[House Hearing, 112 Congress]
[From the U.S. Government Publishing Office]



 
                A COMPREHENSIVE REVIEW OF FAA'S NEXTGEN
                  PROGRAM: COSTS, BENEFITS, PROGRESS,
                             AND MANAGEMENT

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

                                (112-54)

                                HEARING

                               BEFORE THE

                            SUBCOMMITTEE ON
                                AVIATION

                                 OF THE

                              COMMITTEE ON
                   TRANSPORTATION AND INFRASTRUCTURE
                        HOUSE OF REPRESENTATIVES

                      ONE HUNDRED TWELFTH CONGRESS

                             FIRST SESSION

                               __________

                            OCTOBER 5, 2011

                               __________

                       Printed for the use of the
             Committee on Transportation and Infrastructure


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             COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE

                    JOHN L. MICA, Florida, Chairman
DON YOUNG, Alaska                    NICK J. RAHALL II, West Virginia
THOMAS E. PETRI, Wisconsin           PETER A. DeFAZIO, Oregon
HOWARD COBLE, North Carolina         JERRY F. COSTELLO, Illinois
JOHN J. DUNCAN, Jr., Tennessee       ELEANOR HOLMES NORTON, District of 
FRANK A. LoBIONDO, New Jersey            Columbia
GARY G. MILLER, California           JERROLD NADLER, New York
TIMOTHY V. JOHNSON, Illinois         CORRINE BROWN, Florida
SAM GRAVES, Missouri                 BOB FILNER, California
BILL SHUSTER, Pennsylvania           EDDIE BERNICE JOHNSON, Texas
SHELLEY MOORE CAPITO, West Virginia  ELIJAH E. CUMMINGS, Maryland
JEAN SCHMIDT, Ohio                   LEONARD L. BOSWELL, Iowa
CANDICE S. MILLER, Michigan          TIM HOLDEN, Pennsylvania
DUNCAN HUNTER, California            RICK LARSEN, Washington
ANDY HARRIS, Maryland                MICHAEL E. CAPUANO, Massachusetts
ERIC A. ``RICK'' CRAWFORD, Arkansas  TIMOTHY H. BISHOP, New York
JAIME HERRERA BEUTLER, Washington    MICHAEL H. MICHAUD, Maine
FRANK C. GUINTA, New Hampshire       RUSS CARNAHAN, Missouri
RANDY HULTGREN, Illinois             GRACE F. NAPOLITANO, California
LOU BARLETTA, Pennsylvania           DANIEL LIPINSKI, Illinois
CHIP CRAVAACK, Minnesota             MAZIE K. HIRONO, Hawaii
BLAKE FARENTHOLD, Texas              JASON ALTMIRE, Pennsylvania
LARRY BUCSHON, Indiana               TIMOTHY J. WALZ, Minnesota
BILLY LONG, Missouri                 HEATH SHULER, North Carolina
BOB GIBBS, Ohio                      STEVE COHEN, Tennessee
PATRICK MEEHAN, Pennsylvania         LAURA RICHARDSON, California
RICHARD L. HANNA, New York           ALBIO SIRES, New Jersey
JEFFREY M. LANDRY, Louisiana         DONNA F. EDWARDS, Maryland
STEVE SOUTHERLAND II, Florida
JEFF DENHAM, California
JAMES LANKFORD, Oklahoma
REID J. RIBBLE, Wisconsin
CHARLES J. ``CHUCK'' FLEISCHMANN, 
    Tennessee
                                ------                                7

                        Subcommittee on Aviation

                  THOMAS E. PETRI, Wisconsin, Chairman
HOWARD COBLE, North Carolina         JERRY F. COSTELLO, Illinois
JOHN J. DUNCAN, Jr., Tennessee       RUSS CARNAHAN, Missouri
FRANK A. LoBIONDO, New Jersey        DANIEL LIPINSKI, Illinois
SAM GRAVES, Missouri                 PETER A. DeFAZIO, Oregon
JEAN SCHMIDT, Ohio                   BOB FILNER, California
FRANK C. GUINTA, New Hampshire       EDDIE BERNICE JOHNSON, Texas
RANDY HULTGREN, Illinois             LEONARD L. BOSWELL, Iowa
CHIP CRAVAACK, Minnesota, Vice       TIM HOLDEN, Pennsylvania
    Chair                            MICHAEL E. CAPUANO, Massachusetts
BLAKE FARENTHOLD, Texas              MAZIE K. HIRONO, Hawaii
BILLY LONG, Missouri                 STEVE COHEN, Tennessee
PATRICK MEEHAN, Pennsylvania         ELEANOR HOLMES NORTON, District of 
STEVE SOUTHERLAND II, Florida            Columbia
JAMES LANKFORD, Oklahoma             NICK J. RAHALL II, West Virginia
JOHN L. MICA, Florida (Ex Officio)     (Ex Officio)
REID J. RIBBLE, Wisconsin
CHARLES J. ``CHUCK'' FLEISCHMANN, 
    Tennessee
                                CONTENTS

                                                                   Page

Summary of Subject Matter........................................    iv

                               TESTIMONY
                               Panel One

Bolen, Edward M., President and CEO, National Business Aviation 
  Association....................................................    11
Captain, Tom, Vice Chairman, Principal, Aerospace and Defense 
  Sector Leader, Deloitte LLP....................................    11
Huerta, Hon. Michael P., Deputy Administrator, Federal Aviation 
  Administration.................................................    11
Moak, Captain Lee, President, Air Line Pilots Association, 
  International..................................................    11

                               Panel Two

Dillingham, Gerald L., Ph.D., Director, Physical Infrastructure 
  Issues, Government Accountability Office.......................    34
Hendricks, Thomas L., Senior Vice President for Safety, Security, 
  and Operations, Air Transport Association of America, Inc......    34
Scovel, Hon. Calvin L., III, Inspector General, U.S. Department 
  of Transportation..............................................    34

          PREPARED STATEMENTS SUBMITTED BY MEMBERS OF CONGRESS

Costello, Hon. Jerry F., of Illinois.............................    47
Johnson, Hon. Eddie Bernice, of Texas............................    53

               PREPARED STATEMENTS SUBMITTED BY WITNESSES

Bolen, Edward M..................................................    56
Captain, Tom.....................................................    64
Dillingham, Gerald L., Ph.D......................................    67
Hendricks, Thomas L..............................................    80
Huerta, Hon. Michael P...........................................    87
Moak, Captain Lee................................................   108
Scovel, Hon. Calvin L., III......................................   127

                       SUBMISSIONS FOR THE RECORD

Huerta, Hon. Michael P., Deputy Administrator, Federal Aviation 
  Administration, responses to questions from the following 
  members of the Subcommittee on Aviation:

    Hirono, Hon. Mazie K., a Representative in Congress from the 
      State of Hawaii............................................   101
    Lipinski, Hon. Daniel, a Representative in Congress from the 
      State of Illinois..........................................   105
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   A COMPREHENSIVE REVIEW OF FAA'S NEXTGEN PROGRAM: COSTS, BENEFITS, 
                        PROGRESS, AND MANAGEMENT

                              ----------                              


                       WEDNESDAY, OCTOBER 5, 2011

                  House of Representatives,
                          Subcommittee on Aviation,
            Committee on Transportation and Infrastructure,
                                                    Washington, DC.
    The subcommittee met, pursuant to call, at 10:02 a.m., in 
Room 2167, Rayburn House Office Building, Hon. Thomas Petri 
(Chairman of the subcommittee) presiding.
    Mr. Petri. Well, the hearing will come to order.
    And today we will hear from witnesses about the anticipated 
benefits of NextGen and the Federal Aviation Administration's 
effort to modernize our national airspace system.
    But first I want to recognize Jerry Costello. As he 
announced I think this weekend, he is not planning to seek 
reelection, which has made almost all of us here in this town 
unhappy, but probably there are a few people back in his 
district who are running around and revising their aspirations 
and plans as we speak.
    It has been a pleasure to work with Jerry, and I look 
forward to continuing to do that. He is a real gentleman and 
has the best interest certainly of the country and the aviation 
industry and transportation at heart and has contributed a very 
great deal in many areas, including that which we are 
discussing today, through a lot of roundtable discussions and 
efforts to focus the executive branch on moving NextGen forward 
more rapidly and efficiently.
    So anyway, it has been a pleasure serving with you. And I 
have a longer statement which I guess I better read. The 
program known as NextGen touches every aspect of the agency's 
mission. NextGen is an ambitious project currently costing 
roughly $1 billion per year.
    From the beginning, the case for NextGen has centered on 
the FAA's ability to deliver operational benefits to airspace 
users, to increase efficiency, decrease user and agency costs, 
decrease environmental impacts and, most importantly, improve 
safety. NextGen is also considered a job creator, allowing for 
continued growth in this important industry.
    Today's hearing will focus on the benefits the FAA has 
delivered over the last year or so and the specific operational 
benefits that they will deliver over the next 2 years. In 
addition, we expect the FAA to present their long-term 
milestones and targets for NextGen benefits. Key to the 
realization of NextGen benefits is the planned transition from 
the 1950s radar-based surveillance of aircraft to a modernized 
satellite-based surveillance system dependent on GPS avionics. 
As such, NextGen is capital-intensive and reliant on industry 
investments into avionics.
    Today's hearing is an opportunity for the FAA to present a 
proper accounting of NextGen benefits, including when such 
benefits will be realized in the near, mid and long terms. It 
is also an opportunity to build confidence among users who will 
need to invest substantial sums of money to realize the NextGen 
benefits promised by this new system and among Members of 
Congress who oversee and provide Federal money.
    The subcommittee will also hear testimony from 
representatives of the user committee on the benefits that are 
of particular importance to them. Under the NextGen moniker, 
this program has been underway for nearly 5 years, but airspace 
modernization has its roots in the second term of the Reagan 
administration. The idea of implementing dramatic improvements 
to the safety and efficiency of the national airspace system is 
not new. As efforts to produce these benefits have evolved, it 
has always remained critical to demonstrate real progress year 
over year. That includes delivery of benefits in the near term, 
as well as making the policy decisions to guide the long-term 
efforts.
    In 2008, the NextGen program was pulled off the GAO's high-
risk list, a compilation of risky Government programs. From 
today's second panel of witnesses, Members will hear an update 
on FAA's current stewardship of the NextGen program and the 
degree to which benefits are being realized.
    I believe the testimony of these witnesses will be critical 
to the NextGen authorization and funding decisions Congress 
will make in the tight budgetary times.
    Before we turn to Mr. Costello and witnesses for their 
statements, I would ask unanimous consent that all Members have 
5 legislative days to revise and extend their remarks and 
include extraneous material for the record of this hearing.
    Without objection, so ordered.
    Now, I recognize my esteemed colleague, Mr. Costello, for 
his opening.
    Mr. Costello. Mr. Chairman, thank you.
    And let me first thank you for your kind remarks. You are 
correct; I announced over the weekend, actually yesterday 
officially, that I would not seek re-election in the 2012 
election. I said back in 1988, when I ran for my first term, 
that I didn't intend to stay in Congress forever and that I had 
other interests and other things that I wanted to pursue while 
I was still healthy and could in fact pursue those interests.
    So I decided to do that. It was not an easy decision, after 
working here on the Hill for over 23 years with you and other 
colleagues. It has been a great relationship working with the 
chairman. I am going to be around for another 14 months until 
the end of my term. So we will be working closely together.
    And you are right, there are people back in my district 
that, namely eight grandchildren, who are very happy with my 
decision. And one of my granddaughters told me on the phone 
last night that, you know, maybe next year, you will be able to 
make grandparents' day at my school, which I haven't been able 
to do in several years.
    So I am looking forward to--not retiring--but looking 
forward to turning the next page and spending time with my 
grandchildren and also trying to make a contribution in other 
areas other than elective office.
    So, thank you, Mr. Chairman. And I look forward to 
continuing to work with you over the next 14 months.
    I also thank you for holding this hearing today, investing 
in NextGen now will create a legacy of savings for the next 
generation. The Government will save money by providing 
services more efficiently. And the aviation industry users and 
the flying public will be the beneficiaries of billions of 
dollars in operating cost savings.
    In the 111th Congress, we held four NextGen oversight 
hearings. We examined NextGen midterm capabilities, discussed 
area navigations and required navigation performance 
procedures, reviewed the RTCA midterm implementation task force 
report and analyzed the long-term planning and interagency 
cooperation needed in order to keep NextGen on track.
    Clearly, everyone in this room wants NextGen to succeed. 
And I commend the FAA under the leadership of Randy Babbitt and 
others for making progress in several key areas of NextGen, 
such as efficiently using FAA resources to streamline 
procedural approval process, which yields significant fuel 
savings. Further important NextGen-related infrastructure 
programs, such as ADS-B, are moving forward relatively on 
schedule and within the FAA's budget requirements so far.
    However, because many of the NextGen programs are dependent 
on one or more systems, delays in one program mean delays in 
other programs. For example, a holdup with the En Route 
Automation Modernization program could have a domino effect on 
the other key NextGen systems. Including ADS-B, data 
communications and a systemwide application known as SWIM. My 
concern is, what happens when we add severe budget constraints 
on top of logistical program delays? If we are committed to our 
shared goal of spending taxpayer dollars wisely and 
efficiently, I am concerned that significantly cutting funding 
levels for NextGen will move implementation dates back even 
further and will result in increased costs and reduced benefits 
for aviation users.
    When this subcommittee held two hearings on the FAA 
reauthorization bill in February, we had the opportunity to 
hear from both the aviation stakeholders and the FAA. Our 
witness panel concluded that cutting the agency's budget to 
fiscal year 2008 levels, as proposed in the long-term 
reauthorization bill that passed by a partisan vote in April, 
that it would likely trigger drastic and dramatic budget cuts 
and cutbacks and cancellations of core NextGen programs.
    I want to be clear that simply providing more funding is 
not the entire solution to successful NextGen implementation. 
And in fact there are many factors that must come together in 
order for NextGen to be successful now and in the future. But 
when we are trying to implement the largest and most important 
aviation modernization project of our time in a safe and cost-
effective manner, at what point is doing more with less just 
adding to the problem and making it even more difficult for it 
to succeed on time and on budget? Going forward, I believe that 
it is important for us to have an open dialogue with labor and 
industry stakeholders as well as the FAA and other Federal 
agencies, such as NASA, the GAO and the Department of 
Transportation IG, to ensure everyone is on the same page. 
There needs to be realistic timelines, performance metrics and 
a candid discussion of cost requirements to make sure NextGen 
systems are not significantly delayed and end up costing the 
taxpayers more in the long run.
    I commend you, Mr. Chairman, for having this hearing to 
delve into these details. And as a strong proponent of NextGen, 
I want this modernization program to continue to make progress 
and ultimately deliver the benefits that we have long discussed 
for all of our users, operators and the economy. And because 
the aviation industry supports millions of jobs and keeps our 
economy moving, enactment of a comprehensive FAA 
reauthorization bill that includes adequate funding levels for 
NextGen, as well as a fiscal year 2012 appropriations measure 
that makes investments in NextGen a priority, will create jobs 
and improve aviation safety. It will also position us to create 
a lasting transportation infrastructure investment for our 
country.
    Again, Mr. Chairman, I thank you and I look forward to 
hearing from our witnesses today.
    Mr. Petri. Thank you.
    Mr. Mica.
    Mr. Mica. Well, thank you for recognizing me, Mr. Chairman.
    And let me just divert for a second to extend my very best 
wishes to Jerry and to Georgia.
    I was really shocked the other day because I was looking 
for Mr. Costello, and usually I can find him pretty quickly. 
And we have a great rapport, incredible working relationship 
over the entire time I have been in Congress, 19 years, and he 
preceded me. He served as ranking and chair and back and forth 
together and worked to bring the Nation's aviation system back 
to some sense of normalcy after 9/11 and to ensure the safety 
and security of the flying public. I couldn't ask for a better 
partner and better friends than both Jerry and Georgia. So we 
will miss him.
    But I knew there was something wrong when I couldn't get a 
hold of him the other day. I was quite shocked, like everyone 
else, to learn that he was going to hang it up. But we wish you 
well.
    I always thought you were at least as old as me, Jerry. I 
looked it up, and I will be damned if you are not a lot 
younger. So you have a chance for a full additional productive 
career and spend time with your wonderful family.
    So I know all of us on this side wish you well and thank 
you for a working relationship. It has been great, but we will 
miss you, and all of us at some time are going to have to join 
Jerry, either willingly or unwillingly. So we will be with you.
    And if you are like my brother, he is a big Democrat like 
you, there is lots of money after Congress. So good luck. He 
will hate me for saying that. But he just retired a third 
retirement I think, so there is lots of potential out there at 
your young age. But we wish you well.
    Mr. Costello. Thank you, Mr. Chairman.
    Mr. Mica. And I thank you both for convening this hearing 
on the progress of NextGen. We have got two panels, and we will 
hear the benefits, both short- and long-term, and they are 
many. We can't continue to have an aviation system that relies 
on 1950s and 1960s, even 1970s, technology, and we have got to 
do a better job at making certain that our skies are, first of 
all, safe and secondly that our system is efficient as 
possible. And you can only do that with using next-generation 
technology. So we have worked together as strong advocates to 
move forward. We have made some progress.
    Now, today, I don't particularly want to be critical with 
FAA, but obviously, if you read the IG's report or GAO report, 
you will see very specific criticism. The IG really strikes at 
some of the management failures. Some of the RTC 
recommendations from 2009 still have not been implemented. Only 
a few have been addressed. FAA has succeeded somewhat in trying 
to focus on some of the metroplexes and some of our congested 
airspace areas. But unfortunately, the very basis of putting 
NextGen in places, as far as programs and technology, ERAM is 4 
to 6 years behind, according to the report. Some estimates are 
it could be as much as half a billion dollars over budget.
    We still have problems in developing our technology and 
Next-Generation approach to tracking aircraft. And we see 
problems with software programs and management programs in what 
FAA has taken on to move Next Generation forward. And this 
again is not my assessment. This is what the IG has said. And 
this isn't necessarily a failure of money.
    And I share Mr. Costello and others' concern that we 
adequately fund our FAA operations. But this is not a question 
of money. This is a question of failure of management and 
getting a better handle on setting a timeframe, keeping these 
programs, again, moving forward in some logical sequence and 
you have to build on successes to get to where we want to be.
    And unfortunately, there has been too many failures. The IG 
also cited failure to use onboard equipment, come up with 
solutions there. We are behind in that. It looks like also we 
are sort of forced into a full-blown NEPA environmental study. 
I question the need for that. Anyone with any commonsense or 
logic that couldn't determine that this has to be vastly more 
favorable to the environment, more direct routing, less 
emissions, more efficient use of airspace, I am not sure where 
they are coming from.
    But again, we don't need rocket science or continued 
extensive full-blown red tape, dotting I's and crossing T's 
when even commonsense would tell us the environmental positive 
impacts of Next-Generation technology and protocols. One of the 
things that concern me, and I am a strong investigate of having 
the private sector involved in this development and having 
witnessed, oh, back before I became chairman and sitting in 
this very room, and we would have hearings on bringing forth 
new technology, and FAA was doing the developmental programs is 
that they would go on and on. They just asked for another $1 
billion or $2 billion, and they say that our success is right 
around the corner. Well, we are seeing some of that, 
unfortunately, repeated again. And also what concerns me is now 
with the failure of making progress and also the milestones 
that aren't met or properly identified, even baselines that are 
missing, and FAA has not identified, that the private sector is 
now running scared for participation and also not as willing to 
come forward and provide some of the solutions.
    So I am very concerned about our progress with the program. 
We have got some good proposals in our pending legislation. I 
hope to move forward with that in the next few weeks and 
certainly in the next couple of months to finalize our FAA 
reauthorization. We include provisions to set some standards, 
some metrics, some baselines, some milestones and timeframes. 
So, hopefully, that will encourage the private sector also to 
become re-engaged. But we have got to get FAA off dead center 
and get a handle on this very important project.
    So, again, with my compliments to our Member who we are 
going to lose next year and with the concern for the future of 
NextGen, I will yield back.
    Mr. Petri. Thank you.
    Ms. Hirono.
    Ms. Hirono. Thank you very much, Mr. Chairman.
    And I do add my thanks to our Ranking Member Costello, and 
of course, when he chaired this Aviation Subcommittee and the 
leadership he provided and all of the issues confronting us, 
including of course the many hearings we had on NextGen. And I 
want to thank Chair Petri for convening this session to bring 
us up to date on what is happening with NextGen. I am also glad 
that Mr. Costello mentioned the importance of FAA working with 
other partners, such as NASA, GAO and, in my view, particularly 
with the labor unions, who are going to be very much impacted 
by what we do with NextGen. And I will have a few questions for 
our witnesses along those lines.
    Thank you very much, Mr. Chair.
    Mr. Petri. Thank you.
    Mr. Coble.
    Mr. Coble. Thank you, Mr. Chairman.
    No opening statement, per se. I just want to reiterate what 
you and Chairman Mica, your words, generous words, directed to 
the distinguished gentleman from Illinois. He will indeed be 
sorely missed on Capitol Hill, and I look forward to the 
hearing today as well.
    Thank you, Mr. Chairman. I yield back.
    Mr. Petri. Thank you.
    Mr. Boswell, did you want to----
    Mr. Boswell. Thank you.
    I would like to join with everybody else, Jerry, in my--
well, I am just going to say it like it is--my disappointment 
because you have made a great contribution here, and I know you 
will in the next 14 months. So we are really going to lean on 
you a little bit. But, yeah. A lot has been said and more will 
be said as we go along and you have done a great job. And you 
will continue to do so, whatever you do. You are a patriot, a 
great American and somebodywhose friendship I value very much.
    Back to the business at hand, Mr. Chairman. I appreciate 
you having this hearing.
    I think there has been a little amnesia around here. But 
setting that aside, we have got some real challenges across the 
board. I know aviation has put a lot of jobs out there for 
years, growing. And I hear this word uncertainty thrown around, 
and I think we ought to stop and think, who is creating the 
uncertainty, and be honest about it.
    And I would hope that, for example, Mr. Bolen and some of 
the rest of you, would tell us what that means, willingness to 
take risks, whether it is in Wichita or wherever it might be, 
as we think about general aviation and what it contributes to 
our economy and the need. We keep throwing barriers in front of 
them for different things and, you know, trying to make them 
disclose where they are going to do business and so on, which 
is wrong. And then to be willing to invest in risk and so on 
and not knowing what is going to happen to NextGen.
    And, Mr. Mica, you made excellent remarks, and I certainly 
agree with those. It seems like we ought to move off center and 
get to going. Some things are an investment with a known 
return, and I think we are thinking about it. I think we have 
just been thinking about it a long, long time, and we ought to 
get off center.
    So I appreciate what is happening here today. We have had a 
number of hearings on the issue, and we ought to be moving 
forward. Airlines and their willingness to--new equipment, new 
avionics. Avionics costs so much money. General aviation. 
Avionics costs so much money. And those of us who use the 
system a little bit around here can have an appreciation for 
it, but we all ought to appreciate it because we all use the 
system one way or another, whether we are flying back and forth 
to a district or going where we go or those of us that have the 
privilege to participate in general aviation.
    It is my hope that we can move forward and to pick up the 
pace a little bit and realize that this will enhance the 
economy. It is needed. We need to move forward into Next 
Generation. That is a pretty good term. But it is here. It is 
not over the hill. It is here now, and we ought to be into it. 
And those of us who have gone up to the laboratory and done 
other things realize there is lots that can be done to make it 
safer, expedite, get manufacturers to invest and those users to 
invest and do a lot of things. So I appreciate it, and I hope 
we do actually move forward with a little bit expediency and 
get it done now. Thank you very much.
    I yield back.
    Mr. Petri. Thank you.
    Mr. LoBiondo.
    Mr. LoBiondo. Thank you, Mr. Chairman.
    I join with my colleagues in thanking you for calling a 
hearing on this most important topic and also with my 
colleagues on their comments about Mr. Costello.
    Jerry, you are what this place should be about. I have 
tremendously enjoyed your counsel, working with you. Almost 
everybody knows or they should know that you are not a show 
horse; you are a workhorse. You are about getting it done, you 
are about getting results. This place needs more people like 
you. So we thank you.
    And, Mr. Chairman, on the topic of NextGen, I am a huge, 
huge proponent of the program. It is no secret that the Federal 
Aviation Administration Technical Center, which is in my 
district and I believe the premiere facility in the Nation, if 
not the world, in this particular area, has done extraordinary 
work.
    I want to start by saluting the leadership of Secretary 
LaHood and Administrator Babbitt, and Michael to you and your 
whole team, for what you are doing. This is incredibly 
complicated and incredibly difficult.
    But I also want to make a word of comment. I have been into 
the tech center on numerous occasions, and the men and women of 
the tech center have a dedication to excellence and a passion 
for success that makes it much more than a job for them. They 
understand they are a part of history. They are putting their 
heart and soul into this every day. And I think this is going 
to yield great benefits as we move forward.
    We have heard a little bit about the certainty or 
uncertainty. I think one of the biggest things that we can do 
to provide certainty is provide a long-term FAA bill. The FAA 
itself needs to be able to plan. I cannot imagine how you can 
plan 6 months at a time and have to spend so much time and 
resources worrying about shutting down or not shutting down.
    I was out at the conference, which is ongoing now, on 
Monday. Most every private sector company that I talked to 
mentioned the certainty and stability, which we don't have 
right now, which is absolutely critical to our moving forward. 
This partnership between the Government and the private sector 
requires us to have a known quantity of what we are doing and 
how we are doing it. We can't do that on these extensions, and 
I hope we can get by it at this time.
    I also believe that one of the things I have heard 
repeatedly as the contracts--and we have had about $7.3 billion 
worth of contracts under the structure known as SE2020 that 
have been a big help on how we are moving forward. But I 
certainly am concerned that this is not flowing as quickly as 
it could be. I would like to see more task orders and more 
funds being allocated on a faster basis than has been so far.
    I think it would certainly send a very important message to 
those who are paying attention. And with the big issues here in 
Washington and the debt limit commission and continuing 
resolutions, this is so important to the safety of our flying 
public, to the dollars that we can benefit from with our 
economy. It is one of the programs that we know is going to 
produce results.
    And I am thrilled we have the opportunity, Mr. Chairman, to 
listen to our panel and to find ways we can be a force 
multiplier for the group that is here, and I thank you very 
much.
    Mr. Petri. Representative Johnson.
    Ms. Johnson. Thank you very much, Mr. Chairman.
    And let me associate myself with the remarks that have been 
made in relationship to Mr. Costello. It was very disappointing 
information to learn.
    But I would like to thank both of you for this hearing 
today to review the cost-benefits, progress and management of 
FAA's NextGen program. I might add that no where I have been 
talking about transportation has there not been emphasis on 
NextGen and how important it is for the future of our aviation 
industry. And coming from a congressional district that is a 
major air transportation hub, that encompasses Dallas and the 
Dallas Love Field airport that is very adjacent to the Dallas/
Fort Worth International Airport, the safety of our air traffic 
system is of paramount importance.
    And currently the Nation's transportation system supports 
more than 74,000 flights every day and 730 million passengers 
every year, with the FAA forecasting an increase of 53 percent 
to 1.1 billion passengers per year by 2025. So we are very 
concerned. We are a trade hub. Our airport is the economic 
engine for the area. General aviation is expected to increase 
to over 85,000 flights every day over the same period. So, 
clearly, the demands placed on our national air traffic safety 
programs will be far greater as time moves forward, and we must 
prepare for the future.
    While the most critical purpose of NextGen is to improve 
public safety, there are also significant cost savings and 
efficiencies to be derived from the proper implementation of 
the program that will benefit airlines, airports and air 
travelers. The FAA estimates that NextGen air traffic 
management improvements will reduce delays in flight and on the 
tarmac by approximately 35 percent by 2018, as compared to 
doing nothing. That 35 percent improvement in efficiency will 
equate to $23 billion in savings to aircraft operators, air 
travelers and FAA over 8 years.
    These cost savings and public safety improvements are far 
too important for this Congress or this committee to ignore. 
And I look forward to hearing the witnesses' testimony 
regarding the different programs of the NextGen system: the 
Automatic Dependent Surveillance-Broadcast, or the ADS-B; En 
Route Automation Modernization, or the ERAM; the data 
communications, or DataComm; or System Wide Information 
Management, or SWIM; the NAS Voice Switch; NextGen Network 
Enabled Weather, the NNEW; Collaborative Air Traffic Management 
Technologies, the CATMT, and other expert opinions on what must 
be done to modernize our air traffic transportation system.
    And I thank you for sharing my passion for safe and 
efficient national airspace and the recognition that the 
Federal Government must play a partnering role in this effort. 
I think the future is too important for us to play partisan 
politics here and for us to talk about how much we have to save 
and not spend. There are some things that we must spend on to 
keep us on the world stage and in safety. I think this is one 
of them.
    Thank you, Mr. Chairman. I yield back.
    Mr. Petri. Thank you.
    Representative Cravaack.
    Mr. Cravaack. Thank you, Mr. Chairman and Ranking Member 
Costello, for holding these important meetings.
    And I am sorry that the ranking member is not here right 
now.
    Unfortunately, I haven't been able to know--there he is. I 
have just been able to get to know Representative Costello 
somewhat well. But it being a freshman Congressman opposed to a 
more senior Congressman, we haven't been able to run in the 
same circles. But what I can tell you is that in dealing with 
Representative Costello and now paying him the highest of 
compliments is that he is a statesman, with that being the 
highest compliment I think I could give to another fellow 
Representative. So I am sorry for your departure, but--and your 
wisdom for this great panel. So thank you very much, sir.
    NextGen modernization is critically important in our 
national airspace system and can meet the transportation 
capacity for the 21st century. Moreover, implementing NextGen 
technology will lead to improved aviation and a driver for 
future airline productivity.
    While I do not support the President's bill entirely, I was 
glad to see the importance the President placed on NextGen 
funding. I encourage President Obama and his administration to 
think seriously about working together in both Houses of 
Congress to enact NextGen-related legislation. I think this is 
a commonsense issue that transcends the usual partisan 
divisions, and the positive effects of implementing NextGen 
technologies will benefit all Americans.
    I would like to welcome the witnesses to our panel today 
and thank you for advance for your testimony. I look forward to 
hearing from you about ways to ensure the timely implementation 
of NextGen, as well as eliminating the administrative barriers 
preventing NextGen's progress. Quite frankly, I am ready to 
kick the tires and light the fires on implementing NextGen.
    As in the first Aviation Subcommittee hearing this year, I 
will be specifically interested in hearing how the FAA's 
contract management is impacting NextGen modernization. Again, 
thank you for being here today, and I look forward to your 
testimony.
    And I yield back.
    Mr. Petri. Thank you. Thank you all.
    And Representative Norton.
    Ms. Norton. Thank you very much, Mr. Chairman.
    I have to begin by saying what a stunning disappointment it 
was for me to learn that we would be losing Jerry Costello, for 
many, many reasons. First for professional reasons, his 
unusually deep knowledge of this area will be hard to 
replicate. He knows it backwards and forwards, shares it with 
all of us, is hardly replaceable as we move by seniority in 
this body.
    His wonderful friendship and collegiality will be missed by 
all of us. He is a model for how to serve the People of the 
United States and this Congress.
    Mr. Chairman, this is an important hearing to have before 
the end of the fiscal year. One is left to wonder where we 
would be with NextGen if there had not been 22--or is it 23; I 
have almost stopped counting--extensions of the FAA bill. It is 
impossible to believe that the failure to pass this bill has 
had no effect on NextGen. We are not only talking about 
billions of dollars for those of us who want to see more money 
in the economy and more savings in our budget; we are talking 
about something even more important, And that is the safety of 
our system. If we do not meet these deadlines, given the 
increasing pressure on air traffic, I don't think any of us 
with a straight face could say that the skies are safe.
    I have no idea what cuts have had on this very critical 
effort. But I believe we must find out where we are, how far 
behind we are and whether there are enough funds for us to 
continue to move ahead on this very critical long-term effort.
    And I thank you very much, again, for this hearing, Mr. 
Chairman.
    Mr. Petri. Thank you.
    And we turn now to our first panel. And it consists of the 
Honorable Michael Huerta, Deputy Administrator of the FAA; 
Captain Lee Moak, president of the Air Line Pilots Association, 
International; Ed Bolen, president and CEO of the National 
Business Aviation Association; and Mr. Tom Captain, who is the 
vice chairman and principal, Aerospace and Defense Sector 
Leader at Deloitte, a leading accounting and consulting firm 
globally, I believe.
    We will begin with the administrator, Mr. Huerta.

     TESTIMONY OF THE HONORABLE MICHAEL P. HUERTA, DEPUTY 
  ADMINISTRATOR, FEDERAL AVIATION ADMINISTRATION; CAPTAIN LEE 
 MOAK, PRESIDENT, AIR LINE PILOTS ASSOCIATION, INTERNATIONAL; 
EDWARD M. BOLEN, PRESIDENT AND CEO, NATIONAL BUSINESS AVIATION 
    ASSOCIATION; AND TOM CAPTAIN, VICE CHAIRMAN, PRINCIPAL, 
       AEROSPACE AND DEFENSE SECTOR LEADER, DELOITTE LLP

    Mr. Huerta. Good morning, Chairman Petri, Congressman 
Costello, members of the subcommittee. Thank you for this 
opportunity to discuss the benefits of NextGen, and I am very 
pleased to appear before you for the first time.
    NextGen is a comprehensive overhaul of our aviation system 
to make air travel more efficient and dependable while keeping 
you safe in the skies. It is a continuous rollout of new 
procedures and technology that will save fuel, reduce noise and 
cut pollution.
    NextGen is a better way of doing business, for the FAA, for 
the airlines, for airports and for the traveling public. Civil 
aviation contributes $1.3 trillion to our economy and generates 
more than 10 million jobs. NextGen is vital to protecting these 
contributions. The current systems simply cannot accommodate 
anticipated growth.
    President Obama recognizes the economic importance of 
NextGen; the American Jobs Act includes $1 billion to continue 
our research and development to advance this transformation. 
The act also proposes $2 billion for airport improvements for 
runways, taxiways, and terminals.
    The United States has invested nearly $3 billion in 
NextGen. Why? Because our latest estimates show that NextGen 
will reduce delays by about 35 percent in the next 7 years. It 
will bring $23 billion in cumulative benefits. We will save 
about 1.4 billion gallons of jet fuel and cut carbon dioxide 
emissions by 14 million tons.
    Let me highlight some examples where NextGen is already 
improving safety, helping the environment, and adding to the 
bottom line. Helicopters equipped with GPS-based technology in 
the Gulf of Mexico now have improved safety where there was no 
radar coverage before. They are saving flight time and fuel.
    In Colorado, NextGen enables controllers to track aircraft 
through mountains that block radar, thereby enhancing safety.
    Airlines are benefitting from NextGen routes and approaches 
that allow for more direct flights. Southwest Airlines says it 
could save $25 for every mile cut by using a shorter route. By 
using precise NextGen procedures in Juneau, Alaska Airlines 
estimates it avoided cancelling more than 700 flights last year 
due to bad weather. And UPS estimates it will save as much as 
30 percent on fuel during the arrival phase of flights into its 
Louisville hub.
    Environmental benefits are clear: Burning less fuel 
produces less carbon dioxide and other harmful emissions. 
Through the Greener Skies Over Seattle Initiative, airlines 
using NextGen procedures will save several millions of dollars 
per year. Aircraft will emit about 22,000 metric tons less 
carbon dioxide per year, the equivalent of taking more than 
4,000 cars off the streets.
    A true transformation takes planning, and it takes time. So 
let me now describe some of the longer range benefits. NextGen 
will make our aviation system safer. It will increase 
controllers' and pilots' abilities to avoid potential danger. 
Equipped aircraft will receive information about traffic, 
weather, and flight restricted areas. On the ground, advances 
in tracking will make runways safer. We are working in a 
focused way to relieve congestion and tarmac delays in major 
metropolitan areas, including right here in Washington, 
Houston, Atlanta, Charlotte, North Texas and California.
    To fully achieve these benefits, we must do two things: 
First, we need to make sure that the FAA is able to properly 
manage the NextGen transformation. And second, we need to 
continue working with our partners in the aviation community.
    We appreciate congressional approval for the reprogramming 
request we submitted this summer. A streamlined NextGen office 
that reports to me in addition to other organizational changes 
that improve efficiency will help the FAA meet the needs of our 
Nation's air transportation system.
    NextGen will only be successful if we work closely with the 
aviation community. We established a broadbased panel, the 
NextGen Advisory Committee, to provide guidance and 
recommendations. We need their help to forge industry consensus 
on how to equip for NextGen and how to measure our success.
    There is a chicken-and-egg nature to the decisions that 
will influence the extent and timing of NextGen benefits. The 
future depends upon stakeholders' willingness to invest in 
equipment, staffing, and training. NextGen is happening now.
    If we delay investment, the long-term costs to our Nation, 
to our passengers and to our environment will far exceed the 
cost of going forward together at this time.
    Mr. Chairman, that concludes my prepared remarks. I would 
be happy to answer any questions that you and the members of 
the subcommittee may have.
    Mr. Petri. Thank you.
    Captain Moak.
    Mr. Moak. Good morning, Mr. Chairman, Ranking Member 
Costello, and members of the subcommittee. I am Captain Lee 
Moak. I am the president of the Air Line Pilots Association, 
representing over 53,000 pilots who fly for 39 airlines and all 
cargo carriers in the United States and Canada.
    On behalf of our members, I want to thank you for the 
opportunity to provide our perspectives on NextGen.
    A few weeks ago, I was the captain of an aircraft operating 
in the Reagan National Airport, an approach that all of you are 
familiar with, and you probably experienced the rapid altitude 
decline over the Potomac in the last few minutes of a flight 
when you are arriving here from the South and the DCA, a 
necessary drop because air traffic controllers keep airplanes 
high, the air traffic high in the Reagan until the last few 
minutes to avoid Andrews to the east and Dulles to the north 
and west. Now, we are kept high to avoid the other traffic 
because, as a Nation, we are operating our air traffic control 
system largely with the same outdated and imprecise equipment 
and, I stress, procedures that were used during the 1950s.
    NextGen will bring precision approach capability to 
locations and runways where precision approaches do not 
currently exist, like at Reagan and some of the runways at 
Chicago Midway, Boston Logan and Minneapolis. NextGen 
technology gives pilots and controllers precise aircraft 
location and altitude information relative to the landing 
runway, improving safety and capacity, especially when 
operating in adverse weather conditions.
    There is no question, NextGen brings with it enhanced 
safety and also increases airspace capacity and efficiency.
    Now, what is it going to cost? The cost for NextGen, as 
estimated by GAO, has been somewhere around $40 billion 
initially and as high as $160 billion in some scenarios. 
However, there is little debate over the urgent need to 
modernize the system, but industry agrees; with a price tag 
this high, we must get NextGen right the first time.
    With a project of this magnitude and complexity, as well as 
a well coordinated fully integrated plan known to and agreed 
upon by all stakeholders, along with supporting equipment 
standards is critical. Today we do not have a way forward on 
NextGen. There is no coordinated plan.
    Now, some of you know I am new to DC here, and I can give 
you a couple of great examples of that in just a moment. But I 
will give you an example of the point that aircraft 
manufacturers are delivering aircraft that possess capabilities 
that cannot be utilized either because of the current 
infrastructure, the infrastructure not being prepared to use 
the technology, or the operational procedures necessary have 
not been approved.
    In addition, Government has required the installation of 
NextGen equipment, including ADS-B, that does not meet the end 
state standard necessary to achieve the desired long-term 
goals. The Government must step forward with greater financial 
commitment and show real aviation leadership.
    ALPA was pleased to see the President's inclusion of $1 
billion for NextGen projects in the jobs package, and it is our 
hope that it becomes law, and the $1 billion NextGen investment 
will serve as the tipping point for investment in industry and 
Government to move forward on the critical initiatives that we 
are engaged in.
    But again, on the total cost of NextGen, what will $1 
billion get you? Being new, it is like putting a quarter into a 
parking meter up here on Capitol Hill and expect to get 2 hours 
in that meter. It is not going to happen. A quarter only has 
gotten me 7.5 minutes, and if you don't plan it out quite 
right, you are going to get a ticket or, worse yet, you are 
going to get towed. And that is a penalty for a lack of 
investment and an industry and consumers are being penalized 
for not having an investment in NextGen with higher costs that 
sacrifice safety.
    You know, when we move forward on NextGen and we try to 
motivate the industry to invest, it is only going to happen if 
we see a path forward and return to--and a return on the 
investment, and the Government needs to show that financial 
leadership and make decisions moving forward on NextGen. In 
Chicago, in 1945--1944, the International Civil Aviation 
Conference was held in Chicago at that time, and they decided 
that the U.S. was the leadership in the world, and they made a 
fundamental decision to make English the language of aviation. 
And right now, we need to move forward with NextGen so that we 
don't lose that leadership role.
    Now, I know I have gone over my 5 minutes, and I will leave 
my other comments for the Q&A period. But NextGen is important 
for our members. Our pilots are trained. There is equipment out 
there. We need to figure out a way to work together to get this 
timeline sped up.
    Thank you, sir.
    Mr. Petri. Thank you.
    Mr. Bolen.
    Mr. Bolen. Thank you, Chairman Petri.
    Thank you for convening this important hearing and thank 
you for opening today's hearing by recognizing Mr. Costello. On 
behalf of the business aviation community and all of the 
general aviation community, we certainly appreciate the effort 
that the Congressman has made to understand our industry and to 
recognize the benefits and importance of general aviation to 
our country and to be a leading advocate on the value of 
allowing us to use per-gallon charges to fund the system, 
rather than devastating per-flight fees. So I want to thank Mr. 
Costello for all that he has done during his service in the 
Congress.
    This is an important hearing and an exciting one because I 
think NextGen, as you will hear from all of us, is something 
that we fully embrace. What we are trying to do is transition 
from a ground-based, radar-based system to a satellite-based, 
airplane-centric system of air traffic control.
    The benefits are clear. We do believe we can reduce our 
environmental footprint. We do believe we can enhance safety. 
We are convinced we can reduce delays and increase capacity. 
And for the business aviation community, it is the ability to 
increase system capacity that is really exciting to us. What we 
have seen over a period of years, is that as airports become 
congested, general aviation gets pushed out. We are forced to 
go to secondary airports. Some of you will recall back when 
Chicago Midway was a great general aviation airport. 
Manchester, Fort Lauderdale, San Jose, the list goes on and on. 
But as those airports saw growth in scheduled commercial 
operations, we began to get pushed from secondary airports to 
tertiary airports. We need to expand the capacity of the system 
to allow more safe, efficient operations out of all of our 
Nation's airports and all of our airspace.
    So business aviation and the entire general aviation 
community has been very supportive of our move to NextGen. I 
think over the course of the past several years, we have seen 
reason to be excited about some of the things that are going 
on. We see that Joint Planning and Development Office has put 
forward a vision. We have seen the community come together in 
Task Force 5 to work on implementation, and currently, we are 
working very closely with the FAA and the NextGen Advisory 
Council to develop ways that we can move forward in a coherent, 
coordinated way and make some of the benefits a reality today.
    I think the important thing about NextGen is that we all 
understand NextGen is not just about technology. There are 
important technology programs. But NextGen is also about 
procedures and policies and a culture. And I think we can do 
more. Part of the Task Force 5 recommendations and the early 
NAC comments suggest that we have a lot of onboard technology 
today that we are not using to the fullest extent possible. We 
can do more with regard to satellite-based approaches and WAAS-
based approaches throughout the United States that can yield 
some immediate benefits.
    When people want to know how we move forward with NextGen 
faster, we see room for improvement in these areas. That means 
getting more approaches done and not just overlaying just the 
approaches that we have in place today. Let's create new 
approaches that provide real benefits. That does bring some 
environmental challenges, but we think where there is a 
commitment to working together, we can overcome those. So 
getting more of those approaches out there, making sure that 
they deliver benefits and streamlining the approval process so 
that business aviation can participate in that is a fundamental 
way that we can all work together to move forward.
    Business aviation and the entire general aviation community 
is committed to NextGen. We have never wavered in that 
commitment. We participate in all of the advisory groups so 
that we can have input into building a system that doesn't just 
improve transportation for business aviation but for the entire 
aviation community as well.
    We appreciate the leadership that we have seen from this 
committee and the commitment to work together with the aviation 
community.
    We are frustrated by recent proposals that distract us and 
force us to spend time and effort on Capitol Hill working on 
these funding proposals rather than on the important 
communication and coordination that is necessary to make 
NextGen a reality. We are grateful that this committee has 
understood the need to move forward and kept our feet to the 
fire. Thank you.
    Mr. Petri. Thank you. Mr. Captain.
    Mr. Captain. Chairman Petri, Ranking Member Costello, and 
members of the subcommittee, thank you for the invitation today 
to testify, to provide input on the benefits of NextGen.
    Deloitte published an extensive study this past May on the 
business case, based on best commercial practices, for the 
global implementation of air transportation system 
transformation efforts, with particular attention to the U.S. 
NextGen program. My name is Tom Captain. I am the lead author 
of the study.
    That study was funded and performed independently by 
Deloitte and was intended to provide input to the ongoing 
industry dialogue regarding the quantification of benefits and 
costs, funding, scope, timing and potential merits of these 
transformation and modernization initiatives. It also 
identified the risks and the challenges associated with this 
very complex undertaking, as has been mentioned before.
    In our business case, we found that conversion to 
satellite-based positioning, navigation and timing systems 
enables better pilot situational awareness, point-to-point and 
closely spaced aircraft operations, continuous descent 
procedures, and all-weather air traffic operations, resulting 
in significant reduction in weather and congestion related 
delays as well as reduced flight times.
    We found that the successful implementation of NextGen by 
2025, using reasonably conservative assumptions about future 
demand for travel, price increases in oil and other factors, 
results in an estimated net present value of $281.3 billion and 
an internal rate of return of 44.8 percent. By 2026, the first 
year of full implementation, the study found $29 billion of 
first year net benefits, which only would increase each year 
there after, as the price of oil and air travel demand 
increases. This is made up of 830 million gallons of jet fuel 
savings per year again; 900,000 hours of time saved; and 6.8 
million metric tons of carbon emissions avoided.
    It should be noted that these did not include several 
upside benefits potentially that could make this business case 
more positive, including potentially inclusion of NextGen for 
general aviation and for military aircraft operations, nor did 
the scope contemplate potential consolidation, again, 
potential, of the national airspace operation, more efficient 
air traffic control procedures or reduction of legacy ground 
radar systems, for example.
    To provide additional insight about the business case, we 
examined three NextGen schedule scenarios, number one 
implementing as planned in 2025, acceleration to 2020, and then 
delay by 5 years to 2030. We found that acceleration resulted 
in an additional $19.8 billion of net present value and 
increased that high internal rate of return by another 21.7 
percent. Alternatively, delayed implementation still has a 
positive business case of that $281 billion, but it would 
result in a net present value reduction of about $47.6 billion 
and reduces that internal rate of return by 13\1/2\ percent. 
Additionally, the business case found that the net benefits 
would accrue to constituents as follows: 35 percent to 
airlines, 59 percent to passengers, 5 percent to Government and 
airports, and 19 percent to the general economy. These savings 
are not only in fuel costs, people's time, and emissions, but 
in less airplane maintenance and labor costs, insurance, 
reduction in noise, increased airspace capacity, and overall 
economic benefit from a much more efficient air traffic system.
    As outlined in our study, to achieve these benefits, there 
are a number of challenges and risks that must be addressed to 
successfully meet these implementation timetables. These 
include, but are not limited to, funding, technology and 
program risk, workforce transformation, regulatory reform, 
legal, air traffic control procedures, technical and 
certification standards and harmonization, and so forth. In 
addition, the program continues to be impacted by program 
management challenges of cost overruns and schedule delays due 
to technical complexity, requirements creep and uncertainty, as 
well as system verification and integration challenges. Due to 
the integrated nature of these elements, success will be highly 
dependent on the ability to manage requirements, cost and 
schedule in a coordinated manner as a program. A key lag in one 
of these elements could impact the ability of the entire 
program to be on schedule, as has been mentioned before, and a 
focus on interdependencies would necessarily be required.
    Our study highlights considerations targeted at addressing 
a number of these concerns, which include assessments of 
potential funding to address NextGen equipage to close the gap, 
to close the business case for airlines, as well as program 
management to include oversight and governance programs to 
better ensure overall programmatic performance and 
accountability, as has been mentioned by the Administrator 
early year this week.
    In summary, the business case demonstrates that the return 
on investment is significant for all scenarios considered. It 
looks like it is an open-and-shut business case. As we have 
said earlier, it is all about execution.
    Mr. Chairman, that concludes my statement. I would be happy 
to answer your questions.
    Mr. Petri. Thank you.
    I was going to ask you, just to build on your concluding 
statement, if you do a--your firm does a lot of consulting for 
the multinationals of this world, and assume for a minute that 
we are not talking about a Government, but we are talking 
about, say, Exxon Mobil, which does billion-dollar projects all 
the time all over the world. And if they could borrow at the 
Government's costs--we are borrowing at 2 to 3 percent now--and 
get a 65 percent return on their investment if they moved 
things up a little bit faster--I think you indicated 44 percent 
on the current timetable, and if we cut 5 years off it, we 
would get 21 percent more--would you say that that is the kind 
of thing that we would be yelling that they are robbing someone 
because they are making such a huge profit, or is this a no-
brainer, or what--could you bring it to life a little bit for 
us what we are talking about?
    Mr. Captain. Yes, Mr. Chairman. I think if you look at most 
investment cases for property, plant, and equipment, most 
companies would say that a return on investment of 44 percent 
would be outstanding, and that is why we say this is an open-
and-shut business case. It is not about the investment return, 
it is about how you do it and manage the risk.
    Mr. Petri. Thank you.
    And, Mr. Huerta, you are kind of in charge of managing the 
risks or helping to get this thing done. It is a big 
assignment, and it is in a way out of the ordinary for the FAA 
in that normally the FAA is a line agency that is trying to put 
out fires every day and managing the--has responsibility for 
managing the safe and efficient flow of air traffic, among 
other things, in the United States. This is a different type of 
an operation. It is managing a transformative process to 
reconfigure the way it is doing business. Could you discuss 
that a little bit, and the magnitude of the problem, and how we 
can help you to do as effective and efficient a job as 
possible?
    Mr. Huerta. Thank you, Mr. Chairman, and I think you 
provided an excellent summary of the challenge that the FAA 
faces. The FAA is, first and foremost, an operating agency with 
a safety focus, and we never want to do anything that is going 
to get in the way of our ability to maintain a safe system that 
operates as efficiently as possible. And you are correct in 
pointing out that our transformation to NextGen represents a 
very significant difference in the way that we do business.
    One of the things that Administrator Babbitt identified 
early on when he came to the FAA was the importance of 
separating the program management functions associated with 
NextGen from the day-to-day operational functions of the FAA, 
and that was with a very deliberate intent, to ensure that we 
had the appropriate level of focus and oversight on delivering 
NextGen programs as effectively as possible, and at the same 
time not allowing people that are delivering those programs to 
be distracted by the day-to-day operation that is always there.
    We appreciate the support that has been shown by the 
Congress in reorganizing the functions of the FAA to create a 
new program management office and to elevate the profile of the 
NextGen organization, and we are very focused on putting the 
tools in place to ensure that we are able to deliver these 
programs so that we can maximize the benefit.
    We also recognize the need to accelerate, and make very 
visible to everyone, the benefits from delivering NextGen. You 
have heard from the other witnesses the importance of advanced 
navigation procedures, and you have also heard that, in fact, 
most aircraft are equipped to take advantage of those 
procedures today. That has become an area of very significant 
focus for us, and in the year ahead what we really want to do 
is focus on how can we improve the quality of these procedures, 
how can we accelerate their deployment, and how can we see the 
very real benefits associated with reduced fuel consumption, 
reduced time, and corresponding environmental benefits as well. 
But it starts with how we manage and how we oversee the 
programs, and we put changes in place in the last few months 
that I think maximize our ability to do that.
    Mr. Petri. Thank you.
    Mr. Costello.
    Mr. Costello. Thank you, Mr. Chairman.
    Mr. Huerta, let me ask a question, but before I do, I think 
we all recognize that everyone in the room, both on this 
subcommittee and everyone here today, supports NextGen and 
wants to see it successfully implemented. We also, all of us, 
as Members of Congress, and you as taxpayers, want to see us do 
the responsible thing in reining in spending, trying to balance 
the Federal budget, and that is a challenge, trying to make 
investments that, in fact, pay off in the end, while at the 
same time trying to figure out in the Federal budget what can 
be reduced, what can be cut.
    What I am trying to do here is to get a handle on how cuts 
will affect the implementation of NextGen. So my question is, 
your people at the FAA, surely they have done an analysis 
concerning the various proposals in Congress. There are 
proposals in Congress that would cut FAA anywhere from 5 to 10 
percent in the capital and operating budgets, including 
accounts for NextGen. So regardless of where we are and how 
much should be cut and how much shouldn't be cut, I think we 
have a responsibility and the agency has a responsibility to 
tell us how various proposals will affect the implementation of 
NextGen.
    I said in my opening statement that throwing money at this 
issue or any issue is not the only answer, that there are other 
things that have to be done in order to make sure that it is--
NextGen is implemented in an efficient, effective way, but 
obviously you have to have the funding to move forward.
    So my question to you is there are proposals in the 
Congress now to reduce your operating budget, which will, in 
fact, affect NextGen. Have you done an analysis from a 
budgetary standpoint as to what a 1-percent, what a 5-percent, 
what a 10-percent cut would do as far as the progress that the 
agency is making with the implementation of NextGen?
    Mr. Huerta. Thank you, Mr. Costello.
    President Obama has put forward in his budget for fiscal 
year 2012 the Administration's view on what we think are the 
resources that are necessary to keep the program on track and 
to ensure that the benefits that we would like to achieve are 
there.
    The question that you are also raising, which is in tight 
budgetary times, what can we do to maximize the investments 
that we make, and how do we ensure that we keep NextGen on 
track. I think, first and foremost, what the President has put 
forward is what we believe to be the appropriate balance of 
maintaining the operation and ensuring that we are able to 
deliver the goals of NextGen. If we are looking at less than 
that, first and foremost, what we need to be concerned about is 
maintaining a safe system, and that puts us in the position of 
needing to consider are there future investments that we would 
need to delay? If we delay the investment, we delay the 
realization of the benefit, and the challenge of that is that 
the aviation industry continues to grow, and a lot of what we 
are investing in is to enable us to manage that ever-increasing 
share of traffic.
    We have done an analysis, and we have been engaging in 
discussions with industry of how we should look at it, and I 
think the tension that we have in a reduced funding scenario 
is: do we cut everything across the board--what is called the 
famous peanut butter spread--or do we really focus on a couple 
of key programs and try to maximize their benefit? And we don't 
have an answer to that because we want to consult with industry 
in terms of where do they want to see the maximum benefit. You 
have heard from them that in the near term, the focus needs to 
be on advanced procedures.
    I would also like to point out that the investment we have 
made as of today, about half of that has been in the deployment 
of the ADS-B ground stations throughout the country, and we 
need to remain on track to deliver that by 2013 because that is 
a foundational program that enables us to build on the rest of 
the NextGen technologies.
    To keep the program to meet our timetables that industry 
has asked for, Task Force 5 has laid out a series of things 
they would like to see us accomplish between now and 2018. To 
be able to meet that, though, the President's budget really 
provides the template to get us there.
    Mr. Costello. One more question regarding funding. I asked 
Administrator Babbitt when he testified before the subcommittee 
a similar question, and I asked him what effect the proposed 
cuts at the time would have on the implementation of NextGen, 
and he said--I have a transcript of his testimony here, and he 
said that, So I don't think that we should be penny wise and 
pound foolish. Yes, we could save the penny, but in the end it 
is going to cost more money over time to delay a lot of what we 
are proposing.
    And what I am trying to do is get a handle on what that 
means. So I hear you say that, you know, we would take a couple 
of programs and prioritize, but, you know, I think for those of 
us who are making decisions on the budget and funding levels 
for the agency, it would be good for us to know that if you 
rollback to 2008 or 2009 funding levels, that that is going to 
delay the implementation by a year, 2 or 3 years, 4 years, 
whatever it may be, so that when we are making these decisions 
to vote on budget levels, we know exactly what the effect of 
that vote will be, that we know that we are delaying NextGen by 
a specific amount of time. And I don't think I have heard that 
from the agency yet, and I think it would be helpful for 
everyone to know that.
    Mr. Huerta. There is no question that civil aviation is a 
major economic contributor, and, yes, any delay would result in 
delays in benefits to that industry and would significantly 
impact the job potential of that industry.
    In terms of if we cut here, if we reduce by this, what does 
it translate to in years? I think it is dependent on a number 
of factors, paramount among them which is, how does it affect 
various funding categories within the FAA? But there is no 
question that reduced funding will result in delays, and delays 
will cost us more in the future in lost benefit as well as the 
cost of deploying the program.
    Mr. Costello. Thank you.
    Thank you, Mr. Chairman.
    Mr. Petri. Mr. Coble.
    Mr. Coble. Thank you, Mr. Chairman. Good to have the 
panelists with us today. Mr. Chairman, I have to go to another 
meeting, but I want to put a question to Mr. Huerta, if I may.
    Mr. Huerta, very elementary definition, tell us what ERAM 
is, and more specifically why is the program $500 million, I am 
told, over budget and 3 to 5 years delayed? Is there a plan to 
get it back on track? And let me put a two-part question to you 
to tie on to that.
    In your testimony you say that ERAM delays are attributable 
to not having enough stockholder inclusion. If you would, sir, 
elaborate in more detail, is that to say that there were no air 
traffic controllers involved in the development of ERAM? And if 
you will respond to that, I would appreciate it.
    Mr. Huerta. Thank you, Mr. Coble.
    ERAM represents the new platform for handling high-altitude 
traffic at air traffic control centers all across the country, 
and it is a foundational program to NextGen. The original 
contract was awarded to our primary contractor, Lockheed 
Martin, in July of 2003.
    The challenges that we encountered in the deployment of 
ERAM related to what you pointed out as stakeholder or 
shareholder involvement, and that is the air traffic 
controllers that actually have to use this program to safely 
separate aircraft every day. What we found a couple of years 
ago was as we started to roll the system out into our first 
test sites, that there were difficulties in the human 
interface, the controllers' ability to work with the program as 
compared with the program that they were migrating off of, an 
older system known as HOST. And so we elected at that time, a 
couple of years ago, to stop where we were and really focus on 
how could we address the controllers' concerns and to ensure 
that challenges and difficulties we were seeing in the software 
could be addressed such that the controllers would feel 
confident that they would be able to operate on this program.
    That has been very successful, and we now have the program 
up and running at two of our air traffic control centers, Salt 
Lake Center and Seattle Center. On October 19th, we will pass 
the 1-year mark when we will be operating on ERAM at Salt Lake 
Center, and later in the year we will pass the 1-year mark at 
Seattle. And we are very confident that we are going to roll 
out ERAM and operate traffic-operating capability at another 
six sites between now and the end of this calendar year.
    The delaying challenges have resulted in a rebaselining of 
the program, though, in terms of its schedule for rollout. I 
indicated that we expect to be at a total of seven sites by the 
end of this year, and the next 2 years it is our expectation 
that we will complete the rollout of ERAM at the remaining 
sites throughout the country.
    There are a lot of lessons learned associated with ERAM, 
and the one that you pointed out is really the key: the 
importance of the involvement of the operators of the system 
early on in the development. And that is something that we have 
really focused on as we have looked at standing up the program 
management operation within the FAA: How do we adopt those best 
practices and ensure that, as we develop further technology 
programs, that we have the right connection between the 
operators and the users of the system with those that are 
developing it?
    Mr. Coble. Thank you, sir.
    Mr. Chairman and Ranking Member, I am still having 
difficulty in embracing the delay and the monetary, the 
budgetary problem, but I will try to do better as I plow 
through it.
    Thank you all for being with us.
    Thank you, Mr. Chairman.
    Mr. Petri. Thank you.
    Ms. Hirono.
    Ms. Hirono. Thank you, Mr. Chairman.
    As I noted in my brief opening comments, and you mentioned 
the importance of involving the operators of the system early 
on, and so you said in your testimony that there will be a new 
committee to address the various issues that confront FAA as we 
seek to implement the NextGen. And so I wanted to know, this 
committee that you referred to, the coordinating committee, who 
is on it? Are the air traffic controllers sitting at the table 
with you? Because they are the ones who are going to have to 
really move to, you know, implement and be a part of this whole 
system.
    Mr. Huerta. The NextGen Advisory Committee was created by 
the Administrator about a year ago, and it is a broad-based 
committee of industry representatives, all the users of the 
system, and the question put before them is really how do we 
look at the business of NextGen, how do we advance the benefits 
and ensure that NextGen is responding to the needs of the 
aviation industry?
    The members include, yes, labor as well as air carriers. It 
involves all segments of the industry. In fact, two of my 
fellow witnesses on this panel are members of the NextGen 
Advisory Committee. The committee itself meets quarterly, and 
there are a series of working groups that deal with very 
specific taskings and questions that are provided to them by 
the FAA. Examples of recent taskings that we provided to the 
NextGen Advisory Committee are to do some work so that we could 
reach industry agreement on what are appropriate metrics for 
measuring benefits, and then how do we ensure that we are able 
to actually realize those benefits on a timely fashion. We have 
asked for input from them on questions such as ``how do we 
address equipage of the fleet?''
    The aviation industry has always been founded as a 
partnership between Government and industry, and in creating 
the NextGen Advisory Committee, it is really to further that 
partnership for this very important initiative to transform 
our----
    Ms. Hirono. Who are the two other people on the panel? 
Raise your hands.
    Thank you very much.
    To go on, one of the testifiers talked about how important 
it is to get the airlines on board, because they are going to 
need to put forth the funds to make sure that their planes have 
the proper equipment, and I believe, Mr. Huerta, you said that 
most--maybe I heard this wrong--that most of them are already 
equipped to be able to use the NextGen procedures. That seemed 
to be at variance with some of the other testimony that we need 
to figure out a way to incentivize and have the aviation, the 
airlines have the confidence that FAA is actually going to be 
able to move forward with NextGen. Would you like to comment?
    Mr. Huerta. Yeah, thank you.
    There are two distinct levels of equipage. Many aircraft 
are currently equipped to handle advanced navigation procedures 
known as area navigation or required navigation performance, 
RNAV and RNP, respectively. That is a type of approach to 
airports that enables you to operate with reduced fuel burn and 
operate shorter distances coming into airports, and so that is 
one level of equipage.
    Longer term, there will be other benefits associated with 
other equipage; for example, advanced data-communications 
technologies that will minimize opportunities that might exist 
in the system for error associated with radio transmissions. 
Instead, by providing secured data transmissions, you have a 
higher level of confidence that there wouldn't be errors in the 
system.
    What the industry is telling us is many of them are 
equipped for RNAV and RNP, and they would like to maximize the 
benefits of those things, and they want to ensure that the FAA 
is doing what it needs to do to enable them to maximize those 
benefits, and they are right. That is an important confidence-
building step that is needed in order for them to have the 
confidence to do investments in the future.
    Ms. Hirono. So for any of the other testifiers, do you 
think that things are moving along; for the equipment that the 
airlines already have, that you have the confidence that FAA 
will be able to allow the airlines to use, utilize those 
equipments currently?
    Mr. Bolen. Well, I think at this point it is closer to a 
``trust but verify'' type situation. As the Deputy 
Administrator stated, and I thought it was a very accurate 
portrayal of where we are today. A number of groups in the 
aviation community, not just the airlines, but also general 
aviation and even the military, have put GPS equipment on board 
their airplane at their own cost. We have also worked to be 
trained to use this, so investment in NextGen has already been 
made by the private sector.
    Our frustration at this point is that we don't feel we are 
freely, consistently, and ubiquitously operating with those 
types of approaches, thus I earlier spoke about the need to get 
more approaches, have them be beneficial approaches, and make 
sure that we are using them to the greatest extent possible. We 
are committed, we are investing in it today, and when we do get 
to that second level of equipage, whether it is ultimately 
purchased by the Government or by industry, there will be 
additional costs. Not just in buying the box, but installation 
costs, training costs, the keeping everybody current and 
proficient on the system. These will be significant for 
industry, but we shall bear those costs, just as we did with 
RVSM and GPS.
    Ms. Hirono. Thank you. My time is up, but I do--I will 
submit one question to you, Mr. Huerta, that has to do with 
FAA's plans for the NextGen upgrades in Hawaii, which has a 
vast area to cover, our Honolulu air traffic control system.
    Thank you, Mr. Chairman.
    Mr. Petri. Thank you.
    Mr. LoBiondo.
    Mr. LoBiondo. Thank you, Mr. Chairman.
    Mr. Huerta, I have expressed some concerns about the SE2020 
pipeline not flowing as quickly as it could be. I have got a 
couple parts of the question surrounding SE2020. I have heard 
and I would like you to comment on whether right now it is not 
new work that is being assigned, but existing work that is 
simply being brought under SE2020 from other contracts, and can 
you shed some light on when we can expect more dollars and 
tasks to be flowing through the pipeline? Any reasons for the 
slow start, and what you are doing to help address this?
    Mr. Huerta. Thank you, Mr. LoBiondo.
    Yes, as you know, SE2020 is a contract vehicle that enables 
the FAA to contract with the private sector on specific task 
orders associated with the deployment and delivery of NextGen. 
Over the past year, since the award of SE2020, we have 
processed about 144 task orders, and that totals close to $400 
million in investment that has been run through that task 
vehicle. That is about half of our fiscal year 2011 enacted 
capital budget, and as I talked about in my testimony, this 
partnership with the private sector is very important. I think 
that we would all like to maximize the level of private 
participation in the development of this because it is a force 
multiplier for us. It enables us to move things as quickly as 
we possibly can.
    I think that there is concern that is expressed on the part 
of some contractors that we need to be doing more, that there 
are important things that can be done. I think it is important 
to balance that, though, against the overall challenge that we 
have to ensure that all of the work is fully integrated as we 
are developing various parts of an extremely complex system, 
and what we are doing is ensuring that that level of 
integration is there so as to maximize the benefit and to 
ensure that we don't have disconnects as programs get developed 
by different contractors. Would we like to do more, and would 
we like to do it more quickly? Absolutely. But our overriding 
challenge is to ensure that we do it right.
    Mr. LoBiondo. OK. You mentioned that the FAA just 
accomplished the realignment, which is supposed to help NextGen 
along. Could you elaborate a little bit on how specifically 
these changes will help the FAA deliver NextGen?
    Mr. Huerta. Two major things that we did associated with 
our realignment relate to the NextGen program office itself, 
and then the second relates to a program management function, 
how we deliver complex technology programs.
    Taking first the NextGen program office. Previously, it was 
housed within the Air Traffic Organization, which reflects the 
fact that fundamentally what we are redeveloping is an air 
traffic system. But, concern had been expressed by members and 
industry, and, in fact, by this committee, that that 
organizational relationship did not fully reflect the 
transformational nature of NextGen. It is more than developing 
a computer system; it is also how procedures get certified, it 
is how we integrate procedures into airports. It involves the 
full scope of all aspects of the FAA, and there are interagency 
components. You and others have touched on the importance of 
relationships with the Department of Defense, with NASA, and a 
host of other external stakeholders.
    What we have done as part of our restructuring is to 
elevate the NextGen program office into a new Assistant 
Administrator for NextGen that reports directly to me, and I am 
pleased to be joined by my colleague, Vicki Cox, who is the 
Assistant Administrator for NextGen. She has broader agencywide 
responsibility that we think will be very effective in 
leveraging the full Resource of the FAA against this agencywide 
transformation. That is the first thing.
    The second thing is program management. Under our old 
structure, new programs such as ERAM were housed within the 
operating unit that they were ultimately going to support. So 
in the case of ERAM, it was housed in our En Route Organization 
within Air Traffic. The En Route Organization is fundamentally 
an operating organization, and it is very difficult to ensure 
consistency across all programs if they are managed by distinct 
operational units in the FAA. And the second thing is operating 
units are consumed with operations. Deployment of a new program 
is a long-term management program that must be kept on track, 
and we felt it was important to elevate the profile of the 
programs to give them dedicated oversight and ensure that they 
are appropriately linked to the operation to keep them on 
track. And so the two elements were elevating the NextGen 
program itself and then creating within the ATO a program 
management office to oversee large technology development 
programs.
    Mr. LoBiondo. Once again, thank you and your team for what 
you are doing.
    Mr. Chairman, thank you.
    Mr. Petri. Thank you. Mr. Boswell.
    Mr. Boswell. Thank you, Mr. Chairman.
    My time is running out, but I want to compliment all four 
of you. This has been a great panel. You have said the things 
we need to hear. Some of it we have heard before. Just keep 
saying it.
    I especially want to associate myself with Captain Moak and 
Mr. Bolen. Thanks for hanging in there. You have said it 
clearly, Captain Moak, you are going to be OK on Capitol Hill, 
you did a good job, so thanks for making yourself available to 
do what you are doing because we appreciate it very much.
    It is investment with a known return, Mr. Chairman. This is 
investment, and I think for our--call it fiduciary 
responsibility, whatever. If we know this is an investment with 
known return, and also it adds all of the capabilities to 
safety and so on, let us get on with it. Let us get on with it.
    I have to go, so I would like to yield the remainder of my 
time to my good friend and colleague--and I think we are on the 
same frequency--Mr. Graves.
    Mr. Graves. Thank you. I appreciate it, Leonard, I really 
do.
    I actually have a couple of different questions. I don't 
even know where to start. The first one is--and I am going to 
direct it to Mr. Huerta, and we touched just briefly on the 
budget, and you said that the President's bill provides us with 
the tools to get there. And I think we are all concerned about 
implementation of NextGen and getting there, but what I worry 
about is--and the administration has proposed a $100 user fee 
on commercial and general aviation operations in controlled 
airspace, and I worry about that hampering us considerably when 
it comes to implementation of NextGen, and for that matter even 
the general aviation industry altogether. But out of curiosity, 
are you all worried about that proposal?
    Mr. Huerta. Clearly, we are in a time of significant fiscal 
challenge in the country, and I think what the President has 
put forward is a proposal to try to attempt to address that 
challenge that we have. Establishment of the fee would address 
what are regarded as current inequities in the cost of 
operating the air traffic control system. And we recognize that 
the GA community currently pays a fuel tax, but these revenues 
are far less than the cost of the air traffic control services 
that are provided to that community of users. It is a 
relatively small cost in relation to the total operating cost 
of a flight, and I think that what we heard from the President 
is that everyone needs to do their part to address the fiscal 
challenges that we face as a country.
    Mr. Graves. Does the FAA support the $100 fee?
    Mr. Huerta. I support the President.
    Mr. Graves. Do you support the $100 fee?
    Mr. Huerta. Yes.
    Mr. Graves. Mr. Moak, do you want to----
    Mr. Moak. I would like to comment on the $100 fee is 
clearly a tax. The Air Line Pilots Association is against that 
tax. That is a job killer for our members, for the airlines. 
You put another tax on the airlines, you couple that with the 
tripling of the TSA tax, and you are going to have a capacity 
reduction in the system. It is a fact that airline tickets are 
market based. You put those taxes on there, we won't need to 
have NextGen hearings because you won't need to modernize the 
system because there won't be enough people flying. Enough is 
enough on these fees that are taxes in disguise. That is how we 
feel about it.
    Mr. Graves. Mr. Bolen?
    Mr. Bolen. Congressman, the $100-per-flight fee proposal is 
at best a distraction at a time when our industry cannot afford 
to be distracted, and at worst it is a very destructive force.
    A couple of comments. First of all, the idea of a per-
flight charge is not a new idea. It is an idea that this 
committee and several other committees on Capitol Hill have 
thoroughly studied, analyzed. It has been the subject of 
numerous hearings and a great deal of input, and after 4 years 
of considering this question at the deepest level, on both 
sides of this Hill, in four different committees, a decision 
was made to reject a per-flight fee. It is not in the House 
reauthorization bill, it is not in the Senate reauthorization 
bill. A per-flight fee is just a bad idea. Congress has 
rejected it in the past, and it needs to reject it again.
    Let me add a couple of other points. Deputy Administrator 
Huerta talked about cost allocation. As we know from previous 
hearings, the last time the FAA did a cost allocation study, it 
was a flawed study. It did not use sound economic principles. 
The last time the FAA did a cost allocation study that relied 
on proven and established economic principles, it found that 
general aviation imposes maybe 7 to 9 percent of the cost of 
operating the system. Our contribution is currently 8.6 percent 
to the system. We are paying our fair share. That does not mean 
we have not been willing to work with the committee to find 
ways to fund and support NextGen. In fact, we have. But we have 
been very clear. A per-flight fee is not just a tax, it is the 
most destructive tax possible, and not only would it create 
administrative burdens for the general aviation industry, but 
it would distract the FAA from its core focus.
    We want the FAA to be focused on promoting safety and 
making NextGen a reality. We don't want the FAA to become the 
Sky IRS, a collection bureaucracy that is focused on billing 
agents, collection agents, and auditors. It is time to move 
forward on NextGen. Serious proposals are on the table. This 
approach is destructive, and it should be rejected.
    Mr. Graves. Mr. Chairman, I would like to claim my time. I 
think I have got 4 minutes left.
    Real quick, and I apologize, Mr. Huerta, if I mispronounce 
your name, but you said that the $100 fee is going to be used 
to pay for inequities in the air traffic control system. I 
thought it was going to be used to pay for the Jobs Act. Which 
is the case?
    Mr. Huerta. Right now the current funding profile of the 
FAA is about half and half user fees associated with fuel taxes 
and other fees that go into the Aviation Trust Fund and General 
Funds. I think what the President is proposing is a larger 
share of the latter would be based on fees.
    Mr. Graves. All right. We will move on.
    When it comes to NextGen, and my question is--and I am 
going to have a hearing on this issue in my own committee, the 
Small Business Committee, coming up here pretty quick--but 
being as NextGen is a GPS-based system, and we have got the 
LightSquared issue that is out there--and I would like to 
direct the question to Mr. Moak and Mr. Bolen. Please 
elaborate. Give me your concerns, because I am concerned about 
it, the bleed-over, and particularly when we have got this 
elaborate system going into place, and all of a sudden, you 
know, we have got equipment that maybe may not even work under 
the new system.
    Mr. Moak. So the bottom line on equipage in an aircraft as 
we go into NextGen and the money that has been spent since 
early 2000, it depends on GPS. So if GPS has any erosion in 
capability, all this will be for naught. We are against that 
LightSquared issue. We spoke publicly on it, we have been up on 
the Hill on it. The bottom line is we need to protect GPS as a 
fundamental tenet of the future of the national airspace, and 
so I would be happy to attend your hearing on that, by the way.
    Mr. Graves. Mr. Bolen?
    Mr. Bolen. Well, the GPS satellite system was obviously 
created by the military, but provided to the civilian 
community, and the benefits to our country have been 
immeasurable. Whether it is agriculture, transportation, or 
commerce, it has just been tremendous. And for aviation it has 
not just been the technology that has helped make us safer and 
made so much of today's avionics advancements possible, but as 
Captain Moak just said, it is the cornerstone of where we want 
to go, and it is incomprehensible that we are at a point where 
we are talking about interference with the GPS signal. The 
military is against it, the Department of Transportation is 
against it, the aviation community is against it.
    This is about safe navigation. It is about the 
transportation system that is so fundamental to our economy, to 
our jobs, to our way of life. I am not sure how we got here, 
but we need to make sure that going forward the GPS signal is 
clear and reliable. We are all depending on it, and in the 
general aviation community we have invested heavily in its 
equipment.
    Mr. Graves. Mr. Chairman, I would like to go back, and I 
appreciate everybody being here today. I think this is a good 
hearing. But I do want to associate myself with the comments of 
Captain Moak and Mr. Bolen when it comes to the $100 fee and 
how I think it is going to affect the implementation of 
NextGen, and particularly what Captain Moak had to say, I don't 
know if there will be any GA left after a $100 fee is imposed, 
and then I would like to invite everybody to my hearing on 
LightSquared. But this user fee is something that concerns me 
in a big way, and I think it is going to hinder us, hinder us 
considerably.
    And with that I will yield back, and I appreciate very much 
Mr. Boswell yielding me his time.
    Mr. Petri. Thank you.
    Mr. Lipinski.
    Mr. Lipinski. Thank you, Mr. Chairman.
    Chairman Petri, Ranking Member Costello, I want to thank 
you for holding this hearing, and very briefly, Jerry, I want 
to echo my colleagues' comments about how much we will miss you 
here on the committee and in Congress, but most importantly I 
want to congratulate you on making--everything that you have 
done and making this decision. I always think about the fact 
that my predecessor, my father, who retired from here 7 years 
ago, people still say today that he looks younger now than he 
did 7 years ago when he was still here, so you have that to 
look forward to certainly.
    We all know that NextGen is vital for the future of 
aviation in our Nation, and I want to commend the chairman and 
ranking member's efforts to ensure that we see some real near-
term benefits from the program. For northeastern Illinois, 
realizing these near-term benefits is especially important 
because our airports lie at the heart of the regional, 
national, and international aviation system. Midway and O'Hare 
handle over 40 million passengers every year. That number is 
expected to jump by almost 20 percent within the next 5 years, 
15 percent for each 5 years after that. So given the large 
increase that is expected to happen in the near term, it is 
clear we need to emphasize the results today.
    I am happy that we are taking a look at that, while at the 
same time working to invest in more long-term efforts, like 
equipping aircraft with ADS-B out. In particular, I am proud to 
have worked with the chairman and ranking member to include 
language in the draft FAA reauthorization that aims to boost 
NextGen equipage like ADS-B out with the use of public-private 
partnerships.
    So I want to start my questioning with Mr. Huerta. Several 
Federal Aviation commissions recommended that the Federal 
Government consider a variety of financial and operational 
incentives to commercial and GA operators for NextGen equipage. 
Can you explain what types of incentives, if any, are currently 
under consideration by the FAA, and do you think that operators 
will be able to meet the 2020 mandates based on where we stand 
today?
    Mr. Huerta. Thank you, Mr. Lipinski.
    One of the things we have heard loud and clear in our 
discussions with industry about any level of incentive is that 
there needs to be a clear linkage between equipage and benefit, 
and that there need to be mechanisms that would ensure that 
benefits are delivered, and that the FAA actually signs up for 
doing its part so that people are able to take advantage 
associated with equipage.
    We asked the NextGen Advisory Committee to provide us a 
framework to look at future equipage incentives. I think Mr. 
Bolen led that activity, but I think that I can share with you 
on a summary level that they looked across the whole scope of 
the industry and suggested that if you are looking at 
incentives, while they would like to see some direct Federal 
support, they feel that there is a great deal of promise 
through credit programs that would enable them to take 
advantage of lower cost of borrowing, but those credit programs 
would need to be linked to specific performance targets that 
the FAA would need to hit.
    They also go on to say that they think we need to look 
across the whole scope of the industry, and that is not only 
air carrier, but also general aviation, because we operate in a 
mixed environment that everyone uses.
    Getting back to the point of linking together any sort of a 
credit program with commitments on the part of the FAA, I think 
that is entirely fair. I think it is appropriate that the FAA 
be required to step up for delivery of benefits because it is 
consistent with the philosophy I talked about before. Our whole 
aviation system is founded on partnership, and if we are 
depending on the private sector to make certain investments, 
they need to be assured that the benefits will be there.
    Mr. Lipinski. Captain Moak, briefly?
    Mr. Moak. If you don't mind, I want to just give you a 
little more on that view on the why. The why behind this 
problem that we are talking about here is that in the airlines 
they have invested in equipage that is on the airplane right 
now, they have trained the crews to use the equipment that they 
have, and they are not currently able to use it because of the 
process and procedures of the FAA. So that is why this 
incentive discussion continues and continues, because we have 
that equipment there, we are not able to use it, and they are 
not believing that they will be able to deliver when you don't 
have a work plan and a timeline-based project management 
delivered, with a deliverable at the end. And that is why they 
are going with the idea in the airline business that we have 
already invested in training the pilots, we have bought 
equipment that we can't use, and we don't know when the FAA 
will ever be up to speed so we can use it. So they are making 
the argument on a return on investment, and it is because of 
the past.
    So, again, pilots are ready, and we are trained on RNP, on 
RNAV, on CPDLC, which we can't currently use in the continental 
U.S. We have to use CPDLC over the North Atlantic when we leave 
the continental U.S. So that is what the argument is about.
    Mr. Lipinski. If the chairman will indulge me for 30 
seconds, I am going to submit for the record some questions on 
performance-based navigation as something that I think we need 
to expedite the implementation of that, and I am interested in 
what is going on, what the FAA is currently doing on that, but 
I will leave that for the question for the record. Thank you, 
Mr. Chairman.
    Mr. Petri. Thank you.
    Mr. Cravaack.
    Mr. Cravaack. Thank you, Mr. Chairman.
    Thank you to the distinguished panel for being here today. 
Lots of questions, little time.
    The first question of Mr. Huerta. Reading the most recent 
IG report, we keep on hearing the term ``investment,'' we have 
got to keep on investing in this, but how can we invest in 
something when the report of the IG says the FAA has not 
approved total cost, schedule or performance baselines for any 
of NextGen's transformational programs nor developed an 
integrated master schedule for managing and executing NextGen? 
How can we invest in something, sir, we don't even know what 
the parameters are?
    Mr. Huerta. I think a couple of things on that. First of 
all, what the FAA has adopted as a philosophy is: in order to 
minimize program risk is break the program into short and 
longer term investment decisions, and what we would like to see 
is that there is a pairing of costs and benefits with shorter 
term investments so that we minimize the risk, for example, of 
investing over many, many years and waiting for some big payoff 
at the end. We are trying to match costs and benefits over a 
consistent period of time.
    The IG had also suggested that there were certain aspects 
of the program, two in particular, where they identified that 
the FAA has not established baselines for even the first phase. 
We are expecting that in 2012, the next year, that we will be 
at a point where we will have the initial stage for one program 
in terms of baselining, and that we will have a contract award 
for the other, and so we are moving forward to identify program 
baselines.
    On your question related to integration, we have, over the 
last couple of years, developed two guiding frameworks that I 
think go a long way toward addressing that question. The first 
is the NextGen Implementation Plan, which we publish annually. 
We will be publishing again next spring, and in which we make 
every effort to match up specific investments with things that 
have come out of industry in terms of specific proposals that 
they would like to see the FAA adopt against specific 
timetables.
    Within that and on a more detailed level, we have developed 
the NextGen Segment Implementation Plan that then deals with 
the first segment of those and the highly detailed project 
decision to identify dependencies among the programs and to 
ensure that they are fully synchronized.
    I think that what we have tried--it has certainly been my 
mission since I joined the FAA a year and a half ago--to focus 
on much better integration, much better program management, and 
I think that we have made significant progress in that area.
    Mr. Cravaack. I appreciate that comment, sir, but in the 
end that doesn't really help us trying to put a price tag on 
this overall and when we are actually going to have it 
implemented. So I appreciate it, and hopefully it will be more 
clear in the future.
    Captain Moak, I read your testimony, and I found something 
interesting in your testimony, your written testimony, is that 
in regards to unmanned aircraft systems. I found that to be 
kind of intriguing, international airspace. In your written 
testimony you actually mentioned that there has been no 
extensive study to the potential hazards, and the ways to 
mitigate those hazards must be undertaken before we can really 
implement this program.
    What a lot of people aren't aware is that we have a lot of 
DOD missions that actually originate here in the United States, 
flying CONUS, continental airspace, and head on out to overseas 
missions. How much work do you know has been done thus far 
about the Federal Government in studying these potential 
hazards?
    Mr. Moak. We have been interacting and identifying to the 
FAA, they have been very cooperative on this matter, but 
currently there is no transparency and there is no clarity on 
linkage problems, certification of pilots. And I believe until 
we have those type of studies where we are working together, it 
would be tough to integrate them into the national airspace, 
especially in close proximity to passenger or cargo aircraft.
    Mr. Cravaack. That is something that definitely we have to 
look forward in the future, because as UAVs become more 
prevalent, we are going to definitely be having them in the 
same airspace as we have passengers and cargo.
    Mr. Bolen, real quickly, I have got 50 seconds, in regards 
to LightSquared, Representative Graves brought that up as well, 
what would be the cost to the GA community on having to 
implement any type of equipage that would have to try to make 
sure that they were able to maintain the proper signal?
    Mr. Bolen. Well, first of all, right now we don't know that 
a filter is possible. Tests have been run. I think what we are 
sensing from the manufacturers of GPS equipment is they are not 
comfortable that a filter can be effective.
    Certainly having gone to the effort of investing in GPS, 
having gone to the effort at making that the cornerstone going 
forward, to try to do a retrofit is going to be enormously 
costly, and it comes in a backdrop when our industry is 
struggling. Over the last 3 years we have seen employment at 
some of our companies drop by 50 percent. Aircraft operations 
are down, the inventory of used airplanes are up, the prices 
for some models have fallen 30, 40, 50 percent.
    So this is a tough time for us, and the idea that we are 
going to simply go buy new GPS equipment or a new filter for 
GPS equipment because somehow we have given away spectrum that 
was vital to the future of GPS is just incomprehensible. I urge 
this Congress to do all it can to preserve the integrity of 
GPS. We have all invested in it, and its benefits are enjoyed 
by all Americans.
    Mr. Cravaack. Thank you, sir. Indulgence for 30 seconds.
    Mr. Chairman, I agree that a user tax would be absolutely 
detrimental to our community. As a pilot I have been laid off 
before for 2 years because of the tenuous operations, what the 
dollar value is in the aviation community. I have gone through 
a bankruptcy with my company as well because of the troubling 
effects what has happened in our economy. I think adding this 
is just--as Captain Moak said, we are not going to need this 
because there won't be any need for it because our skies will 
be clear.
    So thank you very much, sir, and I yield back.
    Mr. Petri. Ms. Norton.
    Ms. Norton. Thank you, Mr. Chairman.
    Mr. Huerta, Captain Moak raised a kind of ``emperor has no 
clothes on'' issue, although I want to focus on safety, not 
funds. He in his own way, ever respectful way, mocked the 
billion dollars, I guess it is, in the President's budget, 
calling it like a quarter in a meter, and it will get you, you 
know, 7 minutes. I think that was fair. I don't know about you, 
but I think that was fair, and I understand that we are under 
tremendous pressure, so I am not asking this question out of 
criticism. I just think that it was an important point to raise 
because there is a big elephant in this room.
    The elephant is that we are sitting here as if this is 
going to happen. You can ask, are we on track? Let me tell you 
something, we are on track if we are going at the slowest 
possible pace, and we are on track if we are trying to meet 
some deadline, so on track tells us nothing. And whether or not 
we are on track matters to me for one critical reason, and that 
is the increase in air traffic.
    Captain Moak spoke about Reagan, which is right here, where 
for years they have to use special procedures just to get into 
the airport closest to the Nation's Capital. These safety 
concerns are, for me, paramount.
    Now, you are going to have a situation where, according to 
all the figures we have, by 2025 you will have a 53 percent 
increase in passengers riding planes. Well, I will tell you 
what, in this country what you are going to do is you are going 
to keep airplanes going, you know. The airlines are going to 
keep it happening, and nobody is going to say we are grounding 
airplanes because we haven't finished our GPS, and everybody is 
going to say it is safe to fly.
    So let me ask you questions that are very specific. On the 
surveillance broadcast aspect, that is supposed to be done by 
2015--2013; on the data communication segment of it should be 
done between 2015 and 2018; on the systemwide information that 
we are all depending upon, well, segment 2 has not been 
baselined, and I think segment 1 was baselined in 2009.
    I have got to ask you, Mr. Huerta, in terms of the safety 
of the skies, if GPS stays on--I am sorry--if-- yes, if GPS 
stays on the track it is going, are we prepared to limit air 
travel in the United States because we cannot guarantee its 
safety, or do you think we will be able to guarantee the safety 
going at this pace with a 3-percent--53-percent increase in air 
travel in just a few years, by 2025?
    Mr. Huerta. Thank you, Mrs. Norton.
    The FAA will never do anything that would compromise the 
safety of the system.
    Ms. Norton. Please don't give me your stock answer.
    Mr. Huerta. No, but to respect your question, you have 
asked are we on track for the delivery of the benefits.
    Ms. Norton. Or the systems that I have just named.
    Mr. Huerta. Let me talk first about ADS-B, surveillance 
broadcast, by 2013. The FAA is very confident that we will meet 
our deadline for delivery of the ground infrastructure for ADS-
B by 2013. And as I said, we have made significant progress in 
that deployment, and we have----
    Ms. Norton. OK, go on to Data--I have limited time.
    Mr. Huerta. DataComm, we are expecting to receive proposals 
from bidders in the next few days, and based on what we see 
from proposals, I will have a better sense of where we will 
look relative to 2015, 2018. But we have identified those 
deliveries as required under the procurement, and I am looking 
forward to seeing what we get there.
    System Wide Information Management, yes, you are correct 
that on the first segment of that, I think that that was 
baselined back in 2009. There are some benefits that we have 
seen associated with SWIM. That program is one that we continue 
to focus on in order to improve its overall delivery.
    Overall, managing these programs in a very complex and 
synchronized fashion is our highest priority, but I think, I am 
confident that we will be able to meet our timetables.
    Ms. Norton. One further question for you, Mr. Huerta, and 
for Captain Moak. Assuming experienced personnel and the kinds 
of regulations that helicopters use all over the country, do 
you think helicopters should be able to come back and forth 
into the Nation's Capital 10 years after 9/11?
    Mr. Moak. I will speak to that. I believe they can. I was 
out at Potomac TRACON on Monday in anticipating this hearing, 
and they have an excellent system set up out there that is 
probably better talked about privately. But I think they are 
running a great operation out there, the FAA does, with their 
DIN network, so I believe it is very safe.
    Ms. Norton. Mr. Bolen.
    Mr. Bolen. Congresswoman Norton, the idea of simply closing 
down airspace or closing down airports is really an inadequate 
and inappropriate response to our Nation's security needs, and 
you have been a terrific advocate. The reality is we need to 
find a way to facilitate mobility in the United States and do 
it in a secure manner, and that takes attention, it takes 
commitment, but it has to be done. The idea that we resolve 
aviation security issues by not allowing any aviation is self-
defeating. We have got to find a way----
    Ms. Norton. Of course, this is the only place where you say 
``not have any aviation.'' In New York, which was the main, the 
major part of our country hit on 9/11, helicopters were up 
within a few days. Helicopters are up all over the United 
States of America. It is a terrible comment on the aviation 
system in this country, even as it now stands, that even in the 
Capital of the United States, you cannot fly back and forth.
    Mr. Huerta, do you think that given the requisites I 
indicated, the tightest kind of regulations, experienced 
personnel, helicopters should be able to fly into the Nation's 
Capital the way they fly into cities with skyscrapers like 
Chicago and New York?
    Mr. Huerta. There are two dimensions to that. From an 
operational standpoint, yes, we can certainly find a way to 
accommodate helicopter traffic, but the security aspect of 
that, which is, of course, of great interest to other agencies 
and the executive branch, is also something that we need to 
coordinate as well, and I can't really speak on their behalf.
    Ms. Norton. Could I ask you to do this, Mr. Huerta? This 
was not done in this administration, it was done before, and, 
of course, there were some reasons why it was done before. 
Could I ask you when you return to take it upon yourself to sit 
down with the other agencies involved to see if some revision 
of this policy is not in order a decade after 9/11?
    Mr. Huerta. Certainly.
    Ms. Norton. Thank you very much.
    Mr. Petri. Thank you.
    I would like to thank the full panel for the statements 
that you submitted and for your testimony, your answering 
questions. The committee, as you have heard from Mr. Costello 
and myself and other Members, is very interested and supportive 
of trying to help any way we can to advance the date when we 
will recognize the benefits of the transformation of our air 
traffic space, and as Mr. Captain testified, based on his 
study, the returns are so enormous of this investment that even 
if the Government lags in doing it, we are seeing increasing 
signs of individuals in general aviation and other aspects of 
air travel in other countries moving forward more rapidly on 
this new technology. And so it behooves us to not linger 
unnecessarily because the world is going to go on, and we are 
going to be left behind if we don't get our Government sector 
up as efficiently as possible accommodating growth in the 
private sector with all the advantages that this new technology 
offers.
    So thank you again, and we will continue to work with you 
in monitoring this situation and hopefully do our part through 
a reauthorization of giving you more tools and greater focus 
going forward. Thank you.
    Mr. Petri. The second panel consists of the Honorable 
Calvin Scovel, who is the inspector general of the U.S. 
Department of Transportation; Gerald Dillingham, Director of 
Physical Infrastructure Issues of the GAO, Government 
Accountability Office, both of whom have been before this 
Congress and committee on many occasions; and Mr. Thomas L. 
Hendricks, who is senior vice president for safety, security, 
and operations of the Air Transport Association of America.
    We thank all of you for your patience and for being here 
today, and we will begin with Calvin Scovel.

TESTIMONY OF HON. CALVIN L. SCOVEL III, INSPECTOR GENERAL, U.S. 
  DEPARTMENT OF TRANSPORTATION; GERALD L. DILLINGHAM, PH.D., 
     DIRECTOR, PHYSICAL INFRASTRUCTURE ISSUES, GOVERNMENT 
  ACCOUNTABILITY OFFICE; AND THOMAS L. HENDRICKS, SENIOR VICE 
 PRESIDENT FOR SAFETY, SECURITY, AND OPERATIONS, AIR TRANSPORT 
                  ASSOCIATION OF AMERICA, INC.

    Mr. Scovel. Chairman Petri, Ranking Member Costello, 
members of the subcommittee, thank you for inviting me to 
testify on FAA's progress in implementing NextGen.
    NextGen is FAA's most complex effort to date and requires 
multibillion-dollar investments from both Government and 
airspace users to overhaul the national airspace system. Since 
the effort began, we have reported on cost and schedule risks 
as well as challenges FAA must resolve to successfully 
transition to NextGen. FAA has taken action to adjust its 
NextGen plans and budgets in response to our concerns as well 
as RTCA's September 2009 recommendations.
    Pressing challenges remain, however. Today I will highlight 
three challenges that significantly impact FAA's ability to 
manage NextGen's implementation and realize benefits.
    The first challenge concerns FAA's Metroplex Initiative, a 
7-year effort intended to reduce delays at congested airports 
in 21 major metropolitan areas. Initial studies at 5 of the 21 
metroplex locations have been completed, and 2 more are 
underway; however, FAA has not established key milestones or 
capitalized on more advanced procedures, as RTCA recommended, 
raising concerns among airspace users about the pace, 
execution, and viability of the effort.
    The Metroplex Initiative depends on the timely deployment 
of more efficient flight procedures. However, as we have 
previously reported, FAA's new procedures are mostly overlays 
of existing routes, which provide few benefits to users. While 
FAA completed a study that identified initiatives for 
streamlining the process for deploying new flight procedures, 
it may take as long as 5 years to implement them.
    The second challenge involves ERAM, a $2.1 billion system 
for processing flight data. Testing revealed significant 
software problems with ERAM's core capabilities for safely 
managing and separating aircraft. To compensate for ERAM's 
deficiencies, controllers at the key sites have had to rely on 
cumbersome workarounds. For sites with complex and congested 
airspace, such as Chicago and Los Angeles, risks will increase.
    ERAM's problems are the direct result of poor program and 
contract management. For example, FAA and its contractor were 
overly optimistic that ERAM could be fielded within 1 year and 
ignored early warning signs of trouble during initial site 
deployment. FAA did not begin to detect and mitigate 
significant risks until almost 3 years after software problems 
surfaced at Salt Lake Center, a key implementation site. 
Despite ERAM software deficiencies and cost and schedule 
overruns, FAA continues to pay incentives to the contractor.
    Given that FAA and its contractor continue to add new 
capabilities while attempting to resolve problems, challenges 
are likely to remain and will add to costs and delays. A MITRE 
study and our analysis estimate that total cost growth could be 
as much as $500 million, with potential delays stretching to 
2016, 6 years beyond FAA's planned date for implementing ERAM.
    Prolonged problems with ERAM will affect FAA's capital 
budget and could crowd out other critical programs. For 
example, delays in fielding ERAM have required FAA to maintain 
aging systems longer, reprogram funds from other projects, and 
retrain controllers and maintenance technicians, who must 
operate and maintain two different systems.
    Despite the significant program risks and unresolved issues 
associated with ERAM, FAA has not conducted a detailed 
assessment of ERAM's interdependencies or impact on other 
programs, costs, and schedules. To date, FAA plans to allocate 
nearly $600 million to integrate and align NextGen 
transformational systems with ERAM.
    The third challenge FAA must address concerns the costs, 
schedules, and benefits of its transformational systems. FAA 
plans to spend almost $2 billion over the next 5 years on three 
transformational systems, but it remains uncertain what the 
programs will deliver and how much they will cost. For example, 
FAA has already delayed plans to deploy key capabilities of 
DataComm, a wireless system for sharing data between 
controllers and pilots, from 2016 to 2018. Total program costs 
for DataComm are uncertain, but FAA estimates that they could 
be as much as $3 billion. Like DataComm, ADS-B, a satellite-
based surveillance technology, must integrate with multiple FAA 
automation systems, but FAA has not fully addressed 
requirements and system risks for ADS-B.
    Unstable requirements for SWIM, a system expected to 
provide a secure network for NextGen, have already added $100 
million to SWIM's first of three segments and delayed 
completion by at least 2 years. A lack of clear lines of 
accountability for overseeing SWIM's development and management 
largely underlies SWIM's problems.
    Finally, FAA has yet to develop an integrated master 
schedule to manage NextGen. FAA's approach of baselining 
smaller segments of larger programs, such as DataComm, ADS-B, 
and SWIM, may reduce some risks in the short term; however, as 
requirements continue to evolve, programs are left with no 
clear end state, and decisionmakers in the Congress and 
Department lack sufficient information to assess progress. 
Moreover, delays with one program can significantly slow 
another, since the programs have complex interdependencies with 
each other and with FAA's existing automation and communication 
systems.
    While FAA recognizes the need for an integrated master 
schedule to manage the implementation of these NextGen 
capabilities, it has not yet developed one. Without a master 
schedule, FAA cannot fully mitigate operational, technical, and 
programmatic risks and prioritize trade-offs among its NextGen 
programs. Much work remains for FAA to implement RTCA's 
recommendations and achieve promised near-term benefits.
    Regardless of the funding levels Congress provides for 
NextGen, FAA must focus on establishing NextGen budget 
priorities, detailed milestones, and performance goals and 
metrics; it must focus on resolving program management and 
contract problems with ERAM; and it must focus on developing an 
integrated master schedule for all NextGen programs. FAA needs 
to take these actions now to advance NextGen and protect 
taxpayers' interests.
    Mr. Chairman, this concludes my prepared statement. I would 
be happy to address any questions you or other members of the 
subcommittee may have.
    Mr. Petri. Thank you.
    Mr. Dillingham.
    Mr. Dillingham. Thank you, Mr. Chairman, Ranking Minority 
Member Costello, and members of the subcommittee.
    You have heard a lot about the benefits of NextGen from the 
previous panel, and we are all aware of those benefits. I would 
like to take my time this morning and identify with my 
colleague, the DOT IG, and focus on some of the challenges that 
FAA faces going forward.
    The first and arguably the most important challenge for FAA 
is to establish and maintain credibility with NextGen 
stakeholders. This is especially true for airlines, since 
several NextGen benefits depend on having a critical mass of 
properly equipped aircraft flying in the NAS. Program 
cancellations, cost overruns, and schedule breaches in prior 
ATC modernization programs have given stakeholders cause for 
concern about whether FAA can and will deliver desired NextGen 
capabilities on time and on budget.
    According to the airline representatives with whom we 
spoke, two developments would give them the type of 
reassurances that they are seeking. The first is the 
opportunity to make greater use of aircraft technology that is 
currently available in the fleet, such as you have heard 
earlier, RNAV and RNP. The second is on-time delivery of 
NextGen systems with defined benefits and an acceptable return 
on investment. We are optimistic that the recent reorganization 
at FAA, which is partly intended to provide greater and more 
focused accountability for NextGen implementation, will also 
raise the stakeholders' confidence.
    A second challenge for FAA is to deliver NextGen 
capabilities on time and on budget. Delays in implementing key 
programs can have significant implications, given the 
integrated nature of NextGen. For example, the scheduled delays 
associated with the ERAM program affect the delivery of several 
other systems, including ADS-B, SWIM, and DataComm, each of 
which requires the use of some ERAM functions. Additionally, 
program delays could have a negative impact on the plans for 
harmonization with Europe's ATC modernization effort as well as 
the U.S. avionics industry. Thus the implementation of NextGen, 
both in the midterm and the long term, will depend on how well 
FAA manages program implementation and program 
interdependencies.
    A third challenge for FAA is to integrate human factors 
research into NextGen system development and training for those 
who will be responsible for operating and operating within the 
system. FAA and its partners will have to identify and develop 
training for controllers and pilots to carry out their changing 
role and have this training in place before NextGen can be 
fully implemented. Meeting these training requirements may be 
particularly difficult during the transition period when some 
aircraft will be equipped with NextGen systems, and others will 
not.
    A fourth challenge for FAA is to expedite environmental 
reviews and develop strategies to address the environmental 
impacts of NextGen. With the changes in aircraft flight paths 
that will accompany NextGen efforts, some communities that were 
previously unaffected or minimally affected by aircraft noise 
and emissions could be exposed to increased levels of both. 
Obtaining the environmental clearances, including community 
buy-in, can sometimes take several years.
    The last challenge is to manage NextGen implementation and 
current operations with potentially constrained resources. 
Largely because of governmentwide budget constraints, and 
perhaps project implementation delays, FAA has reduced its 
capital budget by a total of $2.8 billion, or 20 percent, for 
fiscal year 2012 through 2015. This proposed reduction could 
affect NextGen and NextGen-related spending. We note that 
significant reduction in FAA's program funding or its 
operations budgets could contribute to delays in establishing 
NextGen capabilities, increase total cost for implementation, 
and postpone benefits. In the final analysis, FAA would have to 
balance its priorities to keep NextGen implementation on 
course, while also sustaining the current system's 
infrastructure, level of safety, and operational efficiency.
    Thank you, Mr. Chairman.
    Mr. Petri. Thank you.
    Mr. Hendricks.
    Mr. Hendricks. Thank you, Chairman Petri, and Ranking 
Member Costello and other members of the subcommittee. Good 
afternoon. My name is Tom Hendricks. I am the senior vice 
president of safety, security, and operations for the Air 
Transport Association. We are committed to evolving the 
national airspace system into the Next Generation Air 
Transportation System, or NextGen. To enable this evolution, we 
believe that Congress and the administration should be guided 
by a national airline policy that recognizes America's airlines 
as the global businesses they are and enables them to operate 
as such. An indispensable element of such a policy is NextGen. 
We appreciate the opportunity to express our views today about 
the progress of that modernization.
    Airlines understand the importance of NextGen. They are 
deeply engaged in it. Airlines also recognize that we cannot 
wait for what is over the horizon. Improvements are within our 
reach and are needed now. We believe that tangible, near-term 
benefits that improve customer satisfaction, with better on-
time performance and that save fuel and reduce emissions can be 
achieved. The FAA should therefore focus on ensuring that 
needed policies, procedures, and training are implemented to 
ensure that the benefits of existing navigation technologies 
are maximized without delay.
    Our priorities for this modernization are to accelerate the 
development and approval process of performance-based 
navigation procedures, the RNAV and RNP approaches that were 
previously referred to; streamline the National Environmental 
Policy Act review process to expedite the development and 
implementation of PBN and other NextGen procedures; and to 
develop metrics that gauge the performance of NextGen.
    We appreciate that each of these objectives was addressed 
in the FAA Reauthorization and Reform Act of 2011, H.R. 658, 
which this committee and the full House approved earlier this 
year. We also commend the House and Senate for resisting any 
increases in commercial aviation taxes in their respective FAA 
bills. Airlines and passengers are already subject to 17 
Federal taxes and fees which totaled nearly $17 billion last 
year in our industry. As a result, Federal taxes now constitute 
$61 of every $300 domestic round-trip ticket, putting 
commercial aviation at a higher Federal tax rate than so-called 
sin taxes on alcohol, tobacco, and firearms.
    We urge House and Senate transportation leaders to resolve 
their differences and send a final multiyear FAA bill to the 
President's desk as soon as possible. We also ask that Congress 
reject aviation taxes included in the White House's debt 
reduction plan, a new $100-per-flight departure tax, and a 
tripling of the passenger security tax from $2.50 to $7.50. 
These taxes would cost passengers and airlines an additional 
$3\1/2\ billion annually, a 21-percent increase in our annual 
Federal tax bill, the results of which would be devastating to 
our industry, our passengers, and the U.S. economy.
    U.S. airlines have lost $55 billion and cut 160,000 jobs 
since 2001. The new taxes would result in another 10,000 
airline job cuts next year and permanent reductions in service 
to less profitable small and medium-sized communities.
    In addition to holding the line on the tax burden of our 
passengers and airlines, enactment of a long-term FAA bill will 
help advance NextGen. NextGen offers the potential to further 
improve aviation safety and deliver substantial efficiency and 
environmental improvements.
    The national airspace system, despite being the most 
complex aviation system in the world, is extraordinarily safe. 
That remarkable safety record reflects the determined efforts 
of the FAA, airlines and its employees, as well as other 
stakeholders, and we appreciate the support and oversight 
provided by this committee, which has played a key role in 
helping shape that success. However, as the committee knows all 
too well, the national airspace system relies on safe but 
outdated technology.
    An FAA-commissioned study published last November estimated 
that the total cost of U.S. air transportation delays was over 
$31 billion in 2007. Without significant modernization of the 
system, congestion and delays will worsen as traffic increases, 
thereby undermining not only the viability and global 
competitiveness of U.S. aviation industry, but the economy as a 
whole.
    Concern about the future of airspace management, as these 
data show, is not a parochial consideration. Aviation is one of 
the principal drivers of the U.S. economy. Commercial aviation 
drives $1.3 trillion in annual economic activity, or 5 percent 
of U.S. gross domestic product, and 10 million good-paying 
jobs. In this context, the need to improve airspace management 
is immediate and pressing. We cannot wait for all the pieces of 
NextGen to come together. We must get the most out of the 
technology investments already made in our aircraft. This means 
that the FAA should focus resources on expediting the 
introduction of the most cost-beneficial elements of NextGen 
that are available, most notably PBN procedures. These will pay 
immediate dividends for all stakeholders, including passengers 
and shippers, by reducing delays, lowering fuel burn, and 
decreasing emissions.
    We commend the FAA for launching its so-called NAV Lean 
program to expedite the deployment of PBN procedures. 
Unfortunately implementation is scheduled to occur over 5 
years. We need a leaner NAV Lean program, and we need it now. 
Airline fuel costs have spiked by nearly one-third this year, 
which will cost the industry an additional $15 billion. U.S. 
airlines have already invested billions of dollars in new 
equipment, infrastructure, and technology to maximize fuel 
efficiency. We are doing our part, and we want to work with the 
FAA to ensure that procedures, policy, and training are updated 
so that we realize the benefits from this investment.
    I will be happy to take any questions from the 
subcommittee. Thank you.
    Mr. Petri. Thank you.
    Thank you all for your testimony.
    One thing that I think has been done more formally in the 
last year was the appointment of a fairly senior stakeholder, 
if you wish, or industry and other involved people, advisory 
group, to work with the FAA to try to help move NextGen forward 
more efficiently. Is that process working, Mr. Scovel, or is 
there--are there ways we could strengthen that? And I guess 
also I wonder if--it is a complex process, and it involves 
decisions by the private sector, but the Government sector is 
in the catbird seat, at least in the short run, because if they 
don't provide the infrastructure, the industry has stranded 
investment, and that is a great deterrent if they don't--if the 
Government doesn't meet its guidelines, or the FAA, with 
NextGen.
    So you talk about trying to set better benchmarks or ways 
not just for Congress, or other, or your agency, but for the 
private sector to calculate their own lead times and 
investments they need to make. How can we strengthen that 
process? Is that committee helping with that and doing it 
effectively?
    Mr. Scovel. Thank you, Mr. Petri.
    Let me preface my answer to your question by noting that 
despite the hard-hitting nature of our testimony this morning, 
my staff and I are firm believers in the concept of NextGen. We 
should not be mistaken as being naysayers before the committee 
today. We are certainly not.
    The benefits are indisputable, and, as Mr. Captain 
testified from the first panel, the business case is open and 
shut. It is all about execution, and that is where our office 
comes into play.
    Our statutory mission, of course, as you well know, is to 
keep the Congress fully and currently informed on the 
efficiency, economy, and effectiveness of the Department's 
programs, and that is what brings us to NextGen. We have been 
looking at it now for a number of years, and I would be remiss 
in my duties if I did not point out areas where the Department 
has been successful as well as those areas where its efforts at 
execution have been less than fully successful. So that is what 
our objective has been with this testimony and every other 
appearance of my office before the committee.
    Your specific question goes to our views of the 
effectiveness of what is now called the NextGen Advisory 
Committee. I would relate our assessment of that back to the 
RTCA Task Force 5, which met in 2009 and made 32 
recommendations across a number of cross-cutting areas, 
including one that FAA has chosen to focus on first as being 
most beneficial to users and, therefore, to the American flying 
public; that is, the Metroplex Initiative. FAA adopted, 
recognized, and approved those recommendations in January 2010 
and has been proceeding with Metroplex ever since. To its great 
credit, the agency recognized that it needed a vehicle 
primarily in order to continue to solicit input from the 
industry, but also to provide labor and other stakeholders with 
a voice in the development process. So it established the 
NextGen Advisory Committee.
    We have not examined the Advisory Committee in great 
detail, but our preliminary assessment is that it has been 
helpful to the agency in driving the process forward. The 
agency has referred specific questions to the NextGen Advisory 
Committee, hoping to get more detailed input so that the agency 
can formulate its approach.
    You asked, Mr. Chairman, specifically about metrics. That 
has been a matter of great dispute, frankly, between FAA and 
the industry. As a case study, we can use what has been 
discussed at length this morning: the development of required 
navigation procedures, RNAV and RNP procedures. FAA has worked 
on RNAV and RNP procedures, but only to the extent of trying to 
develop quantity over quality, in the views of the industry. It 
has developed RNP procedures to overlay existing routes; 
however, those aren't the routes that the industry assesses as 
most valuable to their needs. The industry has repeatedly asked 
FAA not to simply shoot for a quota, but to consider metrics 
such as were cited in a statement by a senior industry official 
last week where he spoke of the percent of an airline's total 
operations that could be governed by RNP, the number of 
approaches, and the clearance rate by air traffic controllers. 
And that brings into play the need for FAA to train its air 
traffic controllers in handling aircraft that have RNP and 
aircraft that don't have RNP, in the mixed equipage 
environment, so that they can safely maintain separation and 
accommodate the industry's needs as well.
    That is the kind of detailed discussion that has to take 
place now between industry and FAA as far as developing a 
common language on metrics so that they can together act to 
bring NextGen to reality, and it is going to take both, as we 
have heard this morning, with significant investments and 
effort from both Government and the industry.
    Mr. Petri. Thank you.
    I just would be remiss if I didn't follow up with Mr. 
Hendricks on one. You have been here before, and I think the 
last time you were before this committee, we were talking about 
kind of a cloud out there having to do with all this depends 
on--a lot of it depends on communication and using part of the 
spectrum, and we were looking at the impacts that the 
aspirations of LightSquared would be on GPS-based 
communications. They have come out with a--and they at the 
testimony indicated that they were thinking about using only a 
part of the spectrum, and then they have come out with now some 
proposals about reequipage or whatever. Do you have any 
evaluation of how realistic any of that is or----
    Mr. Hendricks. Sure. Thank you, Mr. Chairman.
    I am happy to report that the laws of physics have not 
changed since my last testimony in June. LightSquared's 
proposals have been studied very carefully by a special 
committee of the RTCA. As you recall from the testimony, there 
are two 10-megahertz bands both above and below the current GPS 
spectrum that are affected by this. LightSquared has stipulated 
they will not utilize the upper 10-megahertz band.
    The lower band still causes some concern to the industry, 
and that was validated in the RTCA special committee report. We 
currently believe that the upper 5 megahertz of that lower band 
causes problems for aviation GPS users and precision GPS users 
like farmers. The lower 10-megahertz band may be available to 
us, but these so-called filters that LightSquared is referring 
to have not been certified; to my knowledge, they have not been 
manufactured, and the certification standards to put any 
avionics system on an aircraft are extremely high. That is one 
of the reasons we have an incredibly safe system in the United 
States.
    So while theoretically there may be solutions out there, we 
know from experience that the path to those solutions is very 
rigorous, and we need to maintain the highest levels of safety 
possible as we transform to NextGen. So unless we can guarantee 
that, we see very little opportunity for the current proposal 
to be successful.
    Mr. Petri. Thank you.
    Mr. Costello.
    Mr. Costello. Thank you, Mr. Chairman.
    Dr. Dillingham, I wonder if you might give us a brief 
assessment as to the progress that the FAA is making concerning 
NextGen.
    Mr. Dillingham. That is a big question, Mr. Costello.
    Mr. Costello. It is.
    Mr. Dillingham. I think in the first few years there was a 
lot of starts and stops and false starts. Over the last couple 
of years--and some of this is understandable. This is one of 
the most complicated undertakings that we have done across the 
U.S. Government.
    I think we are beginning to turn the corner. We are at 
least guardedly optimistic, and it is because what you have 
heard this morning, that, for example, the RTCA Task Force 5, 
which brought together for the first time all the players, even 
the industry, and everybody agreed if you do these kinds of 
things, then everybody is on board. Another first for the FAA 
is the NAC, which is a--to help them implement the 
recommendations.
    So, I mean, again, we are guardedly optimistic, but, you 
know, it is the implementation where it all falls down, and we 
are watching this for the committee, this committee and other 
committees.
    Mr. Costello. One of the problems that, I think, everyone 
identified in the past was that the FAA had a tendency not to 
include all of the stakeholders, not only labor, but also the 
private sector and so on, bringing them to the table to get 
their benefit of their knowledge and their input on a system 
that they will all be using and benefit by. It appears to me 
that that is in the past, and the cooperation now is working 
pretty well; is that correct?
    Mr. Dillingham. I would agree with that, Mr. Costello, and 
it is because of the work of this committee and the willingness 
to cooperate between the two parties.
    Mr. Costello. Well--and I appreciate that, and I appreciate 
your comments, because Chairman Petri and I, when I was 
chairman and now since I am ranking member and he is chair, I 
think we both agree that it was the responsibility of this 
committee to continue to hold the FAA responsible, and that the 
more pressure that we put on them, the more they would respond. 
And hopefully that is one of the reasons why we are seeing some 
progress as well as a number of other things.
    Final question. You heard me ask--I believe you were in the 
room--you heard me ask earlier, we all know that we have a 
budget problem, we all know that all of us want to address the 
deficit spending issue and get to a balanced budget at some 
time. We also know that there is things that should be cut 
maybe deeper than others, and we also know that some of the 
money that we invest, in fact, will reap benefits, and NextGen 
obviously is one of those investments.
    My concern is trying to figure out, both in talking 
informally and at hearings, as we go forward, and there are 
cuts that are proposed, some 5 percent, some 10 percent, 
operation maintenance, also in NextGen, how that is going to 
affect NextGen. As you heard me say earlier, it is not all 
about money. There is a lot of other things that have to come 
about, but you have to have the money in order to bring the 
private sector and the private contractors in.
    What is your assessment of where we are from a fiscal 
standpoint, I mean, as far as the budget is concerned and what, 
for instance, a 5-percent cut would do as far as delaying 
NextGen as to where we are now?
    Mr. Dillingham. Thank you, Mr. Costello.
    We did some preliminary look when the discussion was taking 
place about moving back to 20O6 and 2008 and 2011 and that kind 
of thing. Basically I think everyone would agree a shortage of 
funding almost automatically means a delay in the 
implementation of the programs, and as delays increase, so do 
costs for various and sundry reasons. We have seen it in the 
past, and we are seeing it now. You heard the discussion of 
ERAM and the $300 million and $10 million a month to maintain 
the old system.
    So delays are costly, and I guess as important as delays is 
confidence. As we said, the credibility for FAA is beginning to 
rise, but when you see situations, it brings back the thought 
that maybe they can't do this.
    Mr. Costello. Thank you very much, Dr. Dillingham, and, 
General Scovel, thank you for your testimony.
    Mr. Petri. Mr. Cravaack.
    Mr. Cravaack. Thank you, Mr. Chairman.
    Thank you again for being here today and all the 
information you are providing us, and in particular I would 
like to thank Mr. Scovel. I thank you very much, you and your 
team, for all the work that you do. The information you gave us 
today was very thorough, very informative, and I just want to 
thank you and your team for all that you do.
    One of the things I could ask you, sir, if you don't mind, 
is the NextGen has never really suffered a lack of funding; 
would that be a correct statement?
    Mr. Scovel. Historically, sir, the Congress has taken good 
care of NextGen.
    Mr. Cravaack. OK.
    Mr. Scovel. We have looked at the Congress' funding of FAA 
programs across the board for many years now, dating all the 
way back to the ground-based radars. The Congress has been 
generous, and appropriately so, in taking care of FAA and its 
capital needs.
    Mr. Cravaack. OK, thank you.
    So is it a funding insufficiency, or is it management 
issues that are basically leading to the delay of NextGen's 
implementation?
    Mr. Scovel. As it currently stands, sir, to date--and I am 
not looking ahead to whatever budget cuts for FAA may lie in 
the future, but I am looking at the agency's posture today 
fiscalwise and executionwise--I would have to say that it 
relates to the Department's inabilities along three lines, if 
you will. First, when it comes down to program execution, it is 
unstable requirements, or requirements that change along the 
way during the development process, that increase costs and 
incur delays. Second, poor program and contracting management 
and decisionmaking also contribute to delays.
    The third area that I would have to cite would be the 
inability of FAA to bring to bear all of the sources of 
information that it may need in order to make proper decisions 
along the line. Whether that is industry, stakeholders, or 
labor, all of those voices need to be heard for FAA to make the 
proper decisions.
    Mr. Cravaack. Thank you for that. It is interesting you 
bring that up. Because in your written testimony you spoke of 
the FAA continued contract management problems. Could you 
elaborate on that a little bit?
    Mr. Scovel. Yes, I could. Let me use ERAM as a case study, 
because ERAM was referred to by a senior FAA official last week 
as the chassis on which all NextGen functionalities must be 
bolted, and that is an arresting image. I would say that the 
vehicle, that chassis, is not right now up on blocks, but it is 
certainly not running. It is at idle. It may be at park, in 
fact.
    FAA has recognized problems, and it has been attempting at 
great speed to try to fix those, but as we dug deeper into ERAM 
over the last couple of years, we had to come to the conclusion 
that this was a program that was hobbled from the start. It 
never had a clean start out of the gate.
    We looked at the contract structure, and we saw 
undefinitized contract elements, and that means that basically 
FAA was going to be billed down the line for work that it 
couldn't identify that it had required in the first place.
    We also saw that this is essentially an IT contract, sir, 
and best practices for IT contracts call for rather small 
segmented divisions so that the agency letting the contract can 
quickly identify where problems may arise and direct the 
contractor to make corrections. With ERAM, however, FAA 
contracted in very large segments so that when the problems 
ultimately did arise later, FAA had to engage in very lengthy 
troubleshooting in order to try to pin down the sources.
    The testing process is another one that is mentioned in our 
written testimony today. FAA sent ERAM to the tech center in 
Mr. LoBiondo's district--and it is a state-of-the-art 
facility--but the contractor sent an incomplete software 
package. It turned out that the tech center's capabilities were 
not up to testing this offering along all the functions that 
would be required to replicate the field. But the program was 
approved, it was accepted by the Government, and it was sent to 
the 20 en route centers, and that is when the problems began to 
be identified as they arose as the controllers began to work 
with the new system.
    That testing process needs to be fixed. FAA cannot go ahead 
with another program along the lines of ERAM, send it to the 
tech center, whether it is an incomplete version of the package 
or that may require capabilities that are simply not resident 
in the tech center, and expect the tech center to do its level 
best on the mission, because that can't happen.
    Once ERAM got out to the field, sir, the controllers 
identified problems. They identified workarounds that they 
needed to take. Those were able to be made at the Seattle and 
Salt Lake Centers, but as the project rolls out to far more 
complex en route centers, and I am thinking now of Chicago and 
L.A., which are supposed to pick up the ERAM program in the 
next several months, as Mr. Huerta testified, those very busy 
centers where the sectors are quite small and the traffic is 
quite dense, controllers are not going to be able to engage the 
same workarounds that they used successfully at Salt Lake.
    For all of those reasons, this was a very troubled program 
from the beginning, and it dates all the way back to the 
contract structure and management decisions along the line.
    Mr. Cravaack. Thank you, sir. I appreciate all that.
    If I could just have a little bit of indulgence. First off, 
outstanding controllers that we have, the boots on the ground 
that actually make this stuff work, our hats have to be off to 
those controllers that do an exceptional job on a daily basis. 
None of us know the challenges that they go through on a daily 
basis.
    With that said, Mr. Hendricks, you kind of commented early 
in your written testimony and also the testimony you brought 
out today that we actually have capabilities within a lot of 
the aircraft already to go ahead and execute RNAV and RNP; is 
that correct?
    Mr. Hendricks. Yes, both in our flight management systems 
and with the navigation capability on the aircraft itself.So 
about 45 percent of the U.S. fleet is capable of RNP approaches 
right now, about 90-plus percent can do area navigation, and 
most of the aircraft have advanced flight management computers 
that allow very optimized cruise altitude and descent planning, 
as you are well aware, and we are not able to take advantage of 
that, and that technology has been around for a couple of 
decades.
    I have flown RNP approaches myself. One of the ones we have 
gained great benefit from is in Quito, Ecuador, where we 
improved the safety and the reliability of the operation in 
Quito. We need to do the same thing at Chicago Midway, where we 
could fly an RNP approach to runway 22 after flying straight in 
to runway 31. These are things that we can do now. We need to 
streamline our processes for environmental reviews, we need to 
put the internal FAA processes that give us approvals to do 
these on steroids and crank out some of the benefit to the 
industry. We will all benefit.
    Mr. Cravaack. Thank you for that. That is the point I 
wanted to bring out.
    Mr. Chairman, as a pilot, I know, I have aircraft that I 
have flown that have the capability of doing the exact same 
things that we are talking about, that have the capability of 
having the efficiencies already in there, and yet because of 
rules, regulations and restrictions, we are not able to 
capitalize on that. As Mr. Hendricks said, that is something we 
need to streamline, because we have the capability of doing 
that right now.
    So I thank you, Mr. Chairman, for your indulgence, and I 
yield back.
    Mr. Petri. Thank you.
    Mr. Costello.
    Mr. Costello. Mr. Chairman, I have no further questions. I 
do want to clarify a point that my friend asked the questions, 
I think, to Mr. Scovel, and you said that based upon where we 
are now, that it is not budget issues or funding issues, it is 
management issues and going forward. And I just wanted to point 
out for the record, because I asked that question at a previous 
hearing, and it was addressed in a GAO report. Actually it is--
GAO report is ``FAA Has Made Progress But Continues to Face 
Challenges in Acquiring Major Air Traffic Control Systems.'' It 
is GAO Report 05-331 in June of 2005 at our request.
    And then the GAO said some key factors cited by the 
Government Accountability Office as contributing to cost 
scheduling and performance shortfalls include, and the number 
one thing that was listed was budget cuts led to cost overruns 
and schedule delays. Now, that was a 2005 report that the GAO--
so I just wanted to put that on the record. And again, you 
know, money is not the only issue here. There are other issues. 
There are management issues and monitoring contracts, and I 
understand that.
    What I want to do is just get out in the open and on the 
record for Members and the stakeholders to understand, as we go 
forward to making decisions about budget issues, the decisions 
that we make, how it will affect NextGen. And if you came in 
here and said, hey, for the next 2 years it is not a money 
issue, it is a management issue, then that is fine; but if you 
said that, you know, if you cut 1 percent or 5 percent, it is 
going to delay it 2 or 3 years, then we just need to know that 
upfront so that when we cast our vote and when we make 
decisions, we know what the consequences are going to be.
    So that is the only point that I wanted to make for the 
record, and with that, Mr. Chairman, I thank our witnesses for 
being here, and I thank you for holding our hearing.
    Mr. Petri. I join in thanking you, and we look forward to 
continue working with you as we do our best to oversee and to 
accelerate this vital national program.
    This hearing is adjourned.
    [Whereupon, at 12:45 p.m., the subcommittee was adjourned.]
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