport, Las Vegas is one of the largest 
airports in the country, as you know; assume, that Ms. Garvey 
indicates the capacity benchmarks, and let's assume 
hypothetically they're reached. What does that tell us? That no 
more flights can be added during particular times during the 
day? What is the significance of that question?
    Mr. Mead. The significance is that if you continue to add 
flights beyond that, you're going to increase the pain 
threshold for the traveling public. You're going to be 
stressing the air traffic control system beyond what is 
reasonable. Hopefully, people won't do that.
    Senator Bryan. What are the options; in other words, if 
there are two or three things that we can think of that would 
enable us to expand that capacity benchmark, what are some of 
the things that we ought to be looking at?
    Mr. Mead. Well, the Free Flight Phase 1 program, certainly, 
at FAA is one that will help to a degree. If you're speaking of 
that particular airport, I'm not that familiar with the Las 
Vegas Airport.
    Senator Bryan. But just in general. Las Vegas is obviously 
of particular concern to me.
    Mr. Mead. I think with the AIP money leveraging technology 
or other capacity enhancements, that will be truly meaningful.
    Senator Bryan. Okay.
    Mr. Mead. That's two areas.
    Senator Bryan. Those are a couple of things. OK, fine.
    Mr. Mead. I would also look to the time of day that planes 
are arriving and departing. I can point to Newark's profile. 
Everybody thinks Newark's profile is terrible. Well, actually, 
there are points in the day where Newark has some valleys, and 
I don't believe we use those valleys enough.
    Senator Bryan. You've given us three options here, and I 
appreciate that. That's very helpful.
    Now let me ask you. I don't want to use ``benchmarks,'' but 
what kind of indicators are there? You're talking about looking 
at our short-term, our intermediate and long-range situation 
here. What are the things that we may need to look at in terms 
of how well we're doing in addressing those problems, short-
term, intermediate and long-term? What should we focus on? 
Let's take the short-term first.
    Mr. Mead. Right. If you were to set those capacity 
benchmarks, you'd want to come in, I would say, every 6 months 
to see what the delay and cancellation factors were, to see 
that they were working.
    I don't mean 1 or 2-minute delays. I don't get upset until 
I'm delayed by about a half an hour now. So you want to have an 
increment of time that's meaningful. But you come back and you 
benchmark the situation.
    And I also think that the load that the controllers are 
handling is important, I would want to see not only the delay 
and cancellation figures, and the load the controllers are 
handling, but how do the runway incursion and operational error 
rates look for that particular facility?
    Senator Bryan. And would you use the same criteria with 
respect to the intermediate and long-term or would you----
    Mr. Mead. Yes. I think you need some goals. Anytime you set 
a limit or a benchmark, I'm not sure that that's futuristic 
enough. I'm hopeful that with free flight and satellite 
navigation, we have something to look toward, and we can set 
some benchmarks for what our goals would be, say for Las Vegas.
    And we could use those very same indicators, sir, to track 
progress toward reaching them.
    Senator Bryan. In your judgment, Mr. Mead, have we provided 
the sufficient legislative framework or authority for the 
Department of Transportation, Ms. Garvey's agency, in 
particular, to do the job? I'm talking about the legislative 
framework not the level of appropriation.
    Mr. Mead. Yes, I believe you have.
    Senator Bryan. So essentially the framework is there, the 
authority is there, as you view it?
    Mr. Mead. Yes, sir.
    Senator Bryan. Okay. How about the level of appropriations?
    Mr. Mead. The Secretary can speak to this. My own view is 
that within the Office of the Secretary--I think the Office of 
the General Counsel and the Office of Aviation and Policy, both 
of which oversee the enforcement of consumer rights, are 
inadequately staffed.
    I don't know exact numbers, sir, but you have fewer staff 
there than you did in 1995, and you've got more than a doubling 
of complaints. These people, can't get to the complaints, and 
that sends the wrong signal about enforcement. And, frankly, we 
need more resources in enforcement.
    Senator Bryan. In enforcement. Any other areas that you 
would suggest that would need more resources?
    Mr. Mead. No, sir.
    Senator Bryan. And my last question, Mr. Mead, in terms of 
procurement for the 12 years that I have been on this 
Committee, we talked about some of the procurement delays and 
how long it takes to acquire and update, and you can buy things 
off the shelf in a shorter period of time, and you can go 
through the procurement, and by the time the procurement 
criteria are established, the equipment is obsolete, and 
there's three new generations of new equipment.
    Give us your assessment, generally, where are we on 
procurement in terms of both the policy and the actual 
implementation?
    Mr. Mead. As you know, Congress enacted procurement and 
personnel reform for FAA.
    Senator Bryan. Yes.
    Mr. Mead. Clearly, under procurement reform, they're 
awarding contracts quicker.
    Senator Bryan. OK.
    Mr. Mead. Clearly, for the technologies like the HOST 
computer, contracts that were let for Y2K, they got the job 
done. Another one was the display system replacement for en 
route centers. But these were not software intensive projects. 
The software intensive projects continue to plague FAA, 
although FAA is much more open about the problems, and seeking 
to tackle problems much earlier in the process.
    The satellite navigation system, is an example of one where 
software problems continue. I don't think it's a function so 
much that the government has the contract. I mean, a private 
sector firm, is running the contract. The FAA and contractor 
are trying to get to a 99.9 percent reliability rate. This is 
important because you can't afford to have a satellite signal 
falling off on a final approach.
    So FAA's software intensive procurements are still having 
more than their share of problems.
    Senator Bryan. Are we making perfection the enemy of the 
possible in terms of setting the standard 99 percent too high? 
Is that something that's not attainable as a practical matter?
    Mr. Mead. In some programs, that's so. Some years ago, 
there was terminal weather Doppler radar which detected 
windshear. That was intended to replace a system that wasn't 
very good. It was good about 50 percent of the time, and I 
think that we probably lost a few years in that procurement 
because we were striving for a 99 percent reliability.
    Satellite technology, though, is another matter. You're 
going to have these airplanes relying on the signal that says 
exactly where you are, and there's not much room for error.
    Senator Bryan. No.
    The Chairman. Senator Hutchinson.
    Senator Bryan. Thank you very much, Mr. Chairman.
    The Chairman. Thank you.
    Senator Hutchison. Thank you, Mr. Chairman.
    I think the capacity issue and the infrastructure needs 
have been well questioned. There's one other point I'd just 
like to ask about on that issue. That is, does the FAA have a 
system that you feel comfortable with, Ms. Garvey, that gives 
air traffic controllers a big enough picture. For example, if 
there are weather problems in Detroit and they are going to 
either keep flights from going in there or reroute, can 
controllers look at the rest of the country and avoid delays by 
either rerouting more flights to the same airport?
    Ms. Garvey. That really gets to the heart of I think a 
number of the issues that we have. At the command center in 
Herndon we have some terrific weather technology. It's a 
wonderful place to visit if you have an opportunity. I know 
some of the members have had a chance to see that. As you've 
suggested, you really do get a comprehensive, big picture look 
when you are at the command center.
    This year, for the first time both the FAA and the 
airlines, are using common weather information, and that's a 
significant step forward.
    However, your question asking whether there is more 
information that we can give to the controller, even more 
precise information, that's really the next iteration of 
technology.
    Senator Hutchison. This is not just seeing the weather 
everywhere, it's knowing what the other controllers are facing 
and having the instant information so that they can make other 
judgments? Is that it?
    Ms. Garvey. That's true. I think in the area of weather, 
there is still another wave of technology that's going to be 
very critical.
    But you know it's interesting. We were up in New York last 
week talking both with the controllers and with the managers, 
and there's a balance to strike. One of the controllers said 
when he was really busy and things were really hopping, he 
knows he just has to take care of his sector. He's just got to 
take care of what he's doing.
    When it slows down a little bit, it's good for him to step 
back and look at the big picture. In a number of the 
facilities, we are putting some of those bigger screens, very 
similar to what we have at Herndon. So we're getting there.
    We're not fully there yet, but the common weather 
information has been extraordinarily helpful this year, and 
still strikes that balance between focusing on what you need to 
get done, and having time when it's a little bit slower to take 
a look at the bigger picture.
    Senator Hutchison. Mr. Slater----
    Secretary Slater. Yes.
    Senator Hutchison.--Part of air rage is this disclosure of 
information to passengers' issue, and I think if people know 
what to expect and are given the information either before they 
come to the airport or when they get there, if there is 
something unavoidable, I think the rage factor could be sharply 
reduced.
    Also, I think that people believe that sometimes flights 
are canceled because they're not full, because there's another 
flight that leaves 45 minutes or an hour later. I know the 
practice of cancelling a flight because it's not full is 
against the rules, but what do you do to make sure that this 
doesn't happen?
    And, I would like to know if you look at the disclosure 
factor and try to see if airlines are giving the information 
that they have to passengers, or is that even something that 
you have the ability to do?
    Secretary Slater. Well, first of all, let me say that it's 
our desire to avoid the need for additional regulation as well, 
and that's why the collaborative process is so essential, where 
we work with the industry. And we've had some considerable 
success in that regard.
    Second, when it comes to information, clearly, we found 
that the biggest issue with passengers is, more often than not, 
the question of information. They know that there will be 
delays for any number of reasons, most of them involving 
weather, and they just want timely, accurate information that 
they can rely on.
    And, clearly, they would like to know when they're delayed 
whether there are options with out airlines as you have noted 
in your earlier comments.
    We actually have, I think, two of the best companies in 
that regard here today, and you'll have an opportunity to hear 
from Leo Mullin with Delta and Don Carty with American.
    During our roundtable discussions, we've gotten into that 
issue. That's with the task force that Mr. Sanchez will head 
dealing with best practices is all about, to collect the best 
information out there that deals with programs employed by 
individual companies, and then to share that across the 
aviation enterprise. That's exactly what we're trying to do.
    I know that Delta has invested significant dollars to 
streamline their technology and to make sure that all of the 
players on the front line are getting the same information at 
roughly the same time.
    Again, Mr. Mullin can get into that to an even greater 
extent.
    Mr. Mead talked about some of the decisions that Mr. Carty 
is going to make as it relates to the scheduling.
    Well, they've relied on their information flow to make 
those kinds of judgments, and those are the kinds of things 
that have to happen as we manage better the process and the 
capacity of the system, and clearly the benchmarks that will 
help us know what the high point is will help us then deal 
within that frame of capacity that is reasonable.
    So I think all of these things are actually helping us to 
enhance the efficiency of the system we have.
    Now, the last point----
    Senator Hutchison. What about cancellation?
    Secretary Slater. Yes. There is a provision that's--I think 
it's 49 U.S. Code, 41.712, which gets into the question of 
accuracy and truth in advertising and in scheduling and all of 
those questions. And, clearly, those powers that are at our 
disposal.
    But we, also, in our consumer reporting activities, stay on 
top of the information, really monitoring flights that are, you 
know, sometimes they have a 100 percent delay record over a 
period of time. In the most recent consumer report, we actually 
identified some of those flights.
    We do monitor the situation. You know, we have tried to use 
a collaboration process. We will continue to do so. But in a 
situation where we find that we cannot resolve matters in that 
way, we do have authority for dealing with those questions.
    Now I'd like to close with a comment that Mr. Mead made 
earlier when responding to Senator Bryan. He said, are there 
other powers or resources that would really be helpful.
    I can tell you that when it comes to our consumer 
protection functions, we do not have the resources to do what 
needs to be done. Now we do have the authorization. And here, 
Mr. Chairman, we had a discussion the other day on the same 
matter as it relates to NHTSA, and we got into a discussion 
about resources.
    And at the time, I was not as clear as I wished to be now, 
and that is, when it comes to authorizations, this Committee 
has been very helpful to us in providing the resources through 
the authorization process.
    But when it gets to appropriations, sometimes we just 
don't, at the end of the day, get the resources we need to give 
us the ability to follow through on some of the authority that 
we have.
    Senator Hutchison. Thank you, Mr. Chairman.
    The Chairman. Senator Rockefeller.
    Senator Rockefeller. Thank you, Mr. Chairman.
    I want to reemphasize what has been said. I think this kind 
of a hearing is very, very useful because I'm not talking about 
particular problems associated with West Virginia. We're not 
discussing noise in Arlington.
    I think this is sort of the whole blame type of thing, and 
what we're trying to do is rise above that. I think one of the 
reasons we haven't been able to rise above that is because when 
we come to markups and things of that sort we tend to, on our 
side, become to look after those particular things which 
constituents are talking to us about and which we feel we need 
for our states, which takes us away from the national aspect of 
all of this.
    On the Administration side, I would have to say--others on 
this Committee would disagree with me, but I'm very much of an 
off-budget person. The Administration was not in favor of an 
off budget for the Airport and Airways Trust Fund, but they 
were for the amount of money that we wanted to spend. And so 
there's that factor.
    The airlines--and we'll get into this also--scheduling 50 
or 60 flights where only 30 are possible, and yet they feel 
they have to do it because if they don't do it somebody else 
will do it, and so that's part of the competition. So, again, a 
blame all around.
    In a sense what we're talking about is, in fact, a national 
system, which is in some ways coordinated as in the case of 
runways and airports by state and local decisionmaking, which 
predominates, and you have a terrific conflicts in those areas. 
And we don't address those problems because we're dealing in 
smaller things and ignoring the larger problem.
    So having said that, let me ask any of you, of the three 
distinguished witnesses. Yes, we put some money into 
infrastructure and runways and air traffic control. It was 
also, I thought, just as interesting that in view of what was 
said about the appropriations process that we put the 
infrastructure and the air traffic control equipment in as 
mandatory spending, so to speak. We then said, all right, if 
you don't want to pay for FAA and air traffic control people, 
then you go ahead and do that, thus, calling the hand of the 
appropriators.
    The appropriatiors, all through the AIR-21 conference 
period, were reluctant as were the Budget Committee people, 
reluctant to give us any money to do any of these kinds of 
things. So, in a sense, we had to manipulate our own process in 
order to get the money that we need.
    But the money that we need, Mr. Mead, is that in fact 
enough? I notice that you said 5 to 7 years to build a runway. 
I'm sort of more schooled in the 8 to 10 years thought.
    So the first question I want to ask is: How much in the way 
of new runways? You know, I know when you focus on California 
and you talk about building a new runway in the San Francisco 
Airport, everybody goes crazy because you can't do anything 
offshore without addressing enormous environmental issues.
    But on the other hand, are we going to have to bypass San 
Francisco? Are they going to have inadequate service because of 
local decision-making or local objections?
    LaGuardia, obviously, is going to have to build out in the 
water. I don't know how their environmentalists or local people 
feel about that, but there aren't going to be more runways 
unless they do that.
    So my question is twofold: One: How many runways can be 
built? There's an enormous cost differential depending on many 
factors including the types of aircraft using a new runway, 
hundreds of millions of dollars in what these runways cost.
    How many do you see being built or what percentage of what 
needs to be built as a result of AIR-21? In other words, how 
far have we fallen short in AIR-21 in terms of what we need to 
do when, really, all of these things have to be done tomorrow 
and obviously can't be?
    Second, would you address this question of, when we build 
interstates, highways, the Feds provide the money; the states, 
more or less, determine the route. The Feds have something, but 
not a whole lot, to say with that.
    And I'm very concerned about your views about whether we 
need to start looking and dealing more forthrightly with states 
and local authorities about how this is a national problem, 
that when something goes wrong in Newark and O'Hare or any of 
those big airports, I need to tell my people, as I do, in West 
Virginia, that the first people to suffer will be Charleston, 
West Virginia, Huntington, West Virginia, because they always 
take the end of the food chain and chop that off.
    So the national dimension of this calls for some new 
thinking, I think, on our part.
    And I would be interested in your response to the question 
of runways and the question of local versus national input.
    Chairman McCain won't remember this, but I remember, I was 
a Governor for 8 years, and I tried for 8 years to raise the 
drinking age in West Virginia from 18 to 21, and I succeeded 
brilliantly by getting it in 8 years from 18 to 19, and then I 
came up here, and in my very first year there was national 
legislation that said, OK, you want your Federal highway funds, 
you put it at 21, and it was done like that.
    Now these are things that states may or may not like, but 
it sure helped a lot.
    So I'd appreciate some responses on those things.
    Secretary Slater. Senator, I think you afford all of us an 
opportunity to comment on the question. Let me just offer a few 
and then turn to my colleagues.
    First of all, I do think that it's very important for us to 
communicate to the Nation the importance of this industry. 
We've talked about passengers increasing, you know, threefold 
over the last 30 years or so. I mean, we're moving now 670 
million passengers this year, 650 million last year, about 200 
million more annually now than when this administration came 
into office.
    It is a critical industry to the long-term viability of our 
economy and to an improvement in the quality of life of our 
citizens.
    Senator Cleland, earlier you talked about extending life. 
Well, when you can move faster and more efficiently by adding 
to the quality of life, you actually extend it. You extend it.
    In the closing years of the last--or in the middle of the 
last century, the vision of the interstate to lock all of our 
communities and cities together, really unleashed the economic 
power of this nation.
    In the coming century, aviation can do that as we play on 
an international stage, giving us access to communities and 
cities around the world.
    Right now, beyond the movement of passengers, aviation 
accounts for only about three percent of the tonnage, the 
freight that we move, but it accounts for about 45 percent of 
the value of the freight that we moved.
    We mentioned Federal Express and UPS and some of those 
companies a little earlier, along with the freight that's moved 
by the passenger carriers, very important to the overall health 
and well being of the economy of the nation.
    Senator Rockefeller. Mr. Secretary, I have time limits. I 
need to get my two questions answered.
    Secretary Slater. I understand. But I think as we make that 
case, we can then, as a Federal Government, better work with 
state and local governments when it comes to meeting the 
infrastructure challenges because they do have a role.
    I don't think that we'll have a time when the Federal 
Government will be dictating a new runway at O'Hare or at 
Hartsfield. We have to do those things together. So the vision, 
the case, I think will help us in that regard.
    As relates to the runways----
    Senator Rockefeller. But then what do you do with San 
Francisco? I mean, I don't know San Francisco well enough to 
say that they would absolutely refuse to have another runway 
built out into what turns out to be a rather large body of 
ocean, called the Pacific Ocean, but I think they would fight 
it.
    It might be a small group, it might be an environmental 
group, or whatever. But they would fight it. And at some point 
you have to have the proper number of runways in San Francisco.
    Secretary Slater. That's right. But Mr. Mead touched on 
that particular question a second ago when he said that 
character of the runway, and it's important in the overall 
national scheme of things, may have to change.
    Once those issues, again, are considered by those at the 
state and local level, there may be then the political will to 
really deal with some of the challenges that have to be 
balanced and met to make those kinds of investments.
    San Francisco, a gateway to Asia, has to consider its role 
in that regard as it relates to L.A. or Seattle. And now with 
the planes that can move greater distances, other gateways 
becoming major U.S. gateways to those important markets.
    Those are the kinds of things that would come into play.
    Senator Rockefeller. So you're suggesting, in that we all 
recognize we don't have 10 years for local decisionmaking to 
rise to the level of Confucious in its wisdom, you're 
suggesting that there might have to be a reconfiguration in the 
traffic allowed into or routed into San Francisco, so that they 
have to deal with the possibility of fewer flights, less 
traffic, in return for keeping that local control?
    Secretary Slater. I'm glad, first of all, that we made it 
more general. We've been talking about San Francisco.
    But I think that what you have to do is have the big 
picture understand what the competing demands are, and in a 
collaborative way, if you can, try to address these needs. But 
where you have powers to do other things, you have to put those 
issues on the table as well, and we're just getting to the 
point again where we're beginning to talk it through.
    Up to this point, it was maintaining the health and 
viability of the industry. We have met that challenge. We have 
opened access and markets and liberalized aviation agreements 
with international partners, and now we have the service issue 
that is the challenge at hand.
    Also, on the issue of the runways, with the 9 or so billion 
dollars in AIR-21, we really have the resources to deal with 
most of the runway issues that are on the table. Many of them 
will be different costs based on the local challenges, but 
generally around 300 or so million for an average size runway.
    A lot of those runways can be paid for with the $9 billion 
in AIR-21.
    And we've also talked about how we might be able to use 
some incentives from our level to actually encourage 
communities as they seek our participation in those kinds of 
investments.
    Mr. Mead. And I don't think money is the problem, 
particularly when you throw in the PFC revenue. When you 
combine that with the $9 billion, that's a very good piece of 
change.
    There is another question, Why should the entire national 
airspace system have to put up with an endless number of 
flights being scheduled out of an airport that can't 
accommodate the capacity?
    As you can see there are some hard decisions ahead. If 
we're not going to improve the infrastructure in a particular 
location, some corresponding adjustments need to be made about 
what the air traffic control systems must be prepared to 
handle.
    The Chairman. Good solution.
    Senator Gorton.
    Senator Gorton. Thank you, Mr. Chairman.
    I'd like to have you put an opening statement in the 
record.
    The Chairman. Without objection.
    [The prepared statement of Senator Gorton follows:]

 Prepared statement of Hon. Slade Gorton, U.S. Senator from Washington

    In the last few years, airline delays have been increasing at a 
dramatic rate. Between 1997 and 1999, delays of 15 minutes or more were 
up 75 percent during the months of April through August. Although final 
statistics for August are not yet available, every indication is that 
delays this past spring and summer were worse than last year, 
especially at the nation's largest airports. Everyone believes that 
delays will get worse as the demand for air travel continues to grow in 
the years to come.
    It is evident that these delays have played a significant part in 
the rise in consumer dissatisfaction with air travel. When airline 
schedules become unreliable, the frustration of passengers is bound to 
rise. That frustration exacerbates any existing flaws in an airline's 
customer service program. As a result, Congress gets called upon to 
address the matter. But more than consumer frustration is at stake.
    The costs of these delays are dramatic. The major airlines estimate 
that delays cost them and their passengers billions of dollars each 
year. The delays of the past two years portend greater problems in the 
future. As many have pointed out, the National Civil Aviation Review 
Commission concluded nearly three years ago that gridlock in the system 
was fast approaching. To avoid a system continually plagued by 
gridlock, those of us who have a role in the oversight and upkeep of 
the national air transportation system must seek out potential 
solutions for the medium and long terms.
    The reasons underlying these delays seem to be as complex as the 
air traffic control (ATC) system itself. The strong economy has lead to 
an increased demand for air travel, which in turn generates more 
flights. Although bad weather certainly plays a significant role, the 
manner in which the FAA responds to potential weather disruptions is 
also an important factor. I am pleased that the FAA and airlines have 
been working more closely to manage air traffic when disruptive weather 
systems are predicted. Government and industry will need to work 
closely on many levels if the problem of delays is ever to be solved. 
Also, airport development cannot be forgotten in the effort to 
accommodate growth in the system.
    In an attempt to address some of the concerns associated with ATC 
management and modernization, Senator Rockefeller and I sponsored 
legislative provisions that were enacted as part of the recent FAA 
reauthorization act. Although our ATC management reform proposal is not 
a panacea, and will not have an immediate impact on delays, we believe 
that it was a step in the right direction for the long run. Much more 
needs to be done, however.
    Unfortunately, there is no time left in this legislative session 
for substantial legislation. We must begin a dialogue now that will put 
us on track to address the deeper problems during the next Congress. An 
industry consensus will be a prerequisite to any meaningful action. If 
the aviation community remains divided with respect to solutions, 
Congress will probably not be able to act in a constructive way. I want 
to explore with our witnesses what else can be done to address these 
matters. I appreciate their participation today and look forward to 
hearing what they have to say.

    Senator Gorton. But just to say, to a certain extent, it 
seems to me the discussion has involved perhaps 2 million 
subjects with some sub-subjects.
    One of those subjects is the capacity of our airports. With 
the two subsets, perhaps one of which we solved, at least 
according to the people here, the money necessary for the 
concrete, the other the issue that Senator Rockefeller brought 
up; and that is, local opposition to that kind of increase in 
capacity.
    The other is the technology. Using what we have now, you 
know, more efficiently with a better air traffic control 
system; the latter right now is a purely Federal 
responsibility.
    Secretary Slater. That's right.
    Senator Gorton. One of the things we're talking about is 
very clearly not.
    With that in mind, I'd like to start with one other thing, 
Mr. Chairman. I'm not a great fan of this administration by any 
stretch of the imagination, but I do want to say that the three 
people who are in front of us, Mr. Chairman, I think have done 
a magnificent job with the complex challenges that they have 
faced, and this may well be the last hearing with this three-
group in this Congress.
    Each one of these people has been extremely constructive, I 
think, in dealing with each one of these very, very many 
challenges.
    Now with that, if I may, I'm going to share an experience 
with you. I had a rare occasion yesterday of coming back from 
Seattle to Dulles in the middle of the week, and by United 
flight, and in a delightful exception to its recent history, 
pulled right out of the gate on time and then pulled right back 
in.
    United Express flight from Eugene had landed and 
distributed passengers two of them to our flight. And its 
baggage was being unloaded, one of the suitcases, almost 
knocked out a baggage attendant with its fumes. It turned out 
that this particular passenger seemed to be carrying an entire 
meth lab or chemical laboratories in his checked baggage.
    And they had to pull both of the passengers who transferred 
to our flight out. They pulled passengers out of perhaps half a 
dozen other flights. We left and arrived here 2\1/2\ hours 
left, and when we left there was a police line around this poor 
little prop commuter plane and a yellow band.
    But that will appear on this chart, you know, the next time 
around. There was no rage among the passengers on our plane. 
You know, this whole thing was very clearly done, you know, for 
our safety.
    And that leads to the principal question I have for you all 
know that is mentioned in passing; and that is, how soon are we 
going to be able to understand not just the gross figures that 
appear on this chart, but how soon are we going to have a 
single definition of what ``late'' is and what ``on time'' is 
and a reasonable breakdown of weather, the kind of problems 
that afflicted United, labor problems, overscheduling at a 
particular time because the airport, even at best, can't do it, 
and pure safety, obviously, necessary things like what took 
place with me yesterday.
    When will we have a chart, in other words, that's more 
meaningful than this was that can tell us the whys? Because 
it's only, it seems to me, that when we know the whys that we 
can really focus in on controlling those we can control, and 
not forgetting the one we can't control, like what happened to 
me yesterday, but at least to isolate them?
    Secretary Slater. Mr. Chairman, a little earlier we talked 
about capacity benchmarks that Ms. Garvey and her team will 
have for us pretty soon. I think we were talking about, what?
    Ms. Garvey. Just about a month or so.
    Secretary Slater. At about a month or so.
    And then we also have a task force that has us following 
through on a measure, a provision in Air-21, that deals with 
the issue of having the same factors of measurement, and our 
Associate Deputy Secretary Steven Van Beek is heading up the 
effort, and it's supposed to be done with that work in about, 
oh, 90 days, and we're into that, so it'll be less than that. 
But by the end of the year.
    Ms. Garvey. Senator, also just to add that we've made a lot 
of progress in the last 6 months, and just arriving at the 
definitions, because you're right. Our common language has not 
been the same.
    Senator Gorton. When will it be?
    Ms. Garvey. Well, with regard to the common definitions, 
we're very close to having them completed. This will be part of 
the work that the Secretary referred to that Steven Van Beek is 
heading. So by the end of this year, we'll have the common 
definitions.
    The challenging part, and Mr. Mead and I have talked a lot 
about this, is then putting in place the right methodology so 
that we're tracking delays correctly. Even the definitions have 
been difficult, I will tell you. We're working on this with the 
airlines, with our colleagues at BTS, and with the Inspector 
General.
    Mr. Mead. Yes. There is one pet peeve that I have on the 
statistics. I try to always mention it, and I would like to see 
it changed by the end of the year.
    I do not think anybody in the traveling public believes 
they are leaving on time when they pull out of the gate at 14.5 
minutes and then sit on the runway for 2 hours. It seems to me 
to be a self-evident change that ought to be made.
    I understand that it's useful to have an internal measure 
for an airline about how quickly you pull away from the gate, 
and that's good to know. But we shouldn't be telling the 
American public they're leaving on time. They must wonder 
what's going on sometimes when we suggest that.
    But that's something that could be changed, and without a 
lot of controversy.
    Senator Gorton. Well, I hope it is and I hope it is 
promptly.
    Thank you, Mr. Chairman.
    The Chairman. Thank you.
    Senator Cleland, sir.
    Senator Cleland. Mr. Mead, I just want to commend you for 
that. The last hearing we had here a few weeks ago, I mentioned 
the idea to an airlines president who shall go nameless. I 
said, aren't we gaming the system here, when if you pull out 
from the gate, about less than 15 minutes, and you sit on the 
runway for an hour and a half, and we've, in effect, I guess, 
all been there, done that, got that T-shirt.
    You know, why is that ``on time departure'' and ``on time 
arrival''? You know, duh. I don't get it. And I thank you for 
that. I think that's one positive change that I think could be 
part of the information that we're talking about that consumers 
want.
    For me, I guess it's my time in the military, I guess being 
in a helicopter so much or whatever, in Vietnam. But if you can 
walk away from it, it's a good flight, you know?
    [Laughter.]
    My standards are pretty low, and the airlines here exceed 
my standards every day.
    [Laughter.]
    But I do think if the traveling public, which expects 
delays, problems, lots of planes in the air, weather, I mean, 
the American public is not dumb. If they just have a realistic 
appraisal of the situation and some real facts in real time, I 
think that's going to help this situation, in terms of 
perception, a whole lot.
    When I say, Mr. Secretary, you have been before this 
Committee twice this week, and may I say you've jumped from the 
Firestone into the fire here.
    [Laughter.]
    I'll tell you, in Atlanta, we need your help. If we don't 
get that fifth runway at Hartsfield, the space station will be 
the second Atlanta airport. We are running out of time, and we 
are not reluctant guests. You're not having to drag the Atlanta 
City Council at Atlanta business community up into this concept 
that they need another runway. We're out there pulling the rope 
not pushing it, and we need all of the help that you and your 
department can give us.
    I might say, Ms. Garvey, I have just a couple of pet 
peeves. I guess my question to you is that we have world class 
carriers, no question. We have a world class number of 
passengers, and it does seem to me that we need a world class 
nerve center; in this case, an air traffic control system, a 
world class air traffic control system.
    By that I mean the most up to date equipment known to the 
mind of man. If you can get out on a little boat and have a 
little bitty thing like that, a GPS, and know exactly where you 
are in the world, it seems to me we ought to have a world class 
system of knowing where every aircraft is at every moment, and 
a communication system in which everybody talks to one another.
    And then we ought to have air traffic controllers that are 
happy. I want a happy air traffic controller. I don't want them 
sad, I don't want them on bad equipment, I don't want them to 
have a bad day.
    [Laughter.]
    It's all part of the nerve center around which whatever 
capacity we have works effectively and safely.
    When do you think we can get or say that we have a world 
class air traffic control system?
    Ms. Garvey. Well, if the question is, when is modernization 
going to be finished, it's always evolving. I think we're 
always going to be looking at new technologies.
    But I'll tell you something. I think we do have a world 
class system. I think we've got the best controllers in the 
world, and I agree with you. You want them feeling good about 
their job, and I think you're going to have a chance later to 
hear from the president of NATCA and HIA. They're terrific. I 
think they are the best.
    The challenge for us in government is to make sure we get 
them the best technology that we can.
    The chairman said earlier we've got to be vigilant about 
that. I think we are. We're putting in place as many building 
blocks as we can as aggressively as we can.
    If you look at a place like Memphis where we've got some of 
the free flight tools in place, the controllers called it ``the 
most modern facility in the world,'' in the New York Times and 
it is. That's what we're doing, incrementally, benchmark by 
benchmark, step by step.
    I think the airlines are right to keep the pressure on us. 
I think Congress is right to keep the pressure on, and we're 
right to keep the pressure on ourselves. But I'll tell you, 
we've got a terrific work force out there. We've got great 
technology in the centers. We've got a lot more to do to keep 
up with this growth, but I think we're really staying the 
course.
    Senator Cleland. I would hate for the FAA to get caught up 
in bureaucratic inertia or budgetary hassles where you can't 
move forward and get what you need. I mean, I think everybody 
in America wants you to have what you need.
    Now, I understand that the FAA does not have the authority 
to borrow funds to purchase equipment, although a program to do 
so passed the Senate, with my support, I might say, as part of 
the FAA reauthorization legislation, but it was dropped in 
conference because of rejections from OMB.
    Would you be better off, would you be able to move faster, 
quicker, better, more assuredly toward the top of the line 
world class equipment that you really know you want, if you had 
the authority to borrow funds to purchase equipment?
    Ms. Garvey. Senator, I think some of those suggestions for 
financing were made by the Mineta Commission. It may have even 
been made by the Baliles Commission. OMB raised some objections 
to them. I think others in the administration had raised some 
objections as well. There were even some objections on the 
Hill.
    So we're proceeding with what we've got. We've got some 
great possibilities, I think, with the program included in AIR-
21, the public/private partnership that I suggested earlier.
    We're willing to try that out and see whether that offers 
us some good examples of how to move forward. So I think we're 
moving forward. We're going to be more vigilant.
    Senator Cleland. Mr. Chairman, may I just call that to the 
attention of our staff. It's something that we might want to 
look at in terms of additional authority to let these good 
people go as fast as they can to where they want to go.
    Mr. Mead.
    The Chairman. We've got to press on here pretty quick.
    Senator Cleland. Yes, sir.
    Thank you for allowing us to have your insight. Thank you 
for the concept of capacity, benchmarks. I do think that that 
will help us all not stack up these airports unrealistically in 
terms of flights and therefore create multiple problems.
    Thank you very much, Mr. Chairman.
    The Chairman. Thank you very much, Senator Cleland.
    Ms. Garvey, I hope you'll pay attention to the story in the 
Wall Street Journal. ``Efforts to ease delays in summer air 
travel also produced snarls. FAA centralized controls and radar 
screens are cited for lost efficiency.'' I hope you'll keep us 
informed in that area.
    Ms. Garvey. We will, Mr. Chairman.
    The Chairman. I want to thank the witnesses. And I 
apologize to you for such a long period of time of questioning, 
but these are very important issues, and I appreciate your 
input. I thank the panel.
    Secretary Slater. Thank you, Mr. Chairman, members of the 
panel.
    The Chairman. Thank you.
    And I appreciate the patience of the next panel, which is 
Mr. Leo F. Mullin, President, Chief Executive Officer, Delta 
Airlines; Mr. Donald Carty, the Chairman and President and 
Chief Executive Officer of American Airlines; Captain Duane E. 
Woerth, President of Air Line Pilots Association; Mr. Robert 
Poole of Reason Public Policy Institute; Mr. John Carr, 
President of National Air Traffic Controllers Association.
    Thank you for your patience.
    We'd like to begin with Mr. Mullin, who can acknowledge the 
compliments of Senator Cleland.

   STATEMENT OF LEO F. MULLIN, PRESIDENT AND CHIEF EXECUTIVE 
                    OFFICER, DELTA AIR LINES

    Mr. Mullin. Thank you very much. I do acknowledge the 
compliments of Senator Cleland.
    Thank you, Senator.
    And thank you very much for inviting all of us, but 
particularly me, here.
    Mr. Chairman, much of what I would have said----
    The Chairman. I agree with his statement.
    [Laughter.]
    Mr. Mullin. Thank you, sir. This is off to a good start.
    I would like to just make succinctly, hopefully, just a 
couple of comments that have not been made previously.
    But, first, I just want to emphasize how important it is 
that capacity increases be made in every single segment of the 
system, the airplanes, the airports, and the air traffic 
control.
    And I think as we think about as we're moving ahead, into 
the future, it's very important to keep in mind one crucial 
governing aspect of why we're here; and that is, that we should 
put the customer first in terms of providing air 
transportation.
    We exhaust every single component of this system to provide 
service to customers, and so as we go through and we consider 
any kind of limitations on the system, any kind of constraints, 
anything that involves the metering of slots, et cetera, we 
have to recognize that we are, in fact, constraining the 
fundamental ability of Americans to travel and that that is 
very, very important.
    I would also add that I think that each of the components 
of the system have got to take responsibility for what they do, 
and I would like to acknowledge, Mr. Chairman, that the 
airlines still have a lot of work to do ourselves.
    We've worked hard in the past 6 months relative to the 
customer service plan to really put the focus back on to 
customer service where it belongs.
    In the case of Delta Air Lines, when I came three years 
ago, we were dead last in almost all of the customer service 
indexes, most notably, on-time performance, 10th out of 10. And 
we're proud right now that Delta is in the top three with 
respect to on-time performance, complaints to the DOT, and 
baggage handling statistics, consistently.
    So we've made a lot of progress in that. And relative to 
the report Mr. Mead will be giving on implementation of our 
customer service plan, we are looking forward to getting good 
marks on that later this year.
    I'd like to point out, however, three points that I don't 
think anybody mentioned as we went through.
    To make a quick comment, regional jets, the requirements 
for better management and labor relations and industry 
consolidation.
    On the regional jets, frequently regional jets are pointed 
out as a burden on the system, wherein, they will increase the 
necessity for capacity in the air space and on the ground.
    Regional jets are one of the most fundamental, wonderful 
technological developments of our industry. In particular, they 
provide the opportunity for service to small and midsize cities 
to a degree that they have not had before. These cities have 
frequently been referred to as ``pockets of pain'' as a result 
of the deregulation that took place in 1978.
    Now they are getting back and tied to the major cities of 
America, and we have to build a system that accommodates them, 
not limits them in the future.
    My second point is that we've had, this past summer, 
difficulties in management labor relations. The United 
situation, of course, was the biggest example of that.
    Let me say that I think both management and labor need to 
operate according to the Hippocratic Oath that all medical 
students take, and that is, with respect to the customer, 
first, ``Do no harm.'' It is a crucial ingredient of moving 
forward. I appreciated your earlier--Mr. Chairman, your 
comments on duty, and I thought those were particularly 
appropriate.
    The last point is on industry consolidation. United and 
U.S. Airways are proceeding with a merger. I think certainly 
mergers should be of business technique that is available to 
airlines as to everybody in all industries.
    I do think that it is going to raise questions of customer 
service moving forward, and that this Committee should take a 
clear examination of that as we move ahead, because all of us, 
who will become competitively affected, will need to take 
steps.
    In response to that, I do think it is a prelude to further 
industry consolidation as that merger moves ahead.
    So I appreciate very much the fact that we've had the 
opportunity to talk here today. It is crucial we take the steps 
now to save our wonderful system now, and it does require 
saving.
    And if a number of these steps that have been outlined 
today are carried out, I think we will look back 5 to 7 years 
from now and feel good about what we've done.
    Thank you, Mr. Chairman.
    The Chairman. Thank you.
    [The prepared statement of Mr. Mullin follows:]

  Prepared statement of Leo F. Mullin, President and Chief Executive 
                        Officer, Delta Air Lines

    Mr. Chairman and Members of the Commerce Committee, it is a real 
pleasure for me to be here today to present Delta's testimony on the 
causes of airline delays and cancellations that are seriously plaguing 
our industry and eroding the public's confidence in our air 
transportation system. We are grateful to have the opportunity to 
address this critical topic. It is vitally important that we properly 
diagnose the reasons for delays so that appropriate measures can be 
taken to reduce and eliminate the problem.
    Virtually everyone taking part in these hearings today agrees that 
the American aviation system is in crisis, poised on the cusp between 
breakdown and renewal. At heart, the system exists to provide safe, 
reliable, convenient and comfortable air service to our customers. 
While air service remains safe, it is no longer consistently reliable, 
convenient or comfortable.
    This is not news, and the situation did not occur overnight. 
Various blue ribbon Committees, including the National Civil Aviation 
Review Commission report of 1997 (commonly referred to as the Mineta 
report), warned of coming air space gridlock. Those predictions have 
proven to be distressingly accurate as flight delays have increased an 
estimated 50 percent over the past five years.
    While our current situation is not news, what is new is the urgency 
of the situation, due in large part to escalating frustration on the 
part of the flying public, which is a fast-growing segment of the 
population. In fact, the rapid growth in passengers--and hence, the 
accompanying growth in airline operations--is at the center of the air 
travel crisis.
    Each year, more people travel more often: around 250 million in 
1978; 650 million in 1999; and an anticipated one billion by 2009. This 
growth is straining each of the three key components of the aviation 
system, including airlines, airports and air traffic control. All three 
are groaning under increasingly heavy passenger crowds--and for all 
three, increased capacity is the only solution if we are to meet 
consumer demand and at the same time return reliability, convenience 
and comfort to air travel.
    If we fail to increase capacity, two equally unacceptable options 
remain. The first would be to meet increasing demand by scheduling more 
flights without adding capacity, causing the aviation system to fall 
even further behind in its ability to deliver acceptable levels of 
convenient and reliable customer service. The second option would be to 
ration air travel services, which is a disturbing prospect for business 
travelers who want to fly to New York-LaGuardia or Washington-Reagan 
National on Monday mornings or for passengers who hope to make it home 
for the holidays.
    The rationing of services also presents a dilemma because it would 
most likely limit air service to new markets in particular, which would 
impact the growth of regional jets (RJs). RJs are the compact, 
efficient new planes that are changing the aviation landscape by 
bringing much-needed, much-sought-after jet service to citizens 
throughout the heartland of America. These small and medium-sized 
communities, frequently referred to as ``pockets of pain,'' have been 
undeserved by airlines as a result of the market dynamics of 
deregulation.
    Today, RJs permit profitable nonstop jet service between these 
communities and larger cities that previously could be reached only 
with flight connections, often onboard less-popular propeller aircraft. 
Within the last several months, Delta has launched RJ service between 
Portland, Maine and New York-LaGuardia; Columbia, South Carolina and 
Dallas/Ft. Worth; and Worcester, Massachusetts and Atlanta, to name 
just a few new markets.
    But despite the increased service levels RJs bring to these 
communities, RJs are not the cause of the escalation in delays and 
cancellations witnessed in June and July. In fact, the majority of new 
RJ service actually replaces less-desirable propeller aircraft flights. 
It is a disservice to citizens in smaller cities who want more jet 
service to suggest that the introduction of these aircraft is having a 
disproportionate impact on delays, and it is nearly unthinkable that we 
suggest to them a return to the days of propeller aircraft and 
inconvenient connections.
    So, if we reject these options and agree that the aviation system 
must aim to provide the service customers want, then it is clear that 
we need adequate infrastructure to meet growing demand. How have each 
of the three aviation system component been responding to this 
challenge, and with what success?
    For airlines, meeting capacity requirements requires that we 
provide aircraft, supporting technical structure, and a motivated and 
skilled workforce. During the last 5 years at Delta we have made new 
aircraft investments of $9 billion and technology investments of over 
$3 billion, and our workforce has increased, through acquisition and 
real growth, by 30 percent to 81,000 people. As part of those 
investments, we've pioneered new levels of service with our growing RJ 
fleet.
    Nonetheless, customer demand has outpaced our growth. This is best 
demonstrated by looking at the ever higher load factors. In the summer 
of 1985, Delta's average system load factor (percentage of occupied 
seats on each flight) was 62 percent; this past summer our load factor 
averaged more than 81 percent.
    The second aviation system component--airports--provide the 
infrastructure to service airline flights. Airports have spent $30- to 
$35-billion in the last 5 years for a broad range of improvements. Yet, 
from terminals to taxiways, capacity has not kept up with passenger 
growth. Most major airports are seriously overcrowded, creating further 
customer discomfort when delays and cancellations concentrate the 
crowds. But the most significant contributor to delay problems by 
airports is the lack of runway capacity.
    As the September 12 cover story in USA Today indicates, U.S. 
airport infrastructure expansion plans on the drawing board today total 
as much as $80 billion. However, airport expansion plans almost 
everywhere are delayed by community and other objections so that 
completion time for runway and other projects often runs into the 
decades. Even as passenger traffic has grown rapidly, only 18 new 
runways were added during the 1990s, and only 5 of those were at large 
hub airports.
    More troubling still is the realization that there is no relief on 
the immediate horizon. While 15 new runways are planned in the next 6 
years at the top 25 airports, including Atlanta Hartsfield, San 
Francisco Bay, and Cleveland-Hopkins, the FAA reports that only five 
runways are under construction today: Phoenix. Detroit, Minneapolis/St. 
Paul, Orlando, and Seattle.
    But the aviation system component whose capacity is of most 
significant concern to us all today is the third on our list: air 
traffic control. Airlines are a unique industry in that we do not 
control the air space which is essentially our production line. 
Instead, air space is controlled by the air traffic control system, or 
ATC. The ATC system has not kept pace with passenger demand and, while 
the current management team has taken steps to rectify this situation, 
it is too little, too late.
    The picture, then, is one wherein much effort has been expended and 
much money spent. Yet the situation--measured (as it must be) by our 
ability to serve customers--is worse. The aviation system capacity 
issues experienced by airlines, airports and ATC will not be resolved 
by the passing of time or the end of summer thunderstorms. In addition, 
the climate surrounding the current situation is fraught with tension. 
Customer frustration is high; travel has become an ordeal. And lately, 
the conflict between airline management and airline labor has 
overflowed into the customer service arena, as was the case with United 
Airlines last month.
    To further complicate the situation, these elements are playing out 
with the industry ``wildcard'' of potential mergers and consolidations 
looming in the background. This implies the threat of a new ``mega'' 
airline that would have a significant destabilizing effect on the 
industry. Such an imbalance would almost certainly lead to full 
industry consolidation, bringing with it broad implications for the 
competitive landscape and thereby the flying public.
    However, as difficult as the situation facing us today is, it is 
not too late to take the necessary action. There are solutions 
available to us if each of the three aviation system components--
airlines, airports, and air traffic control--commit fully to stop 
placing blame, begin taking responsibility and make sure that every 
decision we make going forward is a function of putting the customer 
first.
    The airlines are on the front lines of this dilemma and we must 
take responsibility for the elements in this situation that are within 
our jurisdiction. The first and most important of those elements is 
customer service, especially during the delays and cancellations we are 
discussing today. The standards for how we can best assist passengers, 
especially during irregular operations, has been outlined in the plan 
we developed last year, the Airline Customer Commitment.
    The Commitment outlines a broad-scaled program to provide effective 
customer service solutions, with most of the initiatives focused on 
improved communications, more consistent application of policies and 
better handling of irregular operations. Our immediate job must be to 
fully implement that program across the industry, with special emphasis 
on minimizing the passenger frustration and inconvenience when flights 
don't run as scheduled. At Delta, we put significant effort into this 
program, as has most of the industry. Many of those programs and 
procedures are outlined in the attached letter from myself to The 
Honorable Francisco J. Sanchez, Assistant Secretary for Aviation and 
International Affairs at the U.S. Department of Transportation. Now, 
all airlines must maintain an unwavering focus on meeting and exceeding 
the Commitment guidelines.
    Another responsibility that the airlines and airline labor must 
shoulder is to find ways to keep management/labor issues out of the 
customer service arena. Both sides must bargain constructively and 
there must be better adherence to provisions of the Railway Labor Act, 
including abstinence from any unauthorized work action. Relative to the 
customer, the Hippocratic oath should prevail in all parts of the 
bargaining process: First, do no harm.
    And while customer service requires that we offer passengers the 
flights they want, when they want them, the airlines must also work to 
balance this imperative with another customer service mandate: the 
operation of timely, reliable schedules. The current situation of 
inadequate airport and airspace capacity makes the attainment of that 
goal nearly impossible and, as a result, airlines must assume some 
responsibility for finding appropriate compromises.
    Delta has worked to avoid over scheduling flights through several 
proactive steps. At Atlanta Hartsfield, for example, we have extended 
the morning and evening hours between which we schedule flights. And we 
have increased the number of ``connecting banks'', or groups of closely 
timed flights which are simultaneously at the gate, to allow faster, 
easier flight connections, reducing pockets of concentrated activity.
    In the longer term, airlines must continue to work closely with the 
Federal Aviation Administration to find additional ways to maximize 
airspace and better utilize existing ATC systems. We also need to 
create a common, system-wide performance measurement system that allows 
factual, accurate assessments of our progress.
    For airports, the task requires continued investment in runways, 
taxiways and gates in order to manage increasing customer traffic, 
supported by new methods of expediting the implementation of expansion 
plans. Congress has already provided crucial assistance by passing AIR-
21, which guarantees funding both for essential airport capacity 
programs and for ATC improvements.
    Finally, and perhaps most importantly, we must take a short but 
very focused look at the third aviation system component, the air 
traffic control system. To begin this process, the short-term fixes 
identified as part of the Spring 2000 Initiative must be implemented 
immediately and aggressively. But beyond that, the time has come to 
pursue fundamental ATC reforms if we are to ensure that we maintain our 
nation's excellent aviation safety record while at the same time 
increasing the efficiency and capacity of the system.
    To do this effectively, ATC should be separated from the FAA, 
creating a new, government-sponsored entity that may continue to 
operate under federal ownership but with financing based upon the cost 
of producing the service, paid by the user. The new entity should be 
governed by a board of private/public representatives and operated in 
ways similar to the private sector in terms of management structure, 
personnel polices and compensation.
    These are not new ideas--but they are no longer just interesting 
options. They are urgent and necessary responses to ensure our nation 
continues to have the safest, most effective, most affordable, most 
comprehensive air system in the world. Our aviation network has paid 
immeasurable societal and economic benefits. We owe it to the American 
public to save that system now--and then, make that system even better 
for tomorrow.
    [The information referred to follows:]
                                 ______
                                 
                                                 September 11, 2000
Hon. Francisco J. Sanchez,
Assistant Secretary for Aviation and International Affairs,
U.S. Department of Transportation,
Washington, DC.

Dear Assistant Secretary:

    Thank you for offering me the opportunity to participate in the 
recent conference to discuss challenges facing the airline industry. 
Once again, I commend Secretary Slater and the Department of 
Transportation for their efforts to establish a public/private 
partnership to identify and address these issues. In response to your 
request regarding customer service best practices, the following is a 
list of innovative programs and processes that Delta has found most 
effective in taking care of customers during delays and cancellations 
in order to minimize the frustration and inconvenience caused by these 
occurrences. Our priorities lie in making early decisions about flight 
irregularities; disseminating accurate, consistent information across 
all points throughout the travel experience; and delivering that 
information to the customer in the most timely manner possible.

Behind the Scenes
    The Operations Control Center (OCC), the central coordination point 
for our airline, allows proactive management of Delta's worldwide 
operation as we strive to get all of our customers where they want to 
go, when they want to arrive. This customer-focused, process-driven, 
technology-enabled center allows Delta to focus on the customer while 
keeping safety as the number one priority.
    Systemwide conference calls occur in the OCC three times every day, 
linking all operational areas together with airports throughout the 
system. These customer-centric calls focus on the state of the airline 
with an emphasis on what we can do to better meet the needs of our 
customers.
    Early decisions regarding flight cancellations provide the OCC with 
maximum time to reaccommodate customers when forecast weather and ATC 
appear likely to impact customers in a specific region. By making early 
decisions, we have access to the maximum number of options for 
reaccommodating customers on Delta or another airline. Our goal is to 
protect passengers in a manner that allows them to arrive at their 
destination within two hours of their originally booked itinerary.
    The Inconvenienced Passenger Rebooking System (IPRS) is an 
automated program that is launched whenever a flight is canceled. This 
system automatically rebooks impacted customers on the next available 
Delta flight. One of the special characteristics of this system is that 
it treats special-need customers, such as disabled passengers or 
unaccompanied minors, as well as groups and cruise travelers as 
customers with high priority for reaccommodation.

Before Customers Fly
    Proactive telephone calls from our Reservations Operation Center to 
the customers advise them of a flight disruption when flights are 
canceled more than two hours prior to departure. In addition, the 
proactive telephone call advises customers of new itineraries, rebooked 
through the IPRS system, and confirms that the changes are acceptable.
    Up-to-date flight information is provided for customers on the 
delta.com Web site, on the toll-free voice response unit (VRU), or 
through our toll-free telephone reservations line.
    The Operations Support System (OSS) is the common technology 
backbone that distributes flight information to systems at all points 
in the customers' linear travel experience or ``travel ribbon.'' This 
common backbone ensures that customers receive the same real time 
information about their flight from every source, e.g., VRU, 
reservations telephone line, delta.com Web site, airport gate or flight 
control.
    Media advisories are released to local press outlets on days when 
we are experiencing severe weather. These advisories relate to 
customers the likelihood that flight delays exist and suggest they call 
the airline before leaving for the airport.

In the Airport
    Airport Coordination Centers (ACC) serve as coordination points 
between the OCC and the gates and ticket counters in our hub airports. 
The ACCs provide local expertise in managing the operation at their 
specific station through experience and myriad decision support tools 
at their disposal. They perform many duties from coordinating gate 
changes that lessen the customer impact to participating in the 
decision making process during irregular operations and advising the 
OCC as to which flights offer the greatest potential protection for 
passengers.
    Standardized Flight Advisory Messages (FAM) are the messages used 
to drive real time information regarding flight cancellations from the 
Operation Control Center to the airport gate agents. Last fall, these 
messages were standardized into verbiage easily interpreted by the 
frontline agents, providing them with a necessary tool for clear, 
accurate customer communication.
    Frequent announcements are made in the gate area, providing 
customers with the most timely, accurate flight status information we 
have available. During cases of mechanical or weather delay, the 
captain of the affected flight frequently makes the announcements, 
adding his/her voice of expertise and experience to the situation.
    The cross-functional huddle is the process through which the 
captain, gate agent, flight attendant, and mechanic gather together to 
share information regarding a flight delay. During this huddle, 
extraordinary circumstances are identified, such as passengers with 
special needs who require extra assistance, crew members whose duty 
time is expiring, or the need to board extra provisions on the 
aircraft.
    Gate Information Displays (GIDs) are currently being tested in 
Jacksonville and Atlanta with plans to install them in other major 
cities beginning this fall. These plasma screens provide up-to-date 
information regarding flight status, as well as answers to the most 
frequently asked questions from customers in the boarding area. These 
screens, designed with assistance from the hearing impaired community, 
eliminate the need for customers to stand in line with questions. 
Response to the screens has been extremely favorable.
    Passenger Amenities such as hotel vouchers, meal vouchers, 
telephone cards and ground transportation arrangements are provided to 
passengers who are away from home and inconvenienced overnight by a 
delay or cancellation within Delta's control.

During a Flight
    Processes are in place to board extra provisions such as water and 
food when we know a flight will be delayed after push back from the 
gate but prior to take-off. In addition, within safety and federal 
guidelines, the captain has the authority to allow customers to use 
cell phones and laptops and move about the cabin when the aircraft is 
not on an active taxiway. Should the situation on-board the aircraft 
become unacceptable, the captain has full authority to return to the 
gate and allow customers to deplane.
    Revised Flight Operations Manuals reinforce the need for the flight 
crew to keep customers informed during extended on-board delays. Pilots 
are also provided with suggested phraseology for delay announcements.
    Contingency plans are in place at each airport for handling flights 
which have landed but are unable to get to an airport gate. These plans 
include processes for utilizing gate space operated by other airlines, 
as well as identifying remote parking space for airplanes to park and 
allow customers to deplane. In the unlikely event that an aircraft is 
on the ground for more than two hours without the ability to be 
assigned a gate, processes are in place to notify senior management, up 
to and including the Chairman and CEO, pooling all possible resources 
in order to accelerate resolution.

Ongoing Reinforcement
    The Irregular Operations Management Advisory Council (IMAC) meets 
semi-monthly to discuss the latest trends in customer feedback, share 
best practices, and make continuous improvements to processes and 
programs. Delegates from every operational area are represented on the 
council.
    The Irregular Operations (IROP) Home Page on the intranet provides 
frontline agents with the latest information on processes and 
procedures for handling delays and cancellations. Links to internal 
manuals, suggested phraseology to be used during flight delays, current 
operational statistics and the FAA's National Airspace System status 
Web page are available from the IROPs home page.
    The Rewards and Recognition program recently announced reinforces 
our corporate priority for keeping customers informed during flight 
disruptions. Additionally, a lapel pin attached to a letter from Vicki 
Escarra, Executive Vice President--Customer Service, was provided to 
the frontline workforce as a daily reminder of our Customer Commitment.
    In this document, we have listed just a sample of the initiatives 
which we have found particularly successful in handling delays and 
cancellations. These programs and processes enable us to meet and even 
exceed the requirements set forth in the Airline Customer Service 
Commitment. Beyond that, however, there is much more work in progress 
designed to enhance the total customer travel experience. We continue 
to focus on our performance in the monthly DOT statistics; we are 
striving to find ways to use technology as a tool to reduce lines in 
the airport and communicate with customers; we continue to search for 
innovative ways to put customers back in control of their travel 
experience; and we are committed to continuous development of our 
greatest competitive advantage, the Delta people, a team committed to 
serving our customers.
    I hope that you will find this document helpful in your search for 
industry best practices. Please feel free to let me know if you would 
like further information about any of the initiatives I have mentioned.
        Sincerely,
                                              Leo F. Mullin
                                                  Chairman and CEO.
                                 ______
                                 
Regional Jets and The Delta Network
A Special Report
January 2000
    Like any major brand in a competitive market, Delta Air Lines has 
many different product lines that help distinguish our brand from our 
competition. In addition to Mainline domestic and international 
service, Delta products include Delta Shuttle, Delta Express, Delta 
Connection carriers, and international alliances with Air France, 
AeroMexico and other codeshare partners.
    These products are complementary, mutually dependent, and together 
comprise the Delta Network.
    Today's air travelers demand a variety of choices. We meet this 
demand only by providing the level of diversity we have with the Delta 
Network. Maintaining our competitive position and financial strength 
depends on every product in the Network working together to reinforce 
the total Delta brand.
    No other airline in the industry has the depth and scope of 
services that Delta Air Lines offers our customers. Our integrated 
Network supports:

   Hub development;

   Growth in the highly competitive Northeast;

   Growth in the low-fare Florida market;

   Development of transcontinental East-West flow;

   International expansion.




    Through its diversity, Delta's Network is designed to hit every 
market of opportunity in our industry. And because every market is 
different--in terms of customer demand--Delta applies a ``Best Use'' 
philosophy in deploying our product lines. Decisions are made on which 
product is best used in each market based on strategic and revenue 
goals and the operational costs of deployment.
    Consistent with Delta's Best Use philosophy, Regional Jets (RJs) 
`'fuel'' the Mainline by providing more than $1 billion in revenue 
annually. Also, RJs ``feed'' the Mainline through increased passenger 
loads. As shown in Chart 2, Delta Connection Carriers contribute 
significantly to Delta's industry ranking. Without them, Delta would 
move from first to third in annual revenue compared to other airlines.



Strategic Overview
    In 1996, three Delta Connection Carriers with 48 Regional Jets 
provided the only RJ service available in the United States. In 1997, 
other carriers entered the RJ market, and today more than 380 RJs are 
flown by 14 carriers.
    This phenomenal growth in RJs has fundamentally changed our 
industry. Why? Because Regional Jets are proving to be increasingly 
popular with the traveling public. And, as Chart 3 indicates, steady 
growth in the RJ segment will continue.




    The Delta Network holds a one-third share of the domestic RJ 
market. Swift and decisive deployment of RJs helps maintain our 
competitive advantage and sup-ports Delta's profitable growth. Indeed, 
much of our Mainline service could not be supported without the 
connecting passenger feed provided by RJs.
    For Delta, Regional Jets meet the needs of our diverse customer 
base by offering direct service in markets that cannot economically 
sustain Mainline aircraft, while also providing improved access to our 
hubs. Delta Connection Partners--ASA, Comair, Skywest, ACA, and Trans 
States--bring these passengers to our hubs where they connect to our 
Mainline aircraft.
    Delta RJ service is complementary to, and not competitive with, 
Mainline jet service. These smaller jets primarily serve smaller 
markets of fewer than 100 passengers per day each way. In fact, 82% of 
markets served by Delta Connection partners flying RJs produce fewer 
than 100 passengers per day each way.
    Also, Delta Connection RJs are deployed in more small markets than 
those of our competition. Sixty-three percent of these RJs operate in 
markets with fewer than 50 passengers per day each way, compared with 
44% for other carriers. As these figures indicate, Delta is more 
focused than our competitors in deploying RJs in small markets.
    RJ deployment supports the Delta Network in five essential ways:

    1. Grows the Mainline through increased hub feed;

    2. Preserves market presence when Mainline aircraft are redeployed 
to maximize profits;

    3. Builds and protects market share;

    4. Acts as a low-risk research and development tool for market 
penetration;

    5. Satisfies customer preference by upgrading from turbo-props.

Growing The Mainline
    Today, 8% of Delta's hub traffic (representing five load factor 
points) is generated by Delta Connection carriers. This feed of more 
than 23,000 passengers per day is instrumental to Mainline frequency 
and growth.
    Cincinnati (CVG) provides a strong example of the strategic 
importance of RJs. Nearly 20% of Delta's passengers in Cincinnati come 
from Delta's Connection Partner, Comair. This traffic accounts for 14 
points of our load factor (Chart 4). Without this critical connecting 
feed from Comair's RJ service, Delta's Cincinnati load factor would 
decline from 70.7% to 56.7%. This would reduce profits so dramatically 
that Cincinnati would become an unprofitable hub (Chart 5). As a 
result, Mainline growth there would be unfeasible.






Mainline Redeployment
    Delta continuously evaluates opportunities to redeploy Mainline 
aircraft to meet customer demand and improve aircraft productivity and 
financial returns.
    Regional Jets are an important component of this process. Our 
replacement of two short-haul Mainline aircraft in Atlanta with ASA RJ 
service demonstrates this point. Chart 6 shows the projected annual 
impact related to the redeployment of these two aircraft:

   $43 million additional revenue;

   26% increase in Available Seat Miles (ASMs);

   77% increase in block hours and aircraft utilization.







    Another recent example of Mainline redeployment involves Comair RJs 
at Cincinnati. Two Mainline jets were redeployed at CVG to:

   Introduce the first-ever daily nonstop flights to San Jose, 
        California;

   Replace RJ flights to Colorado Springs;

   Add an additional roundtrip to Orlando.

    New RJ service then covered the redeployed jets' former routes from 
Cincinnati to South Bend and to Grand Rapids. RJs also replaced single 
frequencies to Richmond and St. Louis.
    This shift preserved Delta's market presence in those cities while 
creating better Mainline utilization. The projected annual impact 
related to the redeployment of these two aircraft is:

   $20 million additional revenue;

   55% increase in ASMs;

   21% increase in block hours and aircraft utilization.

    Since 1995, a total of 22 aircraft have been redeployed through 
Regional Jet replacement. As Chart 8 indicates, annual block hours have 
increased by 24% for these redeployed Mainline aircraft. Most 
importantly, these redeployments resulted in the profitable deployment 
of these aircraft and have significantly contributed to Delta's overall 
profit improvement.



Building and Protecting Market Share
    Regional Jets are a key competitive tool in building and protecting 
Delta's market share. RJs point-to-point service (between two non-hub 
cities) in the lucrative Northeast market reflects a key strategic 
decision that supports Mainline expansion. RJ point-to-point deployment 
also helps protect market share in critically important Mid-Atlantic 
and Southeast cities where competitors are increasing their RJ service. 
Also, RJs help protect the Delta Network from competitors' over-flying 
our hubs and diverting passengers away from our Network.
Northeast Point-to-Point
    For airlines, the Northeast represents the largest revenue 
opportunity in the U.S., with more than $30 billion in revenue at 
stake. No single carrier maintains a leadership position in terms of 
market share.
    Together, the New York and Boston markets generate more than $17 
billion in revenue. Much of Delta's newly announced RJ service will be 
concentrated in these strong business markets to enhance our overall 
competitive position by:

   Feeding Mainline at Boston and New York;

   Providing new nonstop service for Southeast and Mid-Atlantic 
        customers;

   Strengthening feed for our Air France partnership (Boston 
        and New York-JFK).

    Delta has a strong position from most East Coast markets to the 
Southeast and West through our hub connections. However, one major gap 
remains in our service from cities North and East of Atlanta. By 
offering nonstop convenience to New York and Boston, we increase the 
likelihood that travelers will choose Delta as their preferred carrier 
for all their destinations.

Mid-Atlantic and Southeast Point-to-Point
    Our Northeast strategy is coupled with our need to provide more 
choice to our customers in important Mid-Atlantic and Southeast 
markets. Thirteen cities in these two regions provide one-third of 
Atlanta's connecting revenue. These cities have been targeted by other 
carriers who bring Delta passengers to their hubs and directly to 
Northeast business destinations.
    To counter this action, Delta is initiating nonstop New York-
LaGuardia (LGA) service from six of these 13 cities: Richmond, 
Greensboro, Charleston, Columbia, Savannah, and Jacksonville.
    For example, Delta's new service between Richmond and New York-LGA 
provides business travelers a key route to the Northeast. It counters 
the concentration of RJ service by US Airways out of Richmond to their 
hubs and the Northeast. Chart 9 illustrates how our new service will 
compete with US Airways in Richmond. By offering nonstop service to New 
York, and eventually Boston, Delta is more likely to retain the loyalty 
of Richmond passengers for travel elsewhere.



Over-flying Hubs
    Increasingly, airlines are initiating RJ service in thin markets to 
intentionally bypass a competitor's hub. This practice is known as 
``over-flying.''
    Delta's Atlanta hub is not immune to this threat. Atlanta serves a 
valuable traffic pool that other carriers can divert to their hubs by 
using Regional Jets. We have begun to experience a negative impact on 
our revenue flows at Atlanta as a consequence of this over-flying.
    A specific example of the impact of over-flying is in the 
Greenville/Spartanburg market, where Delta traditionally held a 
favorable position. Last year, Continental (CO) entered the market, 
offering nonstop RJ service to its Houston hub. As a result of 
passengers' preference for Continental's direct service, we lost 18 
passengers per day who previously connected through Atlanta to Houston. 
We lost an additional 18 passengers per day who previously connected 
through Houston to the West Coast. The impact of CO's Greenville/
Spartanburg expansion is shown in Chart 10.




    Delta's service from Atlanta to Corpus Christi is one example of 
how RJs can help us gain market share. Our entry into this market, as 
shown in Chart 11 added 22 passengers per day onto Delta flights.



Low-Risk Research and Development
    One of the fundamental principles in product development is test 
marketing. Prior to a national roll-out of a new product or service, 
thorough research and development (R&D) is completed in a variety of 
test markets. This same principle is applied when considering RJ 
deployment. In markets where demand does not warrant a Mainline jet, 
Delta will test the market potential by using the more cost-effective 
RJ service. This R&D process can reveal which markets demonstrate 
enough demand to justify Mainline service.
    Delta's new service from Atlanta to Manchester, New Hampshire is a 
case in point. Manchester is one of the fastest growing airports in the 
country. Despite its potential, current demand cannot support Mainline 
jet service to Atlanta. In the meantime, RJs allow us to cost-
effectively serve this market.

Upgrading Turbo-Props
    Providing distinctive customer service is one of Delta's hallmarks. 
Despite the valuable role turbo-props play in extending access to our 
hubs from smaller markets, our customers overwhelmingly prefer the 
convenience and comfort of jet service. Replacing turbo-props with 
Regional Jets responds to what our customers want.
    Today, turbo-prop replacement accounts for 36% of the Delta 
Connection RJ deployment. While decreasing over time, turbo-prop 
replacement will continue to be part of the Delta Network strategy. In 
fact, the Delta Network plans to deploy an all-jet fleet at Cincinnati 
by the end of 2000, improving our competitive position against other 
carriers' Midwest hubs.

Summary
    Delta Air Lines is committed to developing the most successful and 
diverse group of product lines in the industry so that we are viewed as 
#1 in the eyes of our customers. Our growth strategy depends on the 
complementary benefits realized from each of our inter-dependent and 
integrated product lines.
    Regional Jets help grow the Mainline through increased hub feed, 
allow redeployment of Mainline air-craft to more productive, longer-
haul routes, build and protect market share, explore new markets, and 
upgrade turbo-prop service to satisfy customer preference.
    As this report demonstrates, Delta's Connection Carrier RJs help 
build a stronger Delta Network and contribute to Mainline growth.
Glossary of Terms
    ASMs: Available seat miles. A unit of measure of air-line capacity 
representing one seat flown one mile.

    Block Hours: The time in hours that an aircraft leaves the gate at 
itsorigin and arrives at the gate at its destination.

    Code Share: An arrangement between two carriers whereby the first 
carrier operates the aircraft and sells seats under its code, and the 
second carrier sells seats on the same flight under its code. For 
example, Delta and AeroMexico code share on a Delta-operated Atlanta-
Mexico City flight for which AeroMexico and Delta each sell seats under 
their own codes.

    Feed: The inbound passengers who connect to the outbound flights at 
the hub.

    Load Factor: Amount of aircraft capacity utilized, calculated by 
dividing revenue passenger miles by available seat miles.

    Mainline: Delta jet operations--excludes Delta Express, Delta 
Shuttle, Delta Connection Carriers' operations, and Delta alliance/
partners' carrier operations.

    Overflying: Flights that bypass an existing hub and have the effect 
of diverting traffic from traditional connections over that hub. For 
example, Continental's Greenville/Spartanburg-Houston International 
flight diverts some passengers who otherwise would make connections at 
the Atlanta hub.

    Point-to-point Service: A nonstop flight between two non-hub 
cities, for example, New York-LaGuardia to West Palm Beach.

    Redeployment: To move an aircraft from one market to another. (It 
usually implies that an aircraft is moved from a less profitable route 
to a more profitable route.)

    RPMs: Revenue passenger miles representing one passenger flown one 
mile.

    Turbo-prop: An aircraft powered by a turbine engine utilizing a 
propeller.

    Utilization: The hours per day that an aircraft is scheduled for 
revenue operations.

    The Chairman. Mr. Carty, welcome.

  STATEMENT OF DONALD J. CARTY, CHAIRMAN, PRESIDENT AND CHIEF 
              EXECUTIVE OFFICER, AMERICAN AIRLINES

    Mr. Carty. Thank you, Mr. Chairman, and good morning and 
good morning to all members of the Committee.
    I, too, appreciate the opportunity to talk about the single 
most critical issue that faces our industry today, and that, of 
course, is the need to expand our nation's capability to safely 
meet the extraordinary growth and demand of air transportation.
    Now, rather than rehashing the problems in the current 
system, some of which are described in my written statement, I 
want to spend my allotted time, I think, laying out some 
specific recommendations for actions that would address the 
problems of delays and cancellations which do result from 
inadequate air space and ground infrastructure capacity.
    In order to meet the demand for safe, reliable, commercial 
air service, we have to address three areas simultaneously, and 
they've been all mentioned, all of them this morning; end route 
air space capacity and traffic management, terminal arrival and 
departure, air traffic control capacity, and of course ground 
infrastructure that a number of people have alluded to already 
this morning, including runways and taxi ways.
    Fixing any one of those things, even two of them, is going 
to leave us, if we do not have simultaneous and comparable 
improvements in the other areas, it's simply not going to solve 
the ATC problems in the long run.
    The total system capacity is always to be defined by 
whatever choke point, to use Senator Cleland's reference. Going 
to leave us with that choke point still existing.
    Before getting into the specific solutions, I do want to 
elaborate on one part of my written statement regarding charges 
by some, and they were again alluded to this morning, that the 
only problem we have is oversheduling by airlines.
    Now in it I wrote that from a market demand point of view, 
and Leo Mullin just touched on this, we certainly do not over 
figure. In fact, we have record high load factors and we're 
turning more passengers away on our peak hour flights than we 
can handle.
    So from a market, from a customer perspective, of course, 
we're not overscheduling.
    But with that said, at any given airport, the total 
schedules of all the airlines when added up, can and 
increasingly do exceed the capacity of that airport to handle 
the volume.
    I think that's one of the important reasons that we need to 
understand pretty precisely what the capacity of an airport is 
defined to be.
    Now at hub airports, we do have some tools to deal with 
capacity problems since an individual airline has a large 
percentage of the flights operating at that airport.
    Indeed, I think as all of you know and it was alluded to 
this morning, American announced a number of major schedule 
readjustments around and about Chicago O'Hare and at Dallas-
Fort Worth, which are our big domestic hubs, which we think 
will significantly improve our reliability.
    But we're only one of many operators, and to cite some 
examples--LaGuardia, Boston, Los Angeles--a reduction of 
capacity by one airline is just as likely to result in an 
increase by another. Therefore, no one can disarm unilaterally, 
and obviously we can't discuss scheduling with each other to 
reach an industry-wide solution in these circumstances. Hence, 
this scheduling problem really is a real issue, just like 
weather and just like air traffic control modernization. But it 
is only one piece of what is increasingly a very complex 
puzzle.
    The airlines, I think, have to work together, they have to 
reach consensus on a multifaceted plan of action with all the 
users of the system and with government. Now this includes our 
own employee groups, general and military aviation, the many 
professionals that are involved in air traffic control and of 
course the airport operators.
    Of course, it also includes the many levels of government 
that are involved in aviation, and there are many levels of 
government involved, from state and local officials that 
control the local airports, the FAA, and other administrative 
agencies, and of course the Members of Congress and, in 
particular, this Committee.
    So let me turn to some very specific recommendations, which 
I'll group into near-term, medium term, and long-term 
objectives.
    In the near term, the next two to three years, we simply 
must do a better job for our customers, with the tools and the 
infrastructure that we already have.
    We, the airline industry I'm talking about now, needs to 
better understand the perspective of the air traffic 
controllers and the causes of the capacity restrictions that 
exist. Now that's going to allow us to better predict the 
impact of weather or scheduling, on routing decisions that we 
make in the system as a whole.
    With better tools and communications is going to come an 
ability to mitigate the impact on our customers by a 
combination of operational measures, such as rerouting 
connecting passengers over alternate hubs and on alternate 
airlines if necessary, and certainly better and more timely 
customer information.
    Between the industry and the FAA, the development of common 
metrics to define goals and then to assess progress, is a 
prerequisite to improve predictability, efficiency, and 
communication about ATC system capacity.
    There's an old saying that you can't fix what you can't 
measure. Ken Mead alluded to this morning, and he's absolutely 
right, and it certainly, most definitely, applies to the air 
traffic control system.
    In addition, a number of procedural change could be made to 
better utilize capacity. For example, with the full cooperation 
of the FAA and Jane and her people, the airlines have already 
begun to use some lower altitude, alternative routings instead 
of operating all jet aircraft in the same altitude lanes.
    Similarly, through a partnership with the FAA, the 
military, and the industry, we are working toward making 
restricted air space temporary available for commercial 
operations to navigate around adverse weather conditions more 
often.
    We're also collaborating with FAA and the air traffic 
controllers on the use of existing traffic management tools and 
the implementation of available technology for aircraft routing 
alternatives when weather restricts the normal flow of traffic.
    Now although I list these suggestions as near-term, we 
should be clear that each of them requires the cooperation of 
all the parties that I referenced here.
    In most cases, new procedures, in particular, if they are 
to be implemented safely, require careful planning, new 
training, and of course a culture that's going to accept some 
change. And we must never let the desire to eliminate delay and 
disruption impact that commitment to safety.
    Now in the midterm from 2003 to 2005, I've placed those 
efforts aimed at the implementation of new tools and certainly 
implementation of new technologies that make more efficient use 
of the existing capacity. Thus, in this category, we have to 
take steps to develop more efficient ways to use when route 
terminal and airport ground capacity.
    En route capacity utilization can obviously be increased 
safely by beginning to redesign the current air space (and a 
number of the programs that Jane alluded to earlier will result 
potentially to accomplish this), reducing vertical separation 
minimums and using technology to redistribute the controllers' 
workload.
    In the terminal environment, we need to deploy new 
technology such as GPS, coupled with wide area and local area 
augmentation systems to allow more precise tracking and reduce 
separation.
    Another example, today, together with NASA, we're testing 
new technology that detects wake vortex. That is, the 
turbulences caused by another aircraft. If that's successful, 
that system will ultimately allow us to safely decrease 
aircraft spacing when landing and make better use of the 
concrete that's already poured.
    Now at the airports, we need to implement new tools for 
controlling traffic on the ground. We need to improve 
communications to allow airlines to predict precise gate 
arrival and departure times and respond in a far more dynamic 
way than we've been able to heretofore.
    You can easily imagine a day when you no longer arrive 
early only to have to wait on board if there's no gate 
available at your destination.
    And finally long-term solutions, in my estimation, that 
inevitably can only occur in 2005 and beyond, are characterized 
by the need, and there have been several references to it this 
morning, for construction of new airport capacity.
    We need to continue to enhance the performance of the en 
route terminal area air space, particularly for airports in 
congested areas, with the development and implementation of new 
and even more precise technologies.
    Nevertheless, there is and there will continue to be a 
critical need for increased infrastructure--runways, taxi ways, 
and terminal space--and they have to be planned today if we're 
even going to have a chance of having them post-2005.
    As I said at the outset, the air traffic control problem 
has to be addressed, I think, in all areas simultaneously. 
There is simply no golden key to this.
    Until the last piece is in place, we will achieve only the 
incremental improvements that have been referred to. But most 
importantly, all participants in that system must first 
recognize there's a need do work collaboratively toward the 
common goal of increasing the movement of aircraft through the 
system without compromising safety.
    And I agree with the Secretary, the Administrator, that we 
are making very good progress on that front.
    Speaking now on behalf of all the carriers that make up the 
Air Transport Association, you do have our pledge to continue 
the efforts that have already begun to work with Administrator 
Garvey and the air traffic controllers and general aviation 
interest to achieve this goal.
    Again, I'd like to thank you for the opportunity to come 
before you today, and in turn, I'll be delighted to answer any 
questions.
    The Chairman. Thank you, Mr. Carty.
    [The prepared statement of Mr. Carty follows:]

 Prepared statement of Donald J. Carty, Chairman, President and Chief 
                  Executive Officer, American Airlines

    Mr. Chairman and Members of the Committee, I very much appreciate 
the opportunity to testify today on the issue of air traffic delays. I 
am here to testify in my capacity as Chairman of American Airlines. But 
I am also here to listen to you in my role as Chairman of the Executive 
Committee of the Air Transport Association, which represents carriers 
providing more than 85 percent of the air transportation in the United 
States today. I will convey to my colleagues the concerns and 
suggestions that you and others offer today.
    There is certainly no more appropriate forum in which to have this 
discussion than the Senate Commerce Committee, since it was here--over 
four years ago--that a bill was written creating the National Civil 
Aviation Review Commission, chaired by the current Secretary of 
Commerce, Norm Mineta. The very first sentence of the Commission's 
report reads as follows:

    ``Without prompt action, the United States' aviation system is 
headed toward gridlock shortly after the turn of the century. If this 
gridlock is allowed to happen, it will result in a deterioration of 
aviation safety, harm the efficiency and growth of our domestic 
economy, and hurt our position in the global marketplace.''

    Mr. Chairman, the future is now. As we have turned the corner into 
the 21st Century, the predicted air traffic control crisis is clearly 
upon us. To the great credit of this Committee, you were among the 
first to identify the problem. But permanent solutions still elude all 
of us.
    For a variety of reasons, this summer has been particularly hard on 
airline passengers. A combination of extraordinary load factors, 
unusual weather, and a particularly difficult situation at one large 
carrier has contributed to the problem. But the crisis extends well 
beyond the unusual circumstances of this summer. It will not go away by 
itself.
    Some people have argued that the airline industry is oblivious to 
the problem. Nothing could be further from the truth. This is a problem 
of which we are acutely aware and on which we are working every single 
day. We have numerous short-term initiatives underway, many in full 
cooperation with the Federal Aviation Administration. I will discuss 
some of these today. But as you demonstrated four years ago, long-term, 
permanent solutions require much bolder action.
    Schedule delays and cancellations cause numerous downstream 
problems including missed connections, lost baggage, crews running out 
of time to fly, and people stranded in airports. Most important, they 
cause unhappy customers. And unhappy customers don't return.
    That's why we at American recently changed our incentive 
compensation program for officers and senior management to include 
schedule dependability as a major factor. By aligning our own economic 
fortunes directly with the needs of our customers, we are more focused 
than ever on making the system work. As a result, we have devoted 
countless hours to the many industry-wide working groups that are 
tackling various parts of the problem.
    While we are diligently working in partnership with the Federal 
Aviation Administration to find short-term fixes, we need to also focus 
more clearly on the long-range solutions. You have begun that process 
by designating the appointment of a Chief Operating Officer for Air 
Traffic Control and a management board to oversee the operations. That 
is an excellent start. But I would urge you as you go into the next 
Congress to dust off the Mineta report and see if the proposed long-
term solutions don't still work. I think they do.
    There is actually one very positive aspect of the current crisis. 
It is driven, in large part, by an extraordinarily robust economy that, 
in turn, is driving unprecedented demand for air travel. Compared to 
where we were in the depth of the economic crisis of the early 90's, 
this is a very fine problem to deal with. Yet it is still a problem.
    Before talking about solutions, let me address one particularly 
troublesome issue for many of us. Some have said we ``overschedule'' 
our fleet. If, in fact, we were flying empty planes in crowded skies, 
we would be guilty as charged. But most airlines clearly are not doing 
so. Let me assure you, that I have never had a single complaint from a 
customer telling me that we have too many flights going in their 
direction. This summer our system-wide load factor ran in excess of 80 
percent. One day this summer we at American had a system-wide load 
factor in excess of 90 percent. That is unprecedented, and it means 
that we are turning away people who want to travel in our busiest 
markets because we have run out of seats. Moreover, we schedule the 
flights to match our customers' preferred departure and arrival times. 
Meeting our customers' needs necessarily means operating more flights 
in the early morning and evening than across the middle of the day.
    Today, there are simply more people who want to fly than the system 
can handle. The question, in my view, should not be how can we reduce 
capacity, which would inevitably push up prices. Rather, it should be 
how can we safely expand capacity to meet demand and continue to keep 
prices down.
    Of course, there will always be some things which neither the 
airlines nor the FAA will be able to do much about. One of the biggest 
is weather. As we review this summer, it is certainly worth looking at 
some weather data to put the current situation in perspective. The 
chart below compares the spring weather at Dallas-Ft. Worth and Chicago 
year-over-year for the past six years. You will immediately see that 
the last two years have, indeed, been more weather-impacted than 
average.




    Therefore, the data shows that this summer's problems have clearly 
been made worse by unusually bad weather. Weather is a problem we 
cannot effect directly, but we can work together to manage the 
disruptions caused by weather better than we did this summer. And 
weather alone is certainly not the total story.
    The next chart looks at the past six years at American measuring 
extraordinary delays that are not related to aircraft mechanical 
problems.\1\ By extraordinary, I mean delays of one hour or more.
---------------------------------------------------------------------------
    \1\ This chart offers a simplified snapshot that understates the 
congestion problem. American, like many other airlines will 
unilaterally cancel some of its flights in advance when we can forecast 
congestion due to weather or other causes. By canceling flights in 
advance, we are reducing demand on the ATC system, reducing the ripple 
effect caused by delays and we can get a head start on re-accommodating 
our passengers on flights that are more likely to operate on schedule. 
Thus, the delay statistics may improve at the expense of flight 
cancellations. To get a truer picture, both statistics need to be 
considered together.




    There are two items of note here. Clearly the years 1999 and 2000 
are much worse than previous years. But there is a sliver of good news 
as well. In most months we have actually done better this year than 
last. This, I believe, is a reflection of the initiative jointly 
undertaken by the FAA and the industry to reduce delays in the spring 
and summer seasons. These are modest gains, but at least they are 
moving in the right direction.
    Unfortunately, the next two charts are more troubling. The first 
chart shows the number of operations experiencing absolutely 
unacceptable taxi-out delays due to ATC problems. This means the number 
of hours the plane sits on the runway after it pulls back from the gate 
but before it is allowed to take off.




    This is very disturbing, because it shows that each year we are 
experiencing an increasing number of flights that suffer extraordinary 
delays. And here we see no year-over-year improvement.
    The second chart is also quite interesting. This is an analysis of 
our transcontinental flights over the past six years. What we are 
measuring here is the deviation from mean of the distance actually 
flown on the routes. A lot of deviation from the average shows that we 
rarely are permitted by ATC to fly the optimum routes. Instead, ATC 
procedures involve a wide range of routings and substantial circuitry. 
This chart shows that year after year we are, on average, being 
required to fly more miles due to ATC routing decisions than the 
previous year. There is any number of possible explanations for why 
this is happening. But the result is longer time in the air, more fuel 
burned, flight delays, more missed connections and passenger 
inconvenience as well as greater costs all round.




    We need to fix this system. And, as I suggested, we are making some 
progress already on short-term solutions. In particular, Administrator 
Jane Garvey has been as responsive as any person could possibly be 
under the circumstances. We really are working closely with the FAA and 
other carriers to address the problem.
    The following are a few of the short and long term solutions that 
we propose. I should quickly note that many of the solutions we propose 
are not so much new initiatives as things the airlines are already 
doing--either on our own or collaboratively with the FAA.
    To begin with, the magnitude of American's commitment to improved 
dependability can be seen in a bevy of changes we have made--or are 
about to make--to our own flying schedule. Over the years we--like 
every other carrier--have frequently had to add a cushion of extra time 
to our schedules to overcome air traffic control problems, and ensure 
that we were able to deliver what we promise our customers. But what we 
are embarking on this fall is much more comprehensive.
    At American, while our network is far-flung to say the least, our 
major connecting hubs at Chicago O'Hare and Dallas / Fort Worth--which 
between the two account for close to 40% of our total departures--
really drive the performance of our system. If either one of those 
hubs--for whatever reason--falls behind, it's difficult if not 
impossible for the rest of our operation to pick up the slack. This 
fall, at both O'Hare and DFW, we're increasing the time our planes are 
scheduled to be on the ground, and we're increasing the amount of time 
connecting passengers have to get to their next flight. This step is 
driven entirely by our desire to better serve our customers. We would 
naturally prefer to use our aircraft--which represent billions of 
dollars worth of investment--as intensively as possible, but we are 
nonetheless injecting significantly more breathing room into our 
schedule in order to better match our actual operations with our 
customers' expectations.
    At O'Hare, which as you know suffers from both congestion and 
frequent bad weather, we're taking things even farther. Effective 
November 1st, we will be isolating our Chicago system from the rest of 
the network--in effect, putting up a firewall to prevent, as much as 
possible, weather, Air Traffic Control, or any other Chicago-related 
problem from impacting the rest of our system.
    There are thousands of factors that have combined to create the 
operational quandary in which we find ourselves today, and it will take 
thousands of initiatives--some big, some small--to get us out.
    Another near term solution, which involves working cooperatively 
with the FAA, involves alternative routings. The airlines have begun 
flying many routes at lower altitudes. This practice, like less 
intensive aircraft utilization, is costly since flying at lower 
altitude burns more fuel--but it is helping to increase airspace 
capacity. We've also gotten more creative about using alternative 
routes in the event of severe weather. For example, we are working with 
the FAA to explore access to airspace previously restricted for 
military use, much of which can be made available to commercial 
operations on a short-term basis during severe weather without any 
adverse impact on military training or other use. Several airlines have 
also signed an agreement with NavCanada to operate in Canadian 
airspace--for a fee--when weather restricts U.S. routes.
    Obviously, delays in and of themselves are bad. But I think 
everyone here would agree that one of the most frustrating aspects of 
delays occurs when communication breaks down--either between air 
traffic control and the airlines, or between various departments within 
the airline, or most of all, between the airline and our customers. In 
a fast-changing situation, communication will always be a challenge.
    But we're working the problem in two ways. First, we're 
collaborating with the FAA to improve the accuracy and timeliness of 
information from air traffic control to the airlines. And second, we 
have begun a program to better inform our customers about the status of 
their flight. This probably sounds easier than it is, since it involves 
getting accurate up-to-the-minute information from the FAA to our 
people on the airplane, inside the airports, and at our reservations 
systems--to ensure that in the event of a delay, customers get 
consistent, accurate and timely information about what's going on.
    In so many cases, communication can mean the difference between a 
problem and a crisis. As you know, the airlines are very restricted by 
competition laws in the kinds of communicating they are allowed to do 
with each other. I think it would be very helpful to give the FAA the 
authority, on a case by case basis, to grant temporary anti-trust 
immunity to airlines in the midst of an air traffic control crisis. 
This would allow the airlines involved to talk about how best to 
arrange their schedules, and help prevent a bad day from becoming a 
customer service catastrophe.
    Another way we can improve things in the short term is to build a 
better set of metrics against which to judge the performance of our air 
traffic control system. Today, while airline performance is measured in 
a variety of ways, there are no comparable measures for the ATC system. 
We need to establish reasonable standards of performance, and then hold 
ATC accountable for meeting those standards.
    The good news is that we have been working with the FAA to design 
appropriate metrics, and soon there will be a daily report that 
measures system performance. And our hope, naturally, is that the 
report will be a useful tool for measuring the progress we expect in 
the years to come.
    As we try to use our current capacity more efficiently, we also 
need to acknowledge that in the long term, we are going to need more 
fundamental changes to produce the capacity to match the increased 
customer demand we know is coming.
    In the medium term we need to explore the redesign of airspace and 
route structure especially where growth in demand is expected. We need 
to design and build the aviation equivalent of an eight-land highway 
today where we can predict the traffic will be tomorrow. Airspace 
redesign will be dependent on new technologies such as digital voice 
and data transmission that will partially overcome the limits on radio 
spectrum we suffer today.
    One technical innovation that we think is critical to enhancing 
system capacity in the years to come is global positioning system 
technology, or GPS. In our view, GPS and its augmentation systems 
should be endorsed as the navigation system of our industry's future. 
GPS has the potential to help solve our airspace capacity crunch. But 
that won't mean much if we don't also find a way to increase airport 
capacity. One promising technology--AVOSS--which measures the wake 
turbulence of aircraft and allows closer spacing, is one way to 
increase arrival and departure rates on existing runways. But 
ultimately we will have to meet the growing demand by building more 
runways as well.
    All of these are sensible steps that we think can create important 
incremental improvements. But it's clear that in the long term, we need 
fundamental reform of the air traffic control system. We need to find 
ways to bring private sector disciplines to bear on the delivery of air 
traffic control. What I would suggest is that all of us spend a lot of 
time, between now and the beginning of the next session of Congress, 
thinking and talking about the best ways to do that. Obviously, this is 
an issue that the Commerce Committee has had in its sights for some 
time. The aforementioned Mineta Commission provided us with an outline 
on how effective FAA reform might take place, and I think we need to 
revisit the recommendations contained in that outline.
    I want to thank the Committee for the opportunity to be here today. 
It's crystal clear that many of the goals articulated by policy makers 
for our industry--including dependable service, low fares, robust 
competition--are dependent on our ability to solve our capacity 
problem. We all have a vested interest in finding the right solutions, 
and doing so will require nothing less than a complete collaborative 
effort between all the parties involved. Rest assured, we are extremely 
focused on doing our part, and we look forward to moving forward with 
that effort.

    The Chairman. Captain Woerth.

       STATEMENT OF CAPTAIN DUANE E. WOERTH, PRESIDENT, 
           AIR LINE PILOTS ASSOCIATION, INTERNATIONAL

    Mr. Woerth. Good morning, Mr. Chairman.
    As you know, ALPA represents the professional interest of 
58,000 pilots who fly for 50 airlines in the United States and 
Canada, and I do appreciate the opportunity to appear before 
you today to discuss the very complex issues of flight delays 
and proposed solutions to the problem.
    Let me say at the outset that all the members of ALPA are 
grateful to you, as well as your colleagues in the House, for 
the enactment of AIR-21. Your actions go a very long way to 
providing a stable and adequate funding to modernize our air 
transportation system.
    Although the benefits provided by AIR-21 will not be fully 
realized in the near term, we are hopeful that the moneys 
called for during the life of AIR-21 and future authorizations 
and appropriations will lead to the completion of the core, 
NAS, modernization projects contained in the NAS architecture.
    Now at the end of the summer of 1999, the collective 
thought of the aviation community was that the air traffic 
control delays could not have been worse and that positive 
steps needed to be taken to avoid a repeat performance. ALPA 
believes that FAA and the industry took a positive step with 
the spring 2000 initiative.
    Spring 2000 is a daily collaborative planning process 
designed to allow significantly better response to weather and 
other system constraints.
    Its goal is to employ the tools and processes that will 
provide predictability, accountability and the reliability to 
the national air space system. It's a tactical approach to 
managing the national air space system on a real time basis, 
and we urge that the FAA's operating budget be increased to 
fund the spring 2000 process on a continuing basis.
    Air traffic control delays and their relationship to system 
safety is an issue at which ALPA has a considerable interest. 
Delays are symptoms or manifestations of larger problems or 
uncontrollable situations in the national air space system.
    The causes of delays are primarily weather, scheduling that 
is based on optimum weather scenarios, usable runways and gate 
availability, among other things.
    It is important to note that the Eastern third of the 
Nation experienced approximately three times the average number 
of days of severe weather this summer. It's also true to note 
that there are also locations throughout the system that 
sometimes are at absolute maximum capacity even without the 
influence of other factors, such as weather.
    When these other external elements are added, the system 
simply collapses. We have possibly created a false expectation 
for the flying public by promising that people can fly where 
they want to, when they want to, 365 days a year, 24 hours a 
day.
    To satisfy this demand, we have created a scheduling system 
that allows more aircraft into the same environment at the same 
time than the system can efficiently handle even on its very 
best days.
    Environmental concerns have a great impact on the aviation 
industry--noise restrictions, constraints, on arrival and 
departure routes--thereby, exasperating the delay problem. 
Manufacturers and airlines have developed and spent billions of 
dollars designing and purchasing newer quieter aircraft. Pilots 
are compelled to fly highly complex procedures at less than 
operational performance standards to comply with ground-based 
constituent concerns.
    This industry has done all it can to alleviate these 
complaints. There must be a paradigm shift in the public to 
understand that part of the cost of reducing delays may be more 
efficient use of terminal air space and aircraft performance 
capabilities, and this may result in an aircraft overflying 
somebody's house.
    This wholesale acquiescence to environmental concerns may 
have to be amended if we are to thoroughly address the entire 
scope of the delay problem.
    Additionally, resectorization of the en route air space can 
eventually produce some efficiency gains. In fact, RTCA has a 
special Committee looking into this concept, among others, to 
better utilize our national air space. However, any 
recommendations that will result in better management of our 
scare air space resources will not be possible without allowing 
the FAA to consolidate facilities, and that will require some 
tough political decisions.
    ALPA's motto is and will always be, ``Schedule with 
Safety.'' We will continue to champion that standard and we 
will work with the FAA and the members of the aviation industry 
to develop initiatives that will improve efficiency as well as 
maintain and hopefully improve the safety of air operations.
    We will oppose innovative capacity-enhancing procedures 
that do not maintain and improve safety standards. This is our 
bottom line, and it always will be.
    Thank you, Mr. Chairman.
    The Chairman. Thank you, Captain Woerth.
    [The prepared statement of Captain Woerth follows:]

  Prepared statement of Captain Duane E. Woerth, President, Air Line 
                   Pilots Association, International

    Good day Mr. Chairman, I am Captain Duane Woerth, President 
of The Air Line Pilots Association, International (ALPA). ALPA 
represents the professional interests of 58,000 pilots who fly 
for 50 airlines in the United States and Canada. We appreciate 
the opportunity to appear before you today to discuss the very 
complex issues of flight delays and proposed solutions to the 
problem.
    Let me say at the outset, that all the line pilots of ALPA 
are grateful to all of you as well to your colleagues in the 
House for the enactment of AIR-21. Your actions go a long way 
in providing stable and adequate funding to modernize our air 
transportation system. As we all know, the air transportation 
system is dynamic and evolutionary, and so the process of 
modernizing is also an evolutionary process. The planning, 
developing and testing of new technologies and equipment, as 
well as the refining of existing procedures and equipment, has 
to become a ``way of doing business'' if the US is to remain 
the world leader in air traffic control.
    The funds provided by AIR-21 are an excellent beginning, 
but since the funding will not be fully realized in the near 
term, the NAS modernization work will continue to fall further 
behind. For example, the insufficient appropriation for R&D for 
FY 2001 and the lead time needed to realize the benefits from 
the NAS Architecture programs means that parts of NAS 
Modernization will be in its current holding pattern for some 
time. Nonetheless, we hope the funding called for during the 
life of AIR-21 and the funding that will be authorized in the 
future leads to the completion of the core NAS modernization 
projects contained in the NAS Architecture.
    At the end of the summer of 1999, the collective thought of 
the aviation community was that the air traffic control delays 
could not have been worse and that positive steps needed to be 
taken to prevent a repeat performance. ALPA believes the FAA 
took a very positive step with the Spring 2000 Initiative. 
Without it, things could well have been worse.
    Spring 2000 set up a daily collaborative planning process 
that is designed to allow significantly better response to 
severe weather situations and other system constraints. Its 
goal is to deploy the tools and processes that will provide 
consumers with the predictability, accountability, and 
reliability they expect from the national air transportation 
system. The list of technologies and tools in use include 
Flight Schedule Monitoring, the Collaborative Convective 
Forecast Product, Departure Spacing Program, Coded Departure 
Routes, the National Playbook (deals with severe weather 
reroutes), Military Special Use Airspace Access, and Post Event 
Tools, to name a few. Many more innovative technologies are 
under development and their testing and deployment needs to be 
accelerated.
    Spring 2000 is a much-needed tactical approach to managing 
the National Airspace System on a real-time basis and it is 
clear that this initiative must be continued indefinitely. We 
urge that the FAA's Operating budget be increased to fund this 
new process for managing the daily operation of the system. We 
expect that the FAA will shortly change the name of this 
initiative to properly reflect that it is an integral part of 
the NAS.
    The issue of Air Traffic Service delays, and their 
relationship to system safety, is an issue in which ALPA has a 
deep and lengthy history of interest. The air traffic control 
system has become a convenient target and a scapegoat for much 
deeper systemic problems. Air traffic control is often blamed 
for delays it is compelled to implement to maintain the safety 
of the National Airspace System, but are actually caused by 
problems outside the control of air traffic.
    Keep in mind that delays are merely symptoms or 
manifestations of larger problems or uncontrollable situations 
in the National Airspace system. Delays can come from a number 
of sources, the two most prominent are airspace and airports--
although it is in the interfacing of these two elements that 
seems to produce most delays. The causes of delays are 
primarily weather, scheduling that is based on optimum weather 
scenarios, the hub & spoke system, usable runways, and gate 
availability, among others. With that background I need to 
point out that there are locations throughout the system that 
sometimes are at absolute maximum capacity even without the 
influence of other factors such as weather. When these other 
external elements are added, the system just collapses.
    Was this summer worse than 1999? The eastern third of the 
nation experienced more severe convective weather 
(approximately three times the average number of days) this 
summer, and that was the primary cause of the delays. In 
addition, the airlines scheduled a record number of flights, 
which increased the potential for greater delays and 
cancellations. Our understanding is that while more flights 
took place, and more passengers were moved, there were a 
greater number of delays.
    It is clear that at certain times on certain days scheduled 
traffic at the hubs is at absolute capacity. Most of the time 
Visual Meteorological Conditions (VMC) prevail and airline 
schedules are based on VMC airport arrival rates. When the 
weather drops below visual minimums, especially at airports 
with limited instrument landing capability, the impact begins 
to ripple through the system. When an airport must restrict use 
of its runways because spacing or configuration precludes their 
use under Instrument Meteorological Conditions (IMC), then the 
airport acceptance rate falls and departure rates are cut. This 
results in ground delays at departure airports, inbound 
airborne aircraft holding, and then ground delays for 
departures at the arrival airport where planes are waiting to 
take off--it's like dominos. In the summer thunderstorm season, 
when severe convective weather activity develops, it often 
results in airports being closed to all traffic for an extended 
time. Thus, creating havoc in the system. The Spring 2000 
initiative has shown that tactical management can relieve some 
of the problems, but there is no total solution to mitigating 
the impact of severe weather, except to not fly into or near 
it. Maintaining the safety of the system is the guiding 
principle for all decisions.
    We have possibly created a false level of expectation for 
the flying public by promising that people can fly where they 
want to, when they want to. To satisfy this demand we have 
created a scheduling system that allows more aircraft into the 
same environment at the same time than the system can 
efficiently handle, even on the best of days. The schedule 
unrealistically projects everyone into an airport in a one hour 
time period; everyone tries to get there as early as possible, 
so the real crunch occurs in a thirty-minute block. Therefore, 
whenever uncontrollable events like weather occur the system 
collapses from its own weight.
    However, the pressure continues to be put on the ATC 
system. Recently, it was mandated that the four slot controlled 
airports permit more flights. Allowing more slots at these 
airports will aggravate the situation, unless arrival and 
departures are mandated to the slack periods. However, these 
times may be less desirable by the travelling public.
    Our pilots are every bit as concerned about these delays as 
are you, and the flying public. We too hear the stories of 
excessive delays for no apparent reason. These experiences, 
combined with some of the less than well thought out capacity 
initiatives the FAA has tried, have only served to reinforce 
our suspicions that capacity is being emphasized to the 
detriment of safety. We still have the safest system in the 
world, but our confidence in it is challenged by what we 
experience on a daily basis.
    Several of the FAA's innovative capacity enhancements have 
been aimed directly at this aspect of the equation--how can we 
get more airplanes on the concrete at the same time? Air 
traffic control has very specific, safety based, restrictions 
on runway utilization. These separation standards are designed 
to ensure the safety of an aircraft and its passengers from 
other aircraft, and we cannot afford to lessen these standards 
without full and open testing and evaluation. Capacity critical 
initiatives must be backed with data that proves that the 
minimum level of safety is maintained and hopefully enhanced. 
The FAA clearly has the burden of proof.
    Sometimes forgotten, or underestimated and overlooked, is 
the real impact our punishment based ATC system has on delay 
potential. With the emphasis by the FAA on disciplinary 
programs designed to assess blame/fault, rather than 
educational based programs designed to determine cause and 
solution to the problem, the FAA has created a built-in delay-
producer. The FAA grades itself on the number of controller and 
pilot mistakes it detects--Operational Errors and Pilot 
Deviations. The pilot or controller involved is subject to 
administrative disciplinary action if it is determined they are 
at fault. Error detection in the enroute portion of the program 
is automated (Quality Assurance Program, AKA ``snitch patch'') 
and there is no discretion available for ``no harm, no foul'' 
situations. Because of this, controllers add miles in buffers 
to existing separation standards to ensure they won't have a 
``deal.'' Pilots are equally paranoid and mistrusting of 
anything the FAA suggests because most of their interface with 
the FAA is when Flight Standards is pursuing an enforcement 
case which could result in a suspension of a pilot's license 
and loss of income. This does not contribute to a healthy 
environment on either side of the microphone, and results in 
additional questioning, readbacks and pilot rejection of 
controller clearances that only serve to further clog the 
system.
    Another significant element of any program truly designed 
to enhance safety and efficiency is an ability to collect 
accurate data concerning incidents that occur within the 
system. The only realistic way to do this is to establish a 
``no-fault'' reporting system for both pilots and controllers. 
This program must have the objective of investigating for 
safety purposes--investigate incidents to determine why they 
happened, and what can be done to ensure they don't happen 
again. The individuals involved must be able to participate 
freely, without fear of repercussions, in order for a system 
like this to work. Several programs that could be used as 
models already exist--the American Airlines ASAP program, the 
NASA Aviation Safety Reporting System, and the US Airways 
Altitude Deviation Reporting program. A number of airlines are 
also currently in the process of setting up Flight Operations 
Quality Assurance (FOQA) programs that are designed to use 
automated aircraft performance data to improve operational 
safety and aircraft operating procedures. A program must have 
integrity and credibility with both the pilots and controllers 
to be effective. To be able to work on the root causes of 
deeply imbedded systemic problems it is essential that the 
program have accurate, safety oriented data to work with. Only 
through such a program, with guaranteed immunity (from all but 
intentional rule violations) will we ever be able to identify 
and correct potentially catastrophic problems.
    Environmental concerns have a great impact on the aviation 
industry. Noise restrictions constrain arrival and departure 
routes thereby exacerbating the delay problem. The airlines and 
manufacturers have spent millions of dollars designing newer, 
quieter aircraft. Pilots are compelled to fly highly complex 
procedures at less than optimal operational performance 
standards to comply with ground based constituent concerns. The 
industry has done all it can do to alleviate these complaints. 
There must be a paradigm shift in the public to understand that 
part of the cost of reducing system delays may be the more 
efficient use of terminal airspace and aircraft performance 
capabilities--and that may result in an aircraft overflying 
someone's house. This wholesale acquiescence to environmental 
concerns may have to be amended if we are to thoroughly address 
the entire scope of the delay problem.
    For example, Phoenix International Airport is the busiest 
two runway operation in the U.S. but is confined to a single 
departure stream because the departures on both runways 8 R and 
L must fly up the dry river bed that is roughly between the two 
straight-out departure paths. Pilots are required to establish 
visual separation from the previous departure in order for the 
departure rate to be maintained at an acceptable level. In 
normal operations, when there is no weather or other factors 
causing departure delays, the airport is forced to operate in a 
very inefficient manner. When weather is a factor, the delays 
are compounded and the controllers have no way to expeditiously 
get the backlog of departures airborne. The delays continue 
beyond what they should. In reality, the environmental delay is 
part of the airport's normal operation.
    Resectorizartion of enroute airspace can lead to some 
efficiency gains. Initial evaluation of en route airspace 
resectorization proposals being touted by a number of potential 
contractors seems feasible--and they may well be, but not 
quickly. As with potential fixes to other problems, the 
technology is available to accomplish resectorization now. In 
fact, RTCA has Special Committee 192 looking into this concept, 
among others, to better utilize our national airspace. The 
recommendations that will be forthcoming from this Committee 
will result in better management of our scarce airspace 
resource but will not be possible without allowing the FAA to 
consolidate facilities and that will require some tough 
political decisions.
    ALPA's motto is Schedule With Safety. We will continue to 
champion that standard and will work with the FAA and members 
of the aviation industry to develop initiatives that will 
improve efficiency, as well as maintain and hopefully improve 
the safety of air operations. All capacity initiatives must be 
proven to maintain or increase the safety of air operations and 
good test and evaluation data is needed to support the 
implementation of new technologies and procedures. We can 
accept nothing less.
    ALPA's view is that construction of new runways, taxiways, 
terminals and other infrastructure is equally important, if not 
more so, than the development of additional ATC capacity 
initiatives. And, in fact, many of the top 100 airports are 
planning for new and extended runways and other facilities to 
create more capacity.
    In closing, I want to thank you for giving me this 
opportunity to address this most complex of topics. This is one 
of, if not the top priority for ALPA, and you will be hearing 
much more from us in the future about the need to modernize our 
National Airspace System. I would be most happy to answer any 
question that you and the Members of the Subcommittee might 
have.

    The Chairman. Mr. Poole.

        STATEMENT OF ROBERT W. POOLE, JR., DIRECTOR OF 
         TRANSPORTATION STUDIES, REASON PUBLIC POLICY 
                           INSTITUTE

    Mr. Poole. Thank you, Mr. Chairman.
    As director of transportation studies at the Reason Public 
Policy Institute in Los Angeles, I've been involved with air 
traffic control reform studies since 1981, and I've seen the 
debate change greatly over the years.
    Today, I would maintain it's pretty widely agreed that, 
first of all, air traffic control is essentially a commercial 
service while air safety regulation is inherently governmental.
    Second: That FAA's corporate culture is poorly suited to 
running and modernizing a high-tech service business, which is 
what air traffic control is.
    Third: That air traffic control funding should be driven by 
the growth of aviation activity and not by the ups and downs of 
a Federal budget process.
    Now who agrees with these points? If you look carefully at 
them, the Baliles Commission Report in 1993, the Vice 
President's National Performance Review ever since 1994, the 
DOT's Executive Oversight Committee in 1995, and the National 
Civil Aviation Review Commission in 1997.
    We're all here today because of record air traffic delays 
caused by air traffic finally having bumped up against the 
limits of an obsolete air traffic control system, costing 
airlines and passengers literally billions of dollars.
    That's why we've heard a number of airline CEOs start to 
talk about air traffic control possibly being spun off from FAA 
into some kind of a corporation.
    The good news is we now have 13 years of actual experience 
with corporatized air traffic control in 17 countries, 
including Australia, Canada, Germany, Switzerland, the U.K.
    What can we learn from that experience? First, these 
governments have all spun off the air traffic control service 
provider, but they properly kept safety regulation in 
government. Putting safety regulation at arm's length from 
service delivery actually increases air safety.
    Second: The air traffic control companies are all operated 
on a nonprofit basis. Since air traffic control is a monopoly, 
it should be nonprofit with the excess revenues either 
reinvested in the business or used to reduce fees and charges 
in future years.
    Third: These companies are all funded directly by their 
users by means of fees and charges. That makes the company 
accountable to its customers, and as they say in Canada, ``User 
pay means user say.''
    Fourth: These companies all fund modernization by issuing 
long-term revenue bonds based on their predictable stream of 
revenue from fees and charges.
    I think we have enough evidence now to see that air traffic 
control commercialization works. And by that I mean it solves 
the problems that have plagued ATC in country after country. 
After commercialization, we see costs go down, modernization 
speed up, and flight delays get reduced. In no country has 
there been any reduction in air safety.
    So how can we apply this experience to the United States? 
My organization has been working for the past year on a 
detailed proposal for a U.S. air traffic control corporation. 
We're getting input from the entire aviation community. We're 
not done yet, although we hope to have the report out by the 
end of the year, but I can give you some general outlines of 
what we've concluded.
    First: We think the stakeholder controlled, nonprofit 
corporation as they've implemented in Canada, is really the 
best model. It's working very well in Canada and has been for 
nearly 4 years now.
    The proposed corporation would hire all the civilian air 
traffic control employees currently with the FAA, and would 
provide civilian ATC in the United States and oceanic regions. 
It would keep its books like a normal business, using generally 
accepted accounting principles, would pay market based 
compensation to all its employees, and it would be free to 
define and purchase the best technology, like any any other 
high-tech business does.
    The most important element of this reform, in our view, is 
to develop a corporate culture driven by user needs, and the 
best way to do that is to make the company depend on direct 
payments by the users for the services it provides.
    Now, obviously, developing fair and simple ATC fees and 
charges is, in fact, the most difficult part of this project, 
and we haven't quite finished with that. But the general 
principle is that the users should pay for the services they 
receive and that all users and other stakeholders should be 
represented with seats on the Board of Directors. That's the 
way they do it in Canada and it's working.
    Overseas experience shows that this kind of an air traffic 
control corporation can easily be self-supporting from fees and 
charges. And just like any other infrastructure business, 
electricity or telecommunications, they can use that 
predictable revenue stream from fees and charges to issue long-
term revenue bonds for modernization.
    And I'll note that most of these companies, their bonds are 
rated investment grade by the rating agencies because this is 
such a good business.
    Of course, the company should be regulated for safety. It 
should be regulated at arm's length by the FAA just as the 
airlines are, just as pilots, mechanics, airports, and 
manufacturers are. And DOT should have oversight to make sure 
that the fees and charges are, in fact, fair and reasonable, 
and Congress of course will continue to have oversight 
responsibilities over FAA and DOT as it exercises those 
supervisory functions.
    Finally, let me just stress the urgency of this kind of 
structural reform. We've had all these commissions dating back 
to 1993 that have said, this is what we need to do, and yet we 
haven't done it.
    The current system has failed again and again to truly 
modernize this vital infrastructure, yet the shift to free 
flight technology, which you heard about this morning, is 
essential if we're going to avoid gridlock in the next decade.
    A user-focussed air traffic control corporation will be up 
to the task of making this major change and then keeping up 
with the continually changing state-of-the-art. This is not a 
one-time change, it's an ongoing process.
    Most important of all, because it would be paid for 
directly by the users, it will be accountable for results to 
those users.
    Thank you very much, and I'll be happy to do questions 
later.
    The Chairman. Thank you, Mr. Poole. A very stimulating 
proposal.
    [The prepared statement of Mr. Poole follows:]

Prepared statement of Robert W. Poole, Jr., Director of Transportation 
                Studies, Reason Public Policy Institute

    My name is Robert W. Poole, Jr. I am the director of transportation 
studies at the Reason Public Policy Institute in Los Angeles. As a 
former aerospace engineer, I have been studying transportation issues 
for more than 20 years and have advised the U.S. Department of 
Transportation and various congressional committees on a number of 
occasions. In 1993-94 we advised the National Performance Review office 
on what became their proposal for a government corporation to take over 
air traffic control. And in 1997 we advised the National Civil Aviation 
Review Commission, as it assessed the problems of the nation's air 
traffic control system.
    Having been involved with ATC reform since the days of the PATCO 
strike in 1981, I'm impressed by how much the debate has changed since 
then. There is a broad consensus within aviation policy circles on many 
issues that used to be very contentious. It is now widely accepted that 
ATC is an essentially commercial service, and that it is separate from 
air-safety regulation, which is inherently governmental. It is also 
increasingly accepted that the FAA's management and corporate culture 
are poorly suited to operating and modernizing a high-tech service 
business--and have not been significantly improved by the modest 1996 
reforms of procurement and personnel systems. And it is also widely 
accepted that ATC funding should be driven by the growth of aviation 
activity--and not by the ups and downs of the federal budget process.
    These conclusions are reflected in the work of the National 
Partnership for Reinventing Government. The same conclusions inspired 
the DOT's U.S. Air Traffic Services Corporation proposal in 1994-95. 
They underlie the strongly worded findings of the National Civil 
Aviation Review Commission in 1997. And they are backed up by nearly 
two decades of GAO reports and think tank studies.
    We are here today because last summer and again this summer--just 
as NCARC warned--growing air traffic bumped up against the limits of 
our creaking, obsolete ATC system, resulting in record levels of 
airline delays, costing airlines and their passengers billions of 
dollars in extra costs and wasted time. That experience has led to a 
growing chorus from airline CEOs calling for removing the ATC system 
from the FAA and setting it up as a user-funded business. The bible of 
the industry, Aviation Week, has editorially endorsed this approach for 
several years.
    One factor that has helped to shape this growing consensus is the 
actual experience of commercializing air traffic control around the 
world. Twenty years ago, when I first began working on this concept, 
there were no commercial ATC corporations to be found. The few that had 
been started--as nonprofit airline cooperative efforts, in the United 
States in the 1930s by ARINC, and in Cuba and Mexico--had all been 
taken over by their respective governments.
    But beginning in the late 1980s, the same problems that plague our 
ATC system--inadequate or uncertain financial resources, poor cost-
accounting, crippling bureacratic rules on personnel and procurement, 
etc.--led to a growing wave of reform. One after another, starting with 
New Zealand, ATC operations were restructured as commercial 
corporations, either wholly owned by government or as nonprofits 
controlled by the various aviation stakeholders. Among those taking 
this path are Australia, Canada, Germany, South Africa, Switzerland, 
and the U.K. ATC restructuring has been brought about by governments of 
both left and right, including Labor governments in New Zealand and the 
U.K. and a center-right government in Germany.
    Four common elements emerge from these various ATC reforms:

   First, in virtually every case, governments have spun off 
        the ATC service provider but have kept safety regulation as 
        part of the government's transportation agency. Putting safety 
        regulation at arms-length from service delivery is seen, 
        correctly, as a way to improve air safety.

   Second, in every case but one, these ATC corporations are 
        operated on a not-for-profit basis. (That one exception is the 
        UK Labor government's current proposal to sell 51% of the 
        National Air Traffic Service to private investors.) Because ATC 
        is one of those rare cases of natural monopoly, it makes sense 
        to operate it in this way, with any excess revenues either re-
        invested back in the corporation or used to reduce the 
        following year's fees and charges.

   Third, nearly every one of these ATC corporations is funded 
        directly and completely by its users. Fees and charges are the 
        prices of the company's services; they do not get sent to the 
        government, to be appropriated (or held in a trust fund). They 
        are paid directly by the customers to the service provider (as 
        with electricity charges by TVA and postal charges by USPS). 
        And that makes the company accountable directly to its 
        customers. As they say in Canada, ``user pay means user say.''

   Fourth, these ATC companies are able to fund modernization 
        by issuing long-term revenue bonds, based on their predictable 
        stream of revenue from fees and charges. Indeed, NavCanada's 
        bonds had no trouble receiving investment-grade ratings. The 
        financial community loves this kind of investment.

    In addition to these common features of commercialized ATC 
corporations, we also find a common pattern in their experience. To put 
it simply, ATC commercialization works. By that I mean: it solves the 
problems that have plagued government-run air traffic control in 
country after country. Following commercialization, we typically find 
that the unit cost of providing ATC services comes down, modernization 
proceeds more quickly and smoothly, and flight delays are therefore 
reduced. (In Canada, the commercialized ATC provider is implementing 
NASA-developed ATC software called CTAS--the Center-TRACON Automation 
System--in three years, compared with an estimated 10 years it will 
take the FAA to do likewise here.) In no country has there been any 
reduction in air safety, and most observers believe safety levels have 
increased.
    In short, compared to 20 years ago when ATC commercialization was 
mostly theory, today we can draw on a wealth of experience from around 
the world. All of it points to the conclusion that moving ATC out of a 
government bureacracy, converting it into a commercial corporate form, 
charging users directly for services and making it directly accountable 
to those users for its performance, and regulating it at arms-length 
for safety--this kind of fundamental reform works.
    The logical next question is: How can we apply this experience to 
the United States? That is the question that my organization has been 
addressing since last winter. Our three-member project team is 
developing a detailed proposal for an Airways Corporation that could 
take over ATC functions from the FAA and operate in a commercialized 
manner. We are seeking input as we go along from the entire aviation 
community--major airlines, low-fare airlines, cargo carriers, air-taxi 
operators, business aircraft owners, recreational flyers, air traffic 
controllers, and others. Since this is still a work in progress, I 
cannot give you the final results today. As you can imagine, this is a 
very complex project, and different stakeholders have somewhat 
different interests that must be taken into account in coming up with a 
workable plan. But I can give you some broad outlines of where we are 
heading.
    First, having reviewed the global ATC reform experience, we believe 
that the stakeholder-controlled not-for-profit corporation is the best 
model for the United States. It is working very well in Canada, with 
which we share a major border and have extensive air commerce. And it 
harkens back to the origins of U.S. air traffic control, which was 
begun on exactly this basis by Aeronautical Radio, Inc. (ARINC) in the 
1930s. So we have defined a nonprofit ATC corporation with a 
stakeholder-controlled board of directors.
    The Airways Corporation would provide all civilian ATC services in 
the United States and in the oceanic regions for which this country is 
responsible. It would hire a top management team to run the company, 
but would take over essentially all of the current FAA staff in Air 
Traffic Services and Research and Acquisitions, and all current FAA ATC 
facilities. It would keep its books using generally accepted accounting 
principles (GAAP) like a normal company. And it would be free to pay 
market-based compensation to all its employees--both management and 
nonmanagement--so as to ensure the best possible talent for each 
position. It would be free to define and purchase new technology in the 
same way as any private business.
    The most crucial element of this reform is to develop a corporate 
culture that is driven by and responsive to customer needs. That will 
only happen if the company must derive its revenues by meeting their 
needs--in other words, if it derives its revenue directly from its 
customers, via fees and charges. This process is what drives the 
remarkable productivity of the entire U.S. economy. And we can now see 
that it works in air traffic control, as well. To repeat the leitmotif 
of Canadian ATC reform, ``user pay means user say.''
    We fully appreciate that developing the specifics of ATC fees and 
charges is no easy task. We are devoting considerable effort to coming 
up with a pricing proposal that is both simple and fair to all aviation 
users. Until we complete our stakeholder review process, I don't want 
to go into more specifics on this issue. But because we all know that 
private pilot groups have great concerns about this issue, let me say 
just a few words on that score.
    Our plan will propose that current federal aviation user taxes be 
abolished, as part of the transition to the new, commercialized system. 
The underlying principle is that the new ATC fees and charges will 
apply only where users make actual use of ATC services. A private plane 
shooting touch-and-go landings at a non-towered airport is not using 
the system and should not be charged by the system--or by the federal 
government. But those who do use ATC services should pay for the use of 
those services--again, in as fair and simple a manner as possible. And 
as stakeholders in the system, they should be represented on its board. 
This includes military and civilian government users, whose budgets 
should include the cost of using ATC services, just as it includes 
buying fuel for their aircraft.
    The overseas experience clearly demonstrates that an Airways 
Corporation can easily be self-funding. Like any other utility business 
providing a vital public service (e.g., electricity or water) by 
investing in long-lived infrastructure, the most appropriate way to pay 
for that infrastructure is via long-term revenue bonds. With a robust 
stream of revenue from fees and charges, such bonds could easily earn 
investment-grade ratings. Wall Street will be only too happy to arrange 
these bond issues. Hence, we strongly recommend that the corporation 
not be allowed to borrow from the Treasury. Since one of the key 
objectives of this reform is to develop a user-responsive corporate 
culture--i.e., one that will choose wise and cost-effective 
investments, rather than white elephants such as the now abandoned 
Microwave Landing System--is is important that all such investment 
plans be required to pass the market-testing of the financial markets.
    Finally, let me address the question of regulation. There are two 
potential types of regulation involved: safety and economic. In terms 
of safety regulation, the FAA will become the arms-length regulator of 
the new corporation. That will put air traffic control on the same 
basis as all the other participants in the aviation system: airlines, 
private plane owner/operators, airframe and engine producers, airports, 
pilots, and mechanics. All are regulated at arms-length by the aviation 
safety regulator. It will be no different in the case of the ATC 
service provider. Most countries that have commercialized ATC consider 
this separation of regulation from operations to be a significant 
strengthening of air safety.
    When it comes to economic regulation, I noted previously that the 
Airways Corporation will be a natural monopoly. The corporate structure 
we propose is a not-for-profit corporation with a stakeholder board--
essentially, a user cooperative. In theory, such a structure should 
represent the interests of its customers and not require the usual kind 
of public utility regulation (whose purpose it to look out for the 
interests of its customers). However, we all know that the interests of 
business-jet operators and those of cargo carriers and those of major 
airlines are not identical. We believe there will still be a need for 
external review and appeal of the corporation's decisions on such 
things as fees and charges and of changes in levels of service. At this 
point, we think such review and appeal is best carried out by the DOT, 
just as appeals from rail shippers can be taken to the DOT's Surface 
Transportation Board.
    Congress will, of course, continue to have the responsibility to 
fund the FAA and DOT, and to exercise the needed oversight of all of 
their operations, including their regulatory responsibilities with 
respect to air traffic control.
    In closing, I would like to stress the urgency of this kind of 
fundamental, structural reform of the way we provide and pay for air 
traffic control in this country. The current system has failed to bring 
about modernization of the ATC system--modernization that is essential 
if we are not to succumb to gridlock and far worse delays than were 
experienced last spring and summer. The shift from ground-based to 
space-based ATC, based on GPS and data link, promises a major increase 
in both en-route and runway capacity. But the FAA has been 
institutionally incapable of delivering this modernization, wasting 
billions on such fiascos as the Advanced Automation System and the 
Microwave Landing System.
    There are several reasons for this structural failure. One is the 
FAA's cumbersome procurement process. When a new generation of computer 
electronics comes along every 18 months and it takes the FAA five to 
eight years to procure a new system, you have a recipe for getting 
further and further behind the state of the art. This is due in part to 
the FAA's proclivity for defining everything to death in-house, rather 
than making creative use of off-the-shelf systems where feasible. A 
commercial ATC corporation will be able to upgrade its technology as 
quickly and efficiently as other high-tech businesses.
    Another structural problem is uncertain funding. The vitally needed 
controller-to-pilot data link is a key element in free flight, but is 
being delayed by stop-and-go FAA funding. Implementing data link 
requires synchronized schedules involving airlines, avionics makers, 
and ATC facilities on the ground--but FAA budget problems play havoc 
with this synchronization. An ATC corporation would have assured 
funding for such modernization programs via its revenue bonds.
    But the most important structural failing is this: the FAA is not 
customer-driven. Regarding free flight, WAAS, data link, and other key 
technologies, there is no urgency or sense of commitment to meeting 
users' needs as soon as possible. This is a basic problem of corporate 
culture. And it will only be solved when the ATC organization is paid 
directly by its customers and held accountable for results by those 
customers.
    This concludes my presentation today. As I said previously, my 
comments are based on our work-in-progress on defining a plan for ATC 
commercialization that can gain widespread support within the aviation 
community. We are getting close to a finished product, which we hope to 
publish late this fall. I'll be sure you all receive copies.

    The Chairman. Mr. Carr, welcome. And thank you for the 
great job that you and your people do.

              STATEMENT OF JOHN CARR, PRESIDENT, 
          NATIONAL AIR TRAFFIC CONTROLLERS ASSOCIATION

    Mr. Carr. Thank you, Mr. Chairman, and members of the 
Committee.
    My name is John Carr. I am the newly elected president of 
the National Air Traffic Controllers Association, and I 
represent over 15,000 air traffic controllers, serving the FAA, 
the Department of Defense, and the private sector.
    I'd like to thank you for this opportunity to appear before 
the Committee to discuss the problems and solutions related to 
aviation delays.
    I may be new to my position as president of the union, but 
not to the problem of aviation delays. I have over 20 years of 
experience as an air traffic controller, including 10 years at 
Chicago O'Hare.
    I want you to know that the men and women I represent want 
to be part of the solution to this complex and very critical 
problem.
    Continued dissatisfaction with the progress of national air 
space system modernization and the mounting problem of aviation 
gridlock has led some industry and government officials to 
calling for privatization or restructuring of the FAA.
    I'm here today to tell you that privatization of air 
traffic control operations is not the answer. Privatization 
will not increase airport capacity. It will not speed up 
construction of more runways or airports.
    Safe, reliable equipment will not be developed or installed 
any faster.
    Privatization would, instead, chart a course toward undoing 
many of the benefits found in AIR-21 and would fracture the 
delicate balance of a work force that holds this system 
together.
    Privatization is a business oriented solution being offered 
by the airlines and others who might stand to profit from it. 
Proponents argue that competition in the private sector allows 
companies to provide services more efficiently while reducing 
costs. Yet, these same private companies will constantly 
balance their bottom line against an air traffic controller's 
bottom line, the safety of the flying public.
    While on the surface, the solution may seem to save a 
dollar, in reality it makes no sense. As a matter of fact, we 
believe the safety of the flying public and the commercial 
efficiency of our air traffic control system are so intimately 
related to the exercise of the public interest as to mandate 
performance by Federal employees which, as I'm sure you all 
know, is the very definition of inherently governmental in OMB 
Circular A-76.
    In today's environment, controllers are under extreme 
pressure to squeeze more aircraft into already congested air 
space. We go to enormous lengths to ensure the safety of 
millions of flyers each year. We have no incentive to delay or 
hinder air traffic. Our motivation is simply to move aircraft 
as safely and efficiently as possible. The longer I work you 
the more difficult my job becomes.
    However, the primary function of an air traffic control is 
to ensure the safety of the flying public, and we do not 
believe that we should be put in the position of compromising 
that safety to accommodate more passengers, more flights, or 
more profits.
    Aviation delays are a multifaceted problem, and no single 
element is responsible A number of contributing factors, 
including growth in the number of travelers, scheduling 
decisions by airlines, bad weather, new air traffic equipment, 
underutilization of airports and policy changes have led to 
this record number of aviation delays.
    One simple yet controversial solution to this complex 
problem, as others have discussed, would be to construct new 
airports or to expand existing airports by adding runways to 
accommodate larger numbers of aircraft.
    Another solution involves a close examination of the use of 
our nation's existing airports. We believe certain city 
airports are more uniquely suited for increased flights than 
their associated hubs. Most hub airports throughout the country 
have underused secondary airports nearby.
    NATCA believes that increased usage of these airports by 
passengers and airlines alike will help alleviate system 
congestion and delays. All you have to do is look at the 
success that is enjoyed by Southwest Airlines to see that there 
is unused capacity waiting at secondary airports.
    System users must understand that they cannot continue to 
intentionally overload the system. As long as the airlines 
overbook runways during peak hours, delays will continue and 
passengers will wait. Even if controllers have the most up to 
date equipment and technology, delays will not be eliminated.
    There is nothing on the shelf now that will eliminate the 
delays we have now.
    We would simply be better able to keep track of your 
delayed aircraft.
    Another solution of the problem of delays----
    The Chairman. The free flight proposal would not----
    Mr. Carr. It will not eliminate the delays you currently 
face. It will incrementally improve the performance of the 
system, but during peak hours it will not eliminate the delays.
    The Chairman. Thank you.
    Mr. Carr. Another solution to the problem of delays which 
we currently work on involves national air space redesign 
initiatives, which Captain Woerth alluded to.
    Together with the agency, we have created numerous teams 
and redesigned groups each manned by specialist tasks with 
alleviating choke points and built in systemic congestion.
    Critical sectors and routes have been identified, and we 
are working closely with the FAA and the users to rapidly 
change the dynamics of these traffic patterns while carefully 
examining each and every one of them from a safety perspective.
    You see safety as foremost concern of FAA controllers. 
Private companies, however, have accountability to their 
stockholders, and profits are achieved at the expense of not 
only the employees but the system.
    For example, the current Federal Contract Tower Program is 
characterized by inadequate training, inadequate staffing, 
communication lapses, and poor working conditions.
    Proponents of privatization will often point to 
restructured aviation departments by governments abroad, such 
as NavCanada.
    We feel this is akin to comparing our Cadillac with their 
Yugo. Countries that have partially or totally privatized air 
traffic control systems have air space which is very confined, 
relatively compact, fewer employees, fewer airplanes, and fewer 
facilities. The largest of which has been privatized is smaller 
than one-tenth of our system.
    The United States, on the other hand, maintains the largest 
and most complex air traffic control system in the world. 
Together, we're responsible for moving half of the world's 
passengers and cargo.
    Under the leadership of Jane Garvey, the FAA has turned the 
corner on its modernization efforts with the help of the people 
I represent, the air traffic controllers, engineers, and other 
employees.
    A single organization with one mission, one head, and no 
ambiguities about the priority of human life is in this 
nation's best interest. Safety is our bottom line, and air 
traffic controllers are this Committee's partners in fulfilling 
that single, very fundamental mission.
    I thank you for your time, and I'll answer any questions 
that you might have.
    The Chairman. Thank you, Mr. Carr.
    [The prepared statement of Mr. Carr follows:]

   Prepared statement of John Carr, President, National Air Traffic 
                        Controllers Association

    Good morning Chairman McCain, Senator Hollings, and Members of the 
Committee. I want to thank you for this opportunity to appear before 
the Committee to discuss air traffic control. I am John Carr, President 
of the National Air Traffic Controllers Association (NATCA), the 
exclusive representative of over 15,000 air traffic controllers serving 
the FAA, Department of Defense and private sector. In addition, NATCA 
represents approximately 1,200 FAA engineers, over 600 traffic 
management coordinators, agency operational support staff, regional 
personnel from FAA's logistics, budget, finance and computer specialist 
divisions, and agency occupational health specialists, nurses and 
medical program specialists.
    NATCA's mission is to preserve, promote and improve the safety of 
air traffic within the United States, serve as an advocate for air 
traffic controllers and other safety-related employees, and promote 
competence and pride within our profession. We are also responsible for 
promoting technological advances, providing reliable and accurate 
information for our members, and serving as a credible source of 
information for this Committee, the traveling public, and the news 
media.
    Continued dissatisfaction with the progress of national air system 
(NAS) modernization and the mounting problem of aviation gridlock has 
led to many industry and government officials calling for 
privatization/restructuring of the FAA. Proponents argue that 
alternative organizational structures for air traffic control 
operations and/or the entire agency would improve modernization efforts 
and solve the problem of delays. I am here today to tell you that 
privatization of air traffic control operations is not the answer.
    Privatization will not speed up the process of building new runways 
and airports. Safe, reliable, user accepted equipment will not be 
developed and installed any faster. Privatization would, instead, 
fracture the delicate balance of a workforce that holds the system 
together.

Aviation Delays
    Delays, as defined by the FAA, refer to any problem that causes any 
segment of flight to be more than 15 minutes late. Last year, there 
were 306,234 commercial and general aviation delays in the United 
States. Airline delays, as we all know, are at an all time high. 
Passenger frustration is over the top. And, predictably, when something 
goes wrong, the finger pointing and blame game begins. To that end, 
airlines have embarked on a well-financed campaign of misinformation 
blaming air traffic control for their delays. It is unproductive and 
unfair for one segment of the aviation industry to place responsibility 
entirely on another. It is simply untrue to say that air traffic 
control is primarily at fault for the hundreds of thousands of delays 
each year.
    Aviation delays are a multi-faceted problem. No single element is 
responsible. Rather, a number of contributing factors including growth 
in the number of travelers, scheduling decisions by airlines, bad 
weather, implementation of new air traffic controller equipment, under 
utilization of airports, and policy and procedural changes have led to 
the record number of aviation delays. And, just as there is not one 
cause, there is also no blanket solution or quick fix to the problem.
    One simple, yet controversial, solution to the delays issue would 
be to construct new airports and/or expand existing airports by adding 
or extending runways to accommodate larger planes. However, any airport 
construction or expansion plan faces a number of obstacles including 
political hurdles, space limitations, community opposition, noise 
restrictions and environmental concerns. It can take years for a 
project to be approved. Meanwhile, we are fast approaching a crisis 
situation with respect to aviation gridlock.
    NATCA has identified the following factors as the leading causes of 
aviation delays.

I. Crowded Skies
    The United States air traffic control system is the not only the 
largest, most complex and most demanding in the world, but it is also 
the safest. This is, no doubt, due primarily to the dedication and 
professionalism of the nearly 15,000 FAA air traffic controllers. Air 
traffic control is a 7 days a week, 24-hour operation. Today, 
controllers are under extreme pressure to squeeze more aircraft into an 
already congested airspace. Controllers have no incentive to delay or 
hinder air traffic. Our motivation is to move aircraft as safely, 
efficiently and quickly as possible. The longer a delayed aircraft is 
in our airspace or occupies concrete on the ground, the more difficult 
our jobs become. However, the primary function of air traffic 
controllers is to ensure the safety of the flying public, and this 
should not be compromised to accommodate more passengers, more flights, 
or more profits for the airlines.
    In the past 5 years, air traffic has increased by 27 percent to 655 
million commercial passengers annually. If the economy remains strong 
and fuel prices remain low, we can expect more passengers and more 
delays. In fact, the number of passengers is expected to exceed 1 
billion annually by 2010.
    An airport's capacity to handle air traffic is a function of its 
size, the layout of its runways, the air traffic patterns, both 
arriving and departing, and the time frame in which a surge of traffic 
must be dealt with due to airline scheduling.

II. Unrealistic Hub Scheduling
    The inefficient hub and spoke system used by airlines to schedule 
flights is a major source of delays. Flight departure and arrival 
scheduling is at the sole discretion and control of the individual 
airline not Congress, not the FAA, not the air traffic controllers, not 
the airports, and not the public. It is time for the airlines to 
acknowledge their responsibilities in creating delays.
    To maximize profits, airlines are intentionally overloading the 
system. Delays from airline scheduling occur every day at every major 
U.S. airport. Schedules are blindly made to reduce operating costs and 
maximize revenue without regard for other airlines, terminal airspace 
or airport capacity. At ``peak'' times, dozens of planes are 
simultaneously taxiing for take-off or queuing above the airport in a 
finite amount of terminal airspace. This is where the laws of physics 
kick in. Given runway capacity, only certain number of flights can 
depart and arrive within a specified time period. Therefore, airline 
over scheduling during peak hours guarantees delays at busy airports 
even in good weather. It is like trying to cram 10 pounds of sand into 
a 5 pound bag. All scheduled flights will not be able to depart or 
arrive on time.
    Examples of airline induced delays:

   At Dallas/Fort Worth airport, the approximate airport 
        acceptance rate during a 15-minute period is 32 aircraft under 
        perfect (VFR) weather conditions and 24 aircraft in IFR 
        weather. However, day after day airlines repeatedly schedule 
        more arrivals than DFW can handle--often as many as 58 arrivals 
        during a 15-minute period. In fact, during one 15-minute 
        period, 57 aircraft were scheduled to arrive. Fifty-two of 
        these were from American Airlines which use DFW as one of its 
        hubs. Even if the weather is perfect, 25 arrivals will be 
        delayed.

   At Dallas/Fort Worth airport, the approximately airport 
        departure rate is 11 aircraft in a 5-minute period and 32 
        aircraft in a 15-minute period. Again, day after day airlines 
        repeatedly schedule more departures than DFW can handle--often 
        as many as 16 departures at the exact same minute. It is 
        physically impossible to depart that many aircraft in one 
        minute. In fact, during one 15-minute period, 59 aircraft were 
        scheduled to depart. Fifty-five of these were from American 
        Airlines which use DFW as one of its hubs. Even if the weather 
        is perfect, 27 departures will be delayed.

   At Cleveland airport, the acceptance rate during a 15-minute 
        period is 10 aircraft. Due to airline scheduling, 18 of the 56 
        15-minute segments in a 14-hour period are over capacity.

    In acknowledging that delays are inevitable from over scheduling at 
peak times, airlines pad their schedules so as not to negatively affect 
their on-time percentages. For example, a flight from Washington, D.C. 
to Atlanta takes a little over an hour in actual flight time. But, the 
airlines' schedule the flight to last two hours because they know the 
runways will be overbooked on departure and/or arrival.
    Regardless, the airlines would rather have passengers sit on the 
tarmac with no space to take off than lose money. Competition among 
airlines exacerbates this situation. For example, one airline claimed a 
loss in excess of $1 million by scheduling a flight at 12:05 rather 
than exactly matching the time of a competitor's noon flight. 
Therefore, if airline A offers a noon flight from Washington, D.C. to 
New York, then airline B will offer the same flight.
    As long as the airlines continue to overbook runways, especially 
during peak hours, air traffic delays will continue and passengers will 
wait. Cramming extra flights into an already over-taxed system only 
creates congestion in the terminal space, on the runways and at the 
gates. Even if controllers had the most up-to-date equipment, air 
traffic delays will not be eliminated. Controllers would simply be able 
to keep better track of the planes.

III. Weather
    Inclement weather has, and will continue, to play a significant 
role in air traffic delays--accounting for approximately 75 percent. 
Unfortunately, nobody but Mother Nature has any control here.
    Planes fly on a complex set of invisible ``highways in the sky'' 
with intersections, speed limits, separation requirements, etc. After 
takeoff, the controllers in the airport tower hand the plane over to 
controllers at terminal radar approach controls (TRACON) and 
thereafter, to controllers at one of the 21 regional centers. Depending 
on where the plane is going, it may be passed on to another regional 
center and another until it nears its destination. Storms or inclement 
weather cause blockage or closing of one or many of these unseen 
highways. When this occurs, air traffic bottlenecks just like it does 
on the interstate at rush hour. Controllers must then reroute all air 
traffic. In addition to air traffic, ground holds may be placed on 
planes if their destination airport is unable to accept traffic. It can 
take hours to recover from a brief shut down of one air route.
    Most often large storms are predicted early enough to ensure flight 
safety. However, sudden weather shifts require controllers and pilots 
to alter flight operations to ensure safety. Controllers need timely, 
accurate information to reroute traffic to avoid turbulence and delays. 
The following four technologies dominate aviation weather information: 
the Automated Surface Observing System (ASOS); the Digital Automated 
Information Service (D-ATIS); the Next Generation Weather Radar 
(NEXRAD); and Terminal Doppler Weather Radar (TDWR). However, funding 
levels limit deployment of these technologies to large hubs and primary 
``bad'' weather facilities.
    In addition to funding, adequate training is needed to provide 
controllers with a better understanding of weather activity. Most 
controllers receive weather training early in their careers at the 
Oklahoma City academy and biannual briefings on thunderstorms and ice. 
Only those controllers with ASOS observation duties receive complete 
weather observer training, and little to no training is provided for 
using weather radar systems.

IV. Under Utilization of Airports
    A close examination of the use of our nation's existing airports is 
needed. NATCA believes that certain city airports are better suited for 
originating and/or terminating flights than associated hub airports. 
Most hub airports throughout the country have associate airports 
nearby. These associate airports are underused. NATCA believes that 
increased usage of these airports by passengers and airlines will 
alleviate congestion and delays at the hubs. In fact, some of these 
associate airports are not being used at all.

   Consider Chicago's Midway and O'Hare Airports. Midway may be 
        better suited for passengers destined for Chicago than O'Hare 
        Airport. If passengers destined for the city of Chicago use 
        Midway, this may alleviate some of the delays at O'Hare.

   Consider St. Louis Lambert Airport. The runways at Mid 
        America Airport (approximately 25 miles east of St. Louis) are 
        7,000 feet apart making it suitable for parallel approaches. 
        Yet, St. Louis/Lambert Field, with runways too close together 
        for parallel approaches, is the hub airport. Why is Lambert 
        Field so congested while Mid America Airport is ignored?

V. Policies Changes Affecting Delays
    Increasing Number of Commuter Flights
    In order to achieve a competitive advantage and reduce costs, 
airlines have increased the number of small jet planes with frequently 
scheduled flights. This has resulted in crowded airports and increased 
en route congestion. These planes use the same airspace as larger jets 
but fly at a slower pace.

ATC Modernization
    The FAA modernization effort consists of over 100 projects. 
Admittedly, there have been a number of problems and obstacles but the 
FAA has turned the corner. And, we would like to commend Administrator 
Jane Garvey on her efforts in getting many of the ATC modernization 
projects, specifically DSR and STARS, back on track. We are firm 
supporters of Administrator Garvey's ``build a little, test a little, 
deploy a little'' strategy, and NATCA will remain an advocate of this 
throughout the modernization effort.
    We would also like to commend the Committee on passage of the 
Wendell H. Ford Aviation Investment and Reform Act for the 21st 
Century. This three-year, $40 billion Act will provide necessary 
funding for modernization and airport construction projects. NATCA has 
long believed that stable and guaranteed funding is essential to the 
modernization of the national air system (NAS).
    Many are quick to point the finger at the ``outdated and 
antiquated'' air traffic control system as a major cause of delays. 
However, I am here to tell you that not only is this not true, but to 
refer to the air traffic control system as ``outdated and antiquated'' 
is no longer an accurate characterization.

   Installation of Display System Replacement (DSR) at 20 air 
        route traffic control centers (ARTCCs) is complete. DSR 
        modernizes the computer equipment and provides the platform for 
        future air traffic control system upgrades. With DSR in place, 
        controllers have the necessary tools to more efficiently handle 
        today's traffic volume and to accommodate the projected 
        increases in air traffic. While DSR installation was not 
        without difficulty, only three percent of delays last year were 
        attributable to these equipment failures and upgrades. 
        Controllers needed to adjust to the new platform where the 
        computer human interface is completely changed from the old 
        system. DSR installation was like trying to change a tire while 
        traveling at 60 miles per hour.

   With respect to the Standard Terminal Automated Replacement 
        System (STARS), the FAA has revamped the budget and deployment 
        schedule. STARS will replace aging computer and radar scopes at 
        172 terminal air traffic control (TRACON) facilities and 362 
        airport control towers. Installation of STARS is already 
        complete in Syracuse, NY and El Paso, TX.

    Yes, the current system can be improved, but improvements take time 
to develop, test and implement. Privatization will not speed up this 
process. If anything, fracturing the system will slow progress in 
evaluation, testing and deployment of needed systems. And, while 
continuing upgrades and new technological advances are necessary to 
ensure safe, efficient travel in the future, they will not solve the 
problem airline-created delays. Newer equipment will not increase 
airport capacity or change the number of aircraft that can land or 
depart at any given time.

Privatization
    Privatization is not the solution to aviation delays, NAS 
modernization, or the other problems plaguing the air traffic control 
system. Privatization will not increase airport capacity, or build more 
runways or airports. It is simply a business-oriented solution being 
offered by--surprise--the airlines and others who stand to make a 
profit. Proponents argue that competition in the private sector allows 
companies to provide services more efficiently while reducing costs. 
Yet, private companies will constantly balance the bottom line against 
safety. Some things should not be reduced to dollars and cents.
    Given the nature of the air traffic control system, privatization 
is foolish and unfounded. The safety of the flying public should never 
be in competition with corporate profits. The most sophisticated, top-
of-the-line computer system can not guarantee a safe and efficient air 
traffic control system. Only a highly trained and adequately staffed 
workforce can do this. With or without working technology, the human 
element is the last line of defense in maintaining the safety 
(separation of aircraft). For FAA controllers, safety is the number one 
priority. Private companies, however, have little accountability to the 
public--only to their stockholders. Moreover, profits are achieved at 
the expense of the employee. All one has to do is look at the current 
Federal Contract Tower (FCT) Program which is characterized by 
inadequate training and staffing, lower salaries and fewer benefits, 
communication lapses and poor working conditions.
    Privatization of air traffic control operations would further erode 
the homogenous management structure and the seamless nature of our air 
traffic control system. The air traffic control system operates through 
teams of highly skilled and well-trained controllers linked together 
with highly sophisticated communication and radar systems. A smooth, 
safe and efficient system depends on the seamless transition of 
aircraft from control towers to Terminal Radar Approach Controls 
(TRACON) to Air Route Traffic Control Centers (ARTCC). A breakdown in 
communication between controllers at these facilities reduces safety, 
capacity and overall system performance. When one link in the chain is 
broken, communication breaks down and safety is compromised. FAA 
controllers share common language, background and management. Piecemeal 
privatization of air traffic control operations eliminates standard 
phraseology and procedures. Contract controllers do not receive the 
same training as FAA controllers and are not required to follow the 
same work rules and agreements.

Level II and III Towers
    NATCA strongly opposes expansion of the Federal Contract Tower 
(FCT) Program to include Level II and III visual flight rule (VFR) air 
traffic control towers. To do so would not only be unwise, but it would 
be a radical departure from the confines of the existing program. 
Currently, the FCT program consists of low traffic volume towers with 
an hourly traffic density of less than 35 operations (arrivals and 
departures) per hour. The number and complexity of operations increases 
significantly from Level I facilities to Level II (approximately 50 to 
60 aircraft per hour) and Level III (over 100 per hour) towers. In 
fact, eleven of these higher density are among the busiest airports in 
the country. For this reason, the FAA is also opposed to contracting 
out Level II and III towers.
    Proponents of the FCT program point to the cost savings associated 
with the current program. However, any reported savings are 
questionable. And, everyone agrees that these reported savings are at 
the expense of employee salaries, benefits, training, working 
conditions and equipment. The FAA estimates cost savings from 
contracting out Level I towers to be $250,000 per facility annually. 
However, these figures fail to account for a number of indirect and 
hidden costs such as contract oversight, increased insurance premiums, 
controller relocations, and promotions (salaries increase as a result 
of moving controllers to higher level facilities). In addition, these 
figures only show short-term savings, ignoring the long-term costs of 
potential lawsuits and contract cost growth.

Other Countries
    Proponents of privatization often point to restructured aviation 
departments by governments abroad. NATCA believes, however, that any 
comparison is illogical. In countries that have partially or totally 
privatized air traffic control systems, the airspace is relatively 
confined and compact, with fewer number of employees, planes, air 
traffic control facilities, and smaller budget requirements. The United 
States, on the other hand, maintains the largest, most complex and most 
demanding air traffic control system in the world. Most of the FAA's 
nine regions handle airspace and operations that far exceed that of any 
single country that has privatized. Together, all nine FAA regions are 
responsible for moving at least half of the world's aviation passengers 
and cargo.
    While the same type of air traffic control problems may arise in 
many countries, it would be foolish to assume that a blanket solution 
would effectively correct the problem(s) and operate the same in each 
country. This is because the magnitude of airspace and the number of 
flights daily differ drastically from country to country. The U.S. air 
traffic control system is funded through a combination of general and 
aviation specific taxes, where most nations have a user fee system. In 
the U.S., commercial passengers pay a large portion of the air traffic 
control system, and general and business aviation (the U.S. has the 
largest general aviation community in the world) receive substantial 
benefits at little cost. Yet, each entity is treated as an equal with 
services conducted on a first-come, first-serve basis.

Conclusion
    I would like to again thank the Members of the Committee for 
allowing NATCA to testify on the problems facing air traffic control. 
Without expanding domestic airspace and airport capacity, and 
addressing the issue of airline scheduling, delays will not only 
continue to increase but they will reach the point of gridlock in the 
foreseeable future. As an industry, we must stop pointing fingers and 
placing blame. Teamwork and collaboration are needed to develop and 
implement long-term solutions and procedural changes to alleviate air 
traffic delays.

    The Chairman. Did you hear Ken Mead's comments that there 
has been an increase with incursions, and other----
    Mr. Carr. Yes, sir, I did.
    The Chairman. What needs to be done about that? Because 
there's a certain inevitability, the law of averages, 
obviously, is going to prevail here at some point. What needs 
to be done?
    Mr. Carr. Runway incursions and operational errors are up, 
and I believe that there are symptoms of problems that are 
associated with the increased demand we've discussed. They're 
also related, in small measure, to the installation of new 
equipment.
    It should be remembered that while we're using 1970's radar 
and 1980's radios on 1990 scopes, as controllers and pilots, we 
are using 1950's separation standards.
    Collectively, as a group, we need to examine whether or not 
it's safe and reasonable to change separation standards, and I 
believe that a wholesale decriminalization of the operational 
error and runway incursion problem would leave both pilots and 
controllers to knowing that not every minor error that they 
make jeopardizes their career in the field, and I believe that 
you would use those opportunities more for training and 
learning than for punitive discipline; and I believe that you 
would free up, to be perfectly honest with you, more capacity 
in the system if it was less punitive to both the pilots and 
the controllers.
    The Chairman. You have additional information, will you 
provide it to the Committee?
    Mr. Carr. Absolutely. I would be happy to.
    The Chairman. I think one of the most disturbing things 
I've heard in a while is Mr. Mead's comments that these clear 
safety warning signs are on the increase.
    Mr. Carr. It's----
    The Chairman. Mr. Poole--go ahead, Mr. Carr.
    Mr. Carr. Well, it's just very interesting the linkage 
between operational errors and delays because we have 
separation standard minimums. For instance, five miles comes 
immediately to mind. We don't have a published maximum, and 
with the FAA recently implementing more punitive measures 
toward controllers and pilots alike, similar to a three strikes 
and you're out policy.
    After my first strike, I'm not going to be inclined to run 
them five miles apart, sir. I'm going to put a little extra 
room in for my family and my future, and that decreases 
capacity. It's only human nature.
    The Chairman. Mr. Poole, at least on this issue, he agrees.
    Mr. Poole. I do, indeed. I think that makes a lot of sense.
    Mr. Carr. Mr. Poole, how do you respond to Mr. Carr's 
comments that a privatization of the ATC would then cause 
aviation safety to be relegated to a less than paramount 
importance?
    Mr. Poole. I'd like to speak to that directly.
    First of all, I very carefully avoided the term 
``privatization'' because what I am recommending is not 
shifting air traffic control to a for-profit entity. I agree 
completely that there should be no question in anybody's mind 
about a conflict between profit and safety. This should be run 
in the public interest as a nonprofit organization with all the 
stakeholders represented.
    But I think there are three reasons why safety would be 
improved by this kind of structural reform.
    First of all, ICAO itself, the International Civil Aviation 
Organization, recommends, and this is a direct quote from their 
director, the separation of these two functions, and they're 
pushing hard for this to be done in Europe, as well as around 
the world. You want to have independent third party oversight, 
not the FAA regulating itself in its role as service provider. 
It should be at arm's length, like it is at arm's length from 
the airlines.
    Second, this kind of a corporate restructuring will indeed 
make it easier to modernize efficiently and faster by freeing 
up the financial resources through revenue bonds and completely 
private sector type of procurement process, that you'll get 
newer technology in place faster. That will inherently improve 
the safety level of the system.
    Third: All of these corporate entities that have been 
created abroad are required to obtain private liability 
insurance in addition to having the safety oversight from their 
government agencies, so that provides yet another layer of 
safety oversight because they have to satisfy the liability 
industry that they are, in fact, using safe procedures and 
state-of-the-art techniques and so forth.
    So you add that additional layer of oversight to make this 
an even more safe system.
    So I think on safety grounds there's no question this will 
be a winning proposition.
    The Chairman. Captain Woerth, I understand that you 
represent a union and you have the right to go on strike after 
you go through a certain process, and that is a threat that I 
not only respect but do everything in my power to make sure you 
keep.
    I'm disturbed at the sick-out of the American Airline 
Pilots, I'm disturbed at what United Airline Pilots did, 
because it didn't resort to the traditional right to strike. 
They basically inflicted punishment on traveling Americans.
    Now, how do you justify that kind of behavior, specifically 
American Airlines, although I recognize they are not a member 
of your union, but what the United Pilots just did in order to 
exercise leverage, rather than take the traditional path, which 
is available to you, and then say, we are going on strike 
because our demands in the interest of our pilots are not 
satisfied?
    Mr. Woerth. Well, Mr. Chairman, as you already pointed out, 
ALPA does not represent the pilots of American Airlines, and 
perhaps the person sitting next to me can better answer that 
question.
    The Chairman. I don't think so.
    [Laughter.]
    Mr. Woerth. I don't think so either. Maybe not. Nice try.
    But, sir, as to United Airlines, specifically, I think it 
is in the record that the pilots of United Airlines did about a 
year and a half ago try to work with management, actually 
warned their system, which was, let's face it, we're in a very 
successful economy, everybody wants to add as much capacity as 
they can. They've got some ferocious competitor sitting at this 
table that are more willing to take their passengers.
    And they said, you know, we're not sure that you can 
continue to rely on all this extraordinary overtime the pilots 
have been flying year after year, so please cut your schedule 
back so not to inconvenience the customer.
    They're on record as saying that. They've said that on 
television, and as to that matter, the airline did not really 
downsize its system, and did not until this month, really match 
up what the airline can provide.
    So the pilots did not fly as much overtime as they had 
previously. They told them they were not going to, and 
actually, now I think compared to what they were doing for the 
rest of the summer, the airline's running very well.
    It should also be noted, sir, as I mentioned, United was 
especially affected, I believe, with the location of the 
convective activity this summer. It appeared in June and July, 
the line of thunderstorms was just unbelievable. When you have 
two hubs--and I know Mr. Carty is trying to address his issues 
with Chicago--in between Chicago and our other massive hub in 
Washington Dulles, the system really did become overloaded.
    The Chairman. Well, I don't want to belabor the point, and 
I won't. I've made my point, and there's no point in continuing 
to bash these people.
    But what I would just finally add as a footnote. Many of 
these people are friends of mine who used to be in the 
military, and they should appreciate what this does not to rich 
Americans, but particularly in the summertime when people 
literally have saved for a year to take a vacation and find 
themselves out of any capability of doing that. It has really 
inflicted a lot of harm on innocent Americans with this kind of 
work stoppage.
    I do take your point, that United Airlines warned 
management that they would not fly that much overtime, but they 
should also, I think, take into consideration a lot of people's 
lives were significantly disrupted by this action.
    Again, I won't belabor the fact. In fact, I don't intend to 
speak further on it unless I'm asked for an opinion because I 
think it would be rather gratuitous, but I hope you'll 
communicate with the members of your union that one of the 
important assets they have is the goodwill of the flying public 
and that's put at risk.
    Mr. Woerth. Thank you, sir. If I could response in this 
regard. I have done that. I actually pulled it out, and I can 
give you a copy of it, what I put in our Airline Pilot 
magazine, which is distributed to about 72,000 people, with a 
message from the president on the importance of following to 
the letter the Railroad Labor Act. I'll make that available to 
you, sir.
    The Chairman. Thank you very much, Captain Woerth.
    Mr. Mullin and Mr. Carty, I just have a comment. I think 
you have been diligently pursuing better conditions for the 
flying public. I also think you have a long way to go. Mr. 
Carty, do you share Mr. Mullin's concern about the U.S. Air-
United merger?
    Mr. Carty. I do agree with Mr. Mullin that because of the 
importance of networks to our business, a step by a major 
competitor to dramatically strengthen, broaden the network of 
that carrier, and in this case, United-US Air, has got to cause 
carriers like Delta and American to think in turn about what 
they must do as a counterbalance to get their network as broad 
and as strong as their competitor. But I think it could lead to 
subsequent mergers.
    The Chairman. i.e. it would lead to subsequent mergers?
    Mr. Carty. Yes, sir.
    The Chairman. Thank you very much.
    Senator Cleland.
    Senator Cleland. Thank you very much, Mr. Chairman.
    I just want to applaud all of you for being in this tough 
and exciting world. It's got to be one of the most difficult 
jobs in the world to try to manage or lead an airline today, 
and Captain, you and your colleagues have my undying admiration 
and support for literally the risk you take on behalf of us, 
the flying public, everyday.
    Mr. Poole, thank you for trying to analyze these 
challenges; and, Mr. Carr, thank you very much for your 
wonderful group of air traffic controllers who day in and day 
out, 24 hours a day, try to do the best they possibly, humanly 
possibly, can do.
    Mr. Mullin, let me just say everybody knows this has been a 
tough season the last 6 months in terms of on-time performance 
for the whole airline industry, and yet Delta went from 10th to 
3rd. You improved your on-time performance.
    To what do you attribute that, other than great leadership 
at the top?
    [Laughter.]
    Mr. Mullin. You took away my line.
    Actually, it's a system that has no silver bullet to it. 
When we were 10th in 1997, we actually put together a task 
force that identified 70 separate initiatives to be taken 
across the system at every single one of our airports and hubs, 
and thinking through how it was that we could better schedule 
the airline.
    I would also add that we have periodically taken steps, 
particularly in Atlanta, to de-peak the system, to get a better 
flow. Several references have been made to schedule, and how 
you run your schedule is crucially important. It is also very 
important that you have your team and your employees with you 
throughout this kind of a process.
    We've worked very hard on that, but it is a system where 
you have to take it every single location, one by one, and put 
an improvement program in and then hopefully put the pieces of 
the puzzle together and away it works.
    Senator Cleland. Thank you very much. We appreciate your 
leadership.
    Any reaction to the phrase, ``capacity benchmarks,'' owing 
to the fact that given the, in effect, free for all 
economically out there and the competition between airlines 
under deregulation to go after markets, and you want to expand 
your markets and go after every customer, just like we want to 
go after every voter in an open market environment, you want to 
expand that market and go after customers.
    But it seems to me that we are really, to use an air pilot 
phrase, ``we are pushing the envelope now,'' and under that 
free for all some airlines at some airports have, in effect, 
scheduled more aircraft, more tin on the air and on the ground 
than the capacity of the airport or the air traffic controllers 
can handle on their best day.
    Therefore, the FAA comes up with ``concept capacity 
benchmarks'' as a suggestion for remodel action.
    Any reaction?
    Mr. Mullin. I think the fact that we have to consider 
capacity benchmarks is just a truly unfortunate aspect of what 
has occurred here.
    Go back to the fundamental point that we do exist to serve 
customers, and those customers wan to fly where they want to 
fly, when they want to fly.
    We are an industry that drives our mission from service to 
those customers. Capacity benchmarks is nothing other than 
metering the service or constraining the service and cutting 
down the options that the traveling public has.
    I think that given the situation that we have here and to 
echo some of the things that Don Carty stated, in the next two 
to three years, I think we've got a really unique challenge at 
a number of these airports so that these capacity benchmarks 
maybe, in fact, be necessary, in order to just deal with the 
situation which has gotten somewhat out of control.
    But to allow ourselves to create a situation which has 
capacity benchmarks throughout it, is to sub-optimize this 
system. This system is big enough. I mean, this problem of 
reaching a billion passengers by the year 2010 is not going to 
go away in 2010. And in 2020, nobody's run those 
extrapolations, but I'd guess it's going to be 2 billion 
passengers. This is America. There's enough room out there for 
us to run an aviation system that serves the traveling public.
    Our job is to create capacity in the airports, in the air 
traffic control system, and in the airlines that can serve the 
traveling public. Anything that has constraint built into it, 
is not doing their job, and we've got to get the system built 
in a way that just allows us to have enough capacity to provide 
the traveling public with the services they need and they 
deserve.
    The Chairman. Mr. Carty.
    Mr. Carty. If I could just elaborate a little bit on what 
Leo said. I agree with what he said. Somebody made the 
reference earlier, if you go back to the FAA forecast for the 
Year 2000, which was developed in 1993, it was for 700 million 
passengers. That's what we've got. So, in a sense, we shouldn't 
be surprised.
    Now we have a forecast for a billion passengers. That's 
like adding United, Delta, and American to the system again. 
Now that's a lot of growth and demand on the system, and we 
certainly don't want to be here 5 years or 7 years from now 
saying, gee, we knew it was going to happen, but it happened 
anyway, and we weren't ready for it.
    In the case of the capacity benchmarks, to come back to 
your specific question, I think the benchmarks will be very 
helpful in giving us a far more realistic picture of what the 
current capacity is.
    I think they will also allow us to set targets for 
improving that capacity by, as Jane alluded to earlier, looking 
for the choke points and taking them out of there, and ramping 
up that capacity.
    And it will also help the airlines, as I think they're 
helping American today, to look at the hubs or the predominate 
schedule and make the schedule more workable. But I'm sitting 
here looking at a chart of LaGuardia's taxi-out comparison on 
only good weather days in September. Only good weather days.
    And they look--I'm just looking across the hours of the 
day. It looks like we're running up to the 50-minute level, and 
a year ago we were below 20 minutes. So we're almost tripling 
the taxi-out delays at LaGuardia. There are three or four 
airports around the country where that clearly is also 
happening.
    I'm not sure, aside from, as Leo said, just keeping to work 
to push that capacity capability up at LaGuardia, what a 
benchmark is going to tell us. Because, much as I love Leo, I'm 
not going to retrench in my competitive efforts to take all the 
passengers in LaGuardia and nor is he. That's an airport where 
we actually had to find capacity limits, i.e., slots, and now 
we've, in effect, liberalized those.
    So it's going to be a public policy debate for the next two 
or three years. I think it's a tough problem.
    Senator Cleland. I wasn't going to get into this until the 
end of the--until I had asked some other questions. I might say 
now that since I'm the lone individual here----
    [Laughter.]
    Senator Cleland.--the future of American Airline travel is 
now in doubt.
    [Laughter.]
    Let me just get to a philosophical point here. And I don't 
really have an answer for it. I don't really expect you to have 
an answer for it. Just whatever reaction you have is okay. 
There's no right or wrong answer to this.
    In 1938, the Civil Aeronautics Board was formed, in effect, 
to promote domestic or commercial aviation, it seems to me, in 
both aspects. to look after the, quote, ``commercial side,'' so 
that we had viable commerce in airlines, and that was a good 
thing for America, and we grew our airlines.
    Second, though, that the public interest was served, and 
under that sense, basically, every flight, every ticket 
basically, every move that an airline made was, quote, 
``regulated,'' and it had to kind of check off with this 
Airline Aeronautics Board.
    There was control, there was coordination. There was a 
certain sense of a national system being worked. You take that 
off, in effect, you take off the gloves, and it's American 
versus Delta, it's grab it and growl. It's go after the market, 
and if you don't do that then you don't survive. Survival of 
the fittest.
    However, the problem is, we didn't deregulate safety. We 
didn't automatically build in capacity when you increased by 
300 percent your customers.
    So we deregulated, in effect, the economics of air travel, 
but we didn't deregulate the capacity that actually determines 
your market and your ability to serve your market.
    It seems to me that we're kind of sown to the wind, we're 
reaping the whirlwind now that we've kind of skimmed off the 
best aspects of deregulation. Lower ticket prices by 40 
percent. Mr. and Mrs. America, you can fly. And you can have 
more choices of where you go and how you get there. Good for 
the consumer, looked like deregulation, quote, ``great idea.''
    The problem is now everybody goes to DFW at the same time. 
Over 50 airlines scheduled 50 landings at the same runway in a 
five-minute period of time--the runway only handles 34 or 37 on 
a great day, 24 on a bad day--and we've got this gridlock choke 
points and deteriorating service, deteriorating perception of 
airline service and so forth.
    We are, I think beginning to reap the whirlwind of 
deregulation. I'm not sure where we go next. I realize your 
emphasis in the private sector now is not so much airline as a 
service but airline as a business. You've got to make a profit, 
and you've got to move forward, and you've got to expand your 
customer base.
    The problem is, over here, we have a limited amount of air 
traffic controllers, we have a limited amount of runways, and 
we have a limited amount of air space, and I'm not sure what we 
should do. I think if we just increase a little bit of that, 
we're just dealing with the problem of the edges. You're still 
going to be pressured to expand your markets forever.
    I think we're somewhat in a Catch-22 here. I realize the 
demand that you have, but I also realize the realistic point 
that so much of what you need is really out of your control, 
and that somehow we have to begin thinking again of this whole 
thing as a system, to plug in some of the public interest 
aspects of it as well as the private profit aspects of it and 
see if we can't come up with some innovations here, not 
throwback to maybe total deregulation but at least some 
consideration for benchmarks that four runways can only handle 
so many aircraft.
    There's only so much tin you can put in the air and so much 
tin you can put on the ground safely. And then if you go beyond 
that, I think that's what the benchmark is all about. If you go 
beyond that, you're now in a risk zone, and the more you go 
beyond that, you're incurring additional risk, additional 
delays, and additional problems.
    I think that's what the benchmark is all about, and it 
gives us part of what I think we're after, and that is, some 
basic definitions that we can all agree on, that here's this 
standard, and if we go here, we've got a problem. If we meet 
the standard, we should be OK. That kind of thing.
    Also, a realistic assessment that the public out there can 
evaluate the rest of us on.
    Captain Woerth, let me just say that some cargo airlines 
are experimenting with a satellite and cockpit bay system, in 
which planes signal their locations to each other. I'm told 
that it could allow pilots to fly closer together at their 
discretion, thereby increasing the capacity of air lanes. Do 
you have any reaction to that?
    Mr. Woerth. Well, our public policy statement as to traffic 
separation still believes the absolute safest way to do that is 
with the help of air traffic controllers having third parties 
separate us all.
    I have no trouble having more knowledge in the cockpit, 
having that information to us, like we have in TCAS and other 
things. We'll accept any amount of information we can get to 
help it be safe, but the primary responsibility that I think 
will ensure the safest air traffic between the cargo planes and 
passenger planes will be with our brothers at the Air Traffic 
Control Association.
    Senator Cleland. Mr. Carr, ultimately, you and your people 
are the traffic cop on the block.
    Mr. Carr. Yes.
    Senator Cleland. The traffic cop is not running for mayor. 
He doesn't want to get the most votes, but he's the guy that 
enforces the neighborhood and makes sure it's safe.
    So you're the man. I mentioned earlier, a little bit 
joshing but not really, about air traffic controllers being 
happy in their work. What do we need to do keep our air traffic 
controllers, our traffic cops out there, that want to be on the 
beat? They volunteer for this duty? It's a tough duty and tough 
responsibility, and it isn't like airline flying itself. It is 
an unforgiving before. And what do we need to do to keep your 
folks happy and to move forward in this business?
    Mr. Carr. In my person opinion and in the opinion of the 
people that I represent, if the will of the Congress and the 
American people is to create open-ended capacity with unlimited 
growth potential at the top, we need to start pouring some 
concrete. There just simply are not enough runways, taxiways, 
terminals or gates to accommodate the projected growth in 
passenger volume between now and 2010.
    We are happy, by the way, and we appreciate your comments, 
and sincerely appreciate your support of our organization, 
Senator.
    We like to be involved in the solutions on the front end so 
that we don't have to mitigate the impact of bad decisions on 
the back end. I believe----
    Senator Cleland. Can we talk about that for just a second.
    Mr. Carr. Absolutely.
    Senator Cleland. Do you think you'll have some input in 
defining some of these capacity benchmarks since your people 
live with every takeoff and every landing and probably have a 
good feel as to what capacity on a good day should be, what 
that benchmark would be?
    Mr. Carr. I would expect that we would. Actually, our 
organization has built a very collaborative relationship with 
Administrator Garvey and with the FAA and as opposed to a 
traditionally perhaps adversarial labor management 
relationship, we very much find ourselves in the same lifeboat, 
and we're both going to have to row to get where we're going.
    They have welcomed us on with open arms on the front end of 
many of their projects, and we look forward to a continuing 
good relationship with the FAA. We believe it is a real 
partnership that has potential to grow the system, to increase 
capacity, to improve relationships, not only with the users but 
with the stakeholders and with the pilots.
    As I spoke to the chairman earlier, we are concerned that 
there is a need to decriminalize errors within the system.
    Five miles of separation is the legal minimum. 4.9 is an 
error. It is not necessarily unsafe, it's just one of three 
errors I get to make in my career before I go hungry. So we're 
very much concerned about that.
    Senator Cleland. It was a fascinating litany there that you 
mentioned about 1950's separation standards. 1960's something, 
and 1970's radar, and then 1980 something or other.
    We've been told, you know, that the FAA has got this 
advanced system out there, and it's only three or 4 years old 
and all this kind of stuff. But run that litany by us again one 
more time.
    Mr. Carr. Well, the radar system, the actual radar which 
reflects off an aircraft and comes back and tells us the 
position altitude, that technology has been around soon World 
War II, and radar is what radar is. It reflects of a target, it 
comes back, and there you are.
    It isn't substantially different now than it was then, 
except that the information it provides is much greater.
    Our radios have been improved, however, the technology, I 
would say, is still in the improvement stage. We're beginning 
new systems on line. And then the radar displays, the consoles 
and displays, thanks to Jane and the folks at FAA, are all new 
in every center in the country. Those are less than 36 months 
old at every air traffic control center in the country, and 
we're in the process of bringing a similar system to every 
terminal, but it's going to take time. There's over 170 of them 
that we have to install.
    And, again, we take the safety of the flying public as our 
first and primary goal, so we're not going to throw a bunch of 
scopes in, plug them in, sign off on the warranty, send in the 
card and be happy with it. It takes some time.
    But we're very happy with the progress of modernization. 
But the separation standards that we use are archaic, they're 
ancient. Three miles and a thousand feet has been around since 
the advent of aviation. And to be perfectly honest with you, on 
behalf of my friends, the pilots, ``see and be seen,'' is still 
the bottom line separation standard to which they are held, 
even when they operate in clouds.
    I think that's old and it could use some review.
    Senator Cleland. Thank you very much, our distinguished 
panelists. Mr. Mullin and Mr. Carty, thank you for being here. 
You can count on me to help expand capacity. Captain, we'll 
continue to follow our wonderful pilots into the air. And, Mr. 
Carr, thank you for helping us all stay safe.
    Thank you very much, Mr. Chairman.
    The Chairman. Thank you, Senator Cleland.
    Senator Rockefeller. One observation. Every time--I keep 
coming back to this point just simply to make it--every time 
now I walk through a large airport, in my mind, in my eye, I am 
able to, with amazing accuracy, double everything that I am 
looking at. Double the passengers, double the gateways that 
aren't there, double the airplanes that will be there in 8, 10 
years. So, again, this illustrates the urgency of all of this.
    Let me ask a couple of questions, and I know you've been 
here for a while.
    It is a fact and I'd put this to all, although it's 
obviously directed more at Mr. Mullin and Mr. Carty--that there 
is overscheduling.
    One of you did indicate that a vacuum cannot be allowed to 
stand because somebody else moves into it, that you are in a 
classically competitive business, and therefore it's sort of a 
chicken and egg question. You're overscheduling and yet you 
can't afford not to. So what can possibly happen on that?
    Well, one of the things that I suggested in my opening 
remarks is that you could be nervous about antitrust laws. You 
can't meet, you can't talk about, well, I'll do this if you'll 
do this, which would in fact be in the public's interest. You 
know, I won't schedule these operations if you won't schedule 
those flights, which would in fact be in the interest of delays 
and probably national aviation policy. It would probably be in 
the interest of it, but you can't do it.
    Do any of you have any thoughts as to ways around that or 
possibilities of DOT using its existing authority--I don't 
know, I'm not a lawyer so I don't know how to phrase the 
question. But do you understand what I'm asking?
    In other words, antitrust may stand in the way of sensible 
and safe aviation travel in that area.
    Mr. Carty. Yes. I think, Senator, that none of us want it 
to stand in the way of safe transportation, and I don't think 
it has. I think the implication is all back up on the service 
side, to dependability and reliability, because these guys, nor 
do the corporate cultures of the big airlines are going to 
tolerate an unsafe air system. It's not in any of our 
interest----
    Senator Rockefeller. I'm not questioning that. I'm not 
questioning that.
    Mr. Carty. So when an airport gets over capacity, it's a 
service issue. And it is true that in the past on a couple of 
occasions the government has sought ways to provide antitrust 
immunity for airlines to sort out schedule problems for various 
reasons, and it could be done.
    I would go back, I think, to Leo's comment, is that it's 
not the ideal solution, because in effect what you're doing is 
you've got creeping re-regulation of the business going on 
again. Because we haven't provided the infrastructure to really 
let it rip, we are saying to ourselves we're going to limit the 
marketplace in some way, either by telling Delta and American 
through a slot mechanism that they can't fly or agreeing that 
Delta and American should get in a room and sort out the 
LaGuardia problem.
    Either thing is probably adverse to providing the kind of 
capacity that the economy in the market is demanding, but, as 
you point out, might well be consistent in a very short term 
with improving service in the industry.
    There is no question 2 days in a room with all the airlines 
that fly airplanes in LaGuardia, you'll have a LaGuardia 
schedule that will work. There's no question about that.
    Each time the airlines have been granted antitrust immunity 
to sit down and talk about a scheduling problem, they've always 
sorted it out. There was a time a number of years ago when 
there was some transcon capacity issue, and the government was 
very worried about it. I think the meeting took 20 minutes, and 
flights were eliminated. So it can be done.
    But I go back to Leo's opening comments. It's not really 
what any of us and, more importantly, our economy is looking 
for. We're putting constraints on the natural marketplace.
    Senator Rockefeller. You are by doing that. But I then go 
back immediately to my 10 years hence scenario. When everything 
today is doubled, does that change things at all? Leo?
    Mr. Mullin. Just an elaboration because I agree with what 
Don said. I think, Senator Rockefeller, that if we do that it 
is just short-term. I think while you stepped out, I just made 
the observation that America is about growth. And we've all 
talked about the 1 billion passengers, and you had your own 
visualization of it when you walked through the airport, and 
it's going to be 2 billion passengers by the year 2020.
    This problem is going to be with us all the way along. What 
we've got to do is get the solution for the whole long-term 
problem. So if we get together in LaGuardia, which is 
desperately in need of some kind of solution, by the way; and 
I'd almost advocate doing this because it's kind of sick up 
there right now.
    But I would really only want to have that privilege for a 
very short period of time and then get at the hard work of the 
long-term solution.
    Mr. Carty. If I could, I'd like to comment on a question 
that you asked earlier that is related, and that is this 
question of whether the Federal Government needs to do more to 
incentivize the kind of airport development that needs doing.
    I really do think we've become subject to the tyranny of 
the minority in a number of communities. All those folks that 
travel in and out of O'Hare, most of whom live in Chicago and 
are fed up with being on the runway, are being held hostage by 
a very limited political interest around O'Hare airport that is 
blocking another runway. That runway should happen, whether we 
build another airport in Chicago or not. The current activity 
in Chicago dictates another runway in Chicago.
    The city of Boston has needed another runway for a long 
time, and we are still waiting for that.
    These are very tough issues, and I have the good fortune 
not to be a politician so I don't have to be buffeted by all of 
these influences, but from our perspective it seems so clear 
that the majority of people using an airport in many of these 
cities, many of them actually live and work in those 
communities, want more capacity and better service, and in most 
of these cases, there is a tyranny of minority that has tied 
them up in the courts and making runways that should take 2 or 
3 years take 8 or 10.
    Now the good news is we can do it faster than Europe. The 
bad news is we do it a lot slower than they do at Asia.
    Senator Rockefeller. All right. Thank you.
    I think everything should be on the table again if we're to 
move forward on this.
    This is put in an entirely constructive way, and I'll start 
out by giving it a predicate: Back in the late 1960's and 
1970's in West Virginia, when there was a dispute, a labor 
management dispute, between coal companies that didn't want to 
do anything and unions who had problems at the face of the 
mine. So we were living under a regime of TROs, temporary 
restraining orders, and nobody was mining coal, and West 
Virginia's unemployment continued to increase its lead over 
every other state. So that was bad for the state.
    Then, it's hard to even trace the date or the conversation, 
but folks got together, and they said, this is hurting us, this 
is hurting our company, this is hurting our union, this is 
hurting production being on strike. And there was the culture 
of non-giving on both sides.
    I'm not saying that this is true in your case, but it was 
true at that time. There was an ethic that you simply didn't 
give. You went to court before you gave anything at all.
    Now the United situation forces us to look at this 
question. I think if everything is going to be on the table, in 
terms of labor management relations in the airline industry, in 
the next 10 years, as we are overwhelmed by what the Secretary 
indicated would be runways that would be built on time, and I'm 
questioning whether or not that's true.
    What you can build for $100 million in Boston may take $850 
million in St. Louis, depending upon lots of things.
    For example, I have no idea what went on in all of that, 
and I'd say referring generally to the situation. I have no 
idea what the result of all of that was.
    But what if the result were such that United were unable, 
for example, to take more of the strike and thus gave wage 
increases or benefit increases, that they were able to pay but 
that other airlines would not be able to afford.
    But then if there were, generally speaking, a sort of 
tradition of parity within the airline industry, that then 
caused other airlines to fail, or something short of that word. 
That was a little bit too dramatic. And that, in turn, came 
back to hurt a number of pilots or other folks who belong to 
unions.
    So what I'd like to get from both management and labor is 
how you see the current crisis, the urgency of the solution, 
what Mr. Carr said in terms of working together--having found a 
relationship with Jane Garvey, and I understand that, because I 
think she's not only superb but wonderfully easy to work with. 
And I'm not assuming that it could be any different otherwise.
    But can you just give me a sense of whether anything has 
changed? Do either sides see a different responsibility in 
terms of this doubling of traffic and all the rest of it? I've 
double-asked the question.
    Mr. Woerth. Well, Senator, I think everybody at this table 
supports a collective bargaining process. There is just no 
substitute in a free society, and it has its rocky moments, and 
it has its smoother moments.
    Right now, we're probably having a time where there's a lot 
of focus, and particularly in our industry, because we can't 
get out of the newspapers no matter what we do. I mean, we're 
on the front page of every paper, we're on the TV every day. 
It's because of the importance of our industry and the 
frustration with the delays. This is probably the fourth or 
fifth hearing we've held on it, so we're more under the 
microscope than ever before.
    But I don't think the fundamentals of the give and take of 
collective bargaining has changed all that much, especially in 
our industry. I think it should be also noted that people 
forget--and Secretary Slater mentioned it--the first half of 
this decade was a very terrible time financially. We thought we 
were going to lose the whole industry. Where was the bottom?
    President Clinton formed a special commission. We were 
troubled, about how this industry was even going to survive.
    We did start to turn around in the mid-1990's and had some 
good years profitability since.
    I think it needs to be said and recognized in those early 
1990's, there was a tremendous amount of concessions and give 
backs, and understandably so. if you're going to save your 
airline, somebody is going to have to do something.
    And now there is a little bit of pent-up demand and some 
impatience. People are looking at a successful marketplace, and 
they want to regain certainly what they gave up.
    We constantly refer to that. Airline passengers, there's 
three times more of them flying since 1978, and it is 40 
percent cheaper in real terms off their tickets, and that is 
wonderful.
    Even some of our best contracts today that we've 
negotiated, including the United contract, doesn't barely keep 
up with inflation over the last 20 years, even of the best 
contract we have.
    So collective bargaining is going to continue. We 
understand that if we frustrate the public too much or upper 
management upsets the public too much, the last thing I think 
either one of us wants, and I think the Congress wants, is to 
get back into our business, I think I certainly am committed to 
resolving this in the private sector. That's through collective 
bargaining, and we're committed to that.
    Mr. Carty. I think to some degree, Senator, my own 
perspective is that, to some degree in the last several years, 
we've kind of lost track of something Leo said earlier, that 
really this needs to be all about serving the traveling public, 
because the success of the employee and the success of the 
commercial enterprise is dependent on that.
    And there certainly has been some history, and Duane 
touched on some of it, the industry in real doldrums, and then 
finally digging their way out of it.
    There's some other history, too. The industry is changing, 
continues to change very quickly. The advent of a new 
technology airplane, the RJ; the advent of these international 
alliances, which I think makes the employees of every company 
feel a little bit insecure, is the enterprise trying to give my 
job to somebody else. And all that clouded by these economic 
issue that Duane referred to. In a way, I think we've lost our 
way a little bit.
    And I do think the United experience and a couple of 
experiences in the 18 months before that have sobered us all up 
a little bit.
    National Railway Labor Act was designed to allow the 
collective bargaining process that I think all of us endorse to 
occur in a way where the traveling public would not be harmed, 
or would at least have fair warning if they were going to get 
harmed, 30 days notice, a cooling off period.
    Unfortunately, the last 24 months that hasn't happened. The 
traveling public has been abused badly, and I don't think 
that's a unique responsibility of labor. I think it's a joint 
responsibility of labor and management to get focused on what 
the law is, remind ourselves.
    We need to insist that we all follow the law, and labor's 
got to also focus on the fact--I think Duane has a very good 
editorial he's put out in the ALPA magazine--on getting back to 
a collective bargaining process that really runs with the 
spirit of the law that exists and find different ways to begin 
thinking about negotiation.
    What do we have--what interests do we have that are common, 
to get back to your West Virginia story. Let's quit spending 
all the time on the things that divide us, the difficult 
contention that inevitably occurs by dividing up the economic 
pie, and let's get back to a relationship of trust that the 
management of these companies aren't trying to do away with 
their jobs, and let's look for common overlap of interest, and 
let's start the bargaining process by trying to agree on all 
the things that we share an interest in rather than all the 
things that divide us.
    And I think we can get back to healthier labor relations in 
this industry. We are certainly determined to do so at 
American, and I have a good sense that the leadership of our 
major labor unions are on the same page.
    Mr. Woerth. Could I add one thing, Senator?
    Senator Rockefeller. Sure.
    Mr. Woerth. I think maybe an appropriate analogy, since 
we're talking about ATC delays, I think we've all agreed that 
getting some of these contracts on time, that is adding to the 
frustration. I think we're all committed to getting these 
things.
    When they're amendable or expire, the closer we can do that 
and start early enough, and whatever processes we have to do to 
get them closer to their amendable date, the longer they run 
without a contract, an expired contract, the frustration 
builds. I think we're all committed to getting the closer to 
where we are on time, is not that much different than this 
industry. People would be a lot happier on time. Not just 
traveling public, but employees and shareholders alike.
    Senator Rockefeller. I just remember the difference that it 
made for a period of 15--well, actually, it still pretty much 
continues in West Virginia. Our problem has been mechanization 
of the minds. But the labor and management thing, it just 
completely changed because they decided that they are each 
losing in the process. I just wanted to put that on.
    I have a lot more questions I want to ask, but I can't, 
because I have to adjourn this hearing and open another one for 
some confirmation hearings.
    I thank you all very, very much, and you're free.
    [Whereupon the Committee was adjourned.]

                                APPENDIX

  Prepared Statement of Hon. Wayne Allard, U.S. Senator from Colorado

    Mr. Chairman, thank you for allowing me to contribute my comments 
as a part of the Senate Commerce Committee's hearings on air traffic in 
the United States. As you are aware recent issues affecting the major 
air carrier flying in and out of Denver International Airport have 
generated great interest in this issue in Colorado and the surrounding 
region. For several years now there has been a growing interest in 
consumer satisfaction with the airline industry and I am pleased that 
your timely hearings recognize the broad scope of this issue.
    I recently hosted a series of roundtable meetings in Denver with 
community, business, and government leaders concerning many of the 
important issues confronting the State of Colorado. One of the more 
interesting Roundtables each year is the High Technology Roundtable. 
The high technology industry has been increasingly drawn to Colorado 
due to many factors. Colorado is fortunate to have a number of 
nationally recognized research universities, a high standard of living, 
and an educated work force. The recent completion of a new high-
capacity international airport in Denver rounded out the qualities that 
large high technology companies look for when selecting sites for new 
facilities. It is no secret in state and local government that the high 
technology sector represents high paying jobs, a solid tax base and a 
clean industrial presence. I am proud of the State of Colorado for 
providing such an alluring draw for the industry that is playing such a 
vital role in America's economy.
    I am deeply concerned that a consistent theme at each roundtable 
was the ongoing and highly publicized problems in the passenger 
aviation industry. The lack of confidence in passenger airline service 
and the increasing stakes involved were clearly illustrated when one 
participant stated plainly that his company's business model, which 
included Denver and the Silicon Valley, was being modified due to a 
lack of reliable air service in and out of Denver. This only echos what 
hundreds of thousands of travelers have experienced as they have passed 
through Denver International Airport and other airports in recent 
years. The passenger aviation industry has become consistently 
unreliable with tremendous personal and professional costs for the 
people of Colorado. I feel that discussing flight delays and 
cancellations, airline scheduling, the increase in weather related 
delays, airport and air capacity are essential. I would like to focus 
my comments, however, on two issues that may not be getting as much 
attention as those most visible to the flying public; the impact 
``hub'' airports can have on a region and the modernization of the Air 
Traffic Control System (ATC).
    Many people have rushed to judgement on the air traffic issue based 
solely on the recent problems being experienced by United Airlines. In 
addition to being the nation's largest carrier, United has the lion's 
share of gates at Denver International Airport. While it is difficult 
to justify many of the problems numerous passengers have experienced on 
board United and other airlines this summer, I must make it clear that 
the labor and mechanical problems experienced by United do not appear 
to be specific to the airline itself, nor do the problems appear to be 
specific to the Denver market. I would assert that the difficulties 
experienced in Denver this summer are indicative of potential problems 
for a number of hub airports if the carrier they depend on for the bulk 
of their air service were to stutter for one reason or another.
    The current ``hub'' system allows a single carrier to practically 
monopolize the passenger traffic within a region. I have always held 
that increased competition would best serve the flying public. I do not 
believe that the current state of aviation reflects this value and 
consequently entire regions of the country are at the mercy of a single 
air carrier. This summer's problems experienced by United created 
enormous problems in the Denver area. Perhaps next summer similar 
problems will occur in Charlotte, Minneapolis, Miami or any hub airport 
where a single airline accounts for more than sixty percent of the 
market share (according to carrier filings with the Department of 
Transportation United maintains a 65.11 percent market share in Denver 
International Airport). I am respectfully submitting a series of charts 
from the March 28, 2000 Aviation Daily that documents the market share 
of U.S. carriers at leading U.S. airports.*
---------------------------------------------------------------------------
    * The information referred to has been retained in the Committee 
files.
---------------------------------------------------------------------------
    According to a 1999 Consumer Reports survey hub airports where 
passengers lack choice tend to have higher air fares. The survey 
indicated that passengers buying restricted coach-fare tickets can 
expect to pay $25 to $55 more per round trip ticket for journeys 
covering more than 1,600 miles. For airports that serve a large region, 
such as Denver International, consumers are captive not only 
geographically but may also be at the mercy of a large provider. On a 
related note a hub airport that experiences delays by a large carrier 
must redistribute passengers to other airlines. This can dramatically 
lower the on-time percentage of secondary or tertiary carrier as well 
as the overall on-time rating of the entire airport. It is important to 
note that the overall costs of tickets and on-time percentage 
contribute to the overall perception of an airport by consumer groups 
and frugal business or recreational travelers. I believe the answer is 
more competition.
    Prior to United Airlines recent delays and cancellations based on 
high profile labor issues, there existed what many carrier's recognize 
as an increasing problem with delays and cancellations due to the Air 
Traffic Control (ATC) system. The number of weather and ATC delays for 
United Airlines have increased 65% since 1995. The increase in these 
uncontrolled delays are more stark when compared with controlled delays 
such as crews, maintenance and other operational irregularities. 
United's controlled delays, weather and ATC related delays, have 
decreased by 24% since 1995. Clearly there is reason to include a 
comprehensive study of recent changes and problems with the Air Traffic 
Control system maintained by the Federal Aviation Administration in any 
discussion relating to air traffic.
    Almost one year ago the FAA began to centralize the operation of 
the air traffic system's collection and dissemination of weather data. 
In place of individual airlines' meteorologists and regional weather 
forecasters all weather data is now routed from regions all over the 
country to an FAA facility in Herndon, Virginia. From Virginia the FAA 
now issues directives to reroute or ground air traffic. On more than 
one occasion this summer there has been significant disagreement over 
whether decisions to close or reroute traffic have been valid, and 
further, whether the decisions were able to be made objectively from 
the centralized Virginia headquarters.
    In fairness to the FAA it is important to note that the 
centralization of weather data was supported by the carriers following 
the summer of 1999 and previously unequaled congestion and delays. 
Based on data from the summer of 2000 the solution, however, appears to 
have been misdirected. I respectfully submit a September 14, 2000 Wall 
Street Journal article entitled ``Efforts to Ease Delays In Summer Air 
Travel Also Produce Snarls'' which examines the most recent problems 
with this centralized system.
    Given the current questions surrounding the ATC system, and the 
estimated 600 million Americans flying each year, it is important that 
the ATC system be made more responsive and efficient. At the same time 
I believe that we would be well served to examine the recent 
privatization of air traffic control in Canada. I understand that this 
is an issue that may be beyond the scope of the current Commerce 
Committee hearings, but I respectfully request that ``Commercializing 
Air Traffic Control'' by Robert W. Poole, Jr. of the Cato Institute 
also be submitted to the record.
    Thank you for your consideration and your willingness to explore 
these issues. I look forward to working with the Commerce Committee on 
the important issues affecting passengers and airlines in the months to 
come.

                                 ______
                                 
                        The Wall Street Journal
    September 14, 2000

                           Under the Weather
    Efforts to Ease Delays in Summer Air Travel Also Produce Snarls
   FAA's Centralized Controls, New Radar Screens are Cited for Lost 
                               Efficiency
                       `Things Really Got Hairy'
                           By Scott McCartney

    Staff Reporter of the Wall Street Journal
    The passengers at Newark International Airport found themselves in 
an all-too-familiar situation: Delayed. All flights were being held for 
an hour because of thunderstorms.
    But on this clear August afternoon, the only thunderstorms in the 
country were hundreds of miles away, in a corner of Oklahoma.
    Another day, flights from Chicago to New York were grounded because 
of thunderstorms--in Florida.
    How could this be?
    The summer of 2000 was a painful low point for airline delays. 
Throughout the long months, as hundreds of thousands of passengers 
simmered on tarmacs and in waiting lounges, aviation officials 
typically blamed the season's bad storms--plus a combination of too 
many planes, not enough runways and a United Airlines labor dispute. 
But the real problem may boil down to this: a series of little-known 
changes at the Federal Aviation Administration.

Losing Flexibility
    Those changes, ironically, were intended to ease the crippling 
delays that had made the previous summer the all-time worst for delays. 
At the time, President Clinton and the FAA pledged to work with the 
airline industry to fix gridlock in the skies. The basic idea was to 
centralize the agency's operation of the air-traffic system, and to 
improve the FAA's technology and communication with airlines.
    In the end, though, the airlines and even the FAA's own air-traffic 
controllers complained that the centralized system stripped them of 
flexibility in dealing with local traffic jams. Planning sessions 
sometimes degenerated into expletive-filled screaming matches. 
Controllers also groused that new technology gave them an incomplete 
picture of regional weather.

`Significant Change'
    The FAA concedes that there have been difficulties, but says its 
new efforts reduced delays below what they might have been this year--
though a thorough evaluation won't be completed until the fall. ``I 
don't think there's any way of minimizing it. This was a difficult 
summer,'' says FAA Administrator Jane F. Garvey, who got stuck in 
airports herself over the summer. ``This is a very significant change 
in the way we do business.'' Today, the Senate Commerce Committee 
begins hearings into what caused the summer's delays.
    The U.S. air-traffic system basically comprises all control towers 
at the nation's airports, plus the 21 regional FAA control centers that 
direct planes most of the way between takeoff and touchdown. Overseeing 
all of this is the FAA's main command center in Herndon, Va. In the 
past, the individual towers and regional centers would each manage 
flights as they wanted, with little national coordination. They used 
their own weather forecasts, which often contradicted each other, or 
forecasts from airline meteorologists. The result tended to be a 
hodgepodge of arbitrary local decisions that could seriously bog down 
certain regions.

A Uniform Forecast
    In attempting to fix the system, the FAA decided last winter that 
meteorologists from the major airlines and the National Weather Service 
would collaborate twice a day to produce a uniform forecast map of 
severe weather areas, and to give all control centers and carriers 
access to the map by computer. The agency's command center in Herndon 
also instituted a telephone conference call every two hours with most 
of its regional centers and any airline that wanted to join in. That 
way, ideally, decisions to ground or reroute planes could be made with 
input from everyone.
    Some days this summer, participants say, the process was relatively 
smooth. But not always. On Aug. 17, for example, airline and FAA 
officials agreed during an early-morning conference call to delay 
operations at Chicago's O'Hare International Airport because of storms 
in the area. Airlines agreed to cancel some flights but continued to 
count on others, based on an understanding that the FAA wouldn't shut 
off all traffic. Yet by 9 a.m., with no change in the weather, the FAA 
command center in Hem-don suddenly ordered a stop to all traffic, 
leaving everyone stranded. Airlines were furious, and problems at 
O'Hare cascaded into a chaotic day across the country.
    Two days earlier, arrivals at New York's LaGuardia Airport were 
ordered reduced to 30 an hour from the because of scattered rain 
showers. Such conditions normally cause delays of about an hour. But 
because of poor coordination and excessive slowdown orders, only 20 
planes an hour landed, and delays topped three hours. At least one 
airline lodged a written complaint with the FAA the next day.
    The FAA's Mrs. Garvey wouldn't comment on specific routing 
decisions, but says, ``I think legitimately airlines will ask, `Are we 
being too conservative when we put in a [delay] program? I don't think 
we have the full answer.'''
    Mrs. Garvey notes that the airlines themselves asked for more 
centralized control after the disastrous summer of 1999. ``The 
customers themselves said what we need is centralized decision 
making,'' she says. ``Unless you have somebody really calling the shots 
who looks at the whole system, you have individual decisions being made 
that may be good locally, but can screw up the whole system.''
    No one in the aviation industry is seriously arguing for a return 
to the old, decentralized system. And two carriers, Northwest and 
Continental, have publicly praised the new system. It's also not an 
issue of safety: Neither the airlines nor the FAA's regional centers 
contend that planes should take risks in stormy weather. Rather, their 
claim is that the command center in Herndon consistently overreacts and 
ignores evidence from pilots and regional controllers that the weather 
in certain areas is better than the national map suggests.
    For example, just one day after the Aug. 17 O'Hare debacle, the FAA 
command center in Herndon declared that two major air routes for jets 
running along the East Coast were impassable because of a storm in 
Virginia. Planes in Miami trying to get to New York and Boston were 
grounded. The closure forced a massive rerouting of traffic reaching as 
far. west as Chicago and Houston.

Flying in a Storm
    Yet even as the conference call blared on a speakerphone at one 
major airline's operations center, the flight dispatchers saw on their 
radar displays that planes already flying in the stormy area were 
experiencing no problems--and the storm actually was moving slowly 
offshore. As the conference call continued, a Delta Air Lines jet flew 
above the bad weather. Several corporate jets flew right through It. 
The airline dispatchers pointed to the planes on a color monitor, 
shaking their heads in disbelief at the orders coming over the 
speakerphone.
    Before the new system, the FAA wouldn't have demanded the delay in 
Miami, dispatchers say. Regional centers would have allowed flights out 
of Florida to take off, zigzag around the highest storm clouds, or fly 
over the top of the system. If traffic got too heavy, some might have 
been ordered to fly holding patterns for a time. Delays would have been 
contained, airlines contend.
    But the Miami mess was repeated across the country all summer, say 
airlines and air-traffic controllers. Randy Schwitz, executive vice 
president of the National Air Traffic Controllers Association, the 
union representing air-traffic controllers, says that on some days the 
FAA closed airways simply because of forecasts of bad weather, which 
often didn't materialize. Then, while those clear skies were empty, 
storms popped up in the very areas where the FAA had sent large numbers 
of planes.
    ``That's when things really got hairy for controllers,'' says Mr. 
Schwitz. He nonetheless supports the FAA initiatives this year, 
agreeing that the summer would have been far worse if not for the 
centralized system. NATCA says the root of the problem rests with 
airline scheduling at peak hours, and a lack of airport expansion.
    Indeed, the nation's skies have grown more crowded everywhere. 
Airlines jam flights into peak business-travel hours, and create delays 
by flooding hub airports with dozens of flights at the same hour. 
Airport construction, too, hasn't kept pace with the nation's economic 
boom.
    Transportation Secretary Rodney Slater, who plans to testify today 
along with several airline CEOs at the Senate hearing, attributes the 
problems of the past two summers to the strength of the economy, which 
has filled airplanes to record levels. ``It's really tested the limits 
of capacity of the system,'' he says. The Transportation Department 
couldn't have foreseen the rapid growth, he said, and Congress in the 
early years of the Clinton Administration didn't allocate funds to 
embark on massive improvements.
    But while delays have skyrocketed the past two years, the total 
number of flights has been growing no faster than 4% a year, the FAA 
says. At the 22 largest airports, the number of flights were up only 2% 
a year for the past two years. The FAA says even a small increase is 
significant in an already-strained system, especially since the 
expansion has been focused on the crowded skies of the East.
    Weather has been unusually harsh this summer, also mostly in the 
East. In June, a month when delays exceeded last year's record pace, 
the FAA had to take action because of thunderstorms on 24 days, 
compared with five in June 1999. July was calmer than last year, but 
the early part of August was worse than last year. (Final data for the 
month haven't been tabulated.)
    At the same time, travelers had to contend with troubles at UAL 
Corp.'s United, the nation's largest airline, as pilots refused to work 
overtime while contract negotiations reached a climax. The unrest 
forced thousands of cancellations, and fewer than half of United's 
flights operated on time in June and July. (United reached a tentative 
agreement with its pilots union in August.)
    Still, the airlines maintain that the FAA only made matters worse. 
``The problem with this summer is the inefficient manner in which 
severe weather avoidance is executed,'' says Jack Ryan, vice president 
of air-traffic management at the Air Transport Association, an airline 
trade group. ``There's got to be a better way to do this.''

`Let My People Go'
    Mr. Ryan, a former director of air-traffic operations at the FAA, 
was so outraged on the day that Newark flights were delayed an hour 
because of thunderstorms in Oklahoma, 1,200 miles away, that he called 
John Kies, the head of the FAA's Herndon command center, demanding an 
explanation.
    ``I told Kies, `Let my people go!'' says Mr. Ryan. (An FAA 
spokesman says Mr. Kies is traveling in Europe and isn't available to 
comment for this article.)
    At times, participants say, the FAA's conference calls degenerated 
into heated battles between the Herndon command center, regional 
centers and airlines, with regional centers sometimes openly refusing 
orders from the central command.
    On one hectic, stormy day in June, according to people on the phone 
at the time, the Herndon center ordered the regional center in 
Cleveland--which is responsible for a wide swath of airspace from 
Detroit to Buffalo, N.Y.--to keep jets spaced 20 miles apart. Seven to 
10 miles is considered normal spacing; five is the minimum. Still, the 
Cleveland center was particularly overburdened that day, and officials 
there wanted extra space to lighten the load on controllers and give 
them more room to maneuver airplanes. With airline dispatchers and 
other FAA regional centers listening, the response from Cleveland was 
emphatic: ``F--you, we're doing 60 miles!''
    Steven J. Brown, the FAA'S associate administrator for air-traffic 
services in Washington, acknowledges that the agency heard ``some testy 
and rough dialogue'' during conference calls. ``To a degree, that's a 
measure of success. We're open, in public, with maybe some professional 
warts showing.'' In that particular case, he noted, the extra airspace 
was granted, and ``the position Cleveland was articulating was 
important because they're on the front lines.''
    By midsummer, conference calls got so fractious that the major 
airlines decided to hold their own daily private conference call to 
prepare a unified front for the FAA. And in August, Mr. Kies began 
having his own separate daily briefing with airlines to discuss the 
problems of the previous day.
    Some of the trouble this summer actually resulted from new 
technology. For example, radar displays the FAA installed at all its 
centers last year--while hailed by controllers for their reliability, 
added features and ease of use--have a serious drawback: The displays 
lack crucial data on the height of storm clouds, which is found on 
weather radar displays commonly used by TV news stations and pilots. 
Airlines complain some controllers are rerouting airplanes around 
storms they could easily fly over or zigzag through. The FAA monitors, 
with their H-shaped symbols and stark lines indicating storms, also 
make some weather systems appear worse than they are, airlines say.

Even a Few Clouds
    Southwest Airlines, for example, says it's had to reroute flights 
in some areas of the country because controllers using the system 
perceive more clouds. Earlier this summer. even a few clouds in Phoenix 
caused delays that forced planes to divert to Tucson to refuel. ``We 
can't figure out why. In St. Louis, that would be great weather. But in 
some places, a few clouds mess the whole thing up,'' says Greg Wells, 
director of flight dispatch at Southwest.
    Mr. Brown of the FAA says the new displays were ``a great step 
forward. But we've had a learning curve with it.''
    Some of the biggest jam-ups this summer occurred in airspace 
controlled by the Cleveland center, a nondescript building in a 
pastoral setting near Oberlin College that's the busiest air-traffic-
control facility m the world. Along with the Washington regional center 
in Leesburg, Va., it is the funnel into and out of the Northeast, and 
handles a heavy load of complex routing.
    In Cleveland, strains developed earlier this year when the FAA 
beefed up staffing in its traffic-management units, the group of 
controllers at each regional center who coordinate the flow of 
airplanes by assigning takeoff times to jets. These traffic managers 
interact with other FAA staffers called radar controllers, who are each 
assigned a sector of the sky and direct the lanes to their 
destinations.
    The radar controllers and airline dispatchers say traffic managers 
assigned airplanes to sectors that weren't expecting them, for example. 
``In some centers, the traffic-management unit is not communicating the 
plan to the controllers,'' says Jim Sinon, Continental's director of 
air traffic systems, and a former FAA air-traffic-control official.
    Richard Stose, a veteran radar controller at the Cleveland center, 
says he was verbally reprimanded by traffic-management officials for 
giving several delayed flights a 90-mile shortcut to LaGuardia Airport. 
He had already cleared the move with controllers at the FAA'S regional 
center in Ronkonkoma, N.Y., who were showing plenty of empty air space 
in their area. ``So many decisions,'' he says, are coming out of [the 
Herndon command center] and the traffic-management unit ``that they 
don't leave us any flexibility,'' he says. ``It's just a travesty.''
    The FAA says it is still working on traffic-management 
coordination. To improve communications, special message boards are 
being installed in centers showing routing plans for the day. 
Sometimes, officials note, it's the controllers at the radar screens 
such as Mr. Stose who foil plans because they don't see the big 
picture, and try to fill gaps that are needed for airplanes down the 
line.
    Not all of the summer's slowdowns could be blamed on the FAA's 
command center in Herndon. For example, one decision that seriously 
delayed traffic through Mr. Stose's sector, which covers western New 
York, emanated from controllers at the New York regional center. 
Starting in June, they said that corporate jets flying into New 
Jersey's small Morristown and Teterboro airports must be spaced at 
least 10 miles apart from airliners bound for New York's John F. 
Kennedy Airport at peak times. Usually, the corporate jets fly at lower 
altitudes on the same arrival patterns, stacked under the larger jets.
    The separation requirement, which the FAA says isn't used every 
day, created major backups all the way into the Midwest. Delays at JFK, 
which typically ran better than LaGuardia or Newark in prior years, 
were just as bad as the other major New York airports in June and July 
this year.
    The FAA says the change was necessary to slow down traffic to meet 
the capacity of the three airports, and because just one controller in 
the New York center handles arrivals to all three airports from 
Cleveland's airspace.
    By the end of this month, the FAA says it will have fully evaluated 
its summer operation. Already, the FAA has identified seven key choke 
points in the system, and is rushing to fix many by next summer. A 
preliminary tally of delays shows this summer was about equal to last 
summer's record-setting travel snarl, when 163,486 flights were delayed 
an average of about 45 minutes each in a four-month period.
    Mrs. Garvey, the FAA administrator, concedes the agency has had 
pains implementing its new approach. ``We've had a difficult time to 
get all of [the regional centers] to buy into it,'' she says. After 
more study this fall, she says, ``If we need to make more 
organizational changes, we'll do it.''

                                 ______
                                 
              On the Runway: New Systems to Reduce Delays
                           By Scott McCartney

    While travelers fumed on grounded airliners this summer, the 
Federal Aviation Administration was working on new procedures and new 
technologies to increase capacity in the sky.
    Jane F. Garvey, FAA administrator, says one major change is that 
air-traffic contro1lers are actively involved in technology 
development. ``I think we have turned a corner on modernization of the 
air-traffic control system,'' she says.
    Here is a look at some of the more promising projects.

   User Request Evaluation Tool. Believe it or not, current 
        air-traffic control radar displays can't predict conflicts 
        between airplanes. The URET, which is already in use at two of 
        the FAA's 21 regional centers, in Indianapolis and Memphis, 
        Tenn., identifies potential problems in advance, giving 
        controllers more flexibility and the capability to safely 
        handle more airplanes. Requests from pilots can be plugged into 
        the URET to see if they create any conflicts. So far, the 
        system is cutting an average of one mile off the route of every 
        flight within its region, the FAA says. The FAA's goal is to 
        install the URET in five more regional centers, including the 
        three busiest, Cleveland, Chicago and Washington, by the end of 
        2002.

   Traffic Management Adviser. This helps controllers space 
        planes as they approach airports to maximize runway usage. If 
        landings are set at 80 an hour at an airport, for example, the 
        system helps make sure that controllers deliver 80 airplanes an 
        hour. TMA is in use at Dallas-Fort Worth International Airport, 
        and it helped increase capacity at the airport by 5%. In June, 
        it went online in Minneapolis.

   Passive Final Approach Spacing Tool. This system works with 
        the Traffic Management Adviser to help maximize the number of 
        planes a runway can handle. It assigns runways and lines up 
        aircraft. At Dallas-Fort Worth, it has boosted landings by five 
        or six airplanes during each peak rush, the FAA says. It has 
        also increased the rate of departures at the airport. By the 
        end of next year, the FAA hopes to have both systems installed 
        at five other major airports.

   Precision Runway Monitor. This system allows parallel 
        approaches to closely spaced runways. Currently, capacity at 
        several key airports is hampered in low-visibility conditions 
        because runways are spaced too close together for parallel 
        landings. When visibility is good, parallel landings can be 
        made because planes see each other. But in San Francisco and 
        many other airports with parallel runways closer than 4,300 
        feet apart, low visibility can cut capacity in half.

      LUsing very precise radar that makes a complete revolution every 
second instead of every four seconds for conventional radar, the 
Precision Runway Monitor lets planes make parallel approaches to 
closely spaced runways when they can't see each other. The system is in 
use in St. Louis and Minneapolis, and is slated for installation at 
Philadelphia and New York's Kennedy Airport.

   National Airspace Redesign. The grandest project of all, a 
        complete redesign of the skies, should improve traffic flow and 
        erase bottlenecks, proponents say.

    The FAA'S Mrs. Garvey says the redesign will take eight years.
    Many of the changes under study in the redesign project could 
significantly boost capacity. For example, the FAA is considering 
reducing the number of regional centers, thereby eliminating artificial 
traffic boundaries and barriers.
    The agency is also hoping to reduce vertical-separation limits to 
1,000 feet from 2,000 feet, which would require all planes to be 
equipped with precise altitude-reporting equipment. Already, flights 
across the Atlantic and Pacific oceans operate with the narrower 
separation.
    And instead of two controllers handling a chunk of airspace--one 
for low altitudes and one for high altitudes--the FAA hopes to increase 
capacity by creating a third position for jets at very high altitudes. 
This has already been done in--the airspace managed by the Cleveland 
center, but the FAA says it needs more radio frequencies and manpower 
to do it elsewhere.

                                 ______
                                 
  Commercializing Air Traffic Control A New Window of Opportunity to 
                          Solve an Old Problem
                         by Robert W. Poole Jr.

    Robert W. Poole Jr. is president of the Reason Foundation and a 
long-time transportation policy analyst. A former aerospace engineer, 
he holds BS and MS degrees from MIT. He has been researching air 
traffic control since 1977.
    The U.S. Air Traffic Control (ATC) System, owned and operated by 
the Federal Aviation Administration, needs major restructuring. The 
system currently runs on obsolete and failure-prone equipment such as 
1960s mainframe computers, equipment dependent on vacuum tubes, and 
radar between twenty and thirty years old. The FAA maintains safety 
margins by artificially increasing the spacing between flights, 
imposing ground holds, and using other techniques that reduce system 
capacity. The airlines alone waste $3 billion a year in fuel and crew 
time due to the delays. Wasted passenger time is estimated at several 
billion dollars more.
    Five underlying problems produced today's dysfunctional ATC system. 
First, the federal procurement process is costly and cumbersome. 
Second, the civil service personnel system is too rigid to provide the 
compensation and working conditions necessary to attract enough 
controllers for high-stress positions. Third, although the ATC derives 
the majority of its revenue from aviation user taxes, its reliance on 
annual federal appropriations for part of its funds and its inability 
to borrow in capital markets makes modernization difficult. Fourth, 
both Congress and the executive branch micromanage and excessively 
supervise the system, substituting for the judgement of the agency's 
top management. That process wastes large amounts of the management's 
time. And fifth, the FAA struggles with an inherent conflict of 
interest. It has been charged with both regulating aviation safety and 
operating the ATC system.
    While recent reforms have introduced some flexibility into the 
system, the underlying problems remain. Other countries have gotten 
around such problems by allowing the users, including airlines, 
airports, and pilots, to own and operate ATC systems. The Canadian 
system provides the closest and perhaps best model for American 
policymakers seeking to ensure greater airline safety at less cost.

Recent Reforms and Setbacks
    Legislation enacted in October 1995 addressed personnel and 
procurement problems. Pursuant to the legislation, in March 1996, the 
Clinton Administration announced the creation of a new FAA personnel 
system that replaces a foot-high stack of civil service rules with a 
forty-one page document and consolidates 155,000 position descriptions 
into 2,000. In order to attract qualified personnel, the new system 
permits pay and shift differentials to reflect high-stress, high-cost 
locations.
    The new procurement system attempts to reflect private-sector 
practice by exempting the FAA from a number of procurement laws. It 
reduces acquisition documents from 233 to less than 50 and aims to cut 
various procurement time periods in half. It provides for a kind of 
binding dispute resolution in case of a contract award protest, but 
still permits court appeals (which have been a major cost--and delay-
inducing factor). But the potential impact of those reforms is 
inherently limited. Thus, the Clinton Administration in 1995 made a far 
more sweeping reform proposal: divesting the ATC system to a government 
corporation. The U.S. Air Traffic Services corporation (USATS) would 
have been a federally chartered, government-owned corporation, 
analogous to Amtrak, the Tennessee Valley Authority, and the U.S. 
Postal Service. It would have had a board of directors appointed by the 
President and confirmed by the Senate. It would have been fully 
supported by user fees, sans federal appropriations. Its revenue stream 
would have been bondable, and USATS was to have been authorized to 
borrow either from the Treasury or from private capital markets. The 
remaining FAA was to have regulated USATS at arm's length.
    While airline and airport organizations and the air traffic 
controllers' union generally supported the USATS proposal, business 
aircraft and recreational aircraft organizations (referred to as 
general aviation or GA), along with most members of the aviation 
subcommittees of Congress, strongly opposed it. Several House 
Republicans introduced an alternative measure calling for the creation 
of a private, user-owned corporation. That proposal went no further 
than the USATS proposal had gone.
    The fear of losing the huge cross subsidies built into the current 
user-tax method of funding ATC provided the underlying reason for the 
general aviation community's opposition to corporatization. While 
business and recreational aircraft currently pay just 3 percent of all 
such user taxes, they use 20 percent of all en-route ATC services and 
59 percent of all control tower and approach-control (TRACON) services. 
Despite the Administration's proposal to permanently exempt business 
and recreational aircraft from user fees, those organizations 
steadfastly opposed the USATS plan.

COMMERCIALIZING ATC: A GLOBAL TREND
    Other countries facing similar problems with ATC systems have gone 
even further than the Clinton administration proposed. Since 1972--and 
especially in the past decade--at least sixteen countries have 
fundamentally restructured their ATC systems (see Table 1). While 
several have converted their equivalent of the FAA into a free-standing 
corporation providing both ATC and safety regulation, the large 
majority have divested ATC alone, retaining safety regulation as an 
arm's length government function. All sixteen have shifted from tax 
funding to direct user fees. Those corporatizations, or 
``commercializations,'' have all been carried out to solve the same 
structural problems that plague the United States ATC system.
    While many of the restructurings are quite recent, some major gains 
have been reported in several countries. For example, in its initial 
year of operation (1993), the corporatized German Air Navigation 
Services Ltd. (DFS) reduced ATC delays by 25 percent. User charges in 
New Zealand have gone down by 30 percent in real, inflation-adjusted 
terms since corporatization in 1987. The charges are 50 percent lower 
than the government projected, had the system remained unchanged. 
Charges in Australia have gone down by 15 percent in real terms.
    Substantial gains in efficiency led to lower charges. Total annual 
operating costs for Airways Corporation of New Zealand have declined 
from NZ$120 million in 1987, the year of corporatization, to NZ$80 
million in 1993. No adverse effects on air safety have been observed in 
any of the reforming countries. Indeed, most observers expect that the 
technology upgrades facilitated by commercialization will improve 
aviation safety.
    The U.K.'s outgoing Conservative government had proposed further 
privatizing their ATC, either via outright sale or via the grant of a 
long-term franchise. The new Labour government that took office in May 
1997 has included NATS on its list of possible privatizations.


                                                           Table 1: Overseas ATC Corporations
--------------------------------------------------------------------------------------------------------------------------------------------------------
           Country                       Corp. Name                        Year                        Functions                 ATC Funding Source
--------------------------------------------------------------------------------------------------------------------------------------------------------

Australia 1                    CCA                            1988                           ATC + reg.                     Mostly user fees

Austria                        Austria Control                1994                           ATC + reg.                     60% user fees

Canada                         Nav Canada                     1996                           ATC                            100% user fees

Czech Republic                 ATC Admin.                     1993                           ATC                            Mostly user fees

Germany                        DFS                            1993                           ATC                            100% user fees

Ireland                        IAA                            1994                           ATC + reg.                     100% user fees

Latvia                         LGS                            1993                           ATC                            100% user fees

New Zealand                    Airways Corp.                  1987                           ATC                            100% user fees

Portugal                       ANA                            1992                           ATC + airports                 100% user fees

Russia                         Magadan Aero Control           1995                           ATC                            In transition

Singapore                      CAA                            n.a.                           ATC + airports + reg.          100% user fees

South Africa                   AT&NS Co.                      1993                           ATC                            100% user fees

Switzerland 2                  Swiss Control                  1988                           ATC                            100% user fees

Thailand                       AeroThai                       1948                           ATC                            100% user fees

Ukraine                        UK SATSE                       1993                           ATC                            In transition

United Kingdom 3               NATS                           1972/1996                      ATC                            Mostly user fees
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ Considering spin-off of ATC as separate corporation.
\2\ Partial user ownership.
\3\  Considering sale of NATS.

Nav Canada: Beyond Government Ownership
    On 31 October 1996, Canada's government carried out the sale of 
that country's ATC system to a newly created corporation, Nav Canada. 
The not-for-profit, stakeholder-controlled company was incorporated in 
1995 as the outgrowth of a several year process of research and 
consultation by the country's entire aviation community. Canada's 
airline ticket tax is being phased out over a two-year period, to be 
replaced by user fees that will provide the sole revenue source for Nav 
Canada.
    The restructuring of ATC in Canada is a departure from previous 
commercializations in several ways. First, by most quantitative 
measures, it is the largest ATC corporatization to date (see Table 2), 
a system that is between one-fifth and one-eighth as large as the 
United States ATC system. Second, it interacts directly with the 
American system, meaning that commercial airlines and private aircraft 
from the United States will soon be paying direct user fees on the 
growing volume of flights to and from Canada. Third, Nav Canada is the 
first ATC corporation controlled by its users and operators. Fourth, it 
is the first case in which a government has sold, rather than merely 
transferred, its ATC operations to a different corporation.
    How did Canada progress, relatively smoothly, to the dramatic 
restructuring of ATC?
    Canada faced the same underlying problems with its ATC system that 
the United States faces: rigid personnel and procurement systems, 
micromanagement, budgetary constraints, and conflict of interest. 
Starting in 1991, various approaches to reform were considered, 
including a system along the lines of New Zealand's 1987 Airways 
Corporation, similar to the Clinton administration's failed USATS. The 
proposal called for a mixed enterprise, owned partly by government and 
partly by users and a not-for-profit corporation.
    By autumn 1994, the major aviation stakeholder groups had reached 
consensus that the not-for-profit private corporation was the way to 
go. On 23 September, they delivered a position paper to the government 
firmly stating their opposition to a government corporation like USATS. 
The report identified the following drawbacks: continued political 
control and micromanagement; board appointments by politicians, not 
users/stakeholders; corporate culture more like that of government than 
private enterprise; and major modernization decisions subject to 
political influence.
    By contrast, a not-for-profit private corporation would function as 
an entrepreneurial enterprise, avoid conflict of interest with 
regulatory authority, be responsive to its users, and apply ``best 
business'' practices. The paper also set forth a mission statement and 
suggested a board of directors made up of stakeholders. And it called 
for 100 percent funding by user charges, based on ``fair and equitable 
allocation of costs to all users.'' The heads of the airline trade 
group, the airline pilots' union, the air traffic controllers' union, 
the business aircraft association, and the private pilots' association 
signed the remarkable document.
    With the government's blessing, those groups drew up articles of 
incorporation and created Nav Canada in mid-1995. They selected an 
investment bank, RBC Dominion Securities, to develop the plan for 
financing the company's acquisition of the ATC system from Transport 
Canada. The legislation was enacted in mid-1996, and the sale took 
place, for $1.1 billion, on 31 October 1996.
    The government agreed to provide generous severance payments to all 
sixty-four hundred ATC employees, and Nav Canada agreed to accept the 
existing union contracts until they expire at the end of 1997 or 1998.
    Although Nav Canada now owns the former Transport Canada ATC system 
assets, it is a ``non-share capital corporation,'' i.e., there is no 
equity ownership. Its financing is entirely via debt. Without 
shareholders, it will not seek to make a profit, it will only seek to 
cover its costs, and--in the interests of its stakeholders--to keep 
those costs to a minimum. That structure is designed to avoid the need 
for explicit government regulation of the monopoly service of air 
traffic control. Without the drive to earn profits, and with users 
having a major say in running the organization, the classic rationale 
for government regulation of a monopoly (protecting consumers from 
monopoly exploitation) disappears.
    Nav Canada's corporate charter calls for a fifteen member Board of 
Directors to include all relevant stakeholders. Four are appointed by 
the airlines, one by the business aircraft association, and three by 
the government--in its role as a significant user of ATC services. The 
unions appoint two members, and another member is the CEO who is 
appointed by the board. The board appoints the four remaining members 
as independent directors. The members serve for staggered three-year 
terms, to a maximum of nine years, except for the CEO. Elected 
officials, government employees, and employees or directors of any 
significant supplier, user, or client of the corporation are ineligible 
to serve as directors.
    Despite the careful balance of stakeholder interests on the board, 
additional provisions protect users. Nav Canada is required to consult 
with appropriate parties prior to proposing any increases in fees and 
charges or reductions in facilities or services, and must give a sixty 
day notice of changes. Also, an advisory committee will consist of 
persons ``interested in aeronautics and furthering the objects of the 
Corporation.''
    In order to ensure commercial independence, Nav Canada will be 
funded entirely by fees and charges paid by users. Needless to say, 
with a large general aviation community in Canada, the fees and charges 
raised the same kinds of concerns as in the United States. While the 
issue is not yet settled, all parties have agreed that the benefits of 
shifting ATC to a stakeholder-controlled organization are worth the 
difficulties of devising a fair and equitable fee structure. As 
Transport Canada's first discussion paper, The Study of the 
Commercialization of the Air Navigation System in Canada pointed out in 
1994, ``with user pay should come greater user say.''
    Transport Canada's research on ATC user fees found considerable 
uniformity in the charging methods of countries that have 
commercialized ATC. Virtually all employ two principal types of 
charges: ``en-route charges'' and ``landing charges.'' En-route charges 
are generally based on the distance flown multiplied by a factor based 
on the aircraft's weight. Landing charges are generally based on some 
measure of the aircraft's maximum takeoff weight.
    Canada is phasing out its ticket tax and replacing it with a 
similar weight-related measure. The approach is a departure from strict 
allocation of charges according to system costs; after all, it costs 
the ATC system about the same amount of money to guide a small Beech 
Baron as it does a giant Boeing 747. The net result of pricing 
according to the relative value of the service, charging what the 
market will bear, is to keep the charges relatively low for smaller 
aircraft.
    Another principle incorporated in most commercialized ATC charging 
systems is to not charge directly for preflight information services to 
GA users. Flight service stations (FSS) assist GA pilots with flight 
plan filing and weather briefings. If direct fees were charged for 
those services, some users might forego using them, with detrimental 
safety consequences. Hence, the costs of FSS operations are assumed to 
be covered out of the terminal and en-route charges paid by all users.
    Since Nav Canada does not have equity owners, the purchase price 
was financed in the commercial debt market. The initial capital was 
raised as bank loans (bridge financing), which is being replaced, over 
time, with commercial paper and revenue bonds.
    In contrast to a government agency like Transport Canada, which 
must pay for major modernization out of annual appropriations a year at 
a time, a commercialized ATC corporation can finance modernization by 
issuing debt, to be repaid out of its user-fee revenue stream.


                                                           Table 2: Comparison of U.S. and Overseas Air Traffic Control Organizations
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                     United States              Canada               Australia               Germany             United Kingdom          Switzerland            New Zealand
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Independent of Government                          No                    Yes                    Yes                    Yes                    Yes                    Yes                    Yes

Starting Date                                     n/a                   1996                   1988                   1993                   1972                   1988                   1987

Govt. Safety Oversight                            Yes                    Yes                    Yes                    Yes                    Yes                    Yes                    Yes

1994 Revenue ($)                                4,275                    429                    432                    913                    778                    143                     59

1994 Expenses ($ millions)                      6,190                    572                    388                    913                    697                     59                     52

Air Traffic Controllers                        17,300                  2,060                  1,140                  2,000                  1,630                    300                    300

1994 Aircraft Movements                            38                    7.4                    3.6                      2                    1.5                    1.5                    1.2
 (Millions)

Commercial Aircraft                            18,440                  5,680                    260                    680                  3,120                    n/a                    130

Commercial Pilots                             117,430                 20,500                  8,700                  9,000                 12,540                    n/a                  2,960

General Aviation Aircraft                     184,430                 21,850                  7,900                 20,340                  4,270                    n/a                  3,100

General Aviation Pilots                       654,090                 59,990                 22,500                100,000                 27,530                    n/a                  4,190

Weekly Domestic Departures                    142,930                 16,950                  5,500                 15,000                  4,840                    n/a                  3,670

Weekly International Departures                 8,240                  2,660                    670                 15,000                  6,030                    n/a                    530

Source: General Accounting
 Office
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Seeking Consensus on American Restructuring
    Major ATC reform in the United States has been stymied by 
opposition from two quarters, GA and the congressional aviation 
subcommittees. While the subcommittees will likely remain reluctant to 
yield their turf, a unified call for ATC commercialization from 
aviation stakeholders, as occurred in Canada, might suffice to overcome 
the reluctance.
    To airlines in the United States, such an approach offers 
essentially all the advantages of the corporatization proposals they 
have supported in the past. The controllers' union supported the 
Administration's USATS plan but opposed ``privatization,'' meaning a 
for-profit company. Assuming that their pay and benefits are protected 
in a transition to a not-for-profit corporation (NFPC), as in Canada, 
they are likely to support that approach. Many congressional 
Republicans were skeptical of creating another government corporation, 
some terming it a ``flying Amtrak.'' They should be more receptive to a 
user-controlled nongovernmental corporation. And the Administration 
should welcome an alternative way of achieving its aims via the NFPC 
approach.
    The major question mark is the GA community, composed of two 
principal groups: commercial GA, represented by the National Business 
Aircraft Association (NBAA), and recreational GA, represented by the 
Aircraft Owners & Pilots Association (AOPA). The former group flies 
business jets, turboprops, and multiengine piston aircraft. The latter 
group flies mostly single-engine piston aircraft. Despite a provision 
in the USATS measure that exempted GA from user fees, those groups 
feared that a cost-based system of user fees would eventually be 
applied to them, drastically increasing their cost of flying.
    Two key factors might secure GA support for a Canadian-type system. 
The first is a guaranteed seat on the board for both GA groups. The 
1995 USATS proposal offered GA groups a single board member, chosen not 
by them but by the president. The second is a user fee system based 
more on ability to pay than on allocated costs.
    But would the monopolistic nature of an ATC corporation combined 
with the absence of a profit motive provide insufficient incentive for 
the NFPC to develop a commercial corporate culture? The National 
Performance Review's Wayne Leiss addressed that issue at the Air 
Traffic Control Association Annual Meeting on 26 October 1993, ``A 
competitive joint venture achieves the same efficiency as competition, 
but in a monopoly market. The fee-paying customers work through the 
board of directors. They have the same incentive to reduce costs as 
owners trying to make a profit.'' As Leiss notes, ``The key is the 
election of the board of directors by the fee-paying customers. They 
are the only ones with incentives for efficiency, since they are the 
ones paying for any inefficiency. Politically appointed directors, 
while earnest in their intentions, do not share in these incentives.'' 
A board-membership structure might consist of the following: four seats 
for air carriers; one seat for airline pilots; one seat for business/
commercial GA; one seat for recreational GA; one seat for air traffic 
controllers; one seat for airports; two seats for U.S. government.
    Those eleven seats would represent all the major users (commercial 
airlines, GA, government), the two major aviation employee groups 
(airline pilots and controllers), and airport operators; in other 
words, all the major ATC stakeholders. As in Nav Canada, airlines would 
not have a numerical majority and therefore could not impose their 
version of user fees or other policies upon the GA segment. The board 
would select the CEO, who would also be a director, and together, they 
would select three independent directors, for a total of fifteen board 
members. A board structured in that way is intended to foster the 
search for consensus on fee structures and other policies.
    With policy guidance from the other board members, the CEO would 
hire the top management team, most likely leading to the creation of a 
largely new top level of management for ATC. It would draw the best 
available people from the private sector and compensate them 
accordingly. Competitive management pay scales are especially critical 
since the company's not-for-profit status means that no form of 
compensation based on stock or stock options would be available.

User Fees
    In exchange for two board seats, GA users would be expected to 
contribute towards the cost of the corporation's operations. It is 
clearly in the GA community's long-term interest to be a paying member, 
thereby guaranteeing itself influence in the corporate board's policy 
decisions. The GA communities in Canada, New Zealand, and other 
countries where user fees have been introduced as part of ATC 
corporatization, have accepted that principle. Concerning the USATS 
proposal, Kenneth M. Mead of the General Accounting Office testified on 
March 9, 1995 before the House Transportation Subcommittee, ``A 
corporation--created and charged to operate like a business--may have 
little incentive to provide equipment and services to users of the 
system whose financial contributions to the system are proportionately 
less than the value they receive.'' Since GA operations account for 
over half of all control tower operations and some 20 percent of en-
route center operations (see Figure 1), it is only fair that they pay 
some sort of fees for those considerable portions of the ATC system's 
workload.




    The question then becomes: How can a user fee system be constructed 
that realistically reflects GA usage of ATC services but (1) does not 
unrealistically burden GA with crippling cost increases and (2) does 
not have perverse effects on safety, such as tempting some private 
pilots to forego weather briefings in order to avoid paying a fee? 
Other countries with corporatized ATC systems solve those problems by 
setting rates based on the relative value of the service rather than 
strictly on the underlying cost and by avoiding direct charges for 
safety-related information services.
    The first of the above points adopts a variant of the 
internationally accepted practice of basing both terminal and en-route 
charges on the weight of the aircraft, rather than on the proportion of 
system costs allocated to each type of user. Basing charges on weight 
will lead to much lower charges for smaller, lighter aircraft than 
would a fee system based on cost allocation. [Such variable pricing is 
similar to pricing of rail services. See Cunningham and Jenkins, 
``Railing at `Open Access','' Regulation No. 2, 1997] The second point 
means not charging directly for Flight Service Station activities. 
Instead, the corporation's costs of providing those services will be 
recovered from all users, as part of the cost base to be recovered from 
en-route and terminal charges.
    In a 1996 Reason Foundation policy study, Viggo Butler and I 
developed a hypothetical ATC user fee system based on those principles. 
Table 3 summarizes the results for a representative set of general 
aviation and commercial aircraft, along with assumptions about their 
annual flight operations. For example, the Lear 35, a business jet, 
would have total annual ATC charges of $23,696, based on a typical 
annual level of flight activity. That represents about 2.2 percent of 
its total operating cost or 5.5 percent of its direct operating cost.
    Table 4 compares the user fee costs with the present user tax 
payments for the same set of aircraft as in Table 3. As can be seen, 
the net impact of adding user charges and eliminating fuel taxes (for 
GA) and ticket taxes (for airlines) varies according to the type of 
plane and the assumed flight activity.

                                                                       Table 3: Conceptual ATC Charges for Proposed System
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                  Max T.O.  Wt. (lbs.)                          Average  Distance   Terminal  Charge ($)                        Annual Enroute  Cost     Annual Terminal
    Aircraft                               Landings/ Year            (miles)                               Enroute  Charge ($)           ($)                Cost ($)             Total Cost
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Falcon 50                       38,000                   300                 1,050                 17.73                173.76             52,126.83              5,319.48             57,446.31

Falcon 20-5                     29,100                   321                   750                 13.30                 93.08             29,879.84              4,268.88             34,148.73

Lear 35                         18,300                   462                   550                  8.36                 42.93             19,832.38              3,863.75             23,696.13

Lear 24                         13,500                   346                   550                  6.17                 31.67             10,957.00              2,134.65             13,091.65

King Air 20                     12,500                   500                   400                  5.71                 21.33             10,662.50              2,856.25             13,518.75

Baron                            5,400                   267                   250                  2.47                  5.76              1,537.32                658.90              2,196.22

B747                           776,000                   700                 2,500                354.63              8,274.10          5,791,870.00            248,242.40          6,040,112.40

B737                           121,440                 2,954                   521                 55.50                269.85            797,129.73            163,941.33            961,071.06

B757                           332,000                 1,400                 1,500                151.72              2,123.97          2,973,558.00            212,413.60          3,185,971.60
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------


                                    Table 4: Current vs. Proposed User Costs
----------------------------------------------------------------------------------------------------------------
                           Current Annual User   Proposed User Fees     Proposed User Tax   Difference in Annual
        Aircraft                 Tax ($)                 ($)                   ($)                Cost ($)
----------------------------------------------------------------------------------------------------------------
Falcon 50                               39,812                57,446                     0                17,634

Falcon 20-5                             29,356                34,149                     0                 4,793

Lear 35                                 22,575                23,696                     0                 1,121

Lear 24                                 18,506                13,092                     0               (4,964)

King Air                                 6,188                13,519                     0                 7,331

Baron                                    1,500                 2,196                     0                   696

B747                                10,416,000             6,040,112                     0           (4,375,888)

B737                                 1,189,000               961,071                     0             (227,929)

B757                                 3,906,000             3,185,972                     0             (720,028)
----------------------------------------------------------------------------------------------------------------
*Fuel tax for business aircraft, ticket tax for airlines.


    Direct user charges for those GA flights filing flight plans 
(terminal charges) and flying IFR (en-route charges) would replace GA 
fuel taxes. No other types of GA operations would pay any charges or 
any fuel taxes. Even those types of corporate aircraft that would end 
up paying more would still pay only a small percentage of the total 
annual cost of ownership and operation. The largest of these planes, 
the Falcon 50, would pay only 3.2 percent of its total annual cost in 
user fees, compared to 2.2 percent today. Table 5 looks more closely at 
the impact on general aviation.
    The under-$1 billion annual cost of the remaining FAA's safety 
regulation activities should continue to be collected from general 
federal revenues, as are the costs of other safety regulatory agencies 
such as the FDA and OSHA. The airport grant program--if continued--
could be funded either by general revenues or by reduced air cargo and 
passenger ticket taxes at about one quarter of previous levels--i.e., a 
passenger ticket tax of 2 percent. Table 6 looks more closely at the 
impact on airlines of ATC fees with and without a 2 percent ticket tax. 
With the tax, some aircraft will pay more, and others will pay less; 
again, depending on the actual amounts and types of flight activity. 
Without the 2 percent ticket tax, all types of airliners would clearly 
pay less than they do today.

Purchase Price
    The Administration's USATS proposal assumed that the FAA's ATC 
assets would be transferred to the new corporation at no charge. The 
proposal was based on the premise that the assets had already been paid 
for by users via the aviation user taxes deposited into the Aviation 
Trust Fund and on the implicit grounds that USATS would continue to be 
owned by the U.S. government, which would be paying itself if the 
assets were to be purchased. By contrast, Nav Canada purchased the ATC 
assets from Transport Canada for over $1 billion. Should a new ATC 
corporation purchase the ATC assets from the federal government?
    First, although user taxes have paid for a majority of FAA capital 
and operating costs, there is still approximately $2 billion per year 
of general-fund support for FAA's $8 billion to $9 billion budget. 
Hence, one could argue that its users have actually paid for only 
three-fourths of the cost of the system.
    Second, the new corporation and its stakeholders would be gaining 
something of great value in the transfer of ATC to themselves: control 
over the future of this essential system, something they do not have 
today. What they have ``paid for'' via user taxes is a dysfunctional 
system which they do not control. What they would be getting, via the 
corporation, is a (potentially) modernized system that they control. 
That ought to be worth paying for.
    How much are the FAA's ATC assets worth? According to the 
Administration's April 1995 briefing on the USATS proposal, the ATC 
book value (net of accumulated depreciation) as of that date was $5.9 
billion. Since a large fraction of those assets (radar, computers, 
landing aids, etc.) needs to be replaced within a few years, their real 
value is far less than the book value (as the established telephone 
companies have discovered concerning their assets, since the advent of 
competition).
    A third party would have to estimate the market value of the ATC 
system's assets. Presumably, most of the real estate, control towers, 
and en-route centers would be valued at or above book value, in 
contrast to most of the electronic equipment. The net value probably 
will be in the $3 billion-4 billion range, that is, substantially less 
than a single year's ATC corporation operating revenue and a sum 
readily financed in the capital markets, as was done with Nav Canada.

Financing the ATC Corporation
    There are two key questions to address with regard to financing of 
a stand-alone ATC corporation. First, can a brand new corporate entity 
without any operating history raise the capital to make a multibillion 
dollar purchase of the existing assets? And second, can such a 
corporation finance a multiyear modernization program? The answer to 
both questions is yes.
    Last fall, capital markets provided nearly $2 billion to finance 
Nav Canada. The initial funds were provided in the form of relatively 
short-term bank loans, to be replaced over time with longer-term 
commercial paper and revenue bonds. Although the United States' ATC 
system is five to ten times larger than Canada's system, its revenue 
stream is about ten times as large. In both cases, the new corporate 
entity would have either a de facto or a de jure exclusive franchise 
for providing essential ATC services, and the ability to set rates that 
ensure professional operations. Assuming it is well run, it should be 
what the capital markets refer to as a good credit risk.
    As for financing a modernization program, the Department of 
Transportation commissioned a detailed financial feasibility analysis 
of its USATS proposal from Gellman Research Associates and Arthur 
Andersen & Co. The May 1995 report of the Department of 
Transportation's Executive Oversight Committee concluded that, ``In all 
scenarios examined, USATS is financially viable with revenues 
sufficient to cover operating and investment costs.'' In addition, 
``USATS is also able to fund a portion of capital investment by using 
long-term debt which would be repaid when the benefits of those 
investments are realized by users. The accelerated investments [would] 
reduce USATS's ATC operating costs by $0.9 billion. In addition, those 
investments would provide over $10 billion in safety, delay reduction, 
and operating cost savings to users over the 1996 to 2005 time 
period.'' The financial assumptions for a non governmental, non-profit 
ATC corporation would be virtually the same as those used in the 
feasibility studies. Hence, its conclusions would apply equally to the 
proposed corporation.


                                                           Table 5: GA Cost Impact Comparison
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                       Current  Taxes                                   User Fees  (Proposed
                                                 --------------------------                                    System)
                    Aircraft                                                     Percent  T.O.C.     --------------------------      Percent  T.O.C.
                                                       Percent  D.O.C.                                     Percent  D.O.C.
--------------------------------------------------------------------------------------------------------------------------------------------------------
Falcon 50                                                            5.83                      2.19                      8.42                      3.16

Falcon 20-5                                                          6.02                      2.09                      6.70                      2.43

Lear 35                                                              5.23                      2.09                      5.49                      2.19

Lear 24                                                              4.84                      2.28                      3.42                      1.62

King Air                                                             2.81                      1.18                      6.14                      2.59

Baron                                                                2.50                      1.07                      3.66                      1.57
--------------------------------------------------------------------------------------------------------------------------------------------------------

Window of Opportunity
    Continuing squeezes on ``discretionary'' federal spending, and the 
FAA's continued inability to manage major upgrades, almost guarantee 
that ATC modernization will not occur without major restructuring, 
including restructuring of ATC's financing. In 1996, Congress 
authorized two major studies on that issue. Coopers & Lybrand completed 
the first in February 1997; the second will be released by the National 
Civil Aviation Review Commission (NCARC) in October 1997.
    Those studies were prompted in part by the lapsing of the 10 
percent airline ticket tax and GA fuel taxes at the end of 1995, due to 
the congressional shutdown of the federal government. With the ticket 
tax in abeyance for nine months of 1996, the major airlines found that 
more passengers were flying, so they began lobbying for elimination of 
the tax, to be replaced by user fees. Unfortunately for the ATC 
commercialization cause, seven of the largest airlines proposed a 
complex ATC user fee system, based on seats, passengers, and origin-
destination distance, as opposed to actual miles flown, that would have 
greatly increased the amount paid by Southwest and other low fare 
airlines. That ill-conceived proposal came under harsh criticism by the 
General Accounting Office and many members of Congress, and died in 
1996.
    NCARC now is expected to develop a proposal for a new funding 
system able to satisfy both large and small carriers. The lessons of 
how Canada and other countries have dealt with user fees and with 
charges to GA users can help NCARC develop a workable plan.


                             Table 6: Airline Cost Impact of a 2 Percent Ticket Tax
----------------------------------------------------------------------------------------------------------------
                                                  Current 10                Proposed 2   Difference   Difference
                    Aircraft                     percent Tax    Proposed   percent Tax    with  2     without  2
                                                                User Fee                  percent      percent
----------------------------------------------------------------------------------------------------------------
B747                                             $10,416,000    6,040,112    2,083,200  (2,292,988)  (4,375,888)

B737                                               1,189,000      961,071      237,800        9,871    (227,929)

B757                                               3,906,000    3,185,972      787,200       67,172    (720,028)
----------------------------------------------------------------------------------------------------------------


    Everyone who travels by air understands the need for a safe, 
effective, and efficient air traffic control system. Today's 
information processing technology and satellite based navigation 
systems offer the prospect of greatly increased safety and 
significantly lower costs that would dramatically reduce billions of 
dollars in delays suffered by travelers each year due to the ATC 
system's obsolete technology.
    Commercializing air traffic control is achievable. It has already 
been done in sixteen other countries in response to the same problems 
that plague America's ATC system. Adapting their experience to the 
United States can produce a safer and more cost-effective American 
system.

Selected Readings
    Robert W. Poole Jr. and Viggo Butler, ``Reinventing Air Traffic 
Control: A New Blueprint for a Better System,``Policy Study No. 206, 
Los Angeles: Reason Foundation, May 1996.
    Coopers & Lybrand, ``Federal Aviation Administration: Independent 
Financial Assessment, Final Report,'' Washington, DC: Coopers & Lybrand 
L.L.P., Feb. 28, 1997.
    Executive Oversight Committee, ``Air Traffic Control Corporation 
Study,'' Office of the Secretary, U.S. Department of Transportation, 
May 1994.
    Transport Canada, The Study of the Commercialization of the Air 
Navigation System in Canada. Discussion Paper No. 2, ``Safety 
Regulation'' Discussion Paper No. 3, ``The Need for Economic Regulation 
of a Commercial Air Navigation Organization'' Discussion Paper No. 4, 
``Inter-national Experience of ANS Commercialization'' Discussion Paper 
No. 5, ``Illustrative User Charges'' [Note: all five papers were 
produced in 1994.]
                                 ______
                                 
                   Professional Airways Systems Specialists
                                 Washington, DC, September 13, 2000
Hon. John McCain,
Chairman,
Senate Committee on Commerce, Science and Transportation,
Washington, DC.

Dear Senator McCain:

    I understand your Committee will be holding airline delay hearings 
on September 14. As the organization representing 11,000 Federal 
Aviation Administration and Department of Defense (DoD) employees who 
ensure aviation safety and security, I would like to submit a statement 
for the written record.
    Aviation safety requires all users of the National Airspace System 
(NAS) to work together to maintain the U.S.'s stellar record. I commend 
you and the other Committee members for having the foresight to gather 
information from a variety of sources on this all-important topic.
    My statement provides insight into equipment-and integration-
related delays. The FAA, through a true commitment to NAS 
Modernization, could easily rectify these real problems with an 
emphasis on training and proper development of new equipment and 
programs. With delays increasing significantly with each passing year, 
every avenue must be explored to ensure the problem is eventually 
brought under control. While many solutions to delays are extremely 
costly, such as completely overhauling the NAS and building more 
runways, the agency could solve the current equipment-related delays 
within its current budget.
    PASS and the FAA have already begun working together on overhauling 
the Airway Facilities training system and properly implementing the 
components of Free Flight Phase 1. These are steps in the right 
direction, but the FAA needs to be coaxed into realizing the importance 
of working together to truly revolutionize the NAS.
    I hope the statement sheds light on the importance of PASS' role in 
helping to solve the ever increasing airline delays, as well as other 
NAS Modernization problems. If you need further information, please 
don't hesitate to contact either PASS Legislative Director Abby 
Bernstein or myself at 202/293-7277.
        Sincerely,
                                      Michael D. Fanfalone,
                                            PASS National President
                                 ______
                                 
  Statement of Michael D. Fanfalone, President, Professional Airways 
                 Systems Specialists, on Airline Delays

    The Professional Airways Systems Specialists (PASS) provides 
exclusive representation for more than 11,000 of the FAA's Systems 
Specialists, Flight Inspection Pilots, Aviation Safety Inspectors and 
safety support staff. These are the people who maintain the integrity 
of the National Airspace System (NAS), through installing and 
maintaining systems and conducting aviation and flight inspections. 
PASS has in-depth knowledge of the NAS and understands the components 
that must be in place to ensure aviation productivity, safety and 
efficiency.
    During the summer, you could not read a newspaper or turn on a 
television or radio without being inundated with information on ``the 
continued increase in air traffic delays.'' In the midst of this 
period, FAA figures showed 48,448 flights were delayed in June--7.3 
percent higher than the 45,162 delays during the same month in 1999. 
Most aviation experts, including PASS, believe delays will continue to 
increase because today's aviation system is already stretched to its 
limits. With the FAA estimating that air travel will increase to more 
than one billion passengers by 2010, the only logical solutions to cure 
the delays require ``real'' commitments to overhaul the nation's 
aviation system and how it is used. There are no quick fixes. The real 
fix will require significant investment in people, time and money. They 
are crucial because the system is overcrowded and projected increases 
in air travel demand only exacerbate the increase in delays.
    If aviation experts take responsibility and begin solving problems 
under their control, delays will immediately begin to decrease until 
such time that capacity can be meaningfully increased. As the experts 
behind the NAS, PASS can provide insight into equipment failure and 
integration of new systems. While only a small percentage of the 
overall delays are attributed to equipment breakdowns, PASS believes 
that our members can help reduce equipment caused delays. The FAA's 
method of integrating new programs, such as the Display System 
Replacement (DSR), was blamed for 21 percent of the increased delays 
last year.\1\ In 1999, DSR integration with the existing systems caused 
problems in Seattle, Chicago, Cleveland and New York, resulting in 
hundreds of delays. In Chicago, 600 delays occurred after the problem 
knocked out the air traffic control radar for 72 minutes.\2\
---------------------------------------------------------------------------
    \1\ Department of Transportation's Inspector General, Air Carrier 
Flight Delays and Cancellations, p. xi, July 2000 (Prepared by the 
Federal Aviation Administration Bureau of Transportation Statistics 
Office of the Secretary of Transportation).
    \2\ Ibid, p. 30
---------------------------------------------------------------------------
    In order for aviation specialists to begin solving their portion of 
the delay problems, accurate data are needed. An Inspector's General 
report recently called for more reliable reporting methods, finding 
``until complete and consistent data are available, examination of the 
causes of delays and identifying viable solutions will be 
problematic.'' \3\ While over scheduling and weather are considered the 
major causes of delays, the FAA's careless attitude toward NAS 
Modernization is causing the equipment--and integration-related delays, 
which tend to be among the most time-consuming. The DSR delays prove 
the agency is not properly testing equipment in its quest to meet 
deadlines. In 1999, software problems accounted for 35 percent and 
hardware problems were blamed for 27 percent of the equipment-related 
delays.\4\ The DSR integration and other equipment problems have 
contributed to an 18 percent increase in the length of overall 
delays.\5\ FAA could easily begin solving equipment--and integration-
related delays by improving testing and integration of new equipment 
and providing on-site expertise for more immediate response as problems 
occur.
---------------------------------------------------------------------------
    \3\ Ibid, p. i.
    \4\ Federal Aviation Administration, AF Related Delays Fiscal Year 
1999 and First Quarter Fiscal Year 2000 (PowerPoint presentation).
    \5\ Department of Transportation's Inspector General, Air Carrier 
Flight Delays and Cancellations, p. 3, July 2000 (Prepared by the 
Federal Aviation Administration Bureau of Transportation Statistics 
Office of the Secretary of Transportation).
---------------------------------------------------------------------------
System Development and Implementation
    The FAA continues to rush deadlines and implement equipment without 
proper on-site testing--a cause of delays and reduction of safety. 
Since each aviation site is unique, new systems cannot be properly 
validated using the laboratory style of development. In the past few 
years, an unprecedented amount of delays have been caused by the 
integration of the new equipment with the existing components. Major 
new systems, such as the aforementioned DSR, Automated Radar Tracking 
System (ARTS) lIlA, Airport Surveillance Radar (ASR)-9, HOST and 
Oceanic Computer System Replacement (HOCSR) systems have not been 
integrated properly in various sites, causing hours of delays. The 
integration of ARTS lIlA and ASR-9 caused almost 200 flights to be 
delayed after a 10 hour, 33 minute outage at Dulles Airport. At Los 
Angles Air Route Traffic Control Center (ARTCC), an integration problem 
between the new HOCSR and Computer Display Channel delayed hundreds of 
flights at five California airports and caused problems as far away as 
Phoenix, a non-hub airport which traditionally fair the worst during 
delay situations.
    PASS believes expanding the systems specialists' role can help 
mitigate these types of integration problems. The deployment of Free 
Flight Phase I tools \6\ is certainly an example. These tools are 
designed to shift from a centralized command-and-control environment 
between pilots and air traffic controllers to a distributed environment 
allowing pilots more capability to choose a route and flight plan that 
are more efficient and economical. Like many of the other modernization 
systems, these tools are, essentially, ``off-the-shelf.'' However, they 
still need to he adapted to accommodate local site peculiarities and 
needs and unique integration problems at each location. Through site-
level user teams composed of local management and PASS tecfmical 
specialists, the full development of each tool is conducted on-site 
with integration problems solved as they arise. Due to this method, 
these tools, which benefit scheduling and capacity, are being developed 
on schedule, leading everybody involved to expect full deployment by 
the December 31, 2002, deadline. For example, the deployment of pFAST 
and TMA at Dallas-Fort Worth has increased the arrival rate by five 
percent, including an additional 36 flights and a reduction of 540 
minutes of delay each day.
---------------------------------------------------------------------------
    \6\ The five Free Flight Phase 1 tools are Collective Decision-
Making (CDM), Precision Final Approach Spacing Tool (pFAST), Surface 
Mover Advisor (SMA), Traffic Management Advisor (TMA), and User Request 
Evaluation Tool (URET).
---------------------------------------------------------------------------
    This method, called spiral development, needs to be utilized for 
other NAS Modernization systems. FAA may claim that PASS is always 
involved, but the reality is that too often the technical expertise of 
our members is overlooked or ignored.

Training
    The strong work ethic of hundreds of systems specialists has 
enabled Airway Facilities (AF) to maintain and achieve the FAA's safety 
goals and objectives despite insufficient staffing and training. 
However, anemic funding in these areas is taking a toll on the 
readiness of the NAS.\7\ In order to address a portion of this problem, 
PASS and the FAA have recently agreed to an ATS Training Strategy for 
the AF workforce and will soon begin jointly developing the plan to 
``make it happen.'' Training is crucial because only 6,000 Airway 
Facilities employees are providing hands-on maintenance for more than 
40,000 FAA facilities and equipment. The system needs to be 
reinvigorated through local and on-the-job training (OJT). An inspector 
general's audit report, issued August 18, 1999, touted the use of local 
and on-the-job training, finding the current centralized training 
driven by a quota system wasteful and antiquated.\8\ The ATS Training 
Strategy directly addresses this issue. The IG noted that the FAA could 
make changes to its training program within its current budget 
constraints, stating that the ``FAA needs to use its available funds 
more wisely and take greater advantage of more cost-effective training 
methods.'' PASS wholeheartedly concurs.
---------------------------------------------------------------------------
    \7\ Federal Aviation Administration, ``Airway Facilities Readiness 
Level of the Field Evaluation Report No: AAF-20:90-01,'' p. 7, May 17, 
1999.
    \8\ Office of Inspector General, ``Audit Report: Airway Facilities 
Maintenance Training,'' p. 3, August 18, 1999.
---------------------------------------------------------------------------
    At most locations, insufficient staffing levels make it impossible 
for systems specialists to travel to Oklahoma City for weeks and months 
on end for training. The FAA would save a tremendous amount of money 
and recover an untold number of hours in lost productivity by placing 
more emphasis on OJT and providing local and on-site training. The 
skills of the AF technical workforce needs to be upgraded to those of 
software and network specialists enabling these employees to fully 
participate in site-level development of new systems and the ATS 
Training Strategy is a step toward this goal. PASS asks this Committee 
to help ensure the FAA remains committed to implementing this strategy 
that would retrain an entire workforce within the next five years. 
Under the existing system, retraining of the workforce would consume 15 
years.

Contractor Support
    The FAA is relying more and more on contractors to support and 
integrate new systems. Contractor error is a common factor in 
equipment-related delays. In the Los Angeles outage, the FAA NAS Area 
Specialist, despite being inadequately trained and being on duty 
without an FAA NAS Operations Manager, effectively mitigated and 
isolated system errors while configuring two very complex computer 
systems. The contractor did not arrive until considerably after the 
systems specialist had fixed the problem. Other examples of contractor 
error included a 39-minute outage caused by problems with the HOCSR at 
the Atlanta ARTCC and a radar problem in Philadelphia that caused 11 
planes to be lost off-screen for 20 minutes.

Conclusion
    While weather and scheduling account for the majority of delays, 
the resolution of equipment problems could save the industry and 
government millions of dollars. With aviation experts working together 
with the FAA to solve the current problems and finding the best 
remedies to reinvigorate the overtaxed NAS, the U.S. will maintain its 
reputation as the leader in air travel. Some believe that privatization 
of the air traffic control system would help this process, but nothing 
could be further from the truth. Since aviation safety is at stake, 
private sector businesses, which make decisions based purely on profit, 
should not be in control of the NAS. Oversight of the NAS has always 
been and must remain inherently governmental. Safety should never be 
contracted out to the lowest bidder. Privatization proponents would 
have you believe that the system would function better outside of 
government oversight. As the IG report indicated, the government is not 
the main source of NAS delay problems, but airline scheduling and 
weather are the main culprits. The current system is not broken, but a 
commitment needs to be made by all involved in the NAS to solve the 
problems within their grasp and to work together with the agency and 
other organizations to determine long-term solutions.

                                 ______
                                 
    Following is what I would have told the Commerce Committee and the 
Appropriations Committee if I had the opportunity to testify before 
them. I have been told that talking with me is like trying to take a 
sip from a fire hose. With that in mind I'll continue.
      Prepared Statement of Daniel B. Hartley, President of SPEEA
Background:
    I, Dan Hartley, was the president of SPEEA, the engineers union at 
the Boeing Company for a number of years. A major portion of my duties 
then and continuing after I have left office, is about American 
aeronautical competitiveness and its declining state. I am in my 45th 
year of engineering and have been an aviator for a like time having 
flown as a navigator, flight engineer and pilot. I have aviated for the 
Air Force, airlines and Boeing. Currently my wife, also a pilot, and I 
have a private airplane we fly for recreation.
    At my age I am still employed full time as an engineer in 
aeronautics. During my decades I feel proud to have been a participant 
in development of the technologies that have reduced the cost of an 
airline ticket over 6 times in real dollars while increasing the level 
of safety dozens of times. I participated as American technology 
brought the Cold War to an end. A major factor in the demise was our 
increasing lead in aerospace prowess; parenthetically, a major factor 
in the present health of our American economy is the money and talent 
that has been diverted from the Cold War into our own industrial base.
    Deregulation . . . aviation is the most regulated industry in our 
country. This over-control by the government has stifled aeronautics so 
much that we are about to be killed. In this last decade of 
``prosperity'' I see figures that our aerospace employment has gone 
down from 1.4 million to under 800,000 thousand . . . hardly what I 
call healthy economic prosperity. It is not ``politically correct'' of 
me to say that for the last decade, both Republican and Democrat 
Administrations and Democrat and Republican Congresses have been 
parties to the declines in competitiveness that are rapidly approaching 
critical levels. The American air traveler is now seeing one of the 
symptoms of this decline. There are those who decry something called 
``industrial policy'' and who say that we should have no policy and 
that the government shouldn't be picking winners and losers. I submit 
that we have a well-defined industrial policy toward aeronautics . . . 
it could be called ``over-regulation'' and national apathy. Even with 
record dollar exports in the last quarter, the main driver of this 
industry is the smarts of the workers, the intellectual capital . . . 
and our present national policy of holding down progress is lessening 
the desires of those with necessary wisdom to stay in the field. This 
misguided policy has us well down the slippery slide to aeronautical 
mediocrity . . . and, least we need reminded, airliner export is our 
largest export and alone, the source of some half a million supporting 
jobs.
    This decline apparently interests no one inside the Beltway because 
the subject is not glitzy . . . viewers' eyes would glaze over if the 
subject were brought up on the 6 o'clock news. One or two thousand 
needlessly dying in airliner accidents per year is not nearly as 
sensational as a hundred or so who may have been killed due to tire 
problems. Even today's hearing would have never occurred unless we were 
experiencing major air traffic delays. The air travelers main ally in 
this hearing most surely is the first-hand experience of mid-western 
and western states Congressional members commuting by air to and from 
their home districts and states.

I will state that:

   The skies are not crowded. The problem is the way the FAA 
        thinks.

   Safety levels can be improved.

   Costs of air travel and shipment of air cargo and mail can 
        be reduced further, and safely.

   Trip times for the traveler can be reduced without massive 
        cost.

   Technology available today can reduce the risk of mid-air 
        collision.

   Technology available today and reduce the amount of fuel 
        bought from foreign sources and burned into our atmosphere.

   Noise using today's technology can be reduced.

    We are approaching 12 million flights a year that are carrying two-
thirds of a billion passengers (surprisingly the average airliner is 
only carrying some 60 passengers). I hope traffic continues to grow. I 
also hope levels of safety will increase and the cost of air commerce 
in goods and people will decrease on a unit basis. While I do not know 
the statistical figures of travel by highway, my techo-nerd mind does 
not doubt that the number of people traveling this many miles via auto 
would create far more problems and cause far more injuries and deaths 
than occur in air commerce. I'm proud that my fellow aerospace 
engineers and I have had the opportunity to provide the opportunity for 
countless of our fellow citizens who would have been killed in car 
wrecks, to live long enough to burden Social Security. I will be 
arrogant enough to observe that society has been well served by the 
trust placed in us for this technology . . . who said, ``It ain't 
braggin' if you done it''?
    We have a major problem though. We are a lot better at designing 
solutions for these problems still than we are at explaining our 
engineer-friendly solutions in such a way that the average citizen and 
political activists can understand. Some nerd with a pocket protector 
babbling about Mach number and ``w over delta'' is not nearly as 
adorable as, say, a spotted owl or a young salmon. Unfortunately, 
though, if present rates of decline continue, we will be gone before 
these other endangered species.
    Talk is cheap so lets go over some facts that anyone in this 
Committee room, or over at Transportation or the FAA should be able to 
understand:

Crowded Skies Aren't
    Some long-retired Boeing engineers in Seattle, from the old school, 
were asked by a billionaire who wanted more range for his business jet 
if they could help him. They said they could. He believed them and 
provided an airplane and seed money to let them try. They came up with 
a ``radical'' idea that engineering management at Boeing said wouldn't 
work. These very simple looking devices they invented were put on the 
wings of the airplane and, lo and behold, fuel consumption was reduced 
7% with a resulting several hundred mile increase in range. Patents 
were secured and the bolt-on devices were refined, developed and 
certified by the FAA. Their modification worked so well that word of 
mouth attested to the effectiveness . . . so much so that more than 
half the fleet of the billionaire's type airplane has now been modified 
attesting to the effectiveness.
    After years of these old-man engineers being panned by the elite of 
current American aeronautical engineering managers, Boeing was finally 
forced to try the modification for inclusion on the business jet 
version of their newest 737. Ironically they were tried because of the 
distinctive, snazzy look it gave the airplane and not because of any 
expectation of performance improvement. After all, the cream of 
aeronautical engineering management was so confident they wouldn't work 
that one Boeing individual even boasted that he would quit if they gave 
any improvement at all. The old men said to expect about 7%. The most 
rigorous and least refutable type of testing was flown . . . and the 
improvement was 7%. Seven percent may not sound like much to non-
technical people but I know of several cases of more than a billion 
dollars being sunk into the development of a wing to shoot for 4% 
improvement. Not only that, the airplane climbed faster (this uses less 
airspace), flew higher (using unusable airspace) flew faster and had 
the ability to carry between 5,000 and 10,000 pounds more off the same 
runway. Fortuitously, they didn't cost an arm and a leg either. All of 
these improvements would apply directly to capacity improvements for 
our skies and the savings in performance improvement alone would more 
than pay for the mod in a year. These improvements were extended to 
several other models of airliners and results are now beyond question.
    In the course of the earlier developments the patent holder also 
said that wake turbulence behind the airplane would be reduced. A 
couple of flights were flown where a following airplane was 
deliberately flown at varying distance behind a couple of differently 
modified planes to evaluate turbulence change. The qualitative 
evaluation of the pilot was that there was a great reduction.
    Knowing that wake turbulence has a great negative impact on air 
traffic capacity, representatives of Congress even came to Seattle 
starting in 1992 or 1993, to discuss the technology. As a result, 
discussions were held with the FAA about the sensibility to 
methodically and carefully evaluate turbulence technology to get actual 
numbers to confirm what the theoretical and qualitative reductions 
were. If they could then we would have a means to increase system 
capacity quickly and without a complete redesign of the ``National 
Airspace System''. To me (and the average voter no doubt) it is 
incredible that we have spent $32 billion on these grandiose redesign 
efforts over the last decade or two without getting anything useful 
from it . . . except, maybe, the dubious ``we've found a lot of stuff 
that won't work''.
    A couple of years ago the FAA was scrambling for funding and agreed 
that they would evaluate turbulence reduction technology but the 
Administrator didn't want her hands tied with specific legislation. 
Nothing happened so language was put into legislation since FY1999 but 
still the FAA has done nothing. First they said that they would 
reprogram the funds . . . and then they said they would outline the 
program for a supplemental appropriation. Next they said it was a NASA 
problem. Then they said that, since fuel consumption was lowered, they 
shouldn't look at it because it is a marketplace decision and it would 
look as if the FAA were showing favoritism to Boeing . . . ignoring the 
fact that the technology is starting to go on some Boeing airplanes 
because of a non-exclusive use license and that the patent doesn't 
belong to Boeing. In panning the idea, one high FAA official even said 
that turbulence was of no concern to Air Traffic Control because if it 
were, then he would have been told and asked to see if something could 
be done (this even though several FAA publications to airmen clearly 
warn of the danger of turbulence and of the necessity for pilots to 
avoid it).
    In a nutshell, the FAA people have resisted looking at the problem, 
possibly for fear that a significant reduction could complicate (or 
maybe simplify) redesign ground rules being programmed in their latest 
software design. Good Heavens, they should be aware that if there were 
a possibility that turbulence could be reduced in the near future, they 
should allow for this in any ``redesign''. To ignore this is just 
another un-addressed symptom of why the FAA track record has left 
something to be desired. By discounting this new technology, they are 
not unlike the attitude shown by McDonnell/Douglas when they were 
telling customers who wanted to buy these devices that they didn't 
work, and like the reluctant Boeing engineering managers, said they 
would probably wreck the planes.
    Congress and the President again addressed the issue in ``AIR-21''. 
Here are the actual words in this year's authorization act HR1000/S82 
conference report:
    ``Winglet efficiency/wake vortex--The conferees recommend that such 
sums as necessary be expended for research, prototyping, and flight 
testing winglet efficiency/wake vortex technology, which reduces fuel 
consumption and reduces the severity of wake vortex creation potential 
allowing more efficient spacing of aircraft. The Managers also direct 
FAA to work in consultation with NASA on this research.''
    Following is a simplified discussion of the major, unexplored, 
contributor to our traffic congestion.
    Due to the lack of flexibility the FAA uses to direct airplane 
routing, each airplane is directed down the same 3-D path in the sky to 
the airport and runway. Put another way, each airplane is directed into 
harm's way. The pilot ``sees'' these paths by visual indicators when 
the weather is clear, by the radio beams of the Instrument Landing 
System when visibility is limited, and by computerized flight path 
equipment in the airplane. It actually takes about one minute for the 
airplane to cross the end of the runway, touch down, slow down and turn 
off the runway before the next plane arrives. Put another way, a runway 
can comfortably handle one airliner a minute. This can seldom be 
achieved because all of our passenger airliners create a very strong 
tornado-like tube of tightly circulating wind called the wake vortex. 
Near the plane it has sufficient force to flip a small plane completely 
over or cause a large, large unexpected bank on another airliner. Like 
wind it eventually blows itself out, decays. Therefore, it is not safe 
to allow the next airplane in line to be too close to the one ahead of 
it. The distance must be established by the amount of time/distance it 
takes for the wake to decay. As a general rule the larger the airplane 
the worse the wake. The largest airplanes have to be announced as 
``heavy'' as a part of their flight plan and call sign. When the jumbo 
jets first came into service turbulence was so bad they even had to say 
``heavy, heavy''. This way other airplanes and traffic controllers know 
that more separation is required. Separation distances are typically 5 
to 7 miles. (The turbulence on one large Air Force military transport 
is such that parachute safety requires a separation of 40,000 feet, at 
some 5300 feet per mile this equates to 7.5 miles.) At typical approach 
speeds this equates to about three minutes.
    So we have runways that can handle an airplane a minute and 
turbulence limits them to one every three minutes. I hear Congress and 
the FAA wring hands about airspace congestion. There is story after 
story in the media about the problem. AIR-21 is ready to throw a couple 
of billion more into the FAA and built a firewall around it and commit 
the growth in funding for the next five years. Much of the increase is 
going into the AIP budget to build and maintain airports. As an 
engineer quite familiar with the way the FAA does things, I would 
observe that Congress should put some qualifying words into the FAA 
legislation to address the capacity issue. It doesn't make sense to 
spend AIP money on new runways without hedging the bet by also telling 
the FAA to fund a study of capacity improvement of existing by 
turbulence reduction. Firewall or no firewall, the biggest recipient of 
any wake vortex reduction capacity improvement would be the runways; 
basic common sense would say that runway money should, therefore, be 
used to fund the effort. Just one year's AIP money alone could be 
leveraged by 150 or 200 to one. It doesn't look like a smart 
proposition to redesign the National Airspace System for the umpteenth 
time . . . what is it, $32 billion so far, with nothing to show for it 
except things that have failed . . . without putting some money from 
the effort into finding out if real operational airplane modifications 
could result in a better way to reduce the capacity limitations caused 
by the wake vortex. Someone had better have the right numbers on 
turbulence, if for no more reason than to insure that the right safety 
factors are put in the myriad of computer programs that will be a part 
of any redesign effort.
    The FAA is fighting tooth and toenail trying not to look into this 
good opportunity, blaming the lack of funding and the firewalling 
provisions of Congress as the reason. There is a growing number of 
long-time proven engineers much better versed in the problem, who think 
otherwise. Time and again I hear that this is a marketplace problem but 
it isn't. Unless the FAA is in on the evaluations and structures them 
such that they are usable in solving their problems, there is no way 
anyone would invest a lot of money into the proof.

Safety Improvements Easily Obtained
    Lets go on to the next subject and talk about safety improvements. 
I personally have seen operable equipment that can easily eliminate the 
major preventable problem with airplane safety, controlled flight into 
terrain (CFIT). The technology I have seen can be used by an airliner 
and is affordable enough that it can also be used by many Cessna-sized 
light planes. In simulator demonstrations I have seen a pilot seeing 
the technology for the first time is getting along nicely in a minute 
or two . . . that's how natural it is. With little modifications it 
could also be extended to show other airplanes in a natural 
environment. This would lessen the mid-air collision problem and it 
would be compatible with the current FAA provisions. The cost of 
obtaining these gains is minimal if the FAA were more open to new 
ideas.
    Weather is still a real problem in aviation safety. Some very 
innovative ways to deal with this are being tried out in Alaska. They 
work like a charm . . . and there is no reason not to extend their use 
to the other 49 states. LAAS also offers some no risk improvements in 
safety including weather safety. Because it is a challenge to the old 
paradigm in aviation, its potential is not being exercised; if anything 
the FAA seems to be intentionally holding it back. There is no reason 
why the potential of the present equipment is not used to bring ``first 
hand'' information into the cockpit, thus cutting many opportunities 
for one human's mistakes to kill other humans. I will ask, ``Why should 
you be able to get better and more current information about traffic 
conditions on the freeway when the pilots of a $180 million airliner 
with 450 passengers have to rely on someone reading a 1930's technology 
teletype interpolation?'' Even the latest ``internet'' technologies are 
being adapted more for the passengers to ``entertain'' them during 
long, boring flights than for use by the crew. The ability of 
certifiable equipment to bring these safety-enhancing data to the 
cockpit greatly exceed the likelihood of the FAA to encourage the 
adoption and resulting benefits.
    There is another cost of safety that is easily overlooked because 
of the tragic human loss. This additional cost must also be factored 
into the price of each ticket no matter if it is in the cost of the FAA 
ticket, box and fuel tax or the increased insurance costs or accident 
investigation costs and the loss of productivity of the lost airline. 
In one accident Boeing alone, spent more for the accident than they did 
for the total engineering salary and benefit cost for the whole company 
for the whole year. While easily overlooked, this is not a small 
consideration. These tremendous costs need to be considered when 
evaluating the costs of safety improvements. Small improvements 
leverage large costs if they are not considered.

Costs of Passenger and Cargo Movement Can Be Cut
    If separation can be reduced due to wake vortex reduction, and if 
this reduction can be afforded by winglet/spiroids with the 
accompanying fuel savings and increase in performance, then the 
customers will have the benefit of lower cost for a faster trip using a 
less used part of the sky due to faster climb and higher, less crowded 
cruise altitude. Less crowded and more efficient use of the sky also 
implies less of a problem with capacity. This could imply that the 
costs to the FAA per passenger would be less. FAA income could remain 
constant due to the expected increase in the number of passengers. Trip 
times have some economic value to the passengers even though it may be 
speculative as to what it is. Whatever the actual figure, some saving 
will result. Some could argue that the fuel tax money of the aviation 
trust fund would decrease if overall fuel consumption of the airline 
fleet were increased, cutting fuel consumption. Again, if the 
efficiency increased the FAA would not need more money from their tax 
bite on extra, wasted fuel but the income would still increase because 
of the growth in traffic. When taken all together the savings potential 
is too great for Congress to allow the FAA to continue to disregard the 
common sense of this.

Trip Times Can Be Reduced
    Earlier, in the discussion of wake vortex reduction and the 
probability that safe spacing of airliners could be reduced was 
mentioned. To simplify the understanding of this imagine the following:
    You are a good guy and you have one airliner flying into a crowded 
airport. You want to cut your costs so you buy blended winglets/
spiroids to cut your fuel consumption and to carry a larger load in 
your airplane. I dominate the market to the airport and I have 11 
airplanes. My airplane is on approach, yours is second and mine are in 
positions 3 through 12. Turbulence reduction effects of blended 
winglet/spiroids can allow the spacing to be reduced from 3 minutes to 
2 minutes. My airplane must be three minutes behind yours. My number 3 
airplane can be moved up to only 2 minutes behind yours because you 
have the blended winglet/spiroid. Therefore my airplane gets a 1 minute 
reduction in trip time plus 1 minute of fuel plus 1 minute less wear 
and tear on the airplane plus 1 minute less of crew pay. The gain 
doesn't stop there because, even though my number 4 airplane is still 3 
minutes behind my number 3, number 4 is a minute closer to the runway 
because number 3 is; similar efficiencies accrue to number 4 also. This 
repeats for every following airplane. So here is the ``fairness'' of 
the situation: you paid your money and got 7% fuel reduction. I didn't 
pay a penny and got 10 minutes of fuel savings and 10 minutes less trip 
time and 10 minutes less maintenance and crew pay and am able to 
advertise a 1 minute reduction in trip time for 10 trips. You paid the 
money and I got more benefit than you did. A ``free rider'' got more 
than the responsible initiator of the benefit. Furthermore, the 
passengers and boxes that were on my airline got lower costs.
    The FAA argument that this is a ``market place'' decision runs 
against all classic laws of economics and against common sense. In 
advancing this fallacious argument they seem to fail to recognize that 
the costs of controlling the traffic should also be decreased. Congress 
has recognized this for a couple of years but the FAA refuses to 
explore the possibilities.
    Economists will tell a person that the factor that really 
determines the efficiency of our air system is trip speed. Since trip 
speed also takes times to travel to and from an airport and get on and 
off the plane, the portion of applicable trip time that must be 
addressed in the FAA side of the equation of the equation is block 
speed. This is the average time the door of the airplane is closed at 
the start of a trip until when it is opened at the end of the trip, 
divided into the length of the trip. This includes both ground times 
and flight times. Right now the so-called gridlock of the skies is most 
readily measured by the time from takeoff to the time the airplane 
taxis away from the runway and is turned over to ground control. This 
time is increasing alarmingly, to the detriment of everyone. Flight 
times can only be reduced two ways, flying the airplane at a faster 
speed or cutting the procedural times in the trip. If the airplane can 
fly a more direct route and not be delayed or rerouted due to other 
airplanes, the flight time will be reduced. One of the major causes of 
these procedural delays is the turbulence avoidance distances and 
times. In the earlier example where the reduction of turbulence is 
reduced only one minute by one airplane the compounding effect is a 
major reduction in overall flight times.
    Now imagine that 50% of the airplanes, in the example every other 
airplane, could be fitted with turbulence reduction technology. With 
your airplane fitted and the 5 of mine modified and 5 not. Total time 
savings for the airplanes could vary between 10 and 25 minutes 
depending on the mix of trail order of the modified and unmodified 
airplanes. This kind of information is clearly of importance to any 
redesign of the NAS. The FAA would be poor stewards of our skies if 
they didn't take this into consideration and certainly they are the 
logical governmental organization to bring this kind of wisdom into 
play.
    This whole discussion as a simplified summary of the kinds of gains 
available if we, as national policy, were to take advantage of even 
small improvements in turbulence reduction. Certainly these kinds of 
gains spread over the millions of flights is worth billions of dollars 
each year. This is a pretty fair cost leverage for the modest one-time 
cost of the testing necessary to take the theory and initial results 
into airline service.
    There is one more factor that really should be considered when 
talking about ticket costs and trip times. The more air commerce times 
and costs can be reduced, the more passengers and freight will be 
diverted to air from surface travel. DOT economists surely have some 
figures that show the relationship. As mentioned earlier in discussing 
safety, air travel is so much safer than surface travel that any 
diversion to the safer mode will result in less deaths and injuries on 
the highway. Time reduction with no increase in safety levels creates 
the same effect. Again, just because no one will ever be able to point 
to a person by name and prove that person's life was spared does not 
change this logical and statistical reality. I would dare say that, in 
the total, many more lives would be saved by an increase in diversion 
of passengers from surface to air travel by ticket cost and trip time 
reduction than were lost due to the tire problems on some SUV's. Such 
is the complexity and depth of the relationships of small improvements 
to large returns. Certainly the DOT should be sensitive to this but I 
doubt that Congress will find that they are.

Risk of Mid-Air Collision Can Be Reduced
    Technology exists to lessen the risk of mid-air collisions by 
letting the pilots know where all the other airplanes around them are. 
When combined with the advanced vision technologies that can now be 
demonstrated on real hardware, the communicating ability of the radar 
transponder combined with GPS positioning provides real possibility for 
a big reduction in near misses and mid-air collisions. Without getting 
into the discussion of whether the controller or pilot should have a 
particular responsibility, it would help the system if the pilot had 
indication where all other nearby airplanes were. The ADS-B shows great 
promise . . . and it doesn't require the reliability reducing grandiose 
schemes of complications such as GPS/WAAS. In ADS-B (Automatic 
Dependent Surveillance Broadcast) the airplane essentially determines 
where it is and the 3-D direction it is going and broadcasts this to 
all of the other nearby airplanes. It also receives this information 
from the other airplanes. Airplane computers then puts this information 
in a pictorial format for the pilots to see where all the other 
airplanes are. One may get wrapped around the axle as to what the 
procedural changes necessary for any redesigned NAS are but common 
sense says that whatever they are it would help safety if the pilot 
could see where other airplanes are. The concentration should be on 
providing the pilot pseudo-visual indications of traffic whether it is 
at night, in clouds, under, above, behind or below the airplane as well 
as in the cone of concern around the nose. It is poor stewardship to 
continue to resist such improvements as reliable computer and 
communications technology now make possible and affordable. This is the 
perfect case of better being the enemy of good.
    When I am flying, the first thing I would like to know after making 
sure my airplane is flying right, is where other airplanes are. Given 
my choice I would like to see where the other airplanes actually are. I 
want the traffic controllers to know also so they can direct all of the 
airplanes around each other. I feel that the traffic controller is 
short changed by the present philosophy which isn't too different from 
how airplanes were directed upon the advent of radar some 60 years ago 
during the Battle of Britain. I personally think that technology has 
passed our very competent traffic controllers by because they are kept 
from using their talent by enslavement to a dated technology and 
hidebound management structure. I think real attention to giving them 
the modern tools they need will increase their value and insure more 
and better employment. These folks are pretty smart and we should 
listen to them when they have differences of opinions with the people 
in charge of the FAA. It disappointed me when a high official in the 
FAA blamed inability to evaluate the effectiveness on these new 
technologies on the reduction in the funds the FAA had due to money 
being diverted to cover the new PASS and NATCA contracts. Apparently 
the person wanted to use this excuse to blame Congress. What he said 
was not true. Furthermore, he didn't think that I was smart enough to 
go to the law and the Congressional Record and find out that Congress 
specifically addressed this and provided more money, money that was not 
a part of a zero-sum funding process. Condescending things like this 
don't do much to encourage me to support the FAA.

Fuel Bought From Foreign Sources, Burned Into the Atmosphere Can Be 
        Reduced
    We talk about ``greenhouse'' effects and global warming and balance 
of payments and high gasoline prices and fuel cost surcharges for 
airline tickets. The FAA even has an energy office with several people 
who are charged with finding ways to cut fuel consumption . . . even 
being concerned about how much fuel used by baggage cart tugs on 
airport. Along comes a technology that has now proven beyond a shadow 
of doubt that fuel savings on the order of 5% for a jet liner are 
virtually guaranteed and that savings in the order of 10% are within 
reach. This would result in a savings of up to 2 billion gallons of jet 
fuel per year from just airlines alone (since fuel not burned means a 
reduction at the top margin of fuel imported, i.e., the highest priced 
fuel, now about $40 a barrel these figures equate to $8 million a day. 
Success of the $20 million wake turbulence program could be paid for in 
just 60 hours worth of fuel savings alone). If one were to factor in 
the ability to use the airplanes more efficiently and the savings in 
trip times alone this figure could easily increase by another 50 to 
100% for a total of 3 or 4 billion gallons. Our marginal fuel is all 
imported, putting us evermore at the mercy of OPEC, and every gallon of 
this fuel is burned into our atmosphere . . . and we all know that the 
burnt byproducts of fuel weigh many times what the fuel itself weighs. 
It would by my expectation that the FAA, having been clearly made aware 
of this would have been clamoring for Congress to give the authority to 
at least investigate. When I have talked to these very FAA people all I 
get is a ``ho hum''. Treasury, Commerce, Defense and State should also 
be interested because who controls fuel still controls the world. Why, 
in Sam Hill, would Congress think funding their FAA activity is a 
priority when the FAA won't even invest in so much as a phone call in 
response? The present attitude of the FAA should be of real concern to 
Congress. While it is not politically correct to say, Congress is far 
too trusting of the information they get from the FAA and should start 
getting independent information . . . and I would add that, given the 
state of over-regulation and the life or death power this gives, the 
people whose income depends on FAA acceptability, such as airlines may 
not be the most independent of sources.

Noise Can Be Reduced
    The biggest furor about jet airliners is the noise they make. As I 
recollect the popular phrase NIMBY (not in my back yard) originated 
because of airport noise problems. We are willing to spend more than a 
quarter billion dollars of aviation trust fund money to alleviate noise 
but aren't willing to investigate ways to actually reduce the noise to 
the neighborhoods. Electronic technology combined with new developments 
in engines and aeronautics shows promise to cut the noise problem 
considerably. It is true that the improvements may be measurable only 
by sound meter and do not address every quirk of the human psyche but 
we must pursue them anyway. Indeed, if an airliner were built that made 
absolutely no noise, some would probably be howling like banshees 
because the shadow of the plane bothered them . . . or something like 
that. I know of several cases where modern technology could have cut 
the noise to a large group of people by several times except that the 
FAA complained like crazy and did everything within their power to put 
the technology down. While the FAA attitude is delaying the benefits of 
noise reduction technology, the worse danger may be the FAA's clear 
message that they have disdain for new ideas. I would be delighted if 
the management advisory councils would help straighten the FAA out on 
such matters. Unfortunately, when I see the lack of independence of the 
members on the ``outside'' advisory councils, past and present, my 
hopes are not high.
    One should not think that the FAA is run by bad people. They have 
tried to solve some of the largest system problems of all time. Their 
problem was not with lack of sincerity . . . they actually wanted to 
and tried. Activities such as traffic control and regulation and 
certification are very important and deserve more funding. 
Unfortunately, the FAA's going-in lack of appreciation for the 
complexity of what they were trying to do doomed good intentions. They 
tried harder but all too often, just failed. They have become so 
sensitized to criticism that they have become very defensive. In such 
an environment the kinds of free spirits who do solve tough problems 
just won't be attracted to work there. Giving exemptions from federal 
hiring and procurement practices isn't the answer either. The result is 
gridlock and passenger unrest because of skies that the FAA has 
artificially, but unintentionally, clogged up. The old CAA went through 
a similar cycle of decay. Privatizing the FAA is not the answer; my gut 
feel is that this would be disasterous. Breaking them out of the DOT 
may help depoliticize them and that may help a little. Splitting off 
the traffic control and airport functions from the other parts of the 
FAA may help but the danger exists that they would become even more 
marginalized due to feuding between factions. I personally think that 
the FAA needs some sort of partnership with an organization experienced 
with large system integration, perhaps like the Air Force had during 
the trying days of getting our ICBM force developed and operational, or 
I fear the problem will never improve.
    I would suggest that Congress consider going a new direction when 
looking for light at the end of this tunnel. I don't think the FAA has 
any chance to heal themselves no matter what amount of money or relief 
from government regulations given them. There are some old codgers out 
there who have a pretty good track record in completing some projects 
that were a whole lot harder than anything the FAA has had to tackle. I 
have but to look at the moon shot and solid state electronics (the 
technology looks new because the its foundation was so solid that it 
allowed growth), the jet airliner, cars that are way more reliable, 
safer and efficient, the ballistic missile, communications systems . . 
. and a whole host of technologies we are now living on. A good many of 
the pioneers are still alive. They have had their victories and their 
relaxation after retirement. Their minds and innovative spirits have 
not atrophied. They are secure enough in their competence that they 
don't have to be a slave to popularity. Just like these winglet/spiroid 
inventors who have punched some big holes in conventional aeronautical 
theory, many or most will be in their 70's and 80's. Most would 
probably jump at the chance to help Congress or the FAA out in these 
matters. They are no longer beholden to the government, or the airlines 
or industry for their livelihood, so odds are good that they would come 
up with some pretty sound, unbiased advice.

European Issues
    Like it or not, the EU is interested in the issues above . . . 
they're interested because they can use them to make money for their 
people at our American expense. Unlike us, they give massive support to 
their airliner industry. They are blatantly open about their subsidies 
for their manufacturers. They are under no illusions about the purpose 
of their equivalent of the FAA. Incredibly, they have positioned 
themselves into our political processes so deftly that there are 5, 
that's right, 5 sections in the recently passed ``AIR-21'' act the 
President has signed into law. They are also ready to apply 
restrictions in a way that will allow their products to remain in 
service while forcing American products out. One has but to look at how 
they have prohibited ``hush kit'' airplanes from their countries, 
knowing that the only hush kit modifications were on American planes. 
If they could keep them out then it would lower the utility, hence 
value, of the American airplanes and, thereby, increase the value of 
their competing products.
    They have already completed a series of turbulence tests (using 
American technology provide by our government, in part). We can be sure 
that they already have a plan to discriminate against American-built 
airplanes based on turbulence if there is a significant amount of 
turbulence reduction from American technologies discussed above. We 
should understand that they will use this information in a secondary 
way as a means of restricting traffic for any airline flying into or 
through European airspace . . . and if we don't get with it, we won't 
have anything to say about their figures. In the mean time our 
government sleeps. It is up to Congress to give the FAA a bit more 
direction on addressing the types of issues I bring up if we are to 
slow down this sup in competitiveness that our own FAA is abetting.
    Maybe this is now a way to ``win friends and influence people'' but 
in my eyes and the eyes of my compatriots, it is absolutely incredible 
that the Commerce Committee, Republicans and Democrats both, or at 
least, the Aviation sub-Committee doesn't have an investigation and 
hearings on these matters.

Conclusion
    I have made some statements above that may challenge some 
conventional wisdom. To go to the FAA to find out if the assertions are 
valid or not will not yield an unbiased answer. Neither will going to 
an airline whose success depends on passing FAA inspections. But the 
truth is that no one ever believes it when a new paradigm shift starts. 
One could always point to the ``cold fusions'' of the past as an excuse 
to do nothing, but fairness would dictate that the airplane, computer, 
transistor radio, cel-phone and car and every other technology were 
once new. Just maybe there is some credence to the assertions above.
    Thank You.
                                 ______
                                 
            Prepared Statement of Hon. Ernest F. Hollings, 
                    U.S. Senator from South Carolina

    Good morning. I see that we are starting this hearing on time. I 
hope the air carriers appreciate that fact. We may need to break for a 
vote, but we will let you know as soon as we know. For those of you 
that fly, you can see that we run things a little differently here. We 
use real clocks, relatively real, but flexible schedules, and try to 
keep you informed.
    Pick up any major newspaper this summer, and the headlines read 
``Summer's a Bummer on land or in the air''--USA TODAY, August 21.
    ``Crises for Air Traffic System: More Passengers, More Delays''--NY 
Times, September 5.
    ``The Airlines; Less Regulation Won't Fly''--Business Week, August 
7.
    Even the London Sunday Times did a piece on ``Long Delays on US 
Flights''.
    We have graphs, charts, and numbers to demonstrate that things are 
bad. We don't need them, however. All you need to do is look at the 
letters we get, or fly through one of the mega-hubs. Air carrier on-
time performance was one of the worst ever recorded for June, at 66.3%.
    A few weeks ago Secretary Slater called the entire industry in to 
talk about solutions, and I want to hear from him today. I know that 
Administrator Garvey has said that there is no one silver bullet to 
fixing the delay situation, and she is right. It is airport capacity, 
it is carrier service, it is new air traffic control equipment, it is 
new routes being designed by the FAA and industry, and it is money. We 
have the managment, we have FAA reforms--a new Chief Operating Officer 
for air traffic, and a board to work with the COO, and so on, but 
change will take time.
    For years, we have underfunded the needs of the aviation system, 
and it is finally coming to haunt us. We let the Airport and Airways 
Trust Fund surplus be used for everything but aviation, shortchanging 
our airports, travelers and the FAA. I asked the then FAA Administrator 
Alan McArtor for a plan to spend money for airports. To meet the needs, 
not the political needs, or OMB's needs, but the real needs.
    I never got that plan.
    A few years ago, the Committee sat down with the FAA, Mitre, GAO 
and others to take a hard look at the needs of the air traffic control 
system. Everyone knew there wasn't enough money. We had a chart that 
was used as part of that process that showed how much was needed, how 
much the FAA was going to get, and the projected funding the 
President's budget would provide. Unfortunately, we did not fix the 
funding problem until this year. We now have a set amount of money put 
aside solely for aviation--we will have an additional $1.3 billion for 
airport grants, and about $700 million for air traffic control 
equipment in FY 2001, compared to FY 2000. These monies should have 
been made available years ago.
    But that is history. Right now, we need to take a look at how to 
expedite airport construction, how to facilitate industry-FAA 
collaboration on delays, and perhaps call on the Secretary to hold 
scheduling Committee hearings, similar to those held in the mid-80's, 
when we faced a delay problem. The carriers today cannot unilaterally 
disarm their schedules, and it will take a coordinated effort to sort 
through what can and can't be done to help alleviate delays for people.
    Finally, I know that there are some advocates of, and one of our 
witnesses today will discuss, the concept of privatization. Air traffic 
controllers provide a basic safety function. They are at the heart of 
safety, directing planes day in and day out, carrying more than 650 
million passengers per year. I know that some will argue ``but other 
countries privatize ATC functions'', but no where is the aviation 
system so complex. We have more operations in smaller areas than many 
of the countries today that have privatized systems. In addition, we 
keep making changes to the FAA--its time we let the changes we have 
instituted be put to work, rather than change the desks before the new 
people arrive.

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