[Senate Hearing 110-1126]
[From the U.S. Government Publishing Office]
S. Hrg. 110-1126
OVERSIGHT OF FOREIGN AVIATION
REPAIR STATIONS
=======================================================================
HEARING
before the
SUBCOMMITTEE ON AVIATION OPERATIONS, SAFETY, AND SECURITY
of the
COMMITTEE ON COMMERCE,
SCIENCE, AND TRANSPORTATION
UNITED STATES SENATE
ONE HUNDRED TENTH CONGRESS
FIRST SESSION
__________
JUNE 20, 2007
__________
Printed for the use of the Committee on Commerce, Science, and
Transportation
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74-105 PDF WASHINGTON : 2012
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SENATE COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION
ONE HUNDRED TENTH CONGRESS
FIRST SESSION
DANIEL K. INOUYE, Hawaii, Chairman
JOHN D. ROCKEFELLER IV, West TED STEVENS, Alaska, Vice Chairman
Virginia JOHN McCAIN, Arizona
JOHN F. KERRY, Massachusetts TRENT LOTT, Mississippi
BYRON L. DORGAN, North Dakota KAY BAILEY HUTCHISON, Texas
BARBARA BOXER, California OLYMPIA J. SNOWE, Maine
BILL NELSON, Florida GORDON H. SMITH, Oregon
MARIA CANTWELL, Washington JOHN ENSIGN, Nevada
FRANK R. LAUTENBERG, New Jersey JOHN E. SUNUNU, New Hampshire
MARK PRYOR, Arkansas JIM DeMINT, South Carolina
THOMAS R. CARPER, Delaware DAVID VITTER, Louisiana
CLAIRE McCASKILL, Missouri JOHN THUNE, South Dakota
AMY KLOBUCHAR, Minnesota
Margaret L. Cummisky, Democratic Staff Director and Chief Counsel
Lila Harper Helms, Democratic Deputy Staff Director and Policy Director
Christine D. Kurth, Republican Staff Director and General Counsel
Kenneth R. Nahigian, Republican Deputy Staff Director and Chief Counsel
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SUBCOMMITTEE ON AVIATION OPERATIONS, SAFETY, AND SECURITY
JOHN D. ROCKEFELLER IV, West TRENT LOTT, Mississippi, Ranking
Virginia, Chairman JOHN McCAIN, Arizona
JOHN F. KERRY, Massachusetts KAY BAILEY HUTCHISON, Texas
BYRON L. DORGAN, North Dakota OLYMPIA J. SNOWE, Maine
BARBARA BOXER, California GORDON H. SMITH, Oregon
BILL NELSON, Florida JOHN ENSIGN, Nevada
MARIA CANTWELL, Washington JOHN E. SUNUNU, New Hampshire
FRANK R. LAUTENBERG, New Jersey JIM DeMINT, South Carolina
MARK PRYOR, Arkansas DAVID VITTER, Louisiana
THOMAS R. CARPER, Delaware JOHN THUNE, South Dakota
CLAIRE McCASKILL, Missouri
AMY KLOBUCHAR, Minnesota
C O N T E N T S
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Page
Hearing held on June 20, 2007.................................... 1
Statement of Senator Dorgan...................................... 58
Statement of Senator Lautenberg.................................. 3
Statement of Senator Lott........................................ 53
Statement of Senator McCaskill................................... 2
Statement of Senator Rockefeller................................. 1
Witnesses
Barimo, Basil J., Vice President, Operations and Safety, Air
Transport Association of America, Inc.......................... 36
Prepared statement........................................... 38
Brantley, Tom, President, Professional Airways Systems
Specialists (PASS), AFL-CIO.................................... 46
Prepared statement........................................... 47
Filler, Marshall S., Managing Director and General Counsel,
Aeronautical Repair Station Association (ARSA)................. 24
Prepared statement........................................... 26
Gilligan, Margaret, Deputy Associate Administrator for Aviation
Safety, FAA.................................................... 15
Prepared statement........................................... 17
Roach, Jr., Robert, General Vice President of Transportation,
International Association of Machinists and Aerospace Workers.. 20
Prepared statement........................................... 22
Scovel III, Hon. Calvin L., Inspector General, U.S. Department of
Transportation................................................. 5
Prepared statement........................................... 7
Appendix
Rockefeller IV, Hon. John D., U.S. Senator from West Virginia,
prepared statement............................................. 75
Response to written questions submitted by Hon. John D.
Rockefeller IV:
Marshall S. Filler........................................... 77
Margaret Gilligan............................................ 76
Hon. Calvin L. Scovel III.................................... 75
OVERSIGHT OF FOREIGN AVIATION
REPAIR STATIONS
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WEDNESDAY, JUNE 20, 2007
U.S. Senate,
Subcommittee on Aviation Operations, Safety, and
Security,
Committee on Commerce, Science, and Transportation,
Washington, DC.
The Subcommittee met, pursuant to notice, at 2:36 p.m. in
room SR-253, Russell Senate Office Building, Hon. John D.
Rockefeller IV, Chairman of the Subcommittee, presiding.
OPENING STATEMENT OF HON. JOHN D. ROCKEFELLER IV,
U.S. SENATOR FROM WEST VIRGINIA
Senator Rockefeller. My apologies. I've been in the Senate
for a number of years and this is the first time I've ever been
late for anything. I'm just sorry it had to be you.
This is an important oversight. Aviation safety is one of
the Subcommittee's primary responsibilities and we, the
Subcommittee, interestingly, there aren't that many that come.
Claire McCaskill is one, John Thune is another, Trent Lott, and
myself come, but aviation, as you know, is a very difficult
subject and if you're not into the terminology and the weeds of
that and with all the other things people have going on. I'm
always a little bit embarrassed when we have a hearing on such
an important manner, but Claire and I are here and that's--
actually you got a pretty good deal on that.
The Government has absolutely no more important role in
making sure that our Nation's aviation systems remain the
safest in the world. I met with the former Prime Minister of
Ireland this morning where we discussed this general subject in
his new capacity. I want to thank Senator McCaskill for
requesting this hearing, which she did. It was she that
requested it and she is aggressively seeking to improve our
Nation's aviation safety.
Now, I would like to thank our other witnesses for coming
today, as well. That's all of you.
I have a few brief remarks and then we'll ask other
Senators if they have opening statements and I know of at least
one who will.
First, I want to state that I firmly believe that the
United States has the safest and the best air system in the
world. I say that in spite of the fact that we have an analog
air traffic control system, which embarrasses me every single
day of my life, since we're the only people in the
industrialized world that have that. And we're trying to cure
that in the bill, which we passed through Congress with various
people objecting for what I call wholly insufficient reasons.
I do not want to give anyone the impression that I believe
it's unsafe to fly, but the aviation industry continues to
change rapidly in light of unrelenting competitive pressures. I
am concerned that the quickly changing nature of the commercial
aviation industry, coupled with the FAA's declining level of
resources, threatens the agency's ability to maintain the
necessary level of oversight of air carriers' foreign repair
stations and upgrade the existing safety infrastructure at our
own airports. It's a massive problem. There have been huge
layoffs because of budget cuts by the Administration.
Although I understand why many commercial airlines are
contracting out an increasing amount of their maintenance work,
I am concerned that this work is being sent to foreign
countries where governmental oversight for both the home nation
and the FAA may be weak or nonexistent. That is a much larger
source of energy and concern than many of you will, at first,
accept. You will accept this, you'll hear the statement, but
you need to understand this is a, the profound concern of, not
just this Committee, but generally in Congress.
Compounding the industry's trend to outsource much of the
significant maintenance work, is the inability of the FAA to
certify and closely monitor an ever increasing number of
foreign repair stations. I do not question the Agency's
commitment to safety. I believe that is due mainly to a lack of
resources. I'm deeply concerned that the FAA is losing a number
of its most senior safety inspectors and does not have the
ability to replace them.
This Committee, as it begins evaluating the future of the
FAA, should be spending a considerable amount of its time
making sure that the agency is able to meet its foremost
mission, which is the safety of the traveling public.
Again, I want to thank Senator McCaskill for her leadership
on this issue and I call on her for any statements that she may
wish to make.
STATEMENT OF HON. CLAIRE McCASKILL,
U.S. SENATOR FROM MISSOURI
Senator McCaskill. Thank you, Mr. Chairman. And, I want to
thank you for calling this hearing. I think it is incredibly
important. I think if the American people understood some of
the safety and security issues surrounding foreign repair
stations, they would march on Washington with pitchforks. I
began down this road simply by reviewing a summary of the IG
report, the FAA IG reports of both 2003 and 2005. And, as I
began to pull that thread, I was surprised by what I learned
and I hope today I will have the opportunity to ask some very,
I hope, penetrating questions in four different areas.
First, on safety--if, in fact, qualified and certified
inspection sites are important in the United States of America,
then why aren't they important in other countries? We can not
have a double standard. We can not decide that you have to get
to a certain level in the United States, but not care about
those safety levels in other countries. If drug and alcohol
testing are important in the United States of America, they
should be important in every location where someone has access
to the physical operation of an airplane.
In the security area--if background checks are important
and perimeter security is important in some FAA-certified
sites, they should be important in all sites. In June of 2007,
the State Department put out its latest report on terrorism,
excuse me, in June of 2006, this was released on April 30,
2007. The following countries where FAA-certified foreign
repair stations are located, these countries are located as
terrorist safe havens; the tri-border region of Argentina,
Brazil, Columbia, Indonesia, and the Philippines. If we are
allowing foreign repair stations to be located in nations that
have been deemed safe havens for terrorists by our own State
Department, then the standard should be very high in deed for
security checks, background checks, and perimeter security.
The third area that I think we have to talk about today is
accountability. If the Congress passes laws, including their
most recent authorization act, and requires certain rules to be
promulgated and certain action to be taken by FAA and TSA, then
it is imperative that those rules be promulgated, it is
imperative that those laws be followed. If we don't force
accountability for the laws that Congress has already passed,
then one could ask, what is the point of us being here to pass
another FAA authorization act.
And finally funding--and it is forced because it is the
least important. Safety and security are the most important,
accountability of FAA and those people in the Homeland Security
Department are incredibly important, but funding is also
important. Should the taxpayers be funding any part, should we
be subsidizing in any way the effort to inspect foreign repair
stations? Is that fair to those companies who are not going to
the lowest wage and are continuing to repair their airplanes
and maintain their airplanes here in the United States of
America.
Once again, Mr. Chairman, I thank you very much for holding
this hearing and I look forward to hearing the testimony of the
witnesses. I appreciate them all being here, as I know you do,
and I look forward to having these questions answered.
Thank you.
Senator Rockefeller. Thank you, Senator McCaskill.
Senator Lott, do you have--Co-Chair of this Subcommittee.
Senator Lott. Well, thank you Mr. Chairman, glad to be here
and appreciate you having a hearing so we can fully understand
all the ramifications of this issue. I'd like to withhold any
comments at this time so we can hear the testimony of the
witnesses. And maybe I'll have some questions and some comments
after that.
Thank you.
Senator Rockefeller. That means you'll have a lot of
questions.
[Laughter.]
Senator Rockefeller. Senator Lautenberg.
STATEMENT OF HON. FRANK R. LAUTENBERG,
U.S. SENATOR FROM NEW JERSEY
Senator Lautenberg. Thank you, Mr. Chairman. I just need a
moment to get organized.
Senator Rockefeller. Well, we're just going to sit here and
look right at you and wait for you to be ready.
Senator Lautenberg. I respect that.
OK, thanks very much, Mr. Chairman, I congratulate our
colleague from Missouri for her inquiry into the bill and
examining the problems that we see, and as with other
industries across the country work like this, being outsourced
in the aviation industry.
Ten years ago, airlines outsourced 37 percent of their
maintenance work according to the DOT's Inspector General.
Today, they outsource 64 percent, it's quite incredible. The
more repair work the airlines choose to send overseas, the less
of that work gets inspected by FAA.
But in 2003, an Air Midwest plane crashed, killing 19
passengers and 2 crew members, and the NTSB investigated and
found, specifically, that a lack of Federal oversight over
maintenance had contributed to the accident.
Seven hundred and sixty million people will fly this year,
and by the year 2015, the number's expected to hit 1 billion.
And yet, while the number of passengers is increasing, the
amount of maintenance work that the FAA inspects is decreasing.
As of February, the FAA had only three more aviation safety
staffers than it had 3 years ago. It doesn't sound like it's
keeping up to date. And those inspectors used to travel
primarily to staff facilities within the country, but now
they've got to go to aviation repair facilities as far away as
China, without additional resources.
So, I also want to mention my concern about the safety of
the work done at repair stations not certified by the FAA. With
the summer season travel upon us, long-term agenda in air
travel trends shows no sign of slowing. This is not the time to
take any extra risks with the safety of our aviation system.
FAA needs to outline what, if any, work it will allow at these
facilities, for the safety of our passengers and the viability
of our economy, we need to know that our aircraft are being
repaired responsibly, and those repairs are being overseen by
the FAA.
Mr. Chairman, thanks very much for the opportunity to chat
with you here.
Senator Rockefeller. Thank you very much, Senator
Lautenberg.
I'm going to introduce the panelists, and then we're going
to do something a little bit different. Senator McCaskill, who
has been the driving force behind this, is going to come sit
here, and chair the hearing, and I will take her place, and
stay and ask questions.
Our witnesses are Calvin Scovel, U.S. Department of
Transportation Inspector General; Peggy Gilligan, Deputy
Associate Administration for Aviation Safety, FAA; Robert
Roach, General Vice President, International Association of
Machinists and Aerospace Workers; Marshall Filler, Managing
Director and General Counsel, Aeronautical Repair Station
Association; Basil Barimo who is Vice President of Operations
and Safety, Air Transport Association (ATA); and Tom Brantley,
President, Professional Airway Systems Specialists (PASS). So,
just hold for 1 second.
Senator Lott. Are we going to have the testimony of the
witnesses now, beginning with Mr. Scovel, I guess across the
table?
Senator McCaskill. Please, go ahead, thank you.
STATEMENT OF HON. CALVIN L. SCOVEL III, INSPECTOR GENERAL, U.S.
DEPARTMENT OF TRANSPORTATION
Mr. Scovel. Mr. Chairman, Madame Chairman, members of the
Subcommittee, we appreciate the opportunity to testify on FAA's
oversight of foreign repair stations and facilities.
Air carriers have outsourced, or contracted out,
maintenance for years to both domestic and foreign repair
stations. However, in recent years, use of external repair
facilities has become more prevalent in the industry.
From 1996 to 2006, air carriers increased the percentage of
maintenance dollars spent on outsourced maintenance from 37
percent to 64 percent. In 2006, $3.7 billion of the $5.7
billion spent on maintenance was outsourced.
Neither FAA nor the Department maintain information on how
much maintenance air carriers outsource to foreign facilities,
but our work shows that the number of foreign, FAA-certificated
repair stations repairing U.S. aircraft has increased from 344
in 1994 to 698 in 2007.
As we have emphasized in the past, however, the issue is
not where maintenance is performed, it is that maintenance
requires effective oversight.
We see three areas that are key in FAA's efforts to
effectively oversee outsourced air carrier maintenance,
including maintenance performed by foreign repair stations and
facilities. First, FAA must strengthen its risk-based systems
for safety oversight. During the past 8 years, FAA has taken
important steps to move its safety oversight for air carriers
and repair stations to risk-based systems. FAA's new oversight
system applies to both domestic and foreign repair stations. It
is designed to help FAA inspectors focus their outsourced
maintenance oversight on areas that pose the greatest safety
risks. Risk-based oversight should significantly enhance FAA's
ability to focus its inspections. However, we have identified a
number of concerns that FAA must address.
In July 2003, we reported that FAA oversight had not
shifted to where the maintenance was actually being performed.
Instead, inspectors continued to focus inspections on in-house
air carrier maintenance. We also reported, that at that time,
138 repair stations in Germany, France, and Ireland were not
inspected by FAA at all. Under bilateral agreements with the
aviation authorities of these countries, FAA permitted foreign
authorities to inspect FAA-certificated repair stations on its
behalf.
Since our 2003 report, FAA officials have worked closely
with the aviation authorities of other countries, to improve
the surveillance they perform on FAA's behalf. We are concerned
that FAA is still not regularly visiting the facilities and the
countries where agreements exist with other aviation
authorities. For example, FAA international field office
inspectors had not conducted any spot inspections of one major
foreign engine repair station in 5 years between 2001 and 2006.
Recently, FAA has made significant progress in improving
its repair station oversight. Since October 2005, inspectors
have been required to review 15 areas within repair station
operations to obtain a baseline assessment of each facility.
Using this information, inspectors can focus their oversight on
risk areas identified within the facility.
For the new oversight system to be successful, FAA needs to
ensure that its inspectors receive the training they need to
properly implement these new processes.
Second, FAA must know the location and type of maintenance
that is being performed. In July of 2003 and December of 2005,
we reported that FAA did not have good systems for determining
which repair facilities air carriers were using to perform
their most critical maintenance. Air carriers are required to
provide--and FAA must approve--a list of repair stations that
can conduct major repairs on air carriers' aircraft. However,
the information that air carriers were providing did not always
represent the facilities they actually used or show the
quantity of work they sent to each facility.
This fiscal year, FAA developed new inspector guidance and
air carrier processes to address this problem, but these
efforts still fall short of providing FAA with the information
it needs.
For example, air carriers do not include all repair
stations that provide critical component repairs in their
quarterly utilization reports. Also, FAA does not validate the
information provided.
Further, in December 2005, we reported that FAA was not
aware that non-certificated repair facilities were performing
critical repairs for U.S. air carriers. Our review of 19 air
carrier maintenance vendor lists showed that all 19 carriers
used non-certificated repair facilities to some extent. We
identified over 1,400 non-certificated repair facilities
performing maintenance, and more than 100 of these facilities
were located in foreign countries.
I see that I am almost out of time; if I may have, perhaps,
another 2 minutes, I should be able to wrap up.
Senator McCaskill. Take the 2 minutes.
Mr. Scovel. Thank you.
Non-certificated facilities are not required to have the
same quality controls and oversight systems that exist in FAA-
certificated repair stations. Yet, there are no limitations on
the scope of work they can perform. Further, FAA cannot rely on
air carrier oversight programs for non-certificated repair
facilities, because the carriers we visited did not provide
adequate oversight of the work performed. FAA's efforts to
improve its oversight in this area are still underway.
Third, FAA must ensure that its inspectors are well-
positioned to adequately oversee maintenance outsourcing. FAA
has approximately 3,821 inspectors located in offices around
the world to oversee both domestic and foreign aspects of air
carrier maintenance operations. However, FAA does not have a
staffing model to determine the number of inspectors needed and
where they should be placed.
FAA has hired an independent contractor to conduct a study
to determine the most effective staffing mechanism, but
completion of this process is likely years away.
The important implications of the changing U.S. and global
aviation environment that we have discussed today are expected
to be key drivers of future inspector staffing needs. Air
carrier outsourcing of aircraft maintenance, FAA's shift to a
systems safety oversight approach, and safety inspectors'
attrition and retirement are all significant changes that must
be considered in determining staffing needs. Until FAA develops
an effective staffing model, it will not be able to determine
where inspectors should be placed to make the most effective
use of its resources.
This concludes my statement. I would be pleased to address
any questions that you or other members of the Subcommittee may
have.
[The prepared statement of Mr. Scovel follows:]
Prepared Statement of Hon. Calvin L. Scovel III, Inspector General,
U.S. Department of Transportation
Mr. Chairman and members of the Subcommittee:
We appreciate the opportunity to testify on the Federal Aviation
Administration's (FAA) oversight of foreign repair stations and
facilities. Our testimony today is based on a number of our previous
reports as well as our ongoing work. At the outset, it is important to
note that while the United States has the most complex aviation system
in the world, it is also the safest. Multiple layers of controls in air
carrier operations and maintenance processes, along with FAA's
oversight, are largely responsible for the high level of safety that we
have seen in the last 5 years.
This safety record is a remarkable accomplishment given the many
changes occurring within the industry. For example, air carriers
continue to struggle for profitability and are aggressively working to
cut costs by reducing in-house staff, renegotiating labor agreements,
and increasing the use of external repair facilities--many of which are
located in foreign countries.
Today's aviation environment continues to evolve. Since 2001, eight
commercial air carriers have gone through bankruptcy and one has ceased
operations. Fuel prices remain high, and this makes cost control a key
factor in both the sustained profitability and overall survival of an
airline. Personnel and aircraft maintenance are also significant cost
areas within an air carrier's operations, and air carriers have been
outsourcing, or contracting out, more maintenance to domestic and
foreign repair stations to reduce these costs. Outsourcing maintenance
is also a means for air carriers to accommodate the increasingly global
nature of air travel. That is, having maintenance contracts with
facilities around the world permits air carriers to readily obtain
needed maintenance repairs and services.
Air carriers have outsourced maintenance for years to both domestic
and foreign repair facilities. These facilities can complete repairs
for less cost and provide services in areas (such as engine repair)
that would otherwise require air carriers to have specialized equipment
and staff. Many air carriers outsource their engine work to the
original equipment manufacturers because of the level of expertise and
the product warranties that the manufacturers can provide. However, in
recent years, use of external repair facilities has become more
prominent. From 1996 to 2006, while total maintenance costs fluctuated,
air carriers continued to increase the percentage of maintenance
dollars spent on outsourced maintenance--from 37 percent to 64 percent.
In 2006, $3.7 billion of the $5.7 billion spent on maintenance was
outsourced (see figure 1).
Figure 1. Percentage Increase in Outsourced (Contract) Maintenance
Expense for Major Air Carriers \1\ From 1996 to 2006
Neither FAA nor the Department maintain information on how much
maintenance air carriers outsource to foreign facilities, but our work
shows that the number of foreign FAA-certificated repair stations
repairing U.S. aircraft has increased from 344 in 1994 to 698 in 2007.
We have emphasized that the issue is not where maintenance is performed
but that maintenance requires effective oversight.
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\1\ Alaska Airlines, America West Airlines, American Airlines,
Continental Airlines, Delta Air Lines, Northwest Airlines, Southwest
Airlines, United Airlines, and US Airways.
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However, we have identified challenges in FAA's ability to
effectively monitor the increase in outsourcing. For example, in July
2003, we reported \2\ that FAA had not shifted its oversight of
aircraft maintenance to the locations where the maintenance was
performed. Although air carriers were using external repair stations to
perform more of their maintenance work, FAA was still focusing most of
its inspections on the maintenance work that air carriers performed
within their own facilities.
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\2\ OIG Report Number AV-2003-047, ``Review of Air Carriers' Use of
Aircraft Repair Stations,'' July 8, 2003. OIG reports and testimonies
can be found on our website: www.oig.dot.gov.
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FAA has taken a number of steps to improve its oversight, and we
will discuss some of those improvements today. However, the continuous
growth in outsourcing underscores the need for FAA to remain vigilant
in continually improving its oversight.
Today, I will begin by briefly discussing the regulatory
differences between foreign and domestic repair stations. I will then
move to two areas that we see as key in FAA's efforts to effectively
oversee outsourced air carrier maintenance--including that performed by
foreign repair stations and facilities.
Regulatory differences between domestic and foreign repair
stations: FAA-certificated maintenance facilities are referred
to as repair stations. FAA has certificated (or licensed) 698
foreign repair stations to perform work on U.S. aircraft. The
issuance of an FAA certificate means that FAA has determined
that the facilities have the equipment, personnel, and
inspection systems to ensure that repairs are completed
according to FAA standards. Unlike U.S. repair stations,
foreign repair stations must first demonstrate a need to obtain
an FAA certificate--that is, the facility must show that it has
potential customers with U.S.-registered aircraft. Also,
foreign repair station certificates are only valid for a 1- to
2-year period.
These requirements are more stringent than those mandated for
domestic repair stations. However, foreign repair stations are
currently exempt from some FAA requirements that domestic
repair stations must meet. For example, FAA requires domestic
repair stations to have drug and alcohol programs to
periodically test employees performing maintenance but does not
require foreign repair stations to perform drug and alcohol
testing on their employees.
Strengthening safety oversight of repair stations and non-
certificated repair facilities: During the past 8 years, FAA
has taken important steps to move its safety oversight for air
carriers and repair stations to risk-based systems. FAA's new
oversight system applies to both domestic and foreign repair
stations. It is designed to help FAA inspectors focus their
outsourced maintenance oversight on areas that pose the
greatest safety risks. FAA is clearly on the right path;
however, the risk-based systems are not yet at an end-state.
FAA cannot effectively implement a risk-based system for
oversight of aircraft maintenance if it does not know where the
maintenance is performed. In July 2003 and December 2005,\3\ we
reported that FAA did not have good systems for determining
which repair facilities air carriers were using to perform
their most critical maintenance. FAA has developed new
inspector guidance and air carrier processes to address this
problem, but these efforts still fall short of providing FAA
with the information it needs. For example, FAA has developed a
voluntary process for air carriers to report the top 10
critical maintenance providers used each quarter. However, as
long as the process is voluntary, FAA cannot be assured that it
is getting the accurate and timely information needed to
determine where it should focus its inspections. Further, we
reported that FAA was not aware that non-certificated repair
facilities performed critical repairs for U.S. air carriers.
Our review of 19 air carrier maintenance vendor lists showed
that all 19 air carriers used non-certificated repair
facilities to some extent. We identified over 1,400 non-
certificated repair facilities performing maintenance, and more
than 100 of these facilities were located in foreign countries.
FAA's efforts to improve its oversight in this area are still
underway.
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\3\ OIG Report Number AV-2006-031, ``Review of Air Carriers' Use of
Non-Certificated Repair Facilities,'' December 15, 2005.
Ensuring that inspectors are well-positioned to adequately
oversee maintenance outsourcing: FAA has approximately 3,821
inspectors located in offices throughout the United States and
in other countries. FAA inspectors must oversee both domestic
and foreign aspects of air carriers' maintenance operations--a
task made more difficult by the rapidly changing aviation
environment. The pace of these changes makes it imperative for
FAA to maintain a sufficient number of inspectors to perform
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safety oversight and place them in the right locations.
In the next 5 years, 51 percent of the current inspection
workforce will be eligible to retire. However, this is only one
of the challenges that FAA faces with its inspectors. For
example, FAA does not have a staffing model to determine the
number of inspectors needed and where they should be placed.
Until FAA develops a staffing model, it will not be able to
make the most effective use of its resources.
I would now like to discuss the changes occurring in the aviation
industry, regulatory differences, and these two key areas in further
detail.
Recent Trends in Outsourcing
We are conducting a review of the type and quantity of maintenance
that air carriers are outsourcing; we plan to report on this review
later this year. We are finding that the amount, or quantity, of
maintenance that air carriers outsource continues to climb. Further,
the work that U.S. air carriers outsource includes everything from
repairing critical components, such as landing gear and engine
overhauls, to performing heavy airframe maintenance checks, which are a
complete teardown and overhaul of aircraft. As shown in figure 2, nine
major air carriers \4\ we reviewed increased the percentage of heavy
maintenance they outsourced to certificated repair stations from 34
percent in 2003 to 67 percent in 2006.
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\4\ The carriers represent a cross-section of nine of the largest
network and low-cost air carriers and included: AirTran Airways, Alaska
Airlines, America West Airlines, Continental Airlines, Delta Air Lines,
JetBlue Airways, Northwest Airlines, Southwest Airlines, and United
Airlines. Because American Airlines, the largest U.S. air carrier, has
retained its heavy maintenance as opposed to making a significant shift
to outsourcing, we did not include it in our review.
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Figure 2. Percentage of Heavy Airframe Maintenance Checks Outsourced
for Nine Major Air Carriers From 2003 to 2006
Of the heavy maintenance outsourced by the nine carriers in 2006,
35 percent was sent to foreign maintenance providers, up from 21
percent in 2003. The trend in outsourcing is significant and
underscores the need for FAA to ensure that it has accurate information
on where critical maintenance is performed so it can target its
inspection resources.
Repair stations certificated by FAA are located worldwide, as shown
in figure 3. There are currently 4,216 domestic and 698 foreign FAA-
certificated repair stations available for use by U.S. air carriers.
Figure 3. Locations of FAA-Certificated Repair Stations
In addition, there are approximately 900 repair facilities in
Canada that could be used by U.S. air carriers. Under a reciprocal
agreement with the United States, Canadian officials certify and
monitor operations at these facilities. FAA oversees work performed on
U.S. aircraft. At least two major U.S. carriers use Canadian facilities
to perform heavy airframe maintenance, and, as I will discuss later,
air carriers also use domestic and other foreign non-certificated
repair facilities to perform aircraft maintenance.
Regulatory Differences Between Domestic and Foreign Repair Stations
FAA has approved 698 repair stations in countries around the world
to perform work on U.S. aircraft. While FAA verifies that the repair
stations have the equipment, personnel, and inspection systems to
ensure that repairs are completed according to FAA standards, the
repair stations are under the regulatory control of a foreign
governmental authority. As a result, there are some requirements that
FAA does not impose on the facilities. For example, FAA does not
require foreign repair stations to conduct background checks or drug
and alcohol testing on their employees. There are also other
differences between foreign and domestic repair stations (see table 1).
Table 1. Regulatory Differences Between Domestic and Foreign Repair
Stations
------------------------------------------------------------------------
Domestic FAA-
Regulatory Certificated Foreign FAA-Certificated Repair
Difference Repair Stations Stations
------------------------------------------------------------------------
Duration of FAA Certificate lasts Certificate must be renewed every 1
Certificate indefinitely to 2 years
Fees for Do not pay FAA Pay FAA for certification and
Certification for renewal costs
certification
Drug and Alcohol Required to have Not required to have a program
Testing Program a program
Certificated Certain Personnel are not required to be
Mechanics personnel, such FAA-certificated
as return to (Note: Personnel must meet certain
service and training and qualification
supervisory requirements. Mechanics may be
personnel, must certificated by the aviation
be FAA- authority where they are located)
certificated
Security Repair stations Repair stations are not subject to
Regulations on commercial U.S. security requirements
airport property
are subject to
security
requirements
------------------------------------------------------------------------
Source: OIG
As table 1 demonstrates, foreign repair stations must comply with
more stringent requirements, in some respects, than domestic repair
stations to get and maintain their FAA certification. For example,
foreign repair station applicants must show the need to obtain an FAA
certificate. That is, applicants must be able to show that they have
customers with U.S.-registered aircraft or customers with parts used on
U.S.-registered aircraft. U.S. repair station applicants do not have to
meet these criteria. Also, an FAA foreign repair station certificate is
only valid for a 1- to 2-year period.
Foreign repair stations must pay for comprehensive annual or
biannual FAA-required inspections in order to maintain, or renew, their
certificate, whereas domestic repair stations can hold their
certificates indefinitely. Conversely, in some areas, such as personnel
requirements, domestic repair stations are held to more stringent
provisions than their foreign counterparts. For example, U.S. repair
stations must employ FAA-certificated mechanics to approve all repairs;
foreign repair stations are not held to this requirement.
However, some foreign countries may have their own mechanic
licensing requirements that are just as stringent as those required of
FAA-certificated mechanics. For example, one country we visited
requires its mechanics to be at least 21 years old and have a minimum
of 48 months of aviation experience. Also, this country's mechanics are
certificated for a specific size of aircraft. In contrast, FAA-
certificated mechanics must be at least 18 years old and have a minimum
of 30 months of aviation experience; also, they can work on aircraft of
any size.
In 2003, we identified another difference between foreign and some
domestic repair stations--repair stations located on commercial U.S.
airport property must comply with U.S. security requirements. Repair
stations located on foreign airport property in foreign countries are
not subject to U.S. security requirements. The level and depth of
security programs in other countries, including background checks, are
subject to the government requirements in the country where the repair
station operates.
To address security concerns at aircraft repair stations, Congress
included a provision in the Federal Aviation Reauthorization Act
(Vision 100),\5\ which required the Transportation Security
Administration, in consultation with FAA, to issue a final rule
imposing security standards on foreign and domestic repair stations by
August 2004. The rule has not yet been issued.
---------------------------------------------------------------------------
\5\ Vision 100--Century of Aviation Reauthorization Act, Pub. L.
No. 108-176 (2003).
---------------------------------------------------------------------------
Strengthening Safety Oversight of Repair Stations and Non-Certificated
Repair Facilities
FAA has strengthened its repair station oversight through
implementation of a risk-based oversight system for both domestic and
foreign repair stations. The system is designed for inspectors to use
information obtained from data analysis to focus their oversight on
areas with the greatest safety risks. In our view, a risk-based system
is even more crucial to FAA's ability to maximize its inspection
resources and travel budget given the increasingly global nature of the
airline industry. Risk-based oversight should significantly enhance
FAA's ability to focus its inspections; however, we have identified a
number of concerns that FAA must address to continue advancing the
program.
FAA Must Ensure That Its New Risk-Based Oversight System for Repair
Stations Is Effective
In July 2003, we reported that FAA oversight had not shifted to
where the maintenance was actually being performed. Instead, inspectors
continued to focus inspections on in-house air carrier maintenance. For
example, inspectors completed 400 inspections of in-house maintenance
at 1 air carrier but only 7 inspections of repair stations. This
occurred even though this carrier contracted out nearly half of its
maintenance that year.
We also reported that 138 repair stations in Germany, France, and
Ireland were not inspected by FAA at all. Under a bilateral agreement
with the European Joint Aviation Authorities, FAA permitted foreign
authorities to inspect FAA-certificated repair stations on its behalf
to prevent duplicative inspections and reduce the financial burden on
foreign repair stations. However, FAA did not have an adequate method
to monitor the surveillance performed by other authorities. For
example, most of the inspection files we reviewed that FAA received
from the foreign authorities were either incomplete, written in a
foreign language, or otherwise difficult to comprehend.
Since our 2003 report, FAA officials have worked closely with the
aviation authorities of other countries to improve the surveillance
they perform on FAA's behalf. For example, FAA is no longer limited in
the number of inspections it can perform to verify the quality of
foreign aviation authority inspections. However, we are concerned that
FAA is still not regularly visiting the facilities in the countries
where agreements exist with other aviation authorities. For example,
FAA international field office inspectors had not conducted any spot
inspections of one major foreign engine repair station in 5 years
(2001-2006). In addition, FAA inspectors for 1 air carrier that used
the repair station had not visited the facility within the same 5-year
period, even though the repair station had performed maintenance on 39
(74 percent) of the 53 engines repaired for the air carrier.
In recent years, FAA has made significant progress in improving its
repair station oversight. For example, under FAA's old inspection
system for repair stations, inspectors were instructed to perform one
inspection of each facility per year and could review any aspect of the
repair station's operations. Inspectors were not required to provide
detailed information on the areas they inspected or the issues
identified. Since October 2005, inspectors have been required to review
15 areas within repair station operations to obtain a baseline
assessment of each facility. Using the information from this
assessment, inspectors can focus their oversight on risk areas
identified within the facility. Further, the information generated from
this oversight will be available for review by all FAA inspectors to
assist them in targeting their inspections more effectively.
For the new oversight system to be successful, FAA needs to ensure
that its inspectors receive the training they need to properly
implement the new processes. FAA must also ensure that it has reliable
processes for determining where maintenance is performed.
FAA Must Have Adequate Processes for Determining Where the Most
Critical Maintenance Is Performed and How it Should Be
Monitored
In 2003, we reported that FAA inspectors did not have effective
procedures for determining which FAA-certificated repair stations air
carriers were using to perform maintenance that could impact the
airworthiness of their aircraft. In December 2005, we reported that FAA
was unaware of air carriers' use of non-certificated repair facilities
to perform critical maintenance.\6\ These facilities are not covered
under FAA's routine oversight program and do not have the same
regulatory requirements as repair stations that obtain certification
from FAA.
---------------------------------------------------------------------------
\6\ In our December 2005 report, we identified critical repairs as
those repairs categorized as Required Inspection Items by each air
carrier. Required Inspection Items are mandatory maintenance activities
that, due to the importance to the overall airworthiness of the
aircraft, must be independently inspected by a specially trained
inspector after the work is completed.
---------------------------------------------------------------------------
Air carriers are required to provide--and FAA must approve--a list
of substantial maintenance providers, which are repair stations that
can conduct major repairs on the air carrier's aircraft. These
procedures are designed to provide inspectors with information on where
air carriers intend to send their substantial maintenance. However, the
information that air carriers provided did not always represent the
facilities they actually used or show the quantity of work they sent to
each facility. For example, we identified one foreign repair station
designated as a ``substantial maintenance provider'' for a major U.S.
carrier even though it had not conducted any significant maintenance
work for the air carrier in almost 3 years. FAA's surveillance should
be better targeted to those repair facilities that air carriers use
regularly.
FAA's new process for identifying certificated repair stations that
air carriers use to perform maintenance is not effective. In response
to our July 2003 report, FAA implemented a system in Fiscal Year 2007
for both air carriers and repair stations to submit quarterly
utilization reports. These reports are supposed to show the quantity,
or volume, of critical repairs that maintenance providers perform for
air carriers and repair stations. However, submission of this
information is not mandatory. FAA's Flight Standards staff advised us
that a new rule would be required to make volume reporting mandatory
and that they believed air carriers would provide the requested
information voluntarily. Early indicators show that air carriers are
submitting the reports. Our review of FAA records for nine air carriers
showed that as of March 23, 2007, seven of the nine air carriers had
submitted quarterly utilization reports for the quarter ending December
2006. FAA must ensure that air carriers file these reports in a timely
manner.
Our primary concerns with the reports are that (1) air carriers do
not include all repair stations that provide critical component repairs
and (2) FAA does not validate the information provided. Air carriers
are only requested to report the top 10 substantial maintenance
providers used--the ones most frequently used per quarter. The reports
do not have to include repair stations that perform high-volume,
critical component repairs on parts such as wheels and brakes because
FAA's definition of substantial maintenance does not include component
repairs. Further, without some form of data verification, FAA cannot be
assured that air carriers have provided accurate and complete
information. If the reports are to be an effective means for FAA to
track and accurately target those repair facilities that air carriers
use the most, a more thorough process will be needed.
FAA needs to develop a mechanism to identify non-certificated
repair facilities performing critical maintenance for air carriers. In
December 2005, we reported that air carriers were using domestic and
foreign repair facilities that were not certificated by FAA to perform
critical and scheduled \7\ aircraft maintenance. FAA was unaware of
this practice. Air carriers have used non-certificated facilities for
years, but it was widely believed that these facilities principally
performed minor aircraft work on an as-needed basis. However, we
determined that both domestic and foreign non-certificated facilities
can and do perform the same type of work as FAA-certificated repair
stations, including scheduled and critical maintenance. We examined
records at three air carriers and identified 6 domestic and foreign
facilities that performed scheduled maintenance and 21 that performed
maintenance critical to the airworthiness of the aircraft.
---------------------------------------------------------------------------
\7\ This maintenance is required to be performed at regularly
scheduled times, such as inspections required after the aircraft has
flown a designated number of hours (e.g., inspections of crew and
passenger oxygen, aircraft fuselage, wings, and engines).
---------------------------------------------------------------------------
We are especially concerned that air carriers rely on non-
certificated facilities to perform scheduled maintenance tasks that the
air carriers can plan for well in advance. For example, we identified
an air carrier's use of a non-certificated facility to perform work on
three aircraft that was required for compliance with an FAA
Airworthiness Directive. Other critical repairs we found included
adjustments to flight control systems and removal and replacement of an
engine.
FAA does not know how many non-certificated maintenance facilities
air carriers currently use because it does not maintain a list of the
facilities. We sampled 19 air carriers, and all 19 were using non-
certificated facilities to some extent. We identified over 1,400 non-
certificated repair facilities performing maintenance, and more than
100 of these facilities were located in foreign countries, such as
Aruba, Belize, Bermuda, Dominican Republic, El Salvador, Guatemala,
Haiti, and Mexico. It is important to note that in many instances, air
carriers contracted with facilities in these locations to ensure that
they had a maintenance source in locations where there were no FAA-
certificated repair stations available.
Nevertheless, permitting non-certificated facilities to perform
critical maintenance is an important issue that FAA must address. To do
so, FAA must first determine which non-certificated facilities perform
critical and scheduled maintenance and then decide if it should limit
the type of work these facilities can perform.
FAA Cannot Rely on Air Carrier Oversight Programs for Non-Certificated
Repair
Facilities
FAA permits air carriers to use domestic and foreign non-
certificated facilities as long as the work is approved by an FAA-
certificated mechanic. However, this is not an adequate substitute for
an FAA-certificated repair facility because non-certificated facilities
do not have the safeguards and controls for maintenance repair and
oversight that is required at FAA-certificated facilities. Differences
in FAA requirements for these two types of maintenance operations are
illustrated in table 2.
Table 2. Differences in Requirements for FAA-Certificated Repair
Stations and Non-Certificated Facilities
------------------------------------------------------------------------
Certificated Repair Non-Certificated
FAA Requirement Station Repair Facility
------------------------------------------------------------------------
Annual FAA Inspections Required Not Required
Quality Control System Required Not Required
Report Failures, Required Not Required
Malfunctions, and
Defects
Designated Supervisors Required Not Required
and Inspectors
Training Program Required Not Required
Facilities and Required Not Required
Housing*
------------------------------------------------------------------------
* If authorized to perform airframe repairs, certificated repair
stations must have facilities large enough to house the aircraft they
are authorized to repair.
Source: OIG analysis.
We found that air carrier quality systems under which these repairs
were performed were not as effective as they should have been. This was
particularly true in the areas of mechanic training and oversight of
these facilities.
Non-certificated repair facilities are not required to employ
designated supervisors and inspectors to monitor maintenance work as it
is being performed. Relying solely on the expertise of an individual
mechanic to ensure that repairs are completed properly is an inadequate
control mechanism. In our view, this is the reason FAA requires added
layers of oversight, such as designated supervisors and inspectors, in
its certificated facilities.
In our December 2005 report, we stated that neither FAA nor the six
air carriers we visited provided adequate oversight of the work
performed at non-certificated repair facilities. The air carriers we
reviewed relied primarily on telephone contact to monitor maintenance
performed at these facilities rather than conducting on-site reviews of
the actual maintenance work. In contrast, as an added level of quality
control, air carriers often assign on-site representatives to monitor
the work performed at certificated repair stations.
Despite the differences in quality controls and oversight that
exist between certificated and non-certificated maintenance facilities,
there are no limitations on the scope of work that non-certificated
repair facilities can perform. For example, we looked at critical
repairs performed under special authorizations at 1 air carrier and
found that over a 3-year period, 14 of the 19 (74 percent) repairs were
performed at non-certificated repair facilities. Examples of the work
performed include landing gear checks, lightning strike inspections,
and door slide replacements. In contrast, FAA-certificated repair
stations are limited to completing only the specific maintenance tasks
that FAA has determined the facility is capable of performing.
FAA agreed that it needs to place more emphasis on the oversight
that air carriers provide to non-certificated facilities and that it
needs to gather more information on the type of work these facilities
perform. FAA's efforts in this area are still underway. If FAA is to
achieve the planned improvements in oversight of outsourced
maintenance, it will need to obtain definitive data on where air
carriers are getting the maintenance performed, including critical and
scheduled maintenance work done at non-certificated repair facilities,
so that it can focus its inspections to areas of greatest risk.
Ensuring Inspectors Are Well-Positioned To Adequately Oversee
Maintenance Outsourcing
In June 2005, we reported that FAA needed to ensure that its
inspection workforce was adequately staffed. Currently, FAA has
approximately 3,821 inspectors located in offices throughout the United
States and other countries. FAA has assigned a portion of its inspector
workforce to verify that foreign facilities used by U.S. air carriers
continue to meet FAA standards. As shown in table 3, FAA has 86
International Field Office inspectors. Of these 86 inspectors,
approximately 47 are located abroad (i.e., Germany, England, and
Singapore).
Table 3. FAA International Field Office Inspectors and Their Areas of
Responsibility
------------------------------------------------------------------------
International Number of
Field Office Number of Area of Foreign Repair
(IFO) Inspectors Responsibility Stations
------------------------------------------------------------------------
Dallas IFO 5 Mexico 20
Frankfurt IFO 26 Europe (excluding 300
the United
Kingdom), Africa,
and the Middle
East
London IFO 13 United Kingdom 162
Miami IFO 20 South America, 52
Central America,
and the Caribbean
San Francisco IFO 14 Australia, New 61
Zealand, Japan,
Korea,
Philippines,
Fiji, Taiwan, and
other Asian-
Pacific Island
Nations
Singapore IFO 8 China, Hong Kong, 103
India, Indonesia,
Malaysia,
Singapore,
Thailand, and
other Asian-
Pacific Nations
------------------------------------------------------------------------
TOTAL 86 Inspectors .................. 698 Repair
Stations
------------------------------------------------------------------------
Source: FAA data (as of June 10, 2007).
FAA will never have enough inspectors to oversee every aspect of
aviation operations. However, FAA faces challenges in balancing
potential inspector retirements with the number of inspectors it is
able to hire. This year, 27 percent (or 1,037 of the 3,821) of the
current inspector workforce will be eligible to retire. By 2012, 51
percent of the workforce will be eligible to retire. To counter this
trend, FAA requested funding to hire an additional 203 aviation safety
inspectors in its Fiscal Year 2008 budget submission. In 2006, FAA
hired 538 inspectors, but lost 226 (181 to retirements and 45 for other
reasons). However, FAA will need to know where to place inspectors to
make the most effective use of its resources.
FAA Needs a Process To Determine Inspector Placement
FAA does not have a process to determine the number of inspectors
needed and where they should be placed. FAA has made at least two
attempts to develop a staffing model to determine the appropriate
number of and best locations for its inspectors. However, neither of
the two models provided FAA with an effective approach to allocate
inspector resources. During our review of FAA oversight of financially
distressed and low-cost air carriers, we found inconsistencies in the
way that FAA allocated inspectors among field offices. For example, two
FAA offices had the same number of inspectors assigned to oversee the
air carriers in their geographic areas even though one of those
carriers had twice as many aircraft and 127 percent more flights than
the other.
Until FAA develops an effective staffing model, it will not be able
to determine where inspectors should be placed to make the most
effective use of its resources. The important implications of the
changing U.S. and global aviation environment that we have discussed
today are expected to be key drivers of future inspector staffing
needs. Air carriers' outsourcing of aircraft maintenance, FAA's shift
to a system safety oversight approach, and safety inspectors' attrition
and retirement are all significant changes that must be considered in
determining staffing needs. FAA advised us that it has hired an
independent contractor to conduct a study to determine the most
effective staffing mechanism. However, completion of this process is
likely years away.
Mr. Chairman, that concludes my statement. I would be pleased to
address any questions that you or other members of the Subcommittee
might have.
Senator McCaskill. Thank you, Inspector General Scovel.
Ms. Gilligan?
STATEMENT OF MARGARET GILLIGAN, DEPUTY ASSOCIATE ADMINISTRATOR
FOR AVIATION SAFETY, FAA
Ms. Gilligan. Thank you, and I'm pleased to appear before
the Committee today to discuss aviation safety, because the
system has never been so safe, and so there can never be a
better time for us to focus on how we can continue to build on
that safety record.
While the focus for the Committee today is on the issue of
aircraft maintenance, it is important to keep this issue in
context. The truth is, in the recent past, we have suffered
very few major accidents. That's because of concerted efforts
by FAA and those involved in the aviation industry. We've been
working through the commercial aviation safety team for the
last decade, to establish safety requirements for things like
new technology, training, and standard operating procedures.
We've reduced the fatal accident rate significantly. The
results speak for themselves.
In the 1940s, we had about 1,300 fatalities, for 100
million passengers and crew carried. By 1995, that number had
dropped to about 47 fatalities. The average for the last 3
years has been about 4 fatalities per 100 million passengers
and crew carried. That accident rate is not one of fate or
luck. It is the achievement, and the result of a lot of hard
work.
In fact, we compare ourselves to medicine, which also
addresses public health and safety. Like medicine, we have
virtually eliminated major causes of accidents. Just as
dedicated physicians and researchers have eliminated smallpox
and polio. This industry has virtually eliminated mid-air
collisions, controlled flight into terrain accidents, and wind
shear accidents. And I can assure you, we will not see those
accidents as persistent, recurring accident types that they
have been, historically.
In those cases, we used a layered approach to address the
safety risk. That's the same layered approach that we take to
aviation maintenance.
The first layer for establishing the safety of aircraft is
in design and manufacture, and that we hold to the highest
standards. We require designers to anticipate potential
failures, and design safe solutions. We know that the people
involved in the system--pilots and mechanics--will make
mistakes. Our challenge is to anticipate those mistakes, and
design for them. This makes the aircraft what we call ``air
tolerant,'' and this is true whether the aircraft is
manufactured in the U.S., in Canada, in Europe or in Brazil.
Once the aircraft is introduced into service, we require a
second layer of defense--an airline maintenance program. This
includes identifying the facilities and equipment to perform
the work, and training and detailed instructions for those who
will do the work.
It is true, we don't require the airline to provide all of
those elements itself--it can contract with other companies to
provide some of those facilities, or to perform some of the
work. But the work must always be done in accordance with the
airlines' training and maintenance programs.
As we all know, there's a changing industry dynamic, as it
relates to maintenance work. Airlines are contracting more
often to have work done by third parties. Some airlines are
developing their own areas of expertise, and performing
contract maintenance in those areas for other airlines, and
many are using providers all around the world.
But the airline is always responsible for the work
performed, and for the decision to return the aircraft to
service after determining that it's safe.
That's why our third layer is a requirement that the
airlines have a continuing analysis and surveillance system.
Simply put, this is a regulatory requirement that ensures the
airlines track every aircraft's performance, and identify any
failures. It also allows the airline to identify when a repair
may not have solved the root problem.
So, whether the airline maintains the aircraft, or uses
contract workers, the airline is always monitoring the
aircraft's performance, and evaluating the aircraft for its air
worthiness.
And, the fourth layer is FAA oversight. For many years, we
did inspections based on inspector experience, and well-
educated gut reactions. And that worked fine for us, for a very
long time.
But now we have automated tools that allow our inspectors
to focus their attention in areas of risk. And we've integrated
our databases in response to Inspector General recommendations,
so inspectors assigned to an airline, and the inspectors
assigned at the repair station that might be used by that
airline, are sharing up-to-the-minute data. This makes both of
those inspectors more productive.
All of these layers of requirements apply wherever the
aircraft operates, and wherever the repair and maintenance work
is done. And FAA inspectors share the same kinds of data,
whether the inspector is in London, or in Lincoln, Nebraska,
and whether the airline is using a repair station in Asia, or
its own facility in Tulsa, Oklahoma.
We're always looking for ways to enhance the safety of the
system, and hearings like this one provide us another
opportunity to continue the dialogue among all of us who are
dedicated to aviation safety, so that we can improve on our
safety record.
I look forward to responding to any questions you may have
this afternoon.
[The prepared statement of Ms. Gilligan follows:]
Prepared Statement of Margaret Gilligan, Deputy Associate Administrator
for Aviation Safety, FAA
Chairman Rockefeller, Senator Lott, and members of the
Subcommittee, I am pleased to appear before you to discuss the Federal
Aviation Administration's (FAA) oversight of air carrier maintenance
that is outsourced to foreign repair stations. (Just to be clear,
outsourcing is any maintenance performed for an air carrier by any
individuals who are not employed by the air carrier whether in the U.S.
or abroad.) I know the industry trend to outsource more of its
maintenance in recent years has been a concern for some of you. To
some, outsourcing equates to cutting corners to save a few dollars. To
some, less costly maintenance means less safe maintenance. To some,
repair stations represent lesser quality maintenance. All these
assumptions imply that safety is being compromised as more maintenance
is outsourced. I am here today to reassure you that the quality of
maintenance is not compromised simply because it is not being done by
an air carrier. No less an authority than the former Department of
Transportation Inspector General (IG), Ken Meade, testified before
Congress that use of these stations is not a question of quality, but
rather an issue of oversight. We agree, which is why the FAA is
continually improving and refining our oversight of maintenance, no
matter where it is performed or by whom.
Let me start by stating the obvious. The system is safe. As this
subcommittee well knows, we have achieved the highest safety standards
in the history of aviation. Even so, our goal is--as always--to
continue to improve safety. I would like to share with you a chart that
goes to the heart of this hearing. (See the attachment at the end of
the statement.) The lines represent the percent of maintenance that is
being outsourced and the accident rate, per hundred thousand
operations. I think this picture is worth a thousand words. Although
the percentage of outsourcing has never been higher, the accident rate
has never been lower. These statistics amply demonstrate that aviation
safety is not dependent on airlines performing their own maintenance.
Before I explain the specifics of FAA's oversight of outsourced
maintenance, let me take a moment to describe the office of aviation
safety. Last year, after years of hard work, the Office of Aviation
Safety (AVS) achieved ISO 9001 certification. This certification
ensures that, worldwide, FAA safety offices provide standardized
service and products, and that we adhere to the same safety standards
as those businesses we regulate. We are the only Federal organization
of our size, scope and complexity to have achieved ISO certification
under a single quality management system. It was through my employees'
dedication and hard work that we achieved ISO certification. Not one
milestone was missed on our road to certification. So, our oversight of
maintenance is part of an independently validated approach to holding
ourselves to some pretty high standards.
Previously, our oversight was based largely on inspector knowledge
and information that was available as the result of individual
inspections. This approach was the best we could do at the time, but it
was far from comprehensive. The effectiveness of our oversight could
vary from facility to facility. What we are doing now is managing risk
and requiring system safety. Just as we have worked the concept of
system safety with the airlines, we are currently introducing the
concept to repair stations.
Let me explain what I mean by system safety. System safety is
extremely comprehensive. It sounds like a simple list of requirements,
but in reality, it is a sophisticated approach to ensuring that
everything is in place to obtain the information that can identify
vulnerability in time to address it before safety is compromised.
System safety requires the following attributes. It must be clear who
is responsible for different aspects of the operation. The responsible
person must have the authority to take necessary action. There must be
procedures in place to execute required actions. There must be controls
in place to ensure that a consistent product or service is being
provided. There must be oversight/auditing procedures in place to
independently evaluate the effectiveness and consistency of the
operation. And last, there must be interface procedures in place to
ensure that different parts of the organization are effectively talking
to each other. Consistency is the goal. Inconsistency signals the need
for a closer look and can provide us the early warning we need to get
ahead of problems that could affect safety.
In addition, these attributes must be supported by a written Safety
Policy expressing senior management's commitment to continually improve
safety and includes safety risk management processes, safety
assurances, and safety promotion. Safety risk management processes are
used to assess system design and verify that safety risk management is
integrated into all processes. Safety assurances continually identify
new hazards and ensure risk controls achieve their intended objective.
Safety promotion ensures an environment where action is taken to create
a positive safety culture where people acknowledge their accountability
and act on their own individual responsibility for safety.
This is what we will require of all organizations for which we have
safety oversight responsibility, whether it be an airline, a
manufacturer or a repair station. With these elements in place, our
inspectors can perform hazard analyses and identify risk so that
threats can be pre-empted. Instead of relying solely on information
from individual inspections alone, we now perform a sophisticated
analysis of anomalies identified and entered into the system. The
analysis can provide us trend information that effectively targets our
oversight. This is a much more comprehensive approach than what we were
able to do previously. It allows us to get in front of potential
problems in order to prevent them. This is not only a better use of FAA
resources, it enhances safety.
The past few years have been about continuing forward and making
adjustments to an already robust system. We have been working closely
with the Department of Transportation Inspector General's (IG) office
since their issuance in 2003 of the report ``Review of Air Carriers'
Use of Aircraft Repair Stations.'' The report identified specific areas
where the IG felt improvements could be made. In response to the
report, we made a number of changes to our oversight of repair
stations. In 2004, we revised the regulations that apply to repair
stations. The rule improved quality control requirements, equipment
requirements, and provided more detailed requirements on the use by
repair stations of external maintenance providers. In 2005, we issued
guidance to enhance oversight of repair stations based on system safety
requirements and risk assessment. In 2006, we developed and implemented
software to further enhance oversight, risk assessment, and risk
management processes used in our oversight. We've improved our Safety
Performance Analysis System to provide sharing of information between
the inspectors assigned to the repair station, and those assigned to
the air carrier. We've also improved the training requirements for
certain repair station personnel.
We are currently testing a different way to oversee the work
performed by complex repair stations. We call this approach the
Certificate Management Unit (CMU) concept. CMU is a model of oversight
for complex repair stations that parallels the way we conduct oversight
of air carriers. CMU will provide for dedicated inspectors providing
oversight at the assigned repair station. This addresses the criticism
that FAA has failed to adapt its oversight of repair stations to
reflect their increasing use by air carriers. Having assigned
inspectors at these repair stations will further reduce the differences
between the way we oversee major repair stations versus major airlines.
We will continue to evaluate, modify and expand this concept as
appropriate.
I mentioned at the outset that AVS is ISO certified. Part of what
this means is that, as an organization, we must continually evaluate
what we are doing to identify where we can improve. So I fully expect
ongoing modifications to our oversight procedures and analyses as we
learn more and develop new and better tools.
I would now like to turn my focus to foreign repair stations
because I know they have been of particular interest to this
subcommittee. As is the case with domestic repair stations, there is an
incorrect perception that a carrier's use of a foreign repair station
is somehow unsafe or done solely to reduce maintenance costs. I know
there have been a number of efforts to restrict a U.S. carrier's
ability to use foreign repair stations, but I do not believe these
efforts would enhance safety. It is important to understand that FAA
only certifies a foreign repair station if a U.S. carrier wants to use
it. Unlike a domestic applicant, a foreign applicant must provide
evidence that a U.S. operator or manufacturer needs its services. The
repair station must meet the same standards that we apply to repair
stations in the United States or we will not certify it. Safety is
addressed because we require that all aircraft that are registered in
the United States be maintained to U.S. standards, regardless of where
they operate. Due to the global nature of aviation, we must have repair
stations that meet U.S. standards throughout the world. It is an
essential element of the U.S. being a leading provider of international
transportation services. Finally, keep in mind that, as is the case
when a carrier uses a domestic repair station, the carrier has the
ultimate responsibility to ensure that the maintenance is being
performed appropriately. All of this adds up to a great deal of
supervision. The repair station has internal controls, foreign
government oversight, airline oversight, and FAA oversight.
In three countries (France, Ireland and Germany) where we have
Bilateral Aviation Safety Agreements (BASA), we have outlined
Maintenance Implementation Procedures (MIP) to ensure that foreign
inspectors are placing appropriate emphasis on the Federal Aviation
Regulations when conducting review of work done on U.S. aircraft. We
have a long history and experience with these aviation authorities. In
these countries, we rely on the oversight of the aviation authority in
addition to our periodic inspections. We are also working to ensure
that these foreign aviation authorities inform us and seek FAA approval
of changes to repair station operations if they directly impact FAA
requirements.
In response to the IG, we have also made some changes to our
oversight of foreign repair stations. For example, we eliminated the 10
percent sampling requirement on FAA's inspection of repair stations in
countries where there is a BASA/MIP in place. In FY 2006, FAA conducted
sampling inspections in 21 percent of the repair stations located in
these countries. We have also developed and implemented policy and
procedures in the BASA/MIP countries to capture the results from the
inspections conducted by foreign authorities.
It is also important to remember that, by its nature, aviation is
truly an international enterprise. An aircraft, especially in
commercial aviation, contains parts manufactured all around the world.
The original equipment manufactures (OEMs) have a wealth of expertise
in repairing their products. In addition, their parts may have
warranties. It would be extremely unwise to restrict a U.S. carrier's
ability to use OEM maintenance, even if the OEM is abroad.
There are a number of other reasons for air carriers to choose to
outsource some maintenance and repair activities. The expertise of OEMs
is so considerable and their work is so consistent that maintenance is
often outsourced to them, regardless of whether the maintenance being
performed is on a part they manufactured. In other cases, overseas
repair and maintenance facilities may provide a great deal of expertise
for lower costs. Nevertheless, just as aviation safety is in no way
compromised by allowing U.S. carriers to fly aircraft made in Europe,
in Brazil, or in Canada, so too is safety in no way compromised by
allowing other countries to conduct repair and maintenance on our
aircraft.
I would like to conclude this morning by saying that our work with
the IG's office in the past few years has been productive. We have made
a number of adjustments that I think have improved the effectiveness of
our oversight. That can only improve safety. I think we generally agree
that we are moving in the right direction. Certainly, the chart I
talked about reflects that airline use of repair stations has not
compromised safety.
I understand and appreciate this subcommittee's concern about the
increased use of foreign repair stations. Obviously, we share a common
goal to find ways to improve safety at a historically safe period in
U.S. aviation. I can assure you that my office is totally committed to
making whatever adjustments the situation demands when it comes to
safety oversight. Hearings like the one today continue a necessary
dialogue. I do not claim to have all the answers. I think the changes
we have made in recent years are good ones. But we can't sit still.
There will always be ways to improve and we will continue to look for
them.
This concludes my statement. I will be happy to answer your
questions at this time.
Senator McCaskill. Thank you, Ms. Gilligan.
Mr. Roach?
STATEMENT OF ROBERT ROACH, JR., GENERAL VICE
PRESIDENT OF TRANSPORTATION, INTERNATIONAL
ASSOCIATION OF MACHINISTS AND AEROSPACE WORKERS
Mr. Roach. Thank you, Madame Chair, and members of this
Committee, for the opportunity to speak to you today. My name
is Robert Roach, Jr., I'm the General Vice President of
Transportation for the Machinists Union.
I'm appearing on behalf of International President, R.
Thomas Buffenbarger. The Machinists Union is the largest
aviation union in North America, representing 180,000 airline
and aerospace workers in almost every classification, including
mechanics, flight attendants, ramp service workers, public
contact employees and production workers.
Since 2003, nine major U.S. carriers have increased the
amount of outsource work. The percentages, as mentioned by
Senator Lautenberg, are from 34 percent to 67 percent. The
trend of U.S. airlines increasingly subcontracting work,
aircraft maintenance work, jeopardizes safety, and security of
our Nation's air transportation system. The lack of adequate
Federal Aviation Administration oversight at certificated and
non-certificated maintenance repair stations is unforgivable.
Airlines utilize overseas facilities to take advantage of
low wages and lax regulations available at overseas repair
stations, when there are many U.S. repair station facilities
available and underutilized, such as the state-of-the-art
facility in Indianapolis, Indiana, a facility abandoned by
United Airlines.
Cutting back on food, pillows, or other in-flight amenities
is a business decision that only inconvenienced the passengers,
but cutting costs in aircraft maintenance has serious safety
implications.
Our mechanics have found aircraft returning from overseas--
overseas flight having departed with obvious mechanical
problems. Our members have seen aircraft returned from repair
facilities with flaps rigged improperly, engine fan blades
installed backward, improperly connected ducting that resulted
in pressurization problems, air speed indicator lines
disconnected, inoperable thrust reversers, incorrect engine
fuse pins installed, and over-wing exit emergency slides
deactivated.
These aircraft have been deemed ``airworthy'' by repair
stations. Although these mistakes were noticed, and
catastrophic accidents avoided, that is not always the case.
FAA oversight of U.S. repair facilities is better than
foreign repair stations, but is still not adequate. The NTSB
faulted the FAA's lack of oversight of work being performed at
an Air Midwest facility in West Virginia, as a contributing
factor in the January 8, 2003 crash that killed 21 people.
There is still a dangerous shortage of FAA inspectors. The
FAA's Singapore Field Office alone, is responsible for 103
stations, but has only four inspectors. An immediate increase
of FAA inspectors, along with the resources they need--is
necessary to safeguard the U.S. aviation industry.
When inspectors are permitted to make a rare inspection of
oversight repair stations, they must still give advance notice.
Unscheduled surprise inspections, like those performed in the
United States, are necessary to ensure compliance.
Unlike U.S. air worker--United States workers--foreign
maintenance persons are not required to undergo drug and
alcohol testing, or pass criminal background checks, in fact,
they're not even required to read English, which is the
language in which aircraft manufacturers write their
maintenance repair manuals. The FAA's oversight of certified
repair stations is insufficient to ensure compliance and
regulations.
FAA oversight of non-certificated repair stations, however,
is nonexistent. Non-certificated facilities operate without the
same regulatory requirements as certificated repair stations
and operate with no limit on the type or scope of work they can
perform. The FAA does not monitor the maintenance performed at
non-certificated facilities, and the air carrier's training and
oversight of these facilities is inadequate.
Hearings and investigations do nothing to increase safety
unless it's followed with the action by both the FAA and the
airlines who subcontract their maintenance work.
Having U.S. aircraft repaired overseas also opens up this
country to great security risks. It's not hard to imagine how
overseas repair stations working on U.S. aircraft could provide
terrorists with the opportunity to sabotage an aircraft, or
components that will eventually re-enter the United States for
domestic service.
These stations should be immediately closed down so
security audits can be conducted, and security vulnerabilities
addressed. There should be one standard for safety and
security, and FAA oversight at all aircraft facilities working
on U.S. aircraft, regardless of where they are located. This
must include the equivalent standards--criminal background
checks, drug and alcohol testing of all workers, to tighten up
security at the repair stations.
The FAA does not have sufficient funding to hire an
adequate number of inspectors to ensure aviation safety at home
or abroad.
Mr. Chairman--Madame Chair--Members of this Committee, let
my testimony today serve as more than a warning that the
oversight of contract maintenance of U.S. aircraft is almost
non-existent. I am here to offer the assistance of the
machinists union and all of our members who build and maintain
aircraft to help safeguard our aviation industry.
I thank this Committee for inviting us to participate in
these proceedings and listening to our concerns, I look forward
to your questions.
[The prepared statement of Mr. Roach follows:]
Prepared Statement of Robert Roach, Jr., General Vice President of
Transportation, International Association of Machinists and
Aerospace Workers
Thank you, Mr. Chairman, and Members of this Committee for the
opportunity to speak to you today. My name is Robert Roach, Jr.,
General Vice President of Transportation for the International
Association of Machinists and Aerospace Workers (IAM). I am appearing
at the request of International President, R. Thomas Buffenbarger. The
Machinists Union is the largest aviation union in North America,
representing 180,000 airline and aerospace workers in almost every
classification, including Mechanics, Flight Attendants, Ramp Service
workers, Public Contact employees and production workers.
Since 2003, nine major U.S. carriers (AirTran Airways, Alaska
Airlines, America West Airlines, Continental Airlines, Delta Airlines,
JetBlue Airways, Northwest Airlines, Southwest Airlines, and United
Airlines) have increased their amount of outsourced maintenance from 34
percent of total heavy aircraft maintenance checks to 67 percent.\1\
The trend of U.S. airlines increasingly subcontracting aircraft
maintenance work jeopardizes the safety and security of our Nation's
air transportation system. The lack of adequate Federal Aviation
Administration (FAA) oversight of certificated and non-certificated
maintenance repair stations is unforgivable.
---------------------------------------------------------------------------
\1\ Statement of the Honorable Calvin L. Scovel III, Inspector
General of the U.S. Department of Transportation before the House
Transportation and Infrastructure Committee Subcommittee on Aviation,
March 29, 2007.
---------------------------------------------------------------------------
Many overseas repair stations exist only because U.S. airlines are
constantly looking for ways to reduce their operating costs. Airlines
utilize these facilities to take advantage of the low wages and lax
regulations available at overseas repair stations when there are many
U.S. repair facilities available and underutilized, such as the state-
of-the-art Indianapolis, Indiana facility abandoned by United Airlines,
one of the most advanced repair stations in the world. Cutting back on
food, pillows and other in-flight amenities is a business decision that
only inconveniences passengers, but cutting costs in aircraft
maintenance has serious safety implications.
Our mechanics have found aircraft returning from overseas flights
departed with obvious mechanical problems. When they tell FAA
inspectors, the inspectors complain that their hands are tied. Budget
constraints limit their ability to inspect overseas maintenance
operations.
A recent example of poor work performed by a maintenance vendor
occurred at US Airways. The FAA recently issued an Airworthiness
Directive requiring the replacement of the fuse pins that mount engines
to Boeing 767 aircraft. A maintenance contractor for US Airways
performed the modification, but installed the wrong fuse pins on three
aircraft. These pins are designed to allow an engine to drop from the
wing during an emergency to prevent excessive vibrations from causing
the entire wing to break away from the aircraft. Such a catastrophic
event would force the plane into an uncontrolled spiral toward the
Earth. Our members have also seen aircraft return from repair
facilities with the flaps rigged improperly, engine fan blades
installed backward, improperly connected ducting that resulted in
pressurization problems, airspeed indicator lines disconnected,
inoperable thrust reversers and over-wing exit emergency slides
deactivated. These aircraft had all been deemed airworthy by the repair
stations. Although these mistakes were noticed and catastrophic
accidents avoided, that is not always the case.
FAA oversight of U.S. repair facilities is better than foreign
repair stations, but still not adequate. On January 8, 2003, US Airways
Express Flight 5481 crashed into a Charlotte, North Carolina hangar
packed with IAM members, killing all 21 people onboard. The subsequent
National Transportation Safety Board (NTSB) investigation faulted Air
Midwest, which operated the aircraft, the facility that performed
maintenance of the aircraft and the FAA.\2\
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\2\ NTSB Aircraft Accident Report, ``Loss of Pitch Control During
Takeoff,'' Air Midwest Flight 5481, Raytheon (Beechcraft) 2000D, N233Y,
Charlotte, North Carolina, January 8, 2003, NTSB/AAR-04/01.
---------------------------------------------------------------------------
US Airways, then headquartered in Arlington, Virginia, sold the
tickets to the flight and the aircraft displayed the carrier's logo.
Air Midwest, based in Arizona, operated the flight and was responsible
for the aircraft's maintenance. But Air Midwest subcontracted that
maintenance to Raytheon Aerospace in Huntington, West Virginia, who
then contracted with Structural Modification and Repair Technicians to
supply the mechanic workforce.
The NTSB determined that a mechanic improperly adjusted cables that
helped control the pitch of the aircraft. The mechanic had never done
the job on that type of plane before and with his trainer's approval,
skipped steps that the NTSB said would likely have helped the mechanic
catch his mistakes. FAA regulations require such flight critical work
to be inspected, but in this case it was inspected by the same
instructor who allowed steps to be skipped.
NTSB Chairman Ellen Engleman Conners said at the time, ``I think
the entire system here was broken down. There were errors at every
level.'' \3\ Commenting on the airline's layers of subcontracted
maintenance work, Aeronautical Repair Station Association Executive
Director Sarah Macleod said, ``The more removed you get from the
maintenance, the more training it takes. The more tiers, the closer
you'd better be looking.'' \4\ The Machinists Union wholeheartedly
agrees with both of these statements.
---------------------------------------------------------------------------
\3\ Charlotte Observer, ``NTSB faults FAA and airline in US Airways
crash'', February 26, 2004.
\4\ Department of Energy Aviation Flight Safety Notice 03-002,
``Subcontract Maintenance''.
---------------------------------------------------------------------------
A July 2003 Department of Transportation (DOT) Inspector General
Report highlighted the weak oversight of aircraft maintenance performed
overseas by third-party contractors.\5\ In response to that report,
Congress directed the FAA to submit a plan by March 12, 2004 to ensure
that foreign repair stations working on U.S. aircraft are subject to
the same level of safety and oversight as required here at home.
---------------------------------------------------------------------------
\5\ DOT Inspector General Report, ``Review of Air Carriers' Use of
Aircraft Repair Stations'', July 8, 2003 (AV-2003-047).
---------------------------------------------------------------------------
Years past the deadline, the FAA finally submitted a plan that the
Machinists Union believes is woefully inadequate. There is still a
shortage of FAA inspectors, and when inspectors are permitted to make a
rare inspection of an overseas repair station they must still give
advance notice. Unscheduled surprise inspections, like those performed
in the U.S. are necessary to ensure compliance. Unlike U.S. workers,
foreign maintenance personnel are still not required to undergo drug
and alcohol testing or pass criminal background checks. In fact, they
are not even required to read English, which is the language in which
aircraft manufactures write their maintenance repair manuals.
A December 2005 DOT Inspector General report \6\ found that while
foreign repair stations were widely used by U.S. carriers, some FAA
certified foreign repair stations are not inspected at all by FAA
inspectors because civil aviation authorities review these facilities
on the FAA's behalf. Airlines are subcontracting their maintenance and
the FAA is outsourcing their inspections. The Machinists Union believes
this only degrades aviation safety and endangers the traveling public.
---------------------------------------------------------------------------
\6\ Inspector General Report Air Carriers' Use of Non-Certificated
Repair Facilities, December 15, 2005 (AV-2006-031).
---------------------------------------------------------------------------
The FAA's oversight of certified repair stations is insufficient to
ensure compliance with regulations. FAA oversight of non-certificated
repair stations, however, is non-existent.
The Inspector General's 2005 report found that non-certificated
facilities operate without the same regulatory requirements as
certificated repair stations and operate with no limit on the type or
scope of work they can perform. The report also verified that the FAA
does not monitor the maintenance performed at non-certificated
facilities and the air carriers' training and oversight of these
facilities are inadequate. The report further revealed that the FAA did
not know the extent of maintenance performed at non-certificated repair
facilities.
The Machinists Union is thankful the Inspector General's office has
repeatedly demonstrated the FAA's lack of oversight of contract
maintenance facilities. However, hearings and investigations do nothing
to increase safety unless it is followed with action by both the FAA
and the airlines who subcontract their maintenance work.
Having U.S. aircraft repaired overseas also opens up this country
to a great security risk. It is not hard to imagine how overseas repair
stations working on U.S. aircraft could provide terrorists with an
opportunity to sabotage an aircraft or components that will eventually
re-enter the U.S. for domestic service. These stations should be
immediately closed down until security audits can be conducted and
security vulnerabilities addressed.
There should be one standard for safety, security and FAA oversight
at all aircraft repair facilities working on U.S. aircraft, regardless
of where they are located. This must include equivalent standards for
criminal background checks, drug and alcohol testing of workers and
tightening the security at repair facilities.
The FAA does not have sufficient funding to hire an adequate number
of inspectors to ensure aviation maintenance safety, at home or abroad.
Even the recent hiring of additional FAA inspectors does little to
improve oversight. As of January 2007, there were only 103
international field inspectors for a total of 692 foreign repair
stations.\7\ The Singapore field office alone is responsible for 103
stations, but has only 4 inspectors. An immediate increase in FAA
inspectors, along with the resources they need, is necessary to
safeguard the U.S. aviation industry.
---------------------------------------------------------------------------
\7\ Statement of the Honorable Calvin L. Scovel III, Inspector
General of the U.S. Department of Transportation before the House
Transportation and Infrastructure Committee Subcommittee on Aviation,
March 29, 2007.
---------------------------------------------------------------------------
Mr. Chairman, Members of this Committee, let my testimony today
serve as more than a warning that the oversight of contract maintenance
on U.S. aircraft is almost non-existent. I am here to offer the
assistance of the Machinists Union and all our members who build and
maintain aircraft to help safeguard our aviation industry.
I thank the Committee for inviting us to participate in these
proceedings and listening to our concerns.
I look forward to your questions.
Senator McCaskill. Thank you, Mr. Roach.
Mr. Filler?
STATEMENT OF MARSHALL S. FILLER, MANAGING DIRECTOR AND GENERAL
COUNSEL, AERONAUTICAL REPAIR STATION ASSOCIATION (ARSA)
Mr. Filler. Thank you, Madame Chairman, and good afternoon
to Chairman Rockefeller and Senator Lautenberg as well.
My name is Marshall Filler, I'm Managing Director and
General Counsel for the Aeronautical Repair Station
Association. I'd like to assure this Committee that in order to
be a regular member of ARSA, you have to hold a certificate,
and most of our members hold that certificate, we do have about
1 percent that hold other kinds of authorities, and they're not
voting members of ARSA.
Foreign repair stations are also members of ARSA, and they
are an essential part of aviation, and of aviation safety. In
fact, without them, there would be no international travel. I
say that, because under international law, the State of
Registry of the aircraft is responsible for controlling the
maintenance performed on that aircraft, and on any component to
be installed thereon, regardless of where the aircraft is. So,
if an aircraft is traveling in Europe, if it's got an N in
front of it, and it's registered in the United States, the work
must be performed by an FAA-certificated facility, or other
certificated person.
Although it is true that there are 700 repair stations
located outside our borders, it is also true that 425 of them
are in Europe. If you would compare the number of U.S.-based
repair stations that are certificated by the European Aviation
Safety Agency, it is almost 1,200. So, there are almost 3 times
as many U.S.-based repair stations certificated to perform work
under European jurisdiction as there are FAA-certificated to
performed repairs in Europe.
Many of these 700 foreign repair stations are owned by U.S.
companies, by Pratt & Whitney, General Electric, Hamilton
Sundstrand, Honeywell, and Nordam to name a few, as well as
some of the most well-respected international air carriers such
as Qantas. Also among our members are Lufthansa Technik, as
well as SR Technics. These are highly respected, worldwide
acclaimed repair facilities.
When we talk about repair stations, I think it is important
to distinguish the various types--we have line maintenance
facilities that basically keep the aircraft flying during the
day, and do simpler overnight checks. We have substantial
maintenance providers where the aircraft is maintained for
anywhere from a number of days, to weeks in a hanger-type
facility, but most of the repair stations are actually
component repair facilities, located miles from airports,
presenting little security threats, located in places like
industrial parks.
Most of the rules that apply to foreign repair stations by
the FAA are the same. Some of those differences are, there's a
very good reason for them, because of international
considerations, in fact, with respect to drug and alcohol
testing, the FAA did propose to make this mandatory overseas in
1994, but over significant protest from the international
community, and I might add, our State Department withdrew that
proposal in the year 2000.
FAA has chosen, instead, to work through ICAO, the
international body, which has adopted drug and alcohol testing
as a recommended practice. ICAO also has an international
standard that prohibits anybody from performing a safety-
sensitive function under the influence of a controlled
substance.
Some of the requirements of foreign repair stations are
actually greater than they are domestically, such as the
certificate that lasts only a year or two. In the domestic
situation, once you get certificated, you keep it forever. In a
foreign situation, the FAA has to conduct a re-inspection every
12 to 24 months.
With respect to security, I think it is important for
members to know that ICAO also plays a very significant role in
security performed in international locations. ICAO Annex 17
provides for international security standards, that include a
national security program, airport-specific programs for all
airports serving international airlines, air operator security
programs, background checks, perimeter security. All 189
members of ICAO are required to follow these standards, or
otherwise notify ICAO that they are not. So, while it is true
that they are not subject to U.S. requirements, they are
subject to ICAO requirements, and in fact, our TSA rules are
very similar to the ICAO standards because--like all of the
rest of the countries that are members of ICAO, we have to
comply with those standards, as well. I think there's a danger
here if you direct security resources at places where the
threat is less.
Madame Chair, I have two more minutes?
Senator McCaskill. Yes.
Mr. Filler. Thank you very much.
If the--historically, background checks have been required
when people need unescorted access to restricted security areas
of the airport--that's where the threat is greatest. If we re-
direct those resources to places where--that are 20, 25 miles
from an airport, that work on components that are tested and
inspected before they leave the repair station, once again,
functionally checked by the air carrier prior to installation,
we are going to take resources away from the places where we
think they're needed more.
A couple of other things I would like to mention. We
disagree with the notion that airlines will always go to the
lowest cost maintenance provider. And the reason we disagree
with that, is that if that maintenance is performed poorly,
with a lack of reliability, that airplane will not move. FAA
regulations require maintenance discrepancies to be addressed,
or appropriately deferred. And, indeed, if work is performed in
a shoddy fashion, and the maintenance discrepancy is written
up, the cost of that flight delay or flight cancellation will
far outweigh any savings that might accrue because of the use
of, for example, lower paid workers.
We also disagree with the notion that the FAA is
responsible for ensuring safety. FAA regulations set up a
structure in which safety can flourish. We, the certificate
holders, are responsible for ensuring safety. Safety is good
business, as demonstrated by the accident record that Ms.
Gilligan mentioned. We don't believe foreign repair stations
take U.S. jobs, we think only, you have to look at the
situation between the U.S. repair stations and the European
repair stations to know that, I think we actually get the
benefit of that bargain--with 1,200 in Europe, rather, 1200
U.S. repair stations that are certificated by EASA.
We also don't think, well, I think I've used my 2 minutes,
Madame Chair, so I think that I will not ask for any more time,
but I do appreciate your indulgence. Thank you.
[The prepared statement of Mr. Filler follows:]
Prepared Statement of Marshall S. Filler, Managing Director and General
Counsel, Aeronautical Repair Station Association (ARSA)
Chairman Rockefeller, Ranking Member Lott, and members of the
Subcommittee, thank you for inviting me to testify this afternoon about
the role of foreign repair stations, and the safety of aviation
maintenance.
My name is Marshall Filler and I am the Managing Director and
General Counsel of the Aeronautical Repair Station Association (ARSA).
ARSA is a 670 member strong international trade association with a
distinguished 22-year record of educating and representing certificated
aviation maintenance facilities before the U.S. Congress, the Federal
Aviation Administration (FAA), the European Aviation Safety Agency
(EASA), and other national aviation authorities (NAA).
ARSA's primary members are companies holding repair station
certificates issued by the FAA under part 145 of the Federal Aviation
Regulations (FARs). These certificates are our industry's ``license to
do business.'' They authorize repair stations to perform maintenance
and alterations on civil aviation articles, including aircraft,
engines, and propellers, and on components installed on these products.
These repair stations perform maintenance for airlines and general
aviation owners and operators.
In recent years, the profile of the contract maintenance industry
has increased dramatically. With over 4,000 repair stations in the
United States employing almost 200,000 people (Appendix A), this sector
of the aviation industry continues to grow. We welcome the opportunity
to discuss the important role our members play in the aviation industry
here and abroad and to correct any misconceptions about the safety of
maintenance performed by foreign repair stations.
Foreign Repair Stations Are an Essential Part of Aviation
Foreign repair stations are a necessary part of the international
aviation system. Any effort to restrict the use or number of such
facilities would likely lead to retaliatory trade actions by other
countries. Ultimately, U.S. aerospace manufacturers, air carriers and
the flying public would be harmed.
The Chicago Convention of 1944 and International Civil Aviation
Organization (ICAO) standards require that the State of Registry (i.e.,
the country in which an aircraft is registered) oversee the maintenance
performed on that aircraft and related components, regardless of where
the work is performed.\1\ Consequently, a U.S. registered aircraft
requiring maintenance while outside of the U.S. must have that work
performed by an FAA-certificated maintenance provider. Indeed, a
foreign applicant for a repair station certificate must also
demonstrate to the FAA that its services are needed to perform work on
articles subject to FAA jurisdiction.
---------------------------------------------------------------------------
\1\ See, ICAO Annex 8, Airworthiness, 4.2.1(b).
---------------------------------------------------------------------------
Similarly, when an aircraft of foreign registry requires
maintenance while in the U.S., only a repair station certificated or
validated by the relevant NAA may perform the work. For example, only
an EASA-certificated repair station may perform maintenance on an
aircraft of French registry within the U.S.
This legal regime has proven beneficial to American repair
stations. Currently, there are 698 FAA-certificated repair stations
outside the U.S. (see Appendix B). At the same time, there are close to
1,200 EASA-certificated repair stations in the U.S., and numerous other
NAA-certificated repair stations inside our borders.\2\ Our aviation
maintenance industry is highly-regarded worldwide.
---------------------------------------------------------------------------
\2\ Data obtained on European Safety Agency (EASA) website, for
``Foreign EASA Part-145 Valid Approvals for Organisations Located in
the United States'' June 1, 2007.
---------------------------------------------------------------------------
Foreign Repair Stations Must Follow Strict Standards and Procedures
Bilateral agreements are negotiated between two regulatory
authorities to facilitate the airworthiness certification of new and
used products imported and exported from the affected countries. The
agreements are not a ``one size fits all'' proposition; they must be
tailored to the specific oversight systems and capabilities of the
respective authorities.
Such agreements are only concluded after a lengthy evaluation
process that assures that the two regulatory oversight systems are
technically equivalent. In most cases, they are based on reciprocity.
Bilateral agreements also eliminate redundant technical determinations
that are not necessary in the interests of safety. Consequently, they
allow the two authorities to more efficiently allocate their limited
oversight resources. The FAA currently has about 30 bilateral
agreements covering design, production and airworthiness approvals,
primarily for new products.
It is interesting to note that many more bilateral agreements apply
to the airworthiness certification of mostly new products than to
articles that have been maintained or altered. In relatively few cases,
however, Maintenance Implementation Procedures (MIPs) have also been
negotiated. Currently, there are MIPs in place with France, Germany and
Ireland (soon to be expanded to other members of the European Union)
and Canada. The MIPs set forth mutually acceptable procedures that
apply whenever maintenance or alterations are performed on equipment
under the jurisdiction of either authority. They also provide a means
by which the authorities can cooperate in conducting surveillance and
sharing the results of those findings.
Except for Canada, facilities located in MIP countries receive an
FAA repair station certificate. They are required to follow the rules
of their home country and the designated FAA special conditions. The
special conditions are areas where the two authorities' regulations are
different and therefore must be followed when work is performed on
articles subject to the other's jurisdiction.
A list of countries in which FAA foreign repair stations are
located, whether these countries meet ICAO standards, and the status of
bilateral agreements with the U.S. is found in Appendix C.
FAA-Certificated Repair Facilities Located Abroad Are Not a Threat to
the U.S. Economy Or To Aviation Safety
FAA-certified repair stations located oversees must meet the same
or equivalent safety standards as domestic facilities. Unlike their
domestic counterparts, however, foreign repair stations must renew
their certificate with the FAA annually or, at the discretion of the
FAA, biannually, following a safety inspection. This ensures that the
FAA evaluates the housing, facilities, equipment, personnel, and data
of each repair station located outside the U.S. at least once every 2
years.
In 2005, ARSA conducted a member survey, (see Appendix D) which
revealed that the average FAA-certificated foreign repair station is
audited more than 74 times each year by government regulators,
customers, other third-parties, and the repair station's own quality
assurance personnel, suggesting a high-level of combined oversight.
Recent attempts at restricting the use of foreign repair stations,
and specifically removing the FAA Administrator's ability to issue new
certificates, would be highly detrimental. Many companies factor into
their business plan the ability to open a new foreign repair station,
and much time and effort goes into the application and certification
process.
Indeed, many U.S. companies have repair stations internationally.
The FAA's list of foreign repair stations reveal that there are
approximately 80 foreign repair facilities owned by U.S. aerospace
companies, including Nordam, Pratt & Whitney, Hamilton Sundstrand and
Honeywell.\3\ Additionally, international companies have repair
stations located within our borders, such as Lufthansa Technik,
Dassault, and BAE systems.
---------------------------------------------------------------------------
\3\ Based on FAA Listing of Foreign Repair stations from Air Agency
Data, June 10, 2007.
---------------------------------------------------------------------------
The aviation maintenance industry is a global enterprise; thus,
action taken domestically affects companies worldwide. A restriction on
the use of foreign repair stations only punishes American companies,
making them less profitable and competitive.
Although the Location of Work May Differ, Quality Does Not
To operate in the civil aviation maintenance industry, certificated
repair stations must demonstrate to the FAA, or other NAAs if
applicable, that they possess the housing, facilities, equipment,
trained personnel, technical data, and quality systems necessary to
perform maintenance in an airworthy manner. Based upon satisfactory
showings in these areas, a repair station is rated to perform certain
types of maintenance.
However, not all repair stations look alike and their capabilities
vary significantly. Some provide line maintenance--the routine, day-to-
day work necessary to keep an airline's fleet operating safely. Some
perform substantial maintenance, which includes more comprehensive
inspection and repairs on airframes and overhauls of aircraft engines.
Others offer specialized services for their customers such as welding,
heat treating, and coating on a variety of aircraft parts. However, the
vast majority of repair stations perform maintenance on components.
Component maintenance usually occurs off the aircraft, typically away
from an airport in industrial parks and similar facilities.
Regardless of the location of the repair facility, the regulatory
requirements are the same. Each item goes through a series of checks
required by FAA regulation, before being placed on an aircraft.
Despite Limited FAA Resources, The Industry Ensures Safety
Aviation safety does not begin and end with the FAA or any other
regulatory body. Government inspectors will never be able to oversee
each technician at every facility all the time. The industry has the
ultimate obligation to ensure that the civil aviation system is safe.
All evidence suggests that it is fulfilling that responsibility despite
the FAA's limited oversight resources.
In reports published in 2003 and 2005, the Office of the Inspector
General of the Department of Transportation (DOT IG) expressed concerns
about the FAA's oversight of the contract maintenance industry stating
that the agency's oversight is currently insufficient for the amount of
work independent repair stations perform for airlines.\4\ The FAA has
responded to these findings by introducing a risk-based inspection
program that identifies those repair stations doing the most work for
airlines and monitoring their operations more closely. ARSA has
continuously supported efforts to better utilize FAA resources to
ensure the continued quality of contract maintenance here and abroad,
and to demonstrate to policymakers and the public that our aviation
system remains safe.
---------------------------------------------------------------------------
\4\ See, Department of Transportation Office of Inspector General,
Rep. No. AV-2003-047, Review of Air Carriers' Use of Aircraft Repair
Stations, at 1 (July 8, 2003); Department of Transportation Office of
Inspector General, Rep. No. AV-2005-062, Safety Oversight of an Air
Carrier Industry in Transition, at 1 (June 3, 2005).
---------------------------------------------------------------------------
We also note that despite the IG's observations, repair stations
are subject to a tremendous amount of oversight by regulators, their
customers, and other entities as shown in the 2005 ARSA member survey
referenced above (Appendix D). A more recent membership survey
conducted in March 2007 is summarized in Appendix E. The findings from
this survey reaffirmed past survey results, including:
42 percent of members surveyed reported 11 or more external
audits during 2006 by regulators, customers, and third-party
accreditation bodies.
FAA resource issues are having an impact. A quarter of
survey respondents reported losing customers or foregoing
business opportunities because of inadequate FAA staffing.
Thus, safety is not just the FAA's responsibility, but that of
every aviation maintenance employee performing work on behalf of a
certificated repair station, air carrier or other aviation business. It
is the FAA's role to ensure that repair stations have the procedures in
place to ensure the quality of the work performed and to ensure that
procedures are followed. Indeed, FAA regulations treat repair stations
as extensions of an air carrier's maintenance organization. This means
that the maintenance provider, regardless of their location, must
perform the work in accordance with the carrier's maintenance program
and the applicable portions of its manual. It also requires the
airlines to provide a level of oversight to make certain these
standards are met.
This holds true whether the work is being performed at an FAA
certificated facility in Florida or France.
Security Is a Prime Concern of All Repair Facilities
Security at contract maintenance facilities has drawn much
attention. Domestically, many repair stations located on an airport are
required to have their personnel undergo criminal background checks
under TSA regulations if they require unescorted access to the
designated airport security identification display area (SIDA).
Therefore, a repair station employee that performs line maintenance for
an air carrier would have the same 10-year criminal background check
requirement as an airline mechanic. Many repair stations voluntarily
implement additional security procedures since the quality and safety
of their work directly affects their business.
However, many U.S. repair stations are located miles away from
airports and perform specialized work on component parts that have been
removed from the airplane and sent to them for repair. These facilities
are usually small-businesses; thus, imposing undue security burdens on
them would in effect put an entire sector of specialized workers out of
business. Our members understand the need for safety and security,
since their livelihood depends upon it, and we ask that Congress
recognize the difference in repair facilities, remembering that our
industry shares their same goal: maintaining a high level of safety and
security.
Internationally, each country must implement the types of security
procedures to be followed just as they must do in the safety area.
These are based on ICAO standards contained in Annex 17 and thus are
very similar to TSA regulations. They include, but are not limited to:
A national civil aviation security program with continuous
threat monitoring and mandatory quality control procedures;
Airport security programs for each airport serving
international carriers;
Air operator security programs;
Background checks for persons implementing security control
measures and persons with unescorted access to restricted
security areas; and
Periodic ICAO security audits.
The professionals at the TSA, ICAO and other countries' security
oversight organizations have concluded that resources should be focused
where the threat is greatest. Therefore, FAA foreign repair stations
working on components and located miles away from an airport are not
required to implement background checks for their employees. However,
if they perform line maintenance at an international airport or
otherwise require access to the ramp area, foreign repair station
employees would be subject to similar security requirements to their
FAA counterparts, including background checks.
Neither domestic nor international security requirements are based
on whether a person works for an airline or a repair station; they are
dependent on the degree of access the individual has to the restricted
security areas of an airport. Further, mandating additional security
requirements where none are truly needed will reallocate limited
oversight resources from areas where the threat is greater. This could
have the unintended consequence of reducing the level of security for
the traveling public.
Drug and Alcohol Testing
FAA-certificated repair stations in the U.S. are required to
conduct drug and alcohol testing for employees performing ``safety-
sensitive functions'' for U.S. air carriers. This means that an
employee performing a maintenance task is tested for drug and alcohol
use. Additionally, subcontractors used by the repair station are also
required to undergo testing. It is important to note that FAA testing
requirements do not apply outside the U.S. Therefore, employees of
domestic airlines working outside the U.S. must remove their employees
from the drug and alcohol pool when they leave the country.\5\ Once
again, this has nothing to do with whether the individual works for an
airline or a repair station; it is based on where the work is
performed.
---------------------------------------------------------------------------
\5\ 14 CFR part 121, Appendix I, section XII (Drug Testing) and
Appendix J, section VIII (Alcohol Testing).
---------------------------------------------------------------------------
While some have suggested that the U.S. mandate drug and alcohol
testing for all aviation maintenance workers if they work on articles
subject to FAA jurisdiction, several practical and legal issues arise
based on the fact that many of the affected individuals are citizens of
another state. Indeed, the FAA proposed drug and alcohol testing
outside the U.S. in 1994 but withdrew it in 2000 preferring to develop
a multilateral solution through ICAO.\6\ Currently, drug and alcohol
testing is an ICAO recommended practice; the FAA continues to support
making it a standard and thus mandatory for all ICAO members.\7\ In
addition, a related ICAO standard prohibits individuals from performing
safety-critical functions while under the influence of any psychoactive
substance.\8\
---------------------------------------------------------------------------
\6\ FAA Docket No. 27066; Notice 92-18, effective January 13, 2000.
\7\ ICAO Annex 1, Personnel Licensing, 1.2.7.3 and ICAO Document
9654-AN/945, Manual on Prevention of Problematic Use of Substances in
the Aviation Workplace (1995).
\8\ ICAO Annex 1, 1.2.7.1.
---------------------------------------------------------------------------
Conclusion
Foreign repair stations are an essential part of the aviation
community. Without them, maintenance could not be performed on aircraft
overseas, and the ability of Americans to travel abroad would cease.
The standards and procedures followed by foreign repair stations are
essentially the same as those followed by domestic repair stations, if
they are FAA-certificated and working on U.S.-registered aircraft.
The use of foreign repair stations does not threaten the viability
of domestic companies, or aviation safety. In fact, with many American
businesses having facilities located worldwide, changes to the use of
foreign repair stations will adversely affect domestic companies and
encourage foreign countries to retaliate with similar measures. ARSA
believes that the Congress should allow the international regulatory
processes to work through the body established for that purpose, ICAO.
Congress can help maintain the safety and vitality of this industry
by providing the FAA with adequate resources to oversee the repair
station industry, encouraging continued oversight by airline customers
and other civil aviation authorities, and most importantly by ensuring
that legislation and regulations are truly based on safety.
Appendix A
FAA Repair Stations by State
[Including Territories]
------------------------------------------------------------------------
Number of Repair
State Stations Number of Employees
------------------------------------------------------------------------
AK 53 475
AL 56 6,545
AR 43 3,115
AZ 156 6,469
CA 683 30,811
CO 73 1,219
CT 102 7,730
DC 1 7
DE 6 823
FL 512 16,356
GA 114 9,840
GU 1 6
HI 13 113
IA 38 2,985
ID 31 399
IL 93 3,346
IN 72 3,506
KS 107 7,109
KY 37 581
LA 40 2,251
MA 57 1,893
MD 30 1,100
ME 11 857
MI 114 4,469
MN 59 2,204
MO 55 2,643
MS 20 1,019
MT 25 336
NC 65 3,704
ND 11 101
NE 13 1,213
NH 24 590
NJ 69 2,440
NM 21 624
NV 30 748
NY 129 5,450
OH 142 4,599
OK 139 12,059
OR 48 1,444
PA 99 2,699
PR 18 144
RI 9 385
SC 32 2,388
SD 14 73
TN 51 2,090
TX 428 25,801
UT 29 294
VA 45 1,292
VI 1 1
VT 11 158
WA 119 7,547
WI 46 1,537
WV 12 1,517
WY 9 78
------------------------------------------------------------------------
Grand 4,216 197,183
------------------------------------------------------------------------
Based on FAA Air Agency Data Dated: June 10, 2007.
Appendix B
FAA Repair Stations on Foreign Soil by Country
------------------------------------------------------------------------
Number of Repair
Country Stations Number of Employees
------------------------------------------------------------------------
AE 4 4,224
AR 8 1,727
AS 13 6,868
AU 1 1,150
BA 1 5
BE 12 4,618
BR 15 6,160
CH 30 15,171
CI 4 754
CO 4 1,471
CS 3 480
DA 2 859
DR 2 43
EC 2 131
EG 1 3,500
EI 12 3,429
ES 1 1,200
ET 1 2,230
EZ 2 1,213
FI 1 1,800
FJ 1 26
FR 101 25,972
GM 53 30,457
GR 2 914
GT 2 70
HK 7 5,650
HU 2 806
ID 2 2,832
IN 2 806
IS 13 5,567
IT 20 6,659
JA 20 17,332
JO 2 944
KE 1 5
KS 9 5,629
KZ 1 33
LU 1 329
MO 2 995
MT 1 42
MX 20 4,279
MY 8 4,107
NL 20 7,034
NO 4 1,052
NZ 4 3,377
PE 4 670
PM 1 192
PO 2 3,174
QA 1 41
RO 2 864
RP 8 3,249
RS 1 2,350
SA 5 6,423
SF 4 3,690
SN 48 15,475
SP 6 4,360
SW 8 2,481
SZ 8 4,524
TD 1 153
TH 6 5,650
TU 2 3,006
TW 6 4,844
UK 161 23,998
UP 1 91
VE 4 304
WI 1 100
YI 1 --
------------------------------------------------------------------------
Grand 698 267,589
------------------------------------------------------------------------
Based on FAA Air Agency Data Dated: June 10, 2007.
Appendix C
FAA Repair Stations on Foreign Soil by Country Code Listing
[based on FAA data]
----------------------------------------------------------------------------------------------------------------
Category 1 = Meets Bilateral
Total Number of ICAO standards 2 = Agreement
Country Code Name Repair Employees Does not meet ICAO with the
Stations standards U.S.?
----------------------------------------------------------------------------------------------------------------
AE United Arab Emirates 4 4,224 1 --
AR Argentina 8 1,727 1 Yes
AS Australia 13 6,868 1 Yes
AU Austria 1 1,150 1 Yes
BA Bahrain 1 5 Not Listed --
BE Belgium 12 4,618 1 Yes
BR Brazil 15 6,160 1 Yes
CH China 30 15,171 1 Yes
CI Chile 4 754 1 --
CO Columbia 4 1,471 1 --
CS Costa Rica 3 480 1 --
DA Denmark 2 859 1 Yes
DR Dominican Republic 2 43 2 --
EC Ecuador 2 131 1 --
EG Egypt 1 3,500 1 --
EI Ireland 12 3,429 1 --
ES El Salvador 1 1,200 1 --
ET Ethiopia 1 2,230 1 --
EZ Czech Republic 2 1,213 1 Yes
FI Finland 1 1,800 1 Yes
FJ Fiji 1 26 1 --
FR France 101 25,972 1 Yes
GM Germany 53 30,457 1 Yes
GR Greece 2 914 1 --
GT Guatemala 2 70 2 --
HK Hong Kong 7 5,650 1 --
HU Hungary 2 806 1 --
ID Indonesia 2 2,832 1 Yes
IN India 2 806 1 --
IS Israel 13 5,567 1 Yes
IT Italy 20 6,659 1 Yes
JA Japan 20 17,332 1 Yes
JO Jordan 2 944 1 --
KE Kenya 1 5 Not Listed --
KS Korea 9 5,629 Not Listed --
KZ Kazakhstan 1 33 Not Listed --
LU Luxembourg 1 329 1 --
MO Morocco 2 995 1 --
MT Malta 1 42 1 --
MX Mexico 20 4,279 1 --
MY Malaysia 8 4,107 1 Yes
NL Netherlands 20 7,034 1 Yes
NO Norway 4 1,052 1 Yes
NZ New Zealand 4 3,377 1 Yes
PE Peru 4 670 1 --
PM Panama 1 192 1 --
PO Portugal 2 3,174 1 --
QA Qatar 1 41 1 --
RO Romania 2 864 1 Yes
RP Philippines 8 3,249 1 --
RS Russia 1 2,350 1 Yes
SA Saudi Arabia 5 6,423 1 --
SF South Africa 4 3,690 1 Yes
SN Singapore 48 15,475 1 Yes
SP Spain 6 4,360 1 Yes
SW Sweden 8 2,481 1 Yes
SZ Switzerland 8 4,524 1 Yes
TD Trinidad & Tobago 1 153 1 --
TH Thailand 6 5,650 1 --
TU Turkey 2 3,006 1 --
TW Taiwan 6 4,844 1 --
UK United Kingdom 161 23,998 1 Yes
UP Ukraine 1 91 2 --
VE Venezuela 4 304 1 --
WI Western Sahara 1 100 Not Listed --
YI Yugoslavia 1 -- Not Listed --
----------------------------------------------------------------------------------------------------------------
TOTAL 65 698 267,589 60 27
----------------------------------------------------------------------------------------------------------------
Appendix D
ARSA Repair Station Audit Surveillance Survey Results
Domestic Repair Station Annual Audits
----------------------------------------------------------------------------------------------------------------
Responses Internal Regulatory Customer 3rd Party Total
----------------------------------------------------------------------------------------------------------------
Total 183 3,301 663 1,361 235 5,560
Average 18.0 3.6 7.4 1.3 30.4
----------------------------------------------------------------------------------------------------------------
Foreign Repair Station Annual Audits
----------------------------------------------------------------------------------------------------------------
Responses Internal Regulatory Customer 3rd Party Total
----------------------------------------------------------------------------------------------------------------
Total 27 1,439 219 311 48 2,017
Average 53.3 8.1 11.5 1.8 74.7
----------------------------------------------------------------------------------------------------------------
Total Repair Station Annual Audits
----------------------------------------------------------------------------------------------------------------
Responses Internal Authority Customer 3rd Party Total
----------------------------------------------------------------------------------------------------------------
Grand Total 210 4,740 882 1,672 283 7,577
Average 22.6 4.2 8.0 1.3 36.1
----------------------------------------------------------------------------------------------------------------
Appendix E
Analysis of the Aeronautical Repair Station Association's
2007 Member Survey
Executive Summary
In March 2007, the Aeronautical Repair Station Association (ARSA)
conducted a major survey of its members. The purposes of the 2007
survey were to:
Develop a better understanding of the markets served by ARSA
members;
Determine what factors most affect member costs of doing
business;
Identify legislative and regulatory issues of common concern
to the membership;
Determine what members perceive as the most important parts
of the ARSA value proposition; and
Identify additional activities the association could
undertake to enhance value to members.
This survey's major findings were as follows:
ARSA's membership is dominated by privately-owned small
businesses. Nearly 70 percent of the survey respondents have
annual revenues below $10.5 million (Question 2); more than 67
percent have fifty or fewer employees (Question 3); and more
than 81 percent are privately-owned by a single individual,
single family, or group of partners (Question 12).
The overwhelming majority of ARSA members (98.5 percent)
hold Federal Aviation Administration (FAA) repair station
certificates; however, more than two-thirds (68.42 percent) are
also European Aviation Safety Administration (EASA) approval
holders (Question 7).
Commercial air carriers are overwhelmingly the most
important customer market for ARSA members, with general
(business aircraft) the second most important. The military and
general (light aircraft) markets are a distant third and fourth
(Question 9).
Labor unions have low penetration in the repair station
industry. Fewer than twelve percent of survey respondents
report that their facilities are unionized (Question 13).
The survey results suggest that the repair station industry
is thriving economically. More than two-thirds (71.43 percent)
of survey respondents said they plan to add positions and/or
hire new workers in the coming year. Not a single survey
respondent reported plans to eliminate positions. Additionally,
83 percent of survey respondents are optimistic about business
prospects for the coming year, only 9 percent are ambivalent,
and fewer than 8 percent are pessimistic (Questions 15 and 18).
There is a considerable level of oversight of repair
stations, with 42 percent reporting 11 or more external audits
last year by regulators, customers, and third-party
accreditation bodies (Question 19).
FAA resource problems are having some impact on the
efficiency of the contract maintenance industry. A quarter
(24.81 percent) of the survey respondents report losing
customers or foregoing business opportunities because of
regulatory delays resulting from inadequate FAA staffing
(Question 20.)
Obtaining maintenance manuals from manufacturers remains a
major challenge for repair stations. Consistent with earlier
ARSA surveys, more than 70 percent of survey respondents report
having had some difficultly obtaining maintenance manuals from
OEMs. More than a third (37.59 percent) of respondents report
that maintenance manual availability is a consistent source of
frustration, and that their ability to serve customers is
undermined by manufacturers refusing to provide manuals and/or
charging exorbitant prices (Questions 21 and 22.)
Rising health insurance costs have had a significant impact
on ARSA members and their employees, with approximately three-
quarters (74.44 percent) of members reporting that they have
had to reduce benefits or ask workers to shoulder more of the
costs of health insurance in recent years (Question 25.)
Close to 80 percent of survey respondents have had trouble
finding skilled technical workers. More survey respondents
cited the shortage of technical workers as the single greatest
challenge facing that aviation maintenance industry than any
other (Questions 26 and 30).
ARSA members regard ARSA's advocacy activities on behalf of
the industry before U.S. regulators and Congress as the most
important parts of the ARSA value proposition. ARSA's
regulatory compliance publications, the hotline, and
maintenance industry networking opportunities are also highly
regarded (Question 33.)
Survey respondents cite their desire to support ARSA's
advocacy activities and access to regulatory compliance
assistance as the top reasons for joining ARSA (Question 34.)
A majority of survey respondents say that their company
employees have not yet participated in ARSA's Annual Repair
Symposium, suggesting significant opportunities to grow member
participation in ARSA's flagship event. Survey respondents are
ambivalent about restructuring the Symposium to take place
entirely on weekdays and about adding a trade show component to
the meeting (Question 40, 42 and 43.)
Survey Methodology
ARSA's 2007 Member Survey was conducted between Feb. 26 and March 6
using SDI Weblink's online survey system. The ARSA key contact for each
repair station member and corporate member was invited to participate
in the survey through three e-mails sent over the course of the week
requesting input. Although the survey was anonymous, the survey system
was configured to prevent duplicate responses from the same individual.
Ultimately, 133 ARSA member companies participated in the survey out of
a population of approximately 520 regular and 15 corporate members. The
survey margin of error is 7.3 percent.
Senator McCaskill. Thank you.
Mr. Barimo?
STATEMENT OF BASIL J. BARIMO,
VICE PRESIDENT, OPERATIONS AND SAFETY,
AIR TRANSPORT ASSOCIATION OF AMERICA, INC.
Mr. Barimo. Thank you and good afternoon.
I'm Basil Barimo, Vice President of Operations and Safety
of the Air Transport Association of America.
I appreciate the opportunity to join you today, as you
consider how the expertise of highly qualified third parties
can be applied to air carrier maintenance programs.
Long and varied experience confirms that contract
maintenance can be both safe, and efficient, and we should not
be hesitant in accepting its use. Before going any farther,
though, I want to emphasize that the starting point for any
discussion that has aviation safety implications is this--
safety is the constant, overriding consideration in our
member's activities. They understand their responsibilities,
and they act accordingly.
The U.S. airline industry's stellar, and improving, safety
record demonstrates that unflagging commitment. Maintenance
contracting in the airline industry is undertaken in this
overarching context of dedication to safety. It's no different
than any other activity in our industry in that respect.
Consequently, it's not a shortcut by which shoddy maintenance
practices are tolerated, it's not a stray, cutoff from an
airlines overall maintenance program, and it's not adrift,
detached from regulatory moorings. More decisively, the safety
data don't offer a reason to question the use of contract
maintenance. Outsourcing has increased over the past decade,
yet the U.S. industry's maintenance-related safety record is
the best it has ever been. If there were systemic problems with
contract maintenance, the safety data would have exposed it,
and again, we're talking about NTSB data, not anecdotal claims.
This favorable outcome is to be expected. Once again,
context is crucial. Contract maintenance occurs in a highly
structured, safety oriented environment, regardless of where
it's done.
To begin with, the decision to outsource is for each
airline to make. An airline makes that decision as the
certificate holder, the regulated entity that is ultimately
responsible for the safety of its operations. If the airline
elects to use third-party maintenance, the airline is not
fluffing off any of its statutory or regulatory obligations. On
the contrary, the airline's making a well thought-out
determination that outsourcing will contribute--both in terms
of results and efficiency--to the airline's maintenance
program.
Contract maintenance is common, and commonly accepted in
the industry. Virtually every airline, to some degree, relies
on contract maintenance--whether in the form of line, heavy,
engine or component maintenance. Aircraft operators with
demanding and sophisticated maintenance needs, including
various branches of the U.S. military, contract for maintenance
services. It's not an exotic practice, regardless of where it's
done.
The multi-layered and continuous oversight of contract
maintenance does more than ensure a safe aircraft, it enhances
a robust security system--a complex system of checks and
balances, originally designed with safety in mind, are
interwoven with security, and asset protection systems, to
mitigate risks regardless of their nature.
Oversight is fully integrated into FAA's regulatory
structure, the FARs explicitly recognize it, and the FAA
certificates repair stations, which must comply with the
airlines FAA-approved maintenance program. In addition, as the
certificate holder, the airline must monitor the quality of the
maintenance that is performed. To do so, airlines conduct
indepth and frequent audits of the repair stations that they
use, they employ independent auditors, they assign their own
onsite representatives to monitor repair station performance,
and they measure the reliability of the products produced.
Finally, the FAA has a compliance program that surveys the
performance of both the airlines and the repair stations.
Continued access to third-party maintenance is one
ingredient in some airlines' efforts to remain competitive both
here and abroad--that competitiveness is what enables
passengers and shippers to receive the services they want, at
prices they're willing to pay.
Compromise of safety can never be tolerated, but neither
should efforts to limit airlines' ability to obtain necessary
services--consistent with the highest degree of safety--as
economically as possible. This search for efficiency has meant
that some airlines have shifted where their maintenance is
done. Sometimes it meant moving the location of in-house
maintenance facilities, other times it's meant contracting with
a third party, perhaps even overseas, to perform some of the
airlines' maintenance. Neither type of change is pleasant, both
can adversely affect workers and their communities. It has,
however, meant new job opportunities for some workers, and new
economic benefits for some communities.
Far from resulting in the export of the majority of U.S.
maintenance jobs overseas, it has meant that we've been able to
retain them in the United States. This is a key point in
evaluating the effects of contracts maintenance.
Thank you for allowing me to share our views today, and I'm
glad to answer questions.
[The prepared statement of Mr. Barimo follows:]
Prepared Statement of Basil J. Barimo, Vice President, Operations and
Safety, Air Transport Association of America, Inc.
Introduction
The Air Transport Association of America, Inc. (ATA), the trade
association of the principal U.S. passenger and cargo airlines,\1\
appreciates the opportunity to submit these comments for the record on
safety and other issues affecting the U.S. airline industry. ATA member
airlines have a combined fleet of more than 4,000 airplanes and account
for more than 90 percent of domestic passenger and cargo traffic
carried annually by U.S. airlines.
---------------------------------------------------------------------------
\1\ ABX Air, Inc.; Alaska Airlines; Aloha Airlines; American
Airlines; ASTAR Air Cargo; Atlas Air; Continental Airlines; Delta Air
Lines; Evergreen International Airlines; Federal Express Corp.;
Hawaiian Airlines; JetBlue Airways; Midwest Airlines; Northwest
Airlines; Southwest Airlines; United Airlines; UPS Airlines; and US
Airways.
---------------------------------------------------------------------------
Safety is the constant, overriding imperative in our members'
activities. They understand their responsibilities and they act
accordingly. The U.S. airline industry's stellar--and improving--safety
record demonstrates that indisputable commitment.
Airlines Fuel Our Nation's Economy
The U.S. airline industry is not simply an important sector of the
national economy; its services fuel our entire economy. Air
transportation is an indispensable element of America's infrastructure
and our Nation's economic well-being. Individuals, businesses and
communities depend on the national air transportation system. U.S.
airlines transport more than two million passengers on a typical day
and directly employ 550,000 persons to do so; they provide just-in-time
cargo services; they are the backbone of the travel and tourism
industry; and airlines link communities throughout our Nation and to
the world.
Moreover, the airline industry is the foundation of the commercial
aviation sector, which comprises airlines, airports, manufacturers and
associated vendors. U.S. commercial aviation ultimately drives $1.2
trillion in U.S. economic activity and 11.4 million U.S. jobs. By any
measure, the U.S. airline industry is a valuable national asset and its
continued economic health should be a matter of national concern.
The Safest Airlines in the World
Despite the unprecedented travails of the U.S. airline industry
throughout the first half of this decade, its safety record has
continued to improve. Our commitment to safety, even in the face of
unprecedented financial adversity, has been unflagging and will remain
so.
Following $35 billion in losses from 2001 to 2005, 2006 was a much-
improved year for the U.S. airline industry from an economic
standpoint. Including the all-cargo sector, the industry reported
earnings of $3 billion for the year.
While conditions have improved and the overall financial outlook is
guardedly optimistic, debt levels remain high, leaving the airlines
vulnerable to fuel spikes, recession or exogenous shocks (e.g.,
terrorism, pandemics, natural disasters), let alone ill-advised public
policy decisions. The challenge we face is to achieve meaningful and
sustainable profits, and to improve credit ratings to the point where
airlines can weather normal economic turbulence while simultaneously
investing in the future.
Notwithstanding these financial challenges, airline safety has
remained rock solid. NTSB figures show fewer accidents in 2006 compared
to 2005 for all segments of civil aviation, with Part 121 carriers
continuing to have the lowest accident rates. In 2006, Part 121
carriers transported 750 million passengers more than eight billion
miles and logged 19 million flight hours on 11.4 million flights.
Tragically, there were two fatal accidents in 2006 which claimed 50
lives. This yields an accident rate of 0.18 per 1,000,000 departures,
down 30 percent from 2005. For comparison, the average rate for the
five-year period of 2002-2006 was 0.36, and the 5 years prior to that
saw a rate of 0.45 accidents per 1,000,000 departures. The trend
continues in 2007 and, without question scheduled air service is
incredibly safe, getting safer, and maintenance certainly plays a role
in that remarkable achievement.
The chart above clearly depicts the remarkable improvements in
airline safety that have occurred over time. U.S. air carrier accidents
are rare and random. A prominent reason for this is the extraordinary,
long-standing collaboration among the FAA, NTSB, NASA, manufacturers,
airline employees and their unions, airlines themselves, and of course,
maintenance, repair and overhaul service providers (MROs). That
collaborative relationship is firmly entrenched in the aviation
community; indeed, it has strengthened over the years. Programs such as
the joint government-industry Commercial Aviation Safety Team, Flight
Operational Quality Assurance Programs, Aviation Safety Action
Programs, and Line Operations Safety Programs are important, tangible
results of that ongoing collaboration.
These collaborative safety-improvement efforts have created a
safety management system that is data driven and is based on risk
analysis. That undistracted focus on data enables safety-related trends
to be identified, often before they emerge as problems, and are
properly resolved. This objective and measurable approach means that we
apply our resources where the needs actually are, not where surmise or
unverified assumptions might take us.
We can and do spot these trends, whether they are operational or
maintenance related. With respect to the long-standing practice in the
airline industry to use the expertise of regulated contractors to
perform maintenance services, the data quite clearly do not tell us
that safety suffers.
Maintenance Contracting Is Not a New Concept
In simple terms, contract maintenance is the process explicitly
allowed by FAR 121.363(b) \2\ where airlines hire experts to perform
maintenance tasks. The type of maintenance involved can range from
minor servicing to major overhaul of components, engines or the
airframe itself.
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\2\ FAR 121.363 Responsibility for Airworthiness states that:
(a) Each certificate holder is primarily responsible for--
(1) The airworthiness of its aircraft, including airframes,
aircraft engines, propellers, appliances, and parts thereof; and
(2) The performance of the maintenance, preventive maintenance, and
alteration of its aircraft, including airframes, aircraft engines,
propellers, appliances, emergency equipment, and parts thereof, in
accordance with its manual and the regulations of this chapter.
(b) A certificate holder may make arrangements with another person
for the performance of any maintenance, preventive maintenance, or
alterations. However, this does not relieve the certificate holder of
the responsibility specified in paragraph (a) of this section.
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Airlines exist to transport people and goods. In order to survive
they must do it safely, but to thrive in a fiercely competitive, global
environment they must also do it efficiently. Safety need not be
comprised because of considerations of efficiency; in fact, it can be
significantly advanced in an environment where a focus on efficiency
spurs a willingness to re-examine time-worn practices and encourage
innovation that embraces newer--and improved--practices.
The maintenance of commercial airliners is a complex, capital-
intensive business requiring specialized equipment and facilities along
with highly-skilled personnel. One implication of this is that using a
maintenance facility or facilities with specialized skills is likely to
be considered. Complexity inevitably will lead a carrier to examine
dividing maintenance functions; some airlines will elect to do so,
while others will not. Either way, examining alternative sources in
this type of environment is entirely reasonable.
Moreover, current airline business models demand continual scrutiny
of costs, commonly with a bias to shed non-core activities. In the case
of maintenance, there are many incentives to utilize contract
maintenance providers:
Access to specialized repair facilities when and where they
are needed
Avoidance of major capital investments (equipment and
facilities)
Increased utilization of existing facilities
Improved employee focus on core airline activities
Optimization of flight schedules around customer demand
instead of maintenance infrastructure availability
Exceptional quality at a reduced cost
As expected, the level of contract maintenance utilized by
individual airlines varies significantly based on factors such as the
type(s) of aircraft used, geographic region of operation, business
philosophy, labor agreement limitations, internal cost structure, and
commercial relationships with airframe, engine and component
manufacturers. Without exception, all airlines rely to some extent on
contract maintenance providers. This is a point that should not be
obscured: contract maintenance is a commonly accepted practice in this
industry. The extent of it may vary from airline to airline but there
is nothing out of the ordinary about its use.
Airlines are by no means unique in their reliance on contract
maintenance. In fact, many industries rely heavily on contract
maintenance providers for a broad range of services. Trains, buses and
cruise ships are predominantly maintained by companies other than those
who operate them. The United States Department of Defense contracts
with private companies for the maintenance of aircraft, in many cases
the same companies utilized by commercial airlines. As this widespread
pattern of relying on contract maintenance suggests, operators with
very demanding and sophisticated needs routinely and successfully
outsource maintenance.
Statistics Don't Lie
Commercial airlines have utilized contract maintenance for decades.
The industry's reliance on contract maintenance providers increased
since 2001 as airlines restructured their business models. The
implications of this change have been misunderstood. It does not signal
a diminution in safety or a ``slippery slope.'' Critics of contract
maintenance argue that ``If airlines don't perform all of the
maintenance themselves, then they can't be safe.'' Independent data
from the National Transportation Safety Board (NTSB) proves them wrong.
Based on data compiled by the NTSB, maintenance-related accidents
make up roughly 8 percent of all Part 121 accidents over the last 10
years.
The chart above clearly illustrates that U.S. airlines' use of
contract maintenance has not been a detriment to safety. In fact,
maintenance-related safety performance is the best its ever been. It is
simply not reasonable, based on the data available, to consider the
practice of maintenance contracting unsafe.
Effective Oversight Is the Key
Air carriers understand that aircraft maintenance is vital to
continued operational safety. Likewise, safe operations are elemental
to compliance with regulatory requirements and ultimately to an
airline's existence. Over time, the industry has developed a
comprehensive, multilayered approach to oversight that ensures the
highest levels of quality and safety regardless of who does the work or
where that work is performed. This point cannot be overstated--safety
is what counts, first and foremost.
Initial levels of protection are contained in the Federal Aviation
Administration (FAA) regulations, which provide a basic framework to
ensure competence among those certificated to perform aircraft
maintenance.\3\ Prior to granting certification, the FAA confirms that
an entity or individual has fulfilled specific regulatory requirements.
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\3\ See, for example, 14 CFR parts 121, 145 and 65.
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Part of this approval process involves the issuance of Operations
Specifications (OpSpecs) by the FAA. Air carrier OpSpecs contain a
specific section to address aircraft maintenance, and repair station
OpSpecs delineate the ratings and limitations of the maintenance that
can be performed. In FAA Order 8300.10, Volume 2, Chapter 84, it is
stated, in part, that:
OpSpecs transform the general terms of applicable regulations
into an understandable legal document tailored to the specific
needs of an individual certificate holder. OpSpecs are as
legally binding as the regulations . . . (Citations omitted)
Once certificated, air carriers and repair stations are inspected
and monitored by the FAA to verify their continued conformity with the
rules. This ongoing surveillance process can be viewed as the second
layer of safety.
Additionally, certificated air carriers acquire the non-delegable
responsibility for the airworthiness of the aircraft in their fleet.\4\
The backbone of any air carrier's airworthiness is its Continuing
Analysis and Surveillance System (CASS). CASS is a quality-assurance
system required by FAR 121.373 consisting of surveillance, controls,
analysis, corrective action and follow-up. Together, these functions
form a closed loop system that allows carriers to monitor the quality
of their maintenance. In a structured and methodical manner, the CASS
provides carriers with the necessary information to enhance their
maintenance programs.
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\4\ See 14 CFR 121.363 which provides that:
(a) Each certificate holder is primarily responsible for--
(1) The airworthiness of its aircraft, including airframes,
aircraft engines, propellers, appliances, and parts thereof; and
(2) The performance of the maintenance, preventive maintenance, and
alteration of its aircraft, including airframes, aircraft engines,
propellers, appliances, emergency equipment, and parts thereof, in
accordance with its manual and the regulations of this chapter.
(b) A certificate holder may make arrangements with another person
for the performance of any maintenance, preventive maintenance, or
alterations. However, this does not relieve the certificate holder of
the responsibility specified in paragraph (a) of this section.
(Emphasis added.)
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Aircraft maintenance is the primary ingredient of airworthiness and
FAA regulations contain detailed maintenance program and manual
requirements,\5\ which validate the related air-carrier processes and
procedures. When work is sent to a repair station, it must follow the
maintenance program of the air carrier with whom it has contracted.\6\
Combined, these duties comprise the third level of protection.
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\5\ See 14 CFR 121.365; 121.367; 121.369.
\6\ See 14 CFR 145.205 which states, in part, that:
(a) A certificated repair station that performs maintenance,
preventive maintenance, or alterations for an air carrier or commercial
operator that has a continuous airworthiness maintenance program under
part 121 or part 135 must follow the air carrier's or commercial
operator's program and applicable sections of its maintenance manual.
(Emphasis added.)
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Apart from external FAA surveillance, and in line with their
ultimate responsibility for airworthiness, airlines conduct in-depth
initial and frequent follow-up maintenance vendor audits. As a rule,
these audits are performed by air carrier quality, compliance or
inspection department employees, but oftentimes may include outside
counsel and/or consulting firms who specialize in air carrier
maintenance. These audits create a robust fourth level of oversight.
Industry protocol for conducting and substantiating independent
audits of air carriers and repair stations is established by the
Coordinating Agency for Supplier Evaluation (C.A.S.E.). In addition,
guidance materials and inspection checklists created for FAA inspectors
are frequently used.
Typically, preliminary investigation of a potential repair station
vendor by an air carrier would include:
Review of repair station performance and quality metrics
Feedback from past and current repair station customers
Verification of repair station capabilities (OpSpecs)
Review of FAA mandated Repair Station Manual, Quality Manual
and Training Manual
If this repair station examination is satisfactory, it is normally
followed by an on-site visit to verify compliance with applicable
regulations, C.A.S.E. requirements and adherence to the repair
station's own manuals. Some areas of investigation include:
Validation of FAA certificates held by persons directly in
charge of maintenance and/or those who perform maintenance
Inspection of training records of inspectors, technicians
and supervisors
Examination of procedures for technical data, documentation
and maintenance record control
Examination of procedures for work processing, disposal of
scrap parts, tool calibration and handling material with a
limited shelf life
Review of repair station internal inspection, quality, and
security programs
Review of previous inspection program results and corrective
actions
If the repair station is selected to perform maintenance for the
air carrier, similar on-site audits would be conducted on a regular
basis.
Finally, a fifth layer of oversight is provided by on-site air
carrier representatives. These individuals monitor the day-to-day
operations and coordinate the activities of the repair station related
to the air carrier's equipment. Final inspections and, ultimately, air
carrier approval for service are also normally accomplished by these
on-site airline personnel.
In essence, there are two separate but mutually reinforcing
oversight schemes, one regulatory and one independent, both effective
in ensuring satisfaction of applicable FAA regulations. However, air
carriers have further incentive to provide adequate oversight through
the potential negative impact--real or perceived--of safety related
issues. Without question, air carriers continue to make safety their
top priority. Safety is ingrained in our culture.
Safety and Security Layers Are Interwoven
Security of repair station activities is a constant consideration.
As in other areas of civil aviation security, the response to this
issue is based on a layered approach.
The subject of foreign repair station security measures has
attracted attention recently. We wish to clarify a few points about
those measures. As a preliminary matter, we support the Congressional
instruction to the Transportation Security Administration to issue
foreign repair station security regulations. We look forward to
participating in the anticipated TSA rulemaking proceeding.
Mutually reinforcing U.S. and host country regulatory requirements
and carrier practices produce the layered security regime at foreign
repair stations. This begins with a U.S. air carrier's evaluation of a
potential service provider before it enters into a contract for
maintenance, repair or overhaul services. This is an important first
step for the carrier; it is looking to entrust an aircraft or high-
value components to a vendor. The carrier obviously wants to prevent
unauthorized access to such equipment and to be confident that the
potential vendor can do so. Beyond that very basic business concern,
are the security requirements that the country's civil aviation
authority and the airport authority impose. Those requirements are
reinforced by periodic TSA foreign airport security inspections.
Coupled with those requirements is the typical presence of a
representative of the U.S. carrier at the foreign facility. Weaved into
this array of measures is the FAA requirement that repaired or
overhauled items be inspected when they are returned to the U.S.
carrier and before they are returned to service aboard an aircraft.
This means that multiple sets of trained eyes inspect a part that has
been at a foreign repair station. Finally, before an aircraft is
returned to passenger service from a foreign location, it must complete
the aircraft security inspection procedures.
These complementary procedures yield a layered approach, which is
the hallmark of how aviation security is achieved today. We look
forward to continue to work with U.S. and foreign regulators on these
measures.
Global Competition, Local Politics
U.S. airlines continually lead the world in virtually every
performance metric, including safety. Their ability to compete
effectively on a global scale is due, at least in part, to their
ability to evolve with changing market conditions. Airlines across the
United States and around the world have formed alliances that extend
beyond their networks to many aspects of airline operations, including
maintenance. These complex relationships involve airlines, aircraft
manufacturers and a host of service providers.
The loss of some 130,000 airline jobs since 9/11 has been well
documented. As airlines downsized to meet a reduced demand for air
travel, it became even more difficult for them to efficiently utilize
their exhaustive maintenance infrastructure. Fleet reductions targeted
older, maintenance-intensive aircraft, leaving too few aircraft being
maintained at too many facilities, and airlines looked to contract
maintenance providers as a way to secure quality maintenance while
shedding the expensive infrastructure costs. Airlines were also forced
to renegotiate labor agreements in an effort to reduce costs, bolster
productivity and increase asset utilization. Scope clauses were
modified to allow air carriers to more broadly leverage contract
maintenance--a painful move for affected employees, but ultimately
essential to the airline's survival. It is this impact on employees,
particularly maintenance employees, that draws attention to the issue
of maintenance contracting.
The debate surrounding the issue of contract maintenance is best
understood when broken down into several key points:
Most statistics relating to the amount of maintenance
contracted are based on the amount an airline spends. The
amount `outsourced' is derived by dividing the amount spent on
contract maintenance by the total maintenance cost for the
airline. These include all costs associated with the
maintenance of airframes, engines and components.
Engine maintenance is much more expensive per event than
airframe maintenance, due largely to the replacement of
expensive parts within the engine. The fact that virtually all
engine maintenance is performed outside the airline can skew
the numbers.
Even the largest engines are readily transportable enabling
access to repair centers around the world. Engine manufacturers
such as GE, Pratt & Whitney, and Rolls-Royce rely on their
subsidiaries worldwide for maintenance of their products
although, as shown below, most of that work is performed
domestically. Large U.S. airline MROs also maintain engines for
foreign and domestic customers.
ATA-member airlines continue to perform the majority of
airframe checks internally.\7\
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\7\ According to a 2005 survey of ATA member airlines, 70 percent
of all heavy maintenance checks (`C' or higher) were performed
internally by direct airline personnel.
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The majority of narrow-body aircraft maintenance work
contracted out in the past few years has stayed within North
America. Maintenance, repair and overhaul companies (MROs) in
Washington, North Carolina, Florida, New York, Georgia,
Tennessee, Arizona, Texas and Indiana are among those now
performing the work. Large airlines with available capacity
have also captured a portion, and the remainder is performed by
experts in Central/South America and Canada.
Heavy airframe maintenance performed by MROs outside of
North America is limited primarily to wide-body aircraft.
Regularly scheduled operations enable these long-range aircraft
to routinely transit locations abroad that offer best-in-class
maintenance for these aircraft types. Asia and Europe do much
of this work.
Conclusion
U.S. airlines have logged an exceptional safety record while
steadily expanding their use of contract maintenance. So while critics
charge that maintenance contracting undermines safety, independent
government figures simply don't support that conclusion. When
considered objectively, it is evident that the practice helps U.S.
airlines compete effectively with their global counterparts. The
ability to optimize maintenance practices to produce safe, reliable,
customer-worthy aircraft at a competitive cost is essential to
airlines' long-term health. Healthy airlines grow, adding service to
new destinations and increasing service to existing ones. That growth
requires new aircraft, creating new jobs within the airline for pilots,
flight attendants, ramp and customer service personnel, and a wide
range of support staff. Beyond the airline, the impact grows
exponentially and is felt nationwide by manufacturers, ATC service
providers, airports, caterers, fuelers--the list goes on and on.
Contract maintenance has played and continues to play an important role
in improving the health of the U.S. airline industry--in a way that is
entirely consistent with our fundamental commitment to safety. It is
imperative that this fact not be overshadowed by the movement of jobs
from one state or district to another.
Senator McCaskill. Thank you, Mr. Barimo.
Mr. Brantley?
STATEMENT OF TOM BRANTLEY, PRESIDENT, PROFESSIONAL AIRWAYS
SYSTEMS SPECIALISTS (PASS), AFL-CIO
Mr. Brantley. Madame Chairwoman, Chairman Rockefeller,
Senator Lott, and members of the Subcommittee, thank you for
inviting PASS to testify today.
PASS represents over 11,000 FAA employees, including
approximately 2,800 Flight Standards aviation safety
inspectors.
In recent years, the aviation industry has experienced
dramatic changes, including airlines increasing their reliance
on outsourced maintenance work, and a large portion of this
work is being performed at FAA-certificated foreign repair
stations.
PASS and the inspector workforce we represent, who are
responsible for overseeing the certification of and the work
performed at foreign repair stations, have serious concerns
regarding the oversight of these facilities.
Of primary importance, there must be an adequate number of
experienced and trained FAA inspectors in place with budgetary
and management support to properly oversee foreign repair
stations.
Inspector staffing has not kept pace with the exploding
outsourcing business and nearly half of the workforce will be
eligible to retire within 3 years. As such, PASS is requesting
that Congress direct the agency to follow recommendations
outlined in the recent study released by the National Academy
of Sciences, and develop a staffing model for inspectors.
Instead of addressing the inspector staffing issue,
however, the FAA is working to expand the use of Bilateral
Aviation Safety Agreements, which allow foreign authorities to
provide oversight of the work performed at repair facilities.
There are inherent problems associated with allowing non-FAA
employees in foreign locations to perform work on behalf of the
FAA. Primarily, the fact that the FAA does not have adequate
oversight procedures in place to ensure the quality of these
inspections.
The FAA is entering into these bilateral agreements with
other countries not to strengthen aviation safety, but instead
to pass the responsibility for oversight onto another entity.
It must be required and verified that inspections conducted by
foreign authorities are done in line with the safety standards
and regulations of this country. Until this issue is adequately
addressed, additional agreements with foreign aviation
authorities should not be allowed.
In addition, inspectors tell us of several problems
regarding the regulations governing foreign repair stations and
the security at foreign repair stations, since the FAA does not
require the same security screening or drug and alcohol testing
of employees at foreign repair stations as are required in our
own country.
Furthermore, the process an inspector must go through, in
order to gain access to a foreign repair station is so lengthy
and tedious that by the time the inspector arrives at the
facility, the repair station is fully aware of the visit and
the element of surprise is nonexistent, rendering the
inspection a simple formality.
The FAA will argue steadfastly that it cannot impose
standards on foreign countries for drug and alcohol testing of
employees at foreign repair stations or demand that inspectors
be allowed to conduct unannounced inspections. Clearly, the
United States cannot insist that another country apply our
standards and regulations, nor can we dictate the requirements
under which a foreign business must operate.
However, by requiring the same standards for foreign as it
does for domestic repair stations, the FAA would not be
mandating that a foreign government or business do anything
since these foreign repair stations choose to voluntarily
contract with U.S. carriers.
The FAA's responsibility in this regard is to maintain
oversight of all aspects of aviation safety, including where
and how repair work is performed. To hold foreign facilities to
lesser standards not only compromises safety, it gives an
unfair advantage to foreign businesses that do not have to meet
the same standards as those in the United States.
Oversight of foreign repair station maintenance is in
critical need of attention and improvement. The FAA must take
immediate steps to increase staffing for its inspector
workforce so they are able to continue to defend this country's
reputation as having the safest aviation system in the world.
Thank you, and I would be happy to answer any questions
that you have.
[The prepared statement of Mr. Brantley follows:]
Prepared Statement of Tom Brantley, President, Professional Airways
Systems Specialists (PASS), AFL-CIO
Chairman Rockefeller, Senator Lott and members of the Subcommittee,
thank you for inviting PASS to testify today on the oversight of
foreign aviation repair stations. Professional Airways Systems
Specialists (PASS) represents 11,000 Federal Aviation Administration
(FAA) employees, including approximately 2,800 Flight Standards field
aviation safety inspectors \1\ located in 103 field offices in the
United States and eight international field offices in the United
States and abroad. FAA inspectors are responsible for certification,
education, oversight, surveillance and enforcement of the entire
aviation system, including air operator certificates, repair station
certificates, aircraft, pilots, mechanics, flight instructors and
designees.
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\1\ As of February 2007, the FAA lists the number of Flight
Standards inspectors as 3,593. This figure, however, includes first
line field and office managers; the PASS figure only includes
inspectors who actually perform inspection functions in the field.
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In recent years, the overall dynamic of the aviation industry has
experienced significant changes. One such change in practice is the
outsourcing of maintenance work to repair stations in this country and
abroad. Whereas much of this work was once done at the air carrier's
facility, according to the Department of Transportation Inspector
General, air carriers' use of outsourced repair stations has grown from
37 percent of air carriers' maintenance costs in 1996 to 62 percent in
2005, or nearly $3.4 billion of the $5.5 billion spent on maintenance.
During the first three quarters of 2006, the amount of outsourced
maintenance had already increased to 64 percent.\2\
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\2\ Department of Transportation Inspector General, Aviation
Safety: FAA's Oversight of Outsourced Maintenance Facilities, CC-2007-
035 (Washington, D.C.: March 29, 2007), p. 1.
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A large portion of this work is being performed at facilities in
foreign locations; there are currently over 690 foreign repair stations
certified by the FAA. FAA inspectors at international field offices
(IFOs) are charged with certifying these repair stations and then
recertifying them approximately every 2 years. FAA inspectors at
certificate management offices (CMOs) in this country provide oversight
of the maintenance work performed on their assigned air carriers at
FAA-certificated foreign repair stations. However, with the current
state of the inspector workforce and the tedious and bureaucratic
process behind inspecting foreign repair stations, many inspectors say
that they are not confident with the level of oversight of foreign
repair stations and that serious safety issues are not being addressed.
Airworthiness Inspectors
The airworthiness inspector workforce consists of both avionics and
maintenance inspectors, and there are two types of airworthiness
inspectors--general aviation and air carrier:
General aviation inspectors oversee both foreign and
domestic repair stations. Inspectors at IFOs are responsible
for certifying FAA-certificated foreign repair stations. There
are eight FAA IFOs located worldwide in Alaska, California,
Florida, New York, Texas, England, Germany and Singapore that
conduct certifications and surveillance of U.S. foreign repair
stations in a particular geographic area. When inspecting a
foreign repair station, the IFO inspectors examine several
important elements, including, among other things, ensuring
that the repair station has and continues to comply with the
Code of Federal Regulations Part 145 for their repair station
certificate and operation specifications, making sure repair
station manuals continue to meet Federal Aviation Regulations,
and examining the maintenance training, tools and equipment.
These inspections vary depending on the size and complexity of
the repair station, with the time to complete an inspection on
a foreign repair station ranging from a day to a week or more,
not including travel time.
Air carrier inspectors are assigned to a specific air
carrier and examine the certificate-specific work on behalf of
the air carrier certificate to which they are assigned. An air
carrier inspector examines the actual work being done at the
air carrier's facilities or a repair station related to their
respective air carrier certificate and not the repair station
in general. This can include inspecting the aircraft, examining
technical data, and looking at housing and facilities. Air
carrier inspectors often ``spot check'' specific areas based
upon risk-assessment data, a process that can take a few hours
or several days depending on the area of concern.
Following an inspection, both the general aviation and air carrier
airworthiness inspectors enter the results of their inspections into
specific FAA databases. General aviation inspectors use the Program
Tracking Reporting System (PTRS) database, and air carrier inspectors
enter information into either the PTRS database or the Air
Transportation Oversight System (ATOS) database. This information is
then available for all FAA inspectors through the Safety Performance
Analysis System (SPAS), enabling inspectors to analyze areas of
potential concern.
Inadequate Inspector Staffing
A recent study released by the National Academy of Sciences called
attention not only to insufficient inspector staffing but also to the
FAA's lack of a viable staffing model to determine whether it has the
correct number of skilled individuals in position to accomplish the
responsibilities of the job. As noted by the Academies, ``The number of
aviation safety inspectors employed by the FAA has remained nearly
unchanged over the past several years, while aviation industries,
especially the commercial air carriers, have been expanding and
changing rapidly.'' \3\
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\3\ National Research Council, Committee on Federal Aviation
Administration Aviation Safety Inspector Staffing Standards, Staffing
Standard for Aviation Safety Inspectors (Washington, D.C.: The National
Academies Press, 2006), p. 1-4.
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The increasing use of foreign repair stations has been drawing even
more attention to the inspector staffing problem. As the industry
continues to expand, the number of FAA inspectors has not kept pace; in
fact, nearly half of the workforce will be eligible to retire by 2010.
Unfortunately, for 2008, the FAA is only requesting funding to hire an
additional 87 inspectors \4\ above attrition despite the looming surge
in retirements and the fact that it takes two to 3 years to fully train
an inspector.
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\4\ Government Accountability Office, Federal Aviation
Administration: Key Issues in Ensuring the Efficient Development and
Safe Operation of the Next Generation Air Transportation System, GAO-
07-636T (Washington, D.C.: March 22, 2007), p. 31.
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With airlines increasing their reliance on outsourced maintenance
work, the workload of inspectors located at CMOs charged with
overseeing this work has skyrocketed but inspector staffing has
remained stagnant. A prime example of the problems with inspector
understaffing and the increasing reliance on outsourced maintenance
work is Delta Airlines. Since 2005, Delta has outsourced all of its
heavy maintenance work. Inspecting the heavy maintenance work involves
a thorough examination of an entire airplane. According to one
inspector at the Delta CMO, when this work was performed at the Delta
facility, an inspector could oversee the work by traveling a mere seven
miles to the Delta facility. Now, inspectors are forced to travel from
the CMO in Atlanta to places located hours away, such as Florida,
Mexico or, as recently announced by Delta, China. To make matters
worse, staffing figures are down considerably at the CMO--after losing
four inspectors last year and another two this year with no
replacements hired, the CMO is now staffed at 11 airworthiness
inspectors with a few additional inspectors at different locations.
Inspectors stationed at IFOs responsible for certifying repair
stations also face several problems related to insufficient staffing.
The number of foreign repair stations is on the rise as more and more
air carriers outsource work to these less-expensive alternatives. A
lack of inspector staffing, however, makes it difficult to perform
these certifications and impossible to do any follow-up if a problem is
detected. For instance, there are only eight airworthiness inspectors
at the London IFO responsible for 165 certificates in England and
Scotland. When one of these inspectors dedicated to avionics went on
medical leave, this left only one avionics inspector to cover all 165
of these repair stations. In another example, for years, a single
inspector at the Miami IFO had been responsible for certifying the 14
certificated repair stations in Brazil, many of which are expansive,
complicated facilities. The need for additional staffing was finally
addressed in this particular situation and another inspector has been
assigned to the repair stations in Brazil.
If the industry is going to continue to increase its use of foreign
repair stations, it is essential to aviation safety that there are
enough inspectors to ensure oversight of the repair stations and the
work performed there. Many of our inspectors have told PASS that their
workload is based on the number of inspectors available rather than the
oversight that is needed. As such, PASS is requesting that Congress
direct the agency to develop a staffing model for aviation safety
inspectors and follow the recommendations outlined in the Academies
study. The Academies staffing study also emphasized the importance of
involving those who are affected by the staffing model in its
development, specifically stating that aviation safety inspectors, as
well as PASS, should be included in the process from the beginning and
remain active participants through the model's design, development and
implementation. In addition, the FAA should be required to report to
Congress on a quarterly basis on its inspector workforce plan in order
to ensure that the agency has an adequate number of inspectors to
oversee the industry.
Funding Constraints
Combined with the low staffing numbers, insufficient funding for
travel obviously has a considerable impact on the FAA's ability to
perform oversight of foreign repair stations. PASS is hearing from our
inspectors of more and more instances in which FAA inspections of major
repair stations that perform heavy maintenance work have been canceled
or cut short due to lack of funds. According to inspectors in the
field, the inspection process has become primarily budget driven rather
than motivated by safety.
CMO inspectors located in this country encounter numerous problems
when trying to travel to foreign repair stations and are often
questioned by FAA management as to the necessity of travel expenses
needed to reach a location where maintenance is being performed. For
example, a recent trip to a repair station in Germany was approved and
then canceled at the last minute when the inspector was told that there
was not enough funding to perform the inspection. In another situation,
a CMO inspector responsible for examining air carrier outsourced
maintenance work performed at repair stations in Singapore, China and
Ireland is only able to get to these repair stations every four or five
years. Even more disturbing, another CMO inspector responsible for work
being performed in Scotland has never even been to the repair station.
Although infrequently seen by the CMO inspector, it should be noted
that these repair stations are still recertified by an IFO inspector
approximately every 2 years.
The ability to follow up once a problem is detected is an issue
faced by both CMO and IFO inspectors, and both of these groups of
inspectors say funding is the primary reason for not being able to
follow up on an issue. One IFO inspector reports that they often have
to wait until the following year to validate whether or not a problem
has been corrected or pass on the issue to the next inspector traveling
to that country. CMO inspectors are often only able to send the repair
station a letter, depend on the repair station's response for closure,
and wait until the next inspection in order to determine if the issues
have been addressed and a long-term solution incorporated.
It is impossible to ensure safe operations at these repair stations
if inspectors are rushed in their inspections, unable to perform
adequate follow-up or prevented from visiting the repair stations
altogether. The IG specifically addressed the impact of the lack of
resources on the oversight process, concluding that ``adequate
resources need to be committed to air carrier oversight to ensure the
continuity of safe operations, particularly as the airline industry
makes significant and ongoing transitions in their operations.'' \5\ As
such, PASS feels that it is imperative that the FAA allocate adequate
resources for FAA inspectors to visit each foreign repair station at a
minimum of twice a year.
---------------------------------------------------------------------------
\5\ Department of Transportation Inspector General, Safety
Oversight of an Air Carrier Industry in Transition, AV-2005-062
(Washington, D.C.: June 3, 2005), p. 3.
---------------------------------------------------------------------------
Additional Concerns With Oversight of Foreign Repair Stations
Inspectors in the field relay several problems associated with
traveling to foreign countries to examine repair stations. The process
for traveling overseas to inspect a repair station is so labor
intensive, often involving State Department coordination and country
clearances, that an inspector, on average, must give 60 to 90 days
notice prior to their arrival at the repair station. In addition,
inspectors must often travel in pairs when visiting specific countries
that may be considered unsafe. When the inspector is finally able to
get to the foreign repair station, the repair station is fully aware of
the visit and the element of surprise is nonexistent, rendering the
inspection a simple formality.
Once the inspector has traveled to the repair station, inspecting
the repair station or the work performed there introduces additional
difficulties, including cultural and language issues, trouble accessing
equipment, and inability to examine all processes and services used. In
many cases, employees working at foreign repair stations cannot read or
speak English; yet, the air carrier and repair station maintenance
instructions are usually written in English. Inspectors traveling to
foreign locations reveal that training is also a major problem overseas
and that they often see maintenance employees working on aircraft
without the proper training. For instance, inspectors report that
personnel at foreign repair stations do not understand that an item
with an expired shelf life cannot be used even if it still appears in
good condition.
There is also serious concern over the regulations governing
foreign repair stations. For example, as opposed to domestic airline or
repair station employees, workers at foreign repair stations are not
required to pass drug and alcohol tests. In addition, criminal
background checks are not required at foreign repair stations. There
also continues to be major concerns regarding security at these
facilities, with many of the repair stations lacking any security
standards. It should go without saying that if a foreign repair station
wants to work on U.S.-registered aircraft or any aircraft that operate
in this country, those repair stations should be required to meet the
same safety standards as domestic repair stations.
Increasing Use of Bilateral Aviation Safety Agreements (BASAs)
Instead of addressing the inspector staffing and funding issues,
the FAA continues to expand the use of bilateral agreements with
foreign countries to oversee repair stations working on U.S. carriers.
The Bilateral Aviation Safety Agreement (BASA) with Maintenance
Implementation Procedures allows foreign authorities to provide
oversight of the work performed at repair facilities with limited
involvement from FAA inspectors. This eliminates the need for the
inspector to travel to the repair station at all and entrusts
responsibility entirely to a foreign entity. However, there are
inherent problems associated with allowing non-FAA employees in foreign
locations to perform work on behalf of the FAA, primarily the fact that
the FAA does not have adequate oversight procedures in place to ensure
the quality of these inspections. PASS's concerns regarding the FAA's
use of bilateral agreements include the following:
According to the Department of Transportation Inspector
General (IG), foreign inspectors do not provide the FAA with
sufficient information on what was inspected, the problems
discovered and how these problems were addressed. The IG goes
so far as to state that at least one foreign authority
representative said that ``they did not feel it was necessary
to review FAA-specific requirements when conducting repair
inspections.'' \6\
---------------------------------------------------------------------------
\6\ Department of Transportation Inspector General, Review of Air
Carriers' Use of Aircraft Repair Stations, AV-2003-047 (Washington,
D.C.: July 8, 2003), p. v.
The information provided to the FAA by foreign inspectors is
often incomplete, inaccurate or difficult to understand due to
language constraints. In fact, the inspection documents given
to the FAA were found to be incomplete or incomprehensible in
14 out of 16 files reviewed by the IG (88 percent).\7\ Although
the reports are supposed to be filed in English, this is often
not the case. Furthermore, the FAA does not even require that
these foreign aviation authorities provide the appropriate
amount of information in order to allow FAA inspectors to
verify that the work is being done.
---------------------------------------------------------------------------
\7\ Id.
As part of the bilateral agreements, FAA inspectors can
perform annual ``sample'' inspections of up to 10 percent of
facilities already reviewed by foreign inspectors. This system
of ``spot checking'' only highlights the serious deficiencies
with the bilateral agreement process. In one case cited by the
IG, when the FAA performed a sample inspection of a repair
station that had already been inspected by a foreign inspector,
the FAA inspectors found 45 problems, several of which were
directly related to FAA requirements.\8\ Foreign aviation
authorities rely on European requirements rather than adhering
to U.S. safety standards. Currently, other than these
ineffective sample inspections, the FAA primarily conducts
surveillance of foreign aviation authorities through desk
reviews of inspection documents, the quality of which has
already been highlighted as a major issue. In other words, the
FAA has no true way to ensure that the inspections at these
foreign repair stations are being conducted according to U.S.
regulations. In addition, inspectors report that the foreign
aviation authorities are not always reporting to the FAA
deficiencies found during their inspections, which leaves FAA
inspectors with the impression that there are no problems.
---------------------------------------------------------------------------
\8\ Id.
In order to visit a country holding a BASA, the inspector
must provide data to prove that a trip is necessary. However,
the foreign civil aviation authorities are often not providing
accurate data to the agency, making it impossible for the
inspector to show that a trip is warranted. In one case, there
was no information in the database on problems with a repair
station in Frankfurt, but when an inspector was finally able to
get to the facility, he noticed several serious violations that
had not been put into the system. If these countries are not
providing the United States with data, it is impossible to
ensure the safety of the facility or the work being performed
---------------------------------------------------------------------------
there.
In 2003, the IG issued recommendations to enhance FAA oversight of
foreign repair stations. Regarding the many problems with bilateral
agreements, the IG recommended that the FAA modify inspection
documentation requirements with foreign aviation authorities and
develop procedures to ensure that foreign inspectors place appropriate
emphasis on FAA requirements when conducting reviews on the FAA's
behalf. The IG also advised that the FAA revise procedures for
conducting sample inspections of repair stations to allow the FAA to
conduct the necessary number of inspections to ensure the work is being
completed properly. In recent testimony before the House Aviation
Subcommittee, the IG stated that while the FAA has worked to improve
the surveillance foreign authorities are performing on the FAA's behalf
since the 2003 report, the IG remains nonetheless concerned that ``FAA
is still not regularly visiting the facilities in the countries where
agreements exist with other aviation authorities.'' \9\ The IG cited an
example in which FAA inspectors for one air carrier had not visited a
major foreign engine repair facility even though the repair station had
performed maintenance on 39 (74 percent) of the 53 engines repaired for
the air carrier. Furthermore, FAA IFO inspectors had not conducted any
spot inspections of this facility in 5 years.\10\
---------------------------------------------------------------------------
\9\ Department of Transportation Inspector General, Aviation
Safety: FAA's Oversight of Outsourced Maintenance Facilities, CC-2007-
035 (Washington, D.C.: March 29, 2007), p. 9.
\10\ Id.
---------------------------------------------------------------------------
Without a doubt, the FAA must take steps to ensure that inspections
conducted by foreign authorities are done in line with the safety
standards and regulations of this country. Until this issue is
adequately addressed, along with the IG recommendations, additional
agreements with foreign aviation authorities should not be allowed.
Use of Non-Certificated Repair Facilities
``Non-certificated'' means that the repair facility does not
possess a certificate issued by the FAA to operate under the Code of
Federal Regulations Part 145 and is therefore not subject to direct FAA
oversight. A certificated repair station meets the standards as
outlined in the Federal Aviation Regulation and is therefore subject to
direct FAA oversight to ensure that it continues to meet those same
standards. The differences in regulatory requirements and standards at
the two facilities are extremely troubling. For example, in an FAA-
certificated repair station, it is required that there be designated
supervisors and inspectors and a training program. These items are not
required at non-certificated repair facilities.\11\
---------------------------------------------------------------------------
\11\ Department of Transportation Inspector General, Air Carriers'
Use of Non-Certificated Repair Facilities, AV-2006-031 (Washington,
D.C.: December 15, 2005), p. 4.
---------------------------------------------------------------------------
Effective oversight of non-certificated repair facilities gained
attention in the aftermath of the January 2003 Air Midwest crash in
Charlotte, N.C. The National Transportation Safety Board determined
that incorrect rigging of the elevator system by a contractor
contributed to the accident and pointed to ``lack of oversight'' by Air
Midwest and the FAA.\12\ The airline contracted out the work to an FAA-
certificated repair station, which then subcontracted to a non-
certificated repair facility. Under Federal regulations, the airline is
ultimately responsible for ensuring that the work performed at a non-
certificated repair facility is done in accordance with standards and
requirements.
---------------------------------------------------------------------------
\12\ National Transportation Safety Board, Loss of Pitch Control
During Takeoff, Air Midwest Flight 5481, Raytheon (Beechcraft) 2000D,
N233YV, Charlotte, North Carolina, January 8, 2003, Aircraft Accident
Report NTSB/AAR-04/01 (Washington, D.C.: 2004), p. x.
---------------------------------------------------------------------------
A December 2005 IG report called attention to airlines' increasing
use of non-certificated repair facilities to perform maintenance work,
directing the FAA to improve its oversight of air carriers' use of
these facilities. According to the IG, the FAA does not know how many
non-certificated maintenance facilities air carriers currently use, but
the IG identified ``as many as 1,400 domestic and foreign facilities
that could perform the same work (e.g., repairing flight control
systems and engine parts) a certificated facility performs but are not
inspected like certificated facilities. Of those 1,400 facilities, we
identified 104 foreign non-certificated facilities--FAA had never
inspected any of them.'' \13\
---------------------------------------------------------------------------
\13\ Department of Transportation Inspector General, Air Carriers'
Use of Non-Certificated Repair Facilities, AV-2006-031 (Washington,
D.C.: December 15, 2005), p. 6.
---------------------------------------------------------------------------
The IG discovered that there are no limitations to the amount of
maintenance work non-certificated facilities can provide, and that
these facilities are performing far more work than minor services,
including much of the same type of work FAA-certificated repair
stations perform, such as repairing parts used to measure airspeed,
removing and replacing jet engines, and replacing flight control
motors. Some of these non-certificated facilities are even performing
critical preventative maintenance. The IG identified 21 domestic and
foreign non-certificated facilities that performed maintenance critical
to the airworthiness of the aircraft. Even more alarming is that the
FAA was unaware of the critical work being performed at these
facilities. \14\
---------------------------------------------------------------------------
\14\ Id., pp. 1-2.
---------------------------------------------------------------------------
Despite the fact that these facilities are performing safety-
critical work, FAA oversight is practically nonexistent. In other
words, these facilities are performing work pivotal to aviation safety
with no guarantee that it is being done in line with FAA and air
carrier standards. One inspector revealed that he learned of a repair
station contracting out work to an automobile facility. Without having
the ability to visit the facility, there was no way for this inspector
to ensure that the work was being done according to regulations.
Furthermore, inspectors are discovering numerous incidents
involving outsourcing of maintenance for critical functions or
``specialized services,'' an independent rating the FAA grants to some
certificated repair stations for specialized and safety-critical
functions, such as non-destructive testing, specialized testing of some
components, plating, machining and welding. Specialized services, like
other maintenance, can and is being contracted out to non-certificated
repair facilities. Although recent regulatory changes state that
certificated repair stations cannot contract out a specialized service
unless they were issued that rating and are required to approve that
work for return to service, inspectors have consistently found that it
is almost impossible to determine whether that work was done correctly,
completely and in accordance with technical data and regulations.
Inspectors do not have the time or budget capability to adequately
perform surveillance on certificated repair stations, let alone
evaluate and monitor subcontracting to non-certificated facilities.
It is obvious that there must be modifications made regarding air
carriers' use of non-certificated repair facilities. PASS believes that
the most effective way to correct the disparity between certificated
and non-certificated repair facilities is for Congress to require that
air carriers outsource maintenance work only to certificated repair
stations, a standard that should apply to both domestic and
international facilities. This is a feasible option that will ensure
consistency and improved safety within the aviation industry.
Conclusion
It is clear that oversight of foreign repair stations needs serious
attention and improvement. With the FAA anticipating an estimated 1
billion passengers per year by 2015, more inspectors are obviously
needed in order to keep up with the rapid growth in the aviation
industry. Since the FAA claims that it will be impossible for the
inspector workforce to increase at the same rate the aviation industry
is changing and expanding, it is moving toward a system-safety approach
in which data, which has often been found to be incomplete or limited,
will be the primary tool to determine risk. PASS believes that it is
dangerous to rely heavily on a risk-based approach when it is obvious
that our talented and skilled inspector workforce has kept the U.S.
aviation system the safest in the world. In order to ensure continued
safety within the aviation industry, there must be an adequate number
of experienced and trained FAA inspectors in place with budgetary and
management support to accomplish the agency's mission of safety
oversight.
PASS and the inspector workforce we represent remain solely focused
on ensuring the safety of this country's aviation system. We hope that
Congress will seriously examine the conditions surrounding the
oversight of foreign repair stations and recognize that major changes
need to be made in order to protect this country's reputation as having
the safest aviation system in the world.
Senator Lott. Madame Chair?
Senator McCaskill. Yes, Senator Lott.
STATEMENT OF HON. TRENT LOTT,
U.S. SENATOR FROM MISSISSIPPI
Senator Lott. Thank you, Madame Chair and Chairman
Rockefeller, for having the hearing.
Let me just say to the panel, I think this was a good
panel, and you did a really good job. Most of the questions
that would be asked, I think, you've commented on them, and
answered them well.
But maybe I can just crystallize some of them, rather than
giving a statement by asking just two or three questions, if
you would make your answers short, I think that should take
care of it.
First, what we're really worried about here and want to
make sure of is safety and security, OK? I think airlines
should have a right to have contract maintenance, but we need
to make sure that it's done in an appropriate way. You know, I
learned a long time ago when I get on planes, if the pilot
doesn't want to fly, I don't want to fly. If the pilots want to
fly, I usually feel pretty safe, because he's putting his life
on the line, too. So, I think everybody wants this, the work
done properly, we want safety, and we also now want security.
Now, Mr. Scovel, has your office uncovered any evidence
that maintenance work performed by foreign repair stations is
consistently less safe than work performed at domestic repair
stations?
Mr. Scovel. Thank you, Senator Lott.
Our studies from 2003 and 2005 show us that the location
where maintenance is performed is far less important than the
oversight exercised by FAA to guarantee safety. In other words,
we have not found that repairs performed by overseas facilities
are inherently less accurate or less complete than repairs
performed by----
Senator Lott. Well, do you believe that FAA has generally
been responsive in correcting problems with foreign repair
station oversight that's been identified by your office?
Mr. Scovel. Generally, yes. It has been very slow. We have
found that the vehicles that FAA has devised to measure the
maintenance performed by repair facilities, both in the U.S.
and overseas, have been less than fully effective to give the
agency the information it needs to make its safety oversight
systems truly effective.
Senator Lott. Ms. Gilligan, do you believe that restricting
the ability of U.S. carriers from using foreign repair stations
will improve safety?
Ms. Gilligan. Consistent with what the IG has just said,
sir, our findings are the same--the work done at certificated
repair stations meets all of the standards that we require.
Senator Lott. And, Mr. Filler, you feel that your
membership and the overall way that this is being handled, both
the questions of safety and security are being adequately
addressed?
Mr. Filler. Yes, Senator, we do.
Senator Lott. I think we've got to always be diligent. I
think the FAA has got to continue to pursue their
responsibilities. Yes, they probably are slow, I haven't found
anything in the government that's not, but that's no excuse,
because we're dealing with life or death and people's jobs
here. And, I think it's also incumbent upon us to ask
legitimate questions about the impact that this can have on the
industry as a whole, and I'm always trying to look at it--not
just from, you know, a regulator standpoint, or owners or
managers, but also, you know, the workers, too.
So, I think they've done a good job, and I appreciate the
opportunity to hear you, and thank you for allowing me to get
out of order a little bit, there, Madame Chair.
Senator McCaskill. Thank you, Senator Lott.
I would normally defer to the Chairman of the Committee for
questions, first, but he has sent me a note and asked me to go
ahead, so I want to focus in, first, Mr. Scovel, on the
difference between certified and non-certified foreign repair
stations. And I think that's a really important distinction for
us to talk about.
It is my understanding from your testimony and reading some
of the background material in this area that the major carriers
in the United States are utilizing non-certified, overseas
repair facilities for all kinds of work. I mean, not just
kicking the tires and checking the oil--but all kinds of work,
is that correct?
Mr. Scovel. That's correct, Senator.
Senator McCaskill. OK, and so I was--as I direct my
questions on this round of questioning, I am addressing now the
non-certified repair stations. I don't want to talk about the
certified repair stations, because that's a whole--that's
apples and oranges. But we now have established that all of
these carriers are using non-certified repair stations for
major work--not just line maintenance--but major work.
Ms. Gilligan, how many of those non-certified foreign
repair stations are there?
Ms. Gilligan. As you know, Senator, we don't keep a count
of facilities that people may use that don't hold FAA
certificates. Instead, we work through the airlines to
determine that the airline has put in place the proper
procedures, that they're providing the proper training and
equipment and facilities to any facility that doesn't hold an
FAA certificate.
Senator McCaskill. So, so there is no inspection of those
facilities by FAA?
Ms. Gilligan. There is----
Senator McCaskill. Correct?
Ms. Gilligan. We have access to some, to third-party
providers, but we don't have a scheduled plan for reviewing
some of those operators--or some of those facilities.
Senator McCaskill. Any of those facilities, correct, Ms.
Gilligan? You all do not certify, you do not inspect an unknown
number of repair facilities that are providing major work on
major domestic airline carriers, isn't that true?
Ms. Gilligan. It's correct, Senator, but that's because we
are overseeing the carrier. And the carrier now has the
responsibility--the carrier can pick a few different models.
They can do the work internally. They can use a certificated
repair station, and train that repair station personnel and
provide the instructions to that repair station personnel, or
they can hire certificated mechanics, for example, who hold an
FAA certificate and provide that mechanic all of the materials
and training and equipment that they need to perform the
function. They can use any of those three models, and in the
third, that last model, the individual holds an FAA
certificate, but the company through which they may work, may
not hold an FAA certificate.
Senator McCaskill. And do you know how many of those
certified mechanics are working--how many there are right now
that are working at non-certified facilities? Do you even--does
FAA keep track of that?
Ms. Gilligan. No, ma'am. Well, no, we do keep track of
everyone who holds a mechanics certificate, we issue those
certificates. And so, then they have the authority to approve
certain work, whatever it is they're qualified to do, and they
do that under the air carriers program, which we do oversee
through our inspectors.
Senator McCaskill. But you don't match up--the certified
mechanics to the locations of the uncertified repair centers?
Ms. Gilligan. That's right.
Senator McCaskill. You can't, there's no--there's no place
we can go and check to see how many certified mechanics there
may be in any of these uncertified repair centers?
Ms. Gilligan. That's correct.
Senator McCaskill. And so, if, in fact, the certification
process that we have to do here in the United States--if, in
fact, we have a certification process here, do you think the
certification process is important to safety?
Ms. Gilligan. Yes, ma'am, but airlines also use non-
certificated facilities using certificated mechanics, here in
the U.S., as well.
Senator McCaskill. Are they required to do any of the
background checks, or any of the security checks that the
certified facilities are?
Ms. Gilligan. The airline is required to do those checks
for its own employees, but not for mechanics that they hire on
contract.
Senator McCaskill. OK, well, then my question is, if we are
certifying some facilities, but it's OK for the airlines to use
any facility, regardless of whether it's certified, why are we
certifying facilities?
Ms. Gilligan. Again, it's one of several options. When the
carrier uses a facility that does not hold an FAA certificate,
the carrier itself must be in place to provide quality control,
to provide training, to provide all of the tools and
equipment--everything that's needed for the work. And they
hire, generally, then, a certificated mechanic, and they
provide that infrastructure.
When they use a certificated repair station, while they do
have to provide their training program, and their maintenance
program to that repair station, they can take advantage of all
of the facilities and equipment and everything else that the
repair station already has under its approved certificate. So,
it's just a matter of how it is that the carrier is going to
make sure it is meeting the responsibility to have the work
done in accordance with its maintenance program.
Senator McCaskill. OK, so in the instances where it's a
non-certified repair station, this is more a situation where
you are trusting that the airlines are going to perform at a
level--at the same level that you require of the certified
repair stations?
Ms. Gilligan. No, we see that the air carrier meets its
standards. So, the repair station or the air carrier must
meet----
Senator McCaskill. Well, how--?
Ms. Gilligan. I'm sorry, ma'am, if I'm confusing----
Senator McCaskill. I'm confused as, how do you know if you
never go there, and you never look at them? How do you know
that they are up to those standards, if you don't inspect them?
Ms. Gilligan. Because the airlines are continually
analyzing the aircrafts themselves, and they are sharing that
data with our inspectors. By regulation, we require that the
carrier maintain a continuing analysis program, where they
analyze every day how their aircraft are operating, and then
they must address any discrepancies and our inspectors
regularly are a part of that review process. So, we check the
level of safety of the aircraft at the air carrier. And,
because of the multple layers within the design and the
manufacture and the maintenance of the aircraft, that provides
us the opportunity to find discrepancies before they cause any
kind of serious result.
Senator McCaskill. Well, my time's up, and I want to make
sure the other Senators have a chance for a round of
questioning. I'll revisit this on the next round.
Mr. Filler. Senator, would you mind if make one clarifying
comment about, about security? Because one of your questions
was, if a carrier contracts with an individual mechanic to do
line maintenance at an airport.
I didn't want you to be left with the impression that that
person is not given a background check. If that mechanic has
unescorted access privileges to the ramp of an airport, then he
will have to have a background check and he will have to be
appropriately badged and that will be done under the authority
of the individual airport operator. So it doesn't matter, in
that situation, whether or not it's contracted or it's an air
carrier employee. The focus is on, what kind of access does
that individual need to the designated security areas of the
airport.
Senator McCaskill. I appreciate that, Mr. Filler, but the
question is, who is providing the oversight and accountability
that that's occurring? Is it FAA or are we leaving it to
someone else?
Thank you.
I believe, Senator Rockefeller, you're next.
Senator Rockefeller. Thank you, Madame Chair.
The, I agree very much with the Chair's line of questioning
and I have these comments. If there are--and I think there's
some variance in the FAA in this--of the 3,865 FAA inspectors
who monitor more than 5,000--this is, Peggy to you, Ms.
Gilligan, to you----
Ms. Gilligan. Yes, sir.
Senator Rockefeller.--5,000 repair stations used or owned
by U.S. carriers worldwide, then we further know that 51
percent of those FAA inspectors are eligible to retire in 2007.
If you look at U.S. Government retirement, some stay on, but
most don't. It's a stressful life. And, so that immediately, in
essence, cuts the 3,865 into half. So, my question is, how many
inspectors will the FAA hire in 2007? You have no budget, so I
want you to answer around that. And how many inspectors does
the FAA expect to lose this year? And, we'll start with that.
Ms. Gilligan. OK. Thank you, Senator.
First, if I could comment on the retirement. While it is
true, a number of our inspectors are eligible for retirement,
we do have a higher age bracket workforce. It's because most of
the, not most of them, all of them come to us after years of
experience in the industry. So, they actually, oftentimes, come
to us as a second career. And so, while they are relatively
soon eligible for retirement, very, very few of them retire
when they're first eligible. Our retirement rate has been
consistent at between five and 6 percent a year for a number of
years, the past 10 years. And we do a yearly employee attitude
survey, where we ask about retirement plans.
Senator Rockefeller. If I could interrupt for a second----
Ms. Gilligan. Sure.
Senator Rockefeller.--I'd like to comment on that. I think
there's a difference between jobs in general and jobs which
involve saying, ``No,'' or, ``Do this differently.'' There is
an energy level and, you know, there's simply a ferocity, a
focus level, which changes. And I tell you this, say this by
having carefully watched the FAA doing certification processes.
It takes a younger, more ambitious, ferocious type of person to
make sure that each and every one of the 13,000 parts that goes
into a particular airplane is in my mind, to make sure that
they're exactly right. Because they all have to be exactly
right. Now, you could go into, you can go into an outsource
repair station in some other country and have the same rules,
and ``I'll get my next round of drinking,'' and unnoticed,
unnotified inspections and the rest of it.
But, I really, I really would--and I'd like the Inspector
General to comment on this too--there's a difference in
inspection, which is a highly technical, it's sort of like
doing algorithms, I mean, it's a fugue, it's a work of love and
precision.
And, it's also a matter of life and death. And I'd like to
have each of you comment on the age factor with those retiring,
as your statement that, well, we've got people who are old who
have more experience, as opposed to what I said.
Ms. Gilligan. Certainly, sir. First of all, our data shows
that, in our attitude survey we asked employees what you're
retirement plans are and about 5 percent reported that they
plan to retire within a year. So, we think that's consistent.
And, you're absolutely right. These inspectors bring to this
job a love of aviation safety that they've nurtured through
their whole career and most of them come to FAA as, sort of,
the pinnacle of what they'd hope to accomplish in the course of
their careers. And, I believe that their age and experience is
a valued asset that they bring to us.
Senator Rockefeller. Without, interrupt again, but I want
to get it to the IG before my time runs out.
Ms. Gilligan. I'm sorry.
Senator Rockefeller. I voted for having pilots go from 60
to 65 years old. I think that is a world apart decision about
age than, about not--you know, in a crisis these things become
very important, but a lot of those are senior folks who are
doing overseas flights, where it's avionics are automatic and
all the rest of it. Inspecting parts, inspecting brakes,
getting down on the ground in a hot Sierra Leone sun and
looking for precisely that particular piece which could cause
problems is a very different matter. Could you briefly comment
on that?
And, Mr. Scovel, could you briefly comment on that?
Ms. Gilligan. Certainly. As I know you're well aware, our
inspectors are not at the turning of every wrench and the
inspection of every brake. They are there to oversee that the
systems are being followed, that the people are trained, that
the mechanics are, in fact, performing the function that
they're supposed to perform.
Senator Rockefeller. Now, this is not the data analysis,
this is the----
Ms. Gilligan. I'm sorry.
Senator Rockefeller.--this is the oversight analysis.
Ms. Gilligan. Yes, yes. Right.
Senator Rockefeller. You referred to the data analysis.
Ms. Gilligan. The data analysis.
Senator Rockefeller. Data, I'm sorry.
Ms. Gilligan. No, I'm misunderstanding your question, sir.
I apologize.
Senator Rockefeller. Well, I'll wait until my next round.
Ms. Gilligan. I'm so sorry.
Senator McCaskill. Senator Dorgan?
STATEMENT OF HON. BYRON L. DORGAN,
U.S. SENATOR FROM NORTH DAKOTA
Senator Dorgan. Senator McCaskill, thank you very much. I
confess I don't know as much about this issue as I would like
and I apologize for being delayed at this hearing.
I want to ask a question, especially about overseas repair
stations. I had written a piece about this a year and a half, 2
years ago about an American carrier, was according to some news
reports flying empty 320 aircraft, Airbus 320s empty to El
Salvador to do their maintenance and then flying them back
empty, as well. And I became curious about that and wondered
what's the circumstance that would persuade someone to do that.
And, of course, it is cost.
And I became further curious to find out what are the
standards with respect to a repair station in El Salvador
versus a repair station in this country. And, as I began to
look at it, I discovered that at that point nearly half of the
maintenance was outsourced, some of it out of the country. And,
I mentioned, I guess I'll mention to carrier because it was in
the news at the time, it was JetBlue. It was flying empty
Airbus 320s to El Salvador for maintenance.
And so, I was wondering about the standards that exist at
those stations and my understanding from that, I would ask the
FAA whether it is the case, is that the folks at those repair
stations are not required to have the same certification. Let
me just read to you what I had learned at that point. Airplane
mechanics in El Salvador are paid from $300 to $1,000 a month.
About one-third of them have passed the FAA certification for
airplanes mechanics that all U.S. mechanics are required to
pass. Is that, is that the case or was it the case? Is it now
the case?
Ms. Gilligan. Sir, we're very familiar with the facility in
El Salvador. About, something less than 200 of the employees
there hold FAA certificates. The remainder of the employees
hold the certificate issued by the El Salvadorian Government.
As Mr. Filler mentioned earlier, all countries that are members
of the International Civil Aviation Organization do meet a
common set of standards before they can issue certificates to,
whether it's mechanics or pilots or anyone who operates in the
system. So, all of the employees hold certifications and almost
200 of them hold FAA-issued certificates, which they are
allowed to hold.
Senator Dorgan. And, is it the case that, as Mr. Roach
testified, that when inspectors are permitted to make an
inspection of an overseas repair station, they must give
advance notice?
Ms. Gilligan. Generally, sir, we give advance notice even
to domestic stations. These are, first of all, these are large
complex organizations and it's not really very easy to hide
something in at moment's notice.
We want to make sure when we send inspectors, whether it's
domestically or internationally, that the people who they need
to meet are there, that the records are available, that, in
fact, our time is well spent on inspection and not on waiting
and trying to bring all the details and the facts together. So
it's common practice for us to give notice, even to domestic
repair stations, as well. Yes, we do notify the foreign repair
stations when we are coming, again, so that we have the right
information available for the inspectors to be, to be able to
accomplish the inspection.
Senator Dorgan. I don't want to suggest with my questions
that there's diminished safety. I don't know the answer to
this, but it seems to me strange. First of all, that we've
rushed now to well over 60 percent of the maintenance for the
airlines being contracted out, some of it offshore. It seems
strange to me that a domestic airline would fly an empty jet to
El Salvador for maintenance. It seems strange to me that the
FAA, which would be required to evaluate the capabilities of
that repair station would give them advance notice of when one
is about to inspect. It seems to me with almost every
circumstance of oversight, giving someone advanced notice that
you're coming gives you a very different impression when you
come.
I've just been involved in this issue of China and, labor
standards in China and the advanced notice given to Chinese
manufacturing plants of when inspectors would show, which gives
a very different picture of the plant the next day when the
inspector shows.
So, I'm very troubled and concerned about this rush to
outsource, about whether there is accountability for
outsourcing. And, it seems to me that there, that many of the
airlines are now rushing to subcontract their maintenance to
others and that, at least in some cases with respect to foreign
repair stations, in addition to the airline subcontracting
their repair, you are subcontracting, effectively, your
oversight by going to the civil aviation authorities in those
countries for oversight. I, somehow, it doesn't, it looks to me
like these are pieces to a puzzle that don't fit. If you want
accountability and oversight that gives you a strong feeling
that everyone is meeting the same standards.
Ms. Gilligan. If I may comment on your reference to
contracting out the oversight. I think you're referring to
those cases where we have a bilateral agreement with, and we
have three of those in place right now with European countries.
Before we enter that agreement, we evaluate the ability of that
government and their inspectors to do those inspections on our
behalf and we reach the determination that they have a level of
confidence that we can accept. They then provide their
inspection results to us and we make the decision whether or
not the certificate holder can hold that certificate, whether
we need to go in and spot check. And as the IG commented, we
are increasing the amount of spot checking that we're doing.
As Mr. Filler testified earlier, we provide that same kind
of oversight to over 1,200 repair stations in the U.S. that
hold European certification. Our inspectors inspect on behalf
of Europe, 1,200 repair stations in the U.S. Our inspectors
provide those results to the European authorities and the
European authorities determine whether or not U.S. entities can
continue to hold the certificate. So, we do, we do for the
European authorities, the same kind of inspections that we have
them do for us, but ultimately, the decision on whether someone
or a company keeps a certificate. We retain that for our
certificate holders and the Europeans retain that for their
certificate holders.
Senator Dorgan. But, if I might just finish two additional
questions.
Ms. Gilligan, there are, as I understand it, 103
international field inspectors for nearly 700 repair stations
and it seems to me to be terribly understaffed.
Second, when you look at the Department of Transportation
Inspector General reports of, for example, December 2005. They
found that non-certificated facilities operate without the same
regulatory requirements as certificated repair stations,
operate with no limit on the type or scope of work they
perform.
I mean, I think, I have missed the comments of Senator
McCaskill. I think I caught a bit of the flavor of her
questions. I think there's substantial evidence here that this
rush to outsource maintenance is not accompanied by the same
kind of oversight that ought to, that passengers ought to
expect, that the Congress ought to insist upon, and that we had
previously had when those repairs and maintenance were done by
a carrier on the site. Just speaking, just for myself, I
understand why someone would fly an empty plane to El Salvador.
That's about finding cheap labor, I assume, if any. Does
anybody else agree with that? You fly an empty Airbus to El
Salvador and set up cheap labor for maintenance.
Mr. Barimo. Yes, I'd probably elaborate that there's more,
more involved in the decision than just the labor rate.
Senator Dorgan. Yes, the cost of the flight down and back
with an empty plane.
Mr. Barimo. And more importantly, the turn time and the
quality of the aircraft produced. So, if the air carrier can
trim 3 days off of a heavy check and get an airplane that is,
in fact, more reliable than any of their competitor's aircraft,
then it probably makes sense to go down there and do that.
There's more that goes into the decision than just the labor
rate.
Senator Dorgan. All right. It's a fair point. I would
accept that people sitting around the table evaluating where
we're going to outsource or how are we going to outsource
maintenance would not just look at labor rates. It's a fair
point you make. I think that, it seems to me, likely, that
labor rates are a compelling part of that, especially when you
take a look at what I just cited, with respect to the cost of
maintenance in El Salvador.
I'm just picking out that issue because I happened to see
it a couple of years ago and I followed it up to find out what
is this about. I've taken more time than I needed to. Mr. Roach
wanted to make a comment, if you wish.
Senator McCaskill. Go ahead, Mr. Roach.
Mr. Roach. Yes, in reference to flying planes down to El
Salvador, it was JetBlue, but the type of aircraft that you
mentioned, if you recall. I don't know where these planes have
been, these particular JetBlue have serviced, those are the
planes that had these emergency landings, with the nose gear
that would not operate properly.
Senator Dorgan. That was, actually, that plane was not a
plane that was maintained in El Salvador. I did check on that,
but that particular airplane was not one that was flown to El
Salvador.
Mr. Filler. Senator, if I could also.
Mr. Roach. I'm not finished yet.
Mr. Filler. I'm sorry.
Mr. Roach. In addition, these surprise inspections, it is
true that there are inspections in the United States that they
forewarn people, but there are inspections where there are not
people forewarned, they have surprise inspections in the United
States, where outside the country they don't have them. So,
there's a big difference there.
Senator Dorgan. Is that true, Ms. Gilligan?
Ms. Gilligan. I wouldn't call them surprise inspections. We
do have people that are co-located more closely to some
operators in the United States and they are there more on the
day-to-day basis. And we do have the ability and the authority
to do the same in a foreign repair station if we have the need
to. So, we do have the ability to, we do need to notify the
State Department. When U.S. citizens travel on official
business into another country, they do notify the embassy, but
we can then go to the repair station. We do find it more
useful, generally, to provide notice of when we're going to be
there.
Senator McCaskill. Go ahead, Mr. Filler.
Mr. Filler. Thank you, thank you, Madame Chair.
I would like to also add, with respect to the advance
notice, the procedures that repair stations and any
certificated company has to have, Senator, are very extensive.
I mean, manuals and forms and procedures that, even if, and
I've done many audits myself and I've done it for many, many
years in and out of the FAA, and I can tell you that if an
entity has 2 weeks notice, 3 weeks notice the FAA is coming,
they're not going to be able to change their culture. They're
not going to be able to, all of a sudden, follow their repair
station quality manual if they weren't following it before.
It's just too much to turn around. And, I think that overlay of
oversight that the FAA provides, it doesn't make a difference
from a safety perspective, whether you know the FAA is coming
or not.
And then finally, with respect to looking at individual
incidents or accidents, I would caution the Committee in using
any specific accident analysis to prove the general rule. All
accidents are, by nature, exceptions to the general rule.
They're not the general rule and I can mention, and I don't
think it advances the ball so I won't, but I can mention for
every incident anybody can cite that occurred in a repair
station, a contracted repair station, I can cite one that
occurred inside an air carrier when maintenance people employed
by the airline made a mistake that killed people. And, that's
the reality of our business. Safety doesn't, no one's got a
monopoly on safety, and nobody has a monopoly on complacency.
Thank you.
Senator McCaskill. I, let me, I've got a number of
questions here, but let me start by saying I, the issue is not
who is responsible for any individual accident, the issue is,
is oversight and accountability the same, regardless of where
an airplane is maintained and worked on. That's the issue.
And, we have established that we have certified and non-
certified foreign repair stations. And, I'm trying to get at
the difference between the two and the difference in the level
of oversight and accountability for the non-certified repair
stations, which we've already established are doing all the
same kind of work as the certified repair stations. My
understanding, in the first round of questioning, that in the
instances of the use of non-certified repair stations, in these
countries all over the world, that it is the airlines that have
the responsibility for overseeing that, the level of training,
background checks, and security that are going on at those non-
certified foreign repair stations. Is that correct, Ms.
Gilligan?
Ms. Gilligan. The airline is always responsible for the
work that is being done on the aircraft and the airline is
always responsible for determining that the aircraft or the
product should be returned to service.
Senator McCaskill. But they are the only ones responsible
at the non-certified facilities, isn't that correct?
Ms. Gilligan. But, then we're providing oversight of the
carrier.
Senator McCaskill. OK.
Ms. Gilligan. We are, in fact, examining their processes
and procedures that they are putting in place to meet their
requirements.
Senator McCaskill. Then how do you explain the fact in the
2005 IG report, the IG found that there were six carriers that
were looking, that were supposed to be overseeing work at non-
certified foreign repair stations and that they had done this
by phone?
Ms. Gilligan. We take those findings very seriously. It is
because of those kinds of findings that we have put in place a
number of corrective actions in response to the IG's
recommendations. I believe that they made those findings, but
we do know and the data shows, because the accident rate says
that, in fact, we are following the standards. We and the
airlines are following the safety standards. But please, make
no mistake about it, those kinds of findings are very troubling
to us and they are the reasons why we take steps to enhance our
own oversight systems, as well.
Senator McCaskill. Well, you know, it comes back to the
point I tried to make the last time, is that if certification
is important and if we believe certification helps safety, then
allowing the airlines to use facilities that aren't certified
comes with a certain inherent risk. And, if in fact, the IG has
found that they were overseeing non-certified facilities by
phone, then clearly the FAA, at that point in time and we have
not increased by any notable percentage the number of safety
inspectors since that point in time. I think you can understand
the concern. And, what was interesting in your testimony just
recently, I know that American says they get surprise
inspections at FAA-certified facilities all the time. Would you
disagree with that statement?
Ms. Gilligan. No, as I commented, we do, we often are co-
located and the American office that oversees American Airlines
is actually co-located with the American facilities and our
inspectors are there on a regular basis. That's absolutely
accurate.
Senator McCaskill. And then you said, well, we can do it at
foreign repair stations when we need to. Are you implying that
somehow there is a more dire need to have spot inspections in
the United States of America and not in foreign nations?
Ms. Gilligan. No ma'am, all I meant to indicate was that in
some places we're co-located and it's easier, but there are
5,000 repair stations domestically and we don't, we are not co-
located by all of them and we don't do the kinds of oversight
that we do at American Airlines at every one of the repair
stations. In most cases, we notify people because we are
traveling to come to the repair station and so it's consistent
here in the United States and in the repair stations that are
overseas.
Senator McCaskill. Well, let's assume that we think spot
inspections are important or you wouldn't be doing them in
American Airlines, and let's assume that the reason you're not
doing them at foreign repair stations is because of travel time
and convenience. Wouldn't it be certainly appropriate and, in
fact, I think you're policies would embrace the idea, that the
carrier that is using that foreign repair station would pay for
the additional time that inspector would stay or pay for, let's
say they arrive and the paperwork's not there.
By the way, I would think that would be something you'd
want to know, if they had the paperwork onsite and available
for inspection at any time.
But, let's assume that an inspector traveled to a foreign
repair station, got there, the right people weren't there, the
right paperwork wasn't there. Isn't that airline responsible
for paying the cost for that inspector to stay over as long as
it takes to make sure that that facility is up to the same
standards that we require of American-certified repair
facilities?
Ms. Gilligan. To date----
Senator McCaskill. That is, U.S.A.-certified repair
facilities.
Ms. Gilligan. Right, to date we have charged fees to the
repair station itself, when we do certification activities,
when we issue their first certificate, when we do their yearly
or biannual reviews. We have never charged anyone for the
surveillance, that's the safety oversight function, because we
believe that that's inherently a public good and it is
something that the FAA, because we don't want to be limited in
the amount of that kind of oversight we can perform, so we
don't want to be limited by having people pay fees. To date, we
have not, we have not charged fees to the airlines. We'd have
to look at doing that, but we do charge fees to the repair
stations themselves for our inspectors who are doing that
certification work.
Senator McCaskill. OK, for the repair stations, I mean,
charge them for the extra days that are necessary to stay
there. Is there any reason why that wouldn't be possible in
order to have spot inspections in foreign repair facilities
just like we have in the United States?
Ms. Gilligan. Again, as a matter of policy, we have not
wanted to charge fees for the safety oversight. We never wanted
there to be any question that we didn't provide oversight
because someone didn't pay a fee. So, we have always done that
as part of our inherent governmental responsibility.
Senator McCaskill. Well, I'm confused then, because when I
offered my amendment in Committee that brought about this
hearing, one part of my amendment would require the payment to
the FAA for the cost of us having to travel. Since cost is a
factor for these airlines, it certainly, I think, the notion
that the American people should not have to underwrite them
going to another location for lower costs. I don't think that
most taxpayers would want to foot the bill for these airlines
going to another country.
When I, the comment that FAA provided in response to the
draft of that amendment, said that currently, foreign repair
stations that are, do hold certificates, must pay for all costs
associated with FAA inspector oversight, including travel,
salary, and benefits.
Ms. Gilligan. Yes, ma'am. And unfortunately, that is
correct, but not complete. It is correct that all those costs
are paid when we do what we refer to as certification
activities, not when we do what we call surveillance
activities. And, I apologize because our staff in responding to
the question, I believe, split the hair a little too closely.
They do pay for all of the activities that allow a repair
station to get a certificate. That includes the personnel cost
and benefits for our inspectors, as well as their travel. But,
when our inspectors are doing surveillance inspection, what we
call safety inspections, foreign repair stations do not pay
fees for that part of our work. Again, because we never wanted
there to be any confusion that we were limited in the amount of
oversight we could do based on the amount of fees that were
paid. So, I apologize that we were, again I think, they were
accurate in the way we use our terminology, but I believe it
was confusing and I apologize for that.
Senator McCaskill. So, if you take your airplanes to
foreign countries, you are not going to have spot inspections
and you can enjoy the lower costs of labor in those countries
and the American public is, in fact, underwriting the cost of
that outsourcing. Correct?
Ms. Gilligan. The, well, the American public is paying for
FAA's continued oversight of any of the U.S. aircraft that are
operated around the world.
Senator McCaskill. They're paying the extra, they are
paying the extra amount of money that it's costing the FAA to
do whatever, in fact, the amount that you have collected versus
the amount that has been spent. You have collected some, I
guess, what you're now saying today, for the certification
process.
Ms. Gilligan. That's correct. That's right.
Senator McCaskill. But, the taxpayers are actually footing
the bill for the extra amount the government is having to spend
in order for these carriers to enjoy lower labor costs in other
countries. Isn't that correct, Ms. Gilligan?
Ms. Gilligan. The inspectors are providing oversight at
those facilities for whatever reasons that the carriers choose
to use them. And in some cases, as Mr. Barimo has acknowledged,
that the element of the cost of the labor is a piece of it.
From the FAA perspective, our inspectors, whether they are
located internationally or located domestically, we are doing
our oversight to determine that U.S.-registered aircraft meet
the safety standards that our regulations require, wherever
those aircraft operate in the world. And, that's how we have
viewed it, that it's the same level of oversight necessary,
wherever that aircraft is operated.
Senator McCaskill. I think the point, obviously, I think
you understand, and that is, the taxpayers are paying extra for
safety in order for the airlines to enjoy lower labor costs.
And, I would, well, my time's up and why don't you go ahead,
Senator Rockefeller?
Senator Rockefeller. Thank you, Madame Chair.
I am going right back to where I left off. The idea of
unannounced inspections is, in every single respect, offensive
to me. We have a lot of coal mines in West Virginia. Ninety-
nine percent of West Virginians have never been in a coal mine,
except if they happen to work there because they're not allowed
in there. First Lady Eleanor Roosevelt did it, but almost
nobody does. But, Governors and Senators can do that, so I've
been in a lot of coal mines and it is just a fact of life, it's
a fact of human nature, it's a fact of, in that case, corporate
policy, and this case may be different or may be the same, that
everything seems to look better. It's what they call rock
dusting. The mine looks clean, everything is orderly. I've
never ever, as either a Governor or a Senator, ever been down a
coal mine when it just doesn't look absolutely terrific, for me
because I'm heavily involved in energy issues.
Now, I recognize, and I don't say this to denigrate you in
any way, shape, or form, but you're under the restrictions of
the Office of Management and Budget on how you answer
questions. And, I do understand that and the audience, I'm
sure, understands that. You do not have the freedom, maybe, to
answer in the way that you choose to. And I, again, I don't
criticize you for that. But, I do criticize you're defense and
other's defense of, ``it doesn't make any difference if it's
pre-announced or not.'' I think it makes all the difference in
the world, and if people were to come in and find, let's say,
somebody missing because there was a particular phase of an
inspection, and then so be that. All right, so you don't get a
perfect everybody lined up ready to, you know, show you what
they're wares are. It is a wrong thing to do. It is a wrong
thing to do. It is a more expensive thing to do, to announce
it, but it's a wrong thing to do for air safety. I believe that
with every fiber in my body.
Along with Senator McCaskill, I chair this Subcommittee and
I intend to follow through on that. I just, I feel so strongly
about it that I can not tell you.
Second, the whole question of, that was brought up by the
union with respect to, and I just want to get clear on this, of
people not being able to speak English. And then your answer
was, ``Well, we can, we can do that by hands-on training.'' Any
Senator, any busy executive, you, anybody who has complex
problems before them, not only has to have an explanation, but
they have to, probably have to have a binder, which they read
on the trip over to remind them of that explanation. And so,
the concept of actually people just learning things through
hands-on training, that is assuming that both parties speak a
common language and that both parties are qualified in every
respect, is one that I also feel very strongly about. And, I'm
not asking you, particularly, to comment on that. I am asking
Mr. Scovel to comment on it.
Mr. Scovel. Thank you, Senator. I must say we do not have
research conducted by my office on that specific point.
However, I would have to acknowledge the common sense in your
statement that when a mechanic in a foreign country cannot
speak English, and his or her instruction manuals are printed
in that language and that language only, that puts the quality
of the maintenance that he or she will provide at risk.
Senator Rockefeller. Anybody else want to comment?
Mr. Filler. Yes, Senator. I'd like to. The regulations
require that persons that are supervising, inspecting, and
approving for returns of service have to read, write, and
understand the English language. There is no independent
requirement to speak the English language. In the foreign----
Senator Rockefeller. Regulations require.
Mr. Filler. Yes, sir.
Senator Rockefeller. Now, that's an interesting phrase,
isn't it? How many times have I heard that? What does that have
to do with follow-up? This is where the question of oversight,
either----
Mr. Filler. I thought you had asked about----
Senator Rockefeller. I am.
Mr. Filler.--speaking English.
Senator Rockefeller. But, you helped me to expand my
question.
Mr. Filler. OK. I think it's relevant that individuals are
required to read, write, and understand the English language in
a foreign repair station, as well as in a U.S. repair station.
But, there is no requirement that they have to speak it. In a
foreign location, the technicians often are looking at manuals
that have been, or work cards that have been translated into
their native language. But, at the same time, FAA requirements
are that the records must also be translated into English so
they can be evaluated by FAA inspectors.
Senator Rockefeller. Please.
Mr. Roach. What he said was a little tricky. He said the
people who signed the book have to have speak English. The
people who do the work are not required to speak or write
English. The people who are actually hands- on, the people who
work it, the person who comes out after all the work is done,
who's working at that repair station that has to sign the book
because that individual has to be able to read and write
English. But, the person actually tightening the screws and
changing things, they don't have to read or write English to do
the work. There's no certificate to my understanding, people
who are working on aircraft, they're not required to have any
particular certificate. Only the person who's over, who has to
sign off the log book, which could be the person for an
aircraft or a number of aircraft.
Senator Rockefeller. Accepting what you say for the moment,
Ms. Gilligan, would you care to comment on that and Mr. Scovel
would you care to comment on that. And I beg the indulgence of
the Chair.
Ms. Gilligan. Yes, Senator. Actually, everything that both
of these gentlemen have said is accurate. Individuals can work
on aircraft that do not have to hold a particular certificate.
They must then be under the supervision and overseen by people
who hold proper certificates and authorizations. Whoever holds
the certificate has to be able to read, understand, read and
understand English, as Mr. Filler described. And, that has been
the check and balance in the system. It is true that people who
work on aircraft will have work cards, their instruction cards
may be translated into whatever is their native language, but
whoever's overseeing that work is fluent in both their
language, both that native language and in English, so as to
insure that the records are properly maintained to demonstrate
the work that has been done.
Senator Rockefeller. And there's always somebody with that
person during the inspection?
Ms. Gilligan. There is. The requirements for the work to be
overseen by someone who's authorized to do that.
Senator Rockefeller. That's not my question.
Ms. Gilligan. I, they are monitoring the work. There may be
more than one person doing work at a time. They may not be----
Senator Rockefeller. Video or----
Ms. Gilligan. It's not a one to one, it may not be a one to
one relationship, but the person who's going to sign that work
off, who takes that responsibility very seriously is monitoring
the work and determines if the work has been properly
accomplished in accordance with the instruction before signing
the authorization for that.
Senator Rockefeller. We'll come back to you Mr. Roach in a
moment.
Let me just say as a matter of philosophy that I think, I
used the word fugue a moment ago, which probably seemed a bit
bizarre--I'm a baroque music fan--but I, to me an aircraft, and
I mentioned the 13,000 parts, which are individually accepted
part by part before a first model of the five that have to be
approved of a new aircraft are allowed to proceed. I consider
the repair and maintenance work, not on perfectly new pieces of
metal, but on potentially frayed pieces of metal and to what
degree frayed, to a dangerous degree, not to a dangerous
degree. This is a very subtle science, it's an art form. It's
not something which comes from the bosom of one's heart to do a
good job, it comes from an absolute knowledge and determination
under 110 degree sun, presumably we know that's a little
unfair, but sometimes inside a shed, it can be that way too,
people can get tired and you have to be just as good, like a
receptionist at any of our offices, at 6 o'clock in the evening
as you do at 9 o'clock in the morning. I think that, that's my
philosophy of repair and maintenance. Incredibly delicate,
incredibly complicated, and incredibly, the kind of thing you
do not make a mistake upon.
Mr. Scovel?
Mr. Scovel. I would concur, sir. If I may return to one of
your earlier questions on FAA certification of mechanics
working at U.S. stations versus foreign stations. It is our
understanding that, under FAA requirements, supervisory and
inspection personnel at a domestic, FAA-certificated repair
station must be certificated by FAA.
However, for a foreign repair station certificated by FAA,
no personnel must hold a true FAA certificate. Personnel
working on aircraft are required to fulfill certain training or
experience requirements, such as 18 months of practical
experience in work being performed, but they need not hold the
actual FAA certificate. I think that is an important difference
to note for the record.
Senator Rockefeller. All right. Mr. Roach, to you and then
final from my point of view, Madame Chair to you, Ms. Gilligan.
Ms. Gilligan. Thank you, sir.
Senator Rockefeller. Did you get, I think you cared to
comment.
Mr. Roach. Just on the, the language situation. The manuals
that are translated in those foreign repair stations are not
translated by the manufacturer. They are translated by the
foreign repair station or the carrier and so the manuals that
we work on domestically are the manuals that have been prepared
by the manufacturer of that particular aircraft.
Senator Rockefeller. Are you suggesting by that that
they're more in pictorial form?
Mr. Roach. No, I'm saying that the manuals, the manuals are
prepared by the manufacturer for the maintenance of that
aircraft, Boeing or Airbus whoever's handling, let's say
Boeing. And those, Boeing does not translate that into any
particular language, which means that it goes to another party,
who then translate what Boeing meant by that manual to somebody
else who doesn't necessarily have the training and skills in
maintenance because they're not required to. Only the person
who oversees or supervises work, who does not have to be on-
sight. They could be in a room, which happens quite frequently,
they could be in a room someplace when they're told this
particular work has been completed, to come out and look at it.
So your people out there who do not speak English, who are
reading manuals that have been translated third hand, who are
performing this particular work. And, as you indicated, there
are thousands and thousands of parts that are very important to
the safety of that, to the airworthiness of that aircraft and
so we think that reflects on the safety of the aircraft.
Senator Rockefeller. I thank you, sir.
Ms. Gilligan, please understand as I ask you, I seem to be
peppering you with questions and I apologize, but one thing I
really do understand is that all administrations, not just the
present one, but the previous ones have vastly underfunded the
Federal Aviation Administration. I mean, you look at our
attendance here and you get a Congressional response. So that
I, I understand, I mean, there's nothing you can do about
funds. You can't complain about funds and you need funds--and I
know that, and I know that you know that.
So, my question for your last response on this is that I
recognize you are very funds short and we've only partly helped
you with the whole digital air traffic control system yet to
build.
Ms. Gilligan. Thank you, sir. And if I, actually, if I may
comment on the resource issue. Actually, I'm here to thank the
Congress because, in fact, for this year 2007 under the
Continuing Resolution and for last year, 2006, we actually
received in the safety program increases above the Presidential
request. And we appreciate those and we understand that those
are to make up for some short-falls, which we were able to
demonstrate had occurred and, in fact, we took reductions in
our workforce back in the year 2005. So, we are actually quite
appreciative of Congress's understanding of the continued need
to invest in the safety infrastructure that FAA needs to put in
place. And, we appreciate that.
I did want to comment on the Inspector General's comment
about, at foreign-located repair stations it is true we do not
require people to hold an FAA certificate, but our inspectors,
when they are certificating that facility, make a finding that
there are people in that facility that meet all of our
standards in order to serve in that function. So, we do fill
that gap. We don't require them to hold the FAA certificate,
but we make a finding that they are competent and qualified to
meet those same requirements.
But, thank you for giving me the opportunity on the
resource question because, in fact, Congress has been extremely
supportive of the need for us to continue to build our safety
infrastructure and we appreciate that.
Senator Rockefeller. And that must continue.
And I've doubled my time and I appreciate it, Madame Chair.
Senator McCaskill. Thank you, Senator Rockefeller.
I, unfortunately, have to be on the Chair to preside at
4:30, so we only have 10 minutes. So, I will have questions
that I will not have time to get to in the next 10 minutes and
I will ask those of you in writing to add to the record. And, I
will appreciate if people can keep their answers as brief as
possible so I can try to get to as many of them as possible
before we have to adjourn.
I think after 9/11 in this country, there was an acceptance
of the responsibility that the traveling passenger has as to
what they have to go through to maintain safety and security on
an airplane. My mother has two knee replacements, I have one.
We accept the fact that we have to be personally wanded every
time we fly. I think the American public is assuming that we
are making the same kind of requirements of the mechanics that
are working on these airplanes.
And, I know this, that in the IG's report of February 2003,
that during the investigation of the IG, you actually found a
staff senior aircraft technician at a foreign repair station
was a member of al-Qaeda. And, that your investigation revealed
that that aircraft technician had been photographing the U.S.
aircraft as potential targets for a terrorist attack. Have I
accurately portrayed your report in that regard, Mr. Scovel?
Mr. Scovel. Yes, although, truly Senator, modesty compels
me to say that it was not our investigation that found the al-
Qaeda plant at that repair station. It was other law
enforcement authorities. We note that in our report as an
example of security vulnerabilities.
Senator McCaskill. It was, do you know whether that foreign
repair station was certified or non-certified?
Mr. Scovel. It was certified, Senator.
Senator McCaskill. OK. Let me ask, in 2003, Congress made
some requirements of TSA in connection with FAA to, in fact,
complete a rule imposing security standards on foreign and
domestic repair stations and it was required that this rule be
done by August of 2004. And, then those security audits of
foreign stations were to be completed 18 months after the
regulations were finalized. Am I correct that, to date, not
even a proposed rule has been issued, let alone a final rule
and that the agencies are now 30 months delinquent in meeting
this Congressional mandate?
Ms. Gilligan. It is true, Senator. The TSA has not issued a
proposed rule for, to meet those security requirements.
Senator McCaskill. I understand TSA is the lead agency, but
I believe that there was, inherent in the legislation, a
request that you work with its counterpart, your counterpart in
TSA to move these rules forward. Have, in fact, you all, do you
have any written correspondence or anything indicating that you
have been pushing TSA to, to come out with rules concerning
security at repair stations, both foreign and domestic?
Ms. Gilligan. I don't know that there's a written record.
There certainly have been discussions of the language in the
legislation and of the requirement that TSA must issue their
regulations and then make audit findings so that FAA could take
the next step.
Senator McCaskill. And, it's my understanding that your
report, Mr. Scovel, not only dealt with background checks as a
security vulnerability in foreign repair stations, but you also
talked about access to the airport, that was, that you observed
by vending machine personnel and other contract personnel. And,
that you had pictures in your report of gaps in sensing, of
failure to secure the perimeter. Could you briefly summarize
the various security lapses that you witnessed at these, and
then, and these are actually, I assume, the certified repair
stations or were these also non-certified?
Mr. Scovel. They were certified, Senator. I must say,
however, that under Department rules, our report was not
classified in the DOD sense but was marked as Sensitive
Security Information. For that reason, I am not allowed to
discuss all the details that you may be interested in on the
record in an open hearing. However, I would be happy to discuss
those with you and your staff in private.
Senator McCaskill. I'd be anxious to visit with you about
that. I think that this security issue is a major issue here,
particularly in light of the fact that we've had reports that
on the non-certified facilities, some of the oversight being
provided by the airlines was done by telephone. I don't think
that's the kind of oversight that's going to reassure the
American public that we're doing all that we can do to make
these airplanes secure and safe for travel.
The 2004 report, FAA report to Congress states that FAA is
further revising the repair station rules to update and
modernize repair station ratings, and add a quality assurance
program to complete the quality system requirements for both
foreign and domestic repair stations.
The notice for the proposed rulemaking for this effort is
scheduled for publication by the end of the third quarter in
Fiscal Year 2005. Was this notice of proposed rulemaking ever
issued?
Ms. Gilligan. Yes, I'm sorry, Senator, I just had to check.
We did issue that proposal, and we have received comments,
we are disposing of those comments. So we'll be moving to final
rule.
Senator McCaskill. And that was--it was supposed to be done
by the end of the third quarter 2 years ago.
Ms. Gilligan. That was the notice that was to be issued at
that time. I can get you the specific schedule. I don't recall
if we met that third quarter date, but it has been out for
comment, the comment period has closed, and we are now
reviewing those comments, and moving to final rule.
Senator McCaskill. OK. Well, I think we've talked about the
accountability in terms of a security audit that Congress
mandated that has--they haven't begun to occur. And, we've
talked about certified versus non-certified, and what kind of--
we've talked about spot inspections, and not spot inspections,
I guess I would just ask for comments from any of the witnesses
as we close.
There's clearly--there are two standards in terms of repair
stations. You have the standard that is here in certified-FAA
repair stations in the United States of America, we have spot
inspections, you have the certified mechanics, you have
oversight by the FAA.
And then you have a whole lot of repair stations that don't
have that same level of scrutiny and that same level of
oversight. And I would, since we now know that the majority of
the maintenance work is now being done in those that have the
lesser standards, I would like any of you who are comfortable
and want to comment on this double standard to explain to the
American traveling public why we would ever want a double
standard as it relates to the maintenance of our aircraft, and
therefore the safety and security of the aircraft?
Mr. Barimo. I'm glad to address it from the airline
perspective--there is no double standard. Airlines maintain
airplanes to a certain standard, and that's universal across
the board.
So, I want to go back, even to the beginning of this
hearing, where we talked about the scope of work being done by
non-certificated entities. And what we're talking about is a
group of licensed A&P mechanics who are working under the
authority of the airline. Generally doing low-level, line types
of checks. So, functional checks, servicing the airplane,
things like that--not heavy maintenance. In every case, when
ATA members are using foreign repair stations for heavy
maintenance, it is certificated, Part 145 repair stations.
So, I understand there were some deficiencies identified in
the IG's report, I would consider those isolated events, and
there are regulations that require carriers to manage that
properly, and if--in certain cases--it wasn't managed properly,
then there's a mechanism to go deal with that.
Senator McCaskill. And I would say--we've got 4 minutes.
So, I don't know how many of you want to comment--how many of
you want to comment, raise your hand? OK, that gives you each
about a minute.
Mr. Brantley?
Mr. Brantley. I believe the dual standard that we have is
in the oversight that's provided by the FAA.
Senator McCaskill. Right.
Mr. Brantley. With regard to these foreign repair stations,
oversight of the actual work performed is a responsibility of
an inspector in a certificate management office, in the country
here. So, for whatever airline they're tasked with providing
oversight for, that would be their job to ensure that that work
is performed properly. And, in order to do that, they are
required to give 60 to 90 days notice--this isn't a short lead
time we're talking about--60 to 90 days to even be able to go
and do an inspection. And there's no guarantee that when that
90 days is up and they get there, there's still an airplane in
there having maintenance done, that they're responsible for.
So, it truly is a nightmare for an inspector to try to do
the oversight that they're charged with doing.
Senator McCaskill. Mr. Filler?
Mr. Filler. Senator McCaskill, thank you.
I just would like to also emphasize the international
component to a lot of the issues that we're discussing here
today. ICAO exists because some very smart people over 60 years
ago thought that we needed international safety standards, that
would apply to the members of the international community. So,
all of the things that we're here discussing today are all the
subject of ICAO standards, including security and perimeter
checks, and background checks. And there is some U.S. oversight
of that, and my understanding is, TSA does do--as Mr. Barimo
pointed out--security audits of some foreign locations. ICAO
also does security audits to ensure compliance with ICAO
standards.
There's a practical reason, as well, why foreign repair
station people that might have to be certificated if they
worked here, do not have to hold individual A&P certificates.
Some of these facilities, for example, one of our very
prominent members, has 35 repair station certificates, from 35
countries. That counts the E.U. as only one of those 35.
If every one of those countries required their technicians
to be certificated individually, under the regulations of that
local authority as the State of Registry, it could get out of
hand pretty quickly.
I think, as Ms. Gilligan pointed out, the FAA has a
performance-based rule, they evaluate these people, they make
sure they can do their job, and if they're technically not up
to the regulatory standard, then the FAA will say, ``Sorry, you
need to put somebody else in place.''
So, I think the oversight issue you raise is a legitimate
issue, but I don't think the traveling public, or this
Committee, should be concerned that there's a lower level of
safety by the work performed by work stations in general, or by
foreign repair stations versus domestic repair stations. Thank
you.
Senator McCaskill. I've got time for, half a minute, if
anyone else wants to comment.
Mr. Scovel. Half a minute, Senator, if I may.
Our work has shown that non-certificated repair facilities
located overseas are at the far end of the oversight spectrum.
FAA oversight of those facilities is very thin, if not non-
existent in most cases.
While safety has not yet been compromised in the form of an
accident, we must question the quality of the oversight and
determine what is still needed. We have urged FAA in our
report, and in our testimony today, to directly confront the
question of whether the current system should continue, or
whether FAA should limit the type and scope of maintenance that
is allowed to be performed at non-certificated facilities.
Mr. Roach. I have 15 seconds, Senator.
We have a bargain--the machinists union has a bargain
relationship with every major carrier in this country, with the
exception of Delta and American. And, in our discussions with
the CEOs and CFOs, nobody's ever said to us, there can be work
done better overseas, it's always been a cost factor.
So, when somebody alluded to the fact that maybe
something's happening overseas that's not happening here, we've
never heard that from any major carrier, that, it's always been
a cost factor, because they're getting the work done a lot
cheaper, without benefits to workers, without any concern about
human rights or anything of dignity in these other countries.
Thank you.
Senator McCaskill. Let me close by saying, I know there was
reference made to an isolated incident. And, I understand there
is a data-related look at performance of these airlines from a
mechanical standpoint. But everyone should keep in mind, in
terms of security that, what changed this nation, I think,
could be characterized as an isolated incident.
And I appreciate all of your attendance today, and the
testimony you've given, and the hearing is adjourned.
[Whereupon, at 4:30 p.m., the hearing was adjourned.]
A P P E N D I X
Prepared Statement of Hon. John D. Rockefeller IV,
U.S. Senator from West Virginia
The oversight of aviation safety is one of this Subcommittee's
primary responsibilities. The government has no more important role in
making sure that our Nation's aviation system remains the safest in the
world.
I want to thank Senator McCaskill for requesting this hearing and
aggressively seeking to improve our nation' aviation safety. And, I
would like to thank our other witnesses for coming today as well.
I have a few brief remarks and then will ask other Senators if they
have opening statements.
First, I want to state that I firmly believe that the United States
has the safest and best air system in the world. I do not want to give
anyone the impression that I believe it is unsafe to fly.
But, the aviation industry continues to change rapidly in light of
unrelenting competitive pressures. I am concerned that the quickly
changing nature of the commercial aviation industry coupled with the
FAA's declining level of resources threatens the agency's ability to
maintain the necessary level of oversight of air carriers, foreign
repair stations, and upgrade the existing safety infrastructure at our
airports.
Although I understand why many commercial airlines are contracting
out an increasing amount of their maintenance work, I am concerned that
this work is being sent to foreign countries where governmental
oversight from both the home nation and FAA may be weak or non-
existent.
Compounding the industry's trend to outsource much of its
significant maintenance work is the inability of the FAA to certify and
closely monitor an ever increasing number of foreign repair stations. I
do not question the agency's commitment to safety. I believe that this
is due mainly to a lack of resources.
I am deeply concerned that the FAA is losing a number of its most
senior safety inspectors and does not have the ability to replace all
of them. This Committee, as it begins evaluating the future of the FAA,
should be spending a considerable amount of its time making sure that
the agency is able to meet its foremost mission--the safety of the
traveling public.
Again, I want to thank Senator McCaskill for her leadership on this
issue.
______
Response to Written Question Submitted by Hon. John D. Rockefeller IV
to
Hon. Calvin L. Scovel III
Question. How many inspectors will the FAA hire in 2007? How many
inspectors does the FAA expect to lose this year? Given that these are
highly skilled positions, are there enough well trained individuals who
the FAA could hire to be inspectors if the Agency has the resources?
Answer. FAA expects to hire approximately 290 aviation safety
inspectors in FY 2007. During the same period, FAA expects to lose
approximately 200 aviation safety inspectors, which would result in a
net increase of 90 inspectors in FY 2007. Congress approved additional
funding for these 90 inspectors in FY 2007, which was an increase over
FY 2006 staffing levels.
According to FAA's May 2007 Aviation Safety Workforce Plan, the
Agency maintains a pool of about 5,000 qualified inspector applicants
that can be hired quickly. These applicants have specialties in
avionics, maintenance and operations. We do not know whether FAA's
statements are valid since we have not performed a detailed evaluation
in this area. However, as FAA recognizes in its workforce plan, the
Agency faces the challenge of hiring people with the right skills, such
as risk-based decisionmaking and data analyses. These skills are needed
for inspectors to work effectively in the current aviation environment
and with FAA's risk-based oversight systems.
We have identified other shortcomings in FAA's goals to achieve a
well-trained inspector workforce. For example, according to its
workforce plan, in FY 2007:
FAA's goal is to hire only 10 percent of new staff with the
competencies needed to perform inspections using risk-based
systems; and, the new staff only needs to possess two of the
nine competencies that are needed.
FAA plans to train a minimum of 30 percent of existing
inspectors in only one course in risk-based competencies.
Using risk-based oversight systems is a foundational part of FAA's
plan to meet future oversight challenges. Therefore, in our view, the
Agency needs to step up its hiring and training efforts if it is to
maintain a sufficient number of inspectors with the right skill set to
provide oversight of a dynamic aviation industry.
Supplemental Information
According to our analyses of FAA records, as of July 21, 2007, FAA
had hired 170 inspectors; but, 190 inspectors had retired. FAA will
need to work aggressively to meet its goal to hire 290 inspectors by
September 30, 2007. According to its workforce plan, FAA does most of
its hiring during the last two quarters of the fiscal year because of
funding delays.
______
Response to Written Questions Submitted by Hon. John D. Rockefeller IV
to Margaret Gilligan
Question 1. How many inspectors will the FAA hire in 2007? How many
inspectors does the FAA expect to lose this year? Given that these are
highly skilled positions, are there enough well trained individuals who
the FAA could hire to be inspectors if the Agency had the resources?
Answer. At the end of Fiscal Year 2007 FAA is projected to have
3,740 ASIs compared to 3,662 at the end of Fiscal Year 2006. This is an
increase of 78 new hires which will support new certification and
surveillance activities related to the growth of existing operators and
a backfill of 185 positions lost through attrition.
An additional 81 ASIs are projected to be hired in FY 2008. This
increase will support new safety initiatives along with continued
operational safety (core business) to our customers. The increase will
also support continuation of the transition of air carriers to a system
safety approach to oversight.
In order to ensure an adequate number of ASIs, FAA has developed a
Human Capital Plan that is a proactive approach to succession planning
for retiring inspectors. This plan takes into account various
demographic and geographical data and identifies the appropriate skill
sets required to perform the job. FAA has a centralized applicant pool
with a registry of approximately 3,843 qualified applicants that we use
to fill our vacancies.
Question 2. I understand that the FAA is shifting away from a
safety oversight system based on individual inspector's skills and
knowledge to a more risk assessment approach based on data evaluation.
No matter how sophisticated FAA's risk assessment approach becomes in
identifying high priority sites to monitor, is there any real
substitute to a human inspection?
Answer. There will always be a need for inspectors to perform
onsite inspections. What's important is that we establish what to
inspect based on an assessment of risk. The Air Transportation
Oversight System (ATOS) provides automated tools that analyze the data
collected by our inspectors and point them toward elements of a
carrier's system that might present a risk. In this way, we ensure the
most efficient use of our safety oversight resources.
Question 3. According to Mr. Brantley's testimony, insufficient
funding for travel obviously has impacted the FAA's ability to perform
oversight of foreign repair stations. Mr. Brantley asserts that
increasingly FAA inspections of major repair stations that perform
heavy maintenance work have been canceled or cut short due to lack of
funds. According to inspectors in the field, the inspection process has
become primarily budget driven rather than motivated by safety. Please
comment on this statement. Has the FAA cut down on the inspection of
heavy maintenance work?
Answer. The FAA does not agree that inspections of major repair
stations that perform heavy maintenance have been canceled due to lack
of travel funds.
In FY 2006 and 2007, Congress has provided substantial budget
increases to allow us to hire additional inspectors. The cost of hiring
an inspector includes the personnel costs and benefits required, as
well as the costs for training and travel to make the inspector
competent and effective. The FAA ensures that critical safety travel
resources are available for inspectors to perform their safety
oversight responsibilities. The FAA is not aware of any travel canceled
due to funding issues.
______
Response to Written Questions Submitted by Hon. John D. Rockefeller IV
to Marshall S. Filler
Question 1. Representatives from your organization have stated in
the press that the oversight of facilities in places such as Britain
and Portugal was often more rigorous than in the United States. I would
expect the European Joint Aviation Authority to have a rigorous safety
system in place; but I am concerned that other countries whose aviation
governance systems are not as mature may not be as thorough.
Answer. All 189 member countries are required to follow
International Civil Aviation Organization (ICAO) safety and security
standards and virtually all foreign repair stations are located in
Category 1 countries (i.e., countries that the FAA has found to be in
compliance with ICAO standards.) More importantly, the FAA (not the
foreign authority) is responsible for monitoring compliance with 14 CFR
part 145.
In those cases where a maintenance bilateral agreement exists (such
as France, Germany, Ireland and soon to be expanded to other members of
the E.U.), the FAA does rely on findings made by the foreign safety
inspectors just as the foreign aviation authorities rely on the FAA's
oversight findings of U.S. facilities to ensure compliance with the
foreign government's requirements.
However, in most cases, maintenance on U.S.-registered aircraft and
related components is NOT governed by a bilateral agreement. Therefore,
FAA inspectors personally oversee those facilities, wherever they are
located. A foreign repair station's compliance with part 145 is ensured
through normal surveillance and frequent recertification inspections,
an activity that is not required domestically. ARSA urges the Congress
to ensure that the FAA has sufficient funding to conduct surveillance
activities at all repair stations, wherever they are located.
Question 2. Does the Aeronautical Repair Station Association
maintain minimum requirements for its members with regard to the level
and quality of background checks? Are there any international standards
for repair stations or can anyone who can find mechanics and planes to
work on open a business?
Answer. ARSA does not set a standard for members regarding
background checks. Regulations issued by the country where the facility
is located dictate the need for such checks depending primarily on the
location of the facility. Domestically, many repair stations located at
an airport are required to have their personnel undergo criminal
background checks under TSA regulations if they require unescorted
access to the designated airport security identification display area
(SIDA). Therefore, a repair station employee that performs line
maintenance for an air carrier would have the same 10-year criminal
background check requirement as an airline mechanic. Many repair
stations voluntarily implement additional security procedures since the
quality and safety of their work directly affects their business.
Internationally, the International Civil Aviation Organization
(ICAO) sets standards for maintenance, security, and safety. Member
countries must adopt or validate regulations that comply with those
standards, including personnel licensing, certification of air
operators and approved maintenance organizations. In fact, FAA
regulations are based on ICAO standards.
Each country must implement the types of security procedures to be
followed just as they must do in the safety area. These are based on
the standards contained in ICAO Annex 17 and thus are very similar to
TSA regulations. They include, but are not limited to:
A national civil aviation security program with continuous
threat monitoring and mandatory quality control procedures;
Airport security programs for each airport serving
international carriers;
Air operator security programs;
Background checks for persons implementing security control
measures and persons with unescorted access to restricted
security areas; and
Periodic ICAO security audits.
The professionals at the TSA, ICAO and other countries' security
oversight organizations have concluded that resources should be focused
where the threat is greatest. Therefore, FAA-certificated foreign
repair stations working on components and located miles away from an
airport are not required to implement background checks for their
employees. However, if they perform line maintenance at an
international airport or otherwise require access to the ramp area,
foreign repair station employees would be subject to similar security
requirements as their FAA counterparts, including background checks.
Neither domestic nor international security requirements are based
on whether a person works for an airline or a repair station; they are
dependent on the degree of access the individual has to the restricted
security areas of an airport. Further, mandating additional security
requirements where none are truly needed will reallocate limited
oversight resources from areas where the threat is greater. This could
have the unintended consequence of reducing the level of security for
the traveling public.