[House Hearing, 113 Congress]
[From the U.S. Government Publishing Office]




                               before the

                      COMMITTEE ON SMALL BUSINESS
                             UNITED STATES
                        HOUSE OF REPRESENTATIVES


                             SECOND SESSION


                              HEARING HELD
                            FEBRUARY 5, 2014



            Small Business Committee Document Number 113-053
              Available via the GPO Website: www.fdsys.gov

                         U.S. GOVERNMENT PRINTING OFFICE 

86-618 PDF                       WASHINGTON : 2013 
  For sale by the Superintendent of Documents, U.S. Government Printing 
  Office Internet: bookstore.gpo.gov Phone: toll free (866) 512-1800 
         DC area (202) 512-1800 Fax: (202) 512-2104 Mail: Stop IDCC, 
                          Washington, DC 20402-0001


                     SAM GRAVES, Missouri, Chairman
                           STEVE CHABOT, Ohio
                            STEVE KING, Iowa
                         MIKE COFFMAN, Colorado
                       BLAINE LUETKEMER, Missouri
                     MICK MULVANEY, South Carolina
                         SCOTT TIPTON, Colorado
                   JAIME HERRERA BEUTLER, Washington
                        RICHARD HANNA, New York
                         TIM HUELSKAMP, Kansas
                       DAVID SCHWEIKERT, Arizona
                       KERRY BENTIVOLIO, Michigan
                        CHRIS COLLINS, New York
                        TOM RICE, South Carolina
               NYDIA VELAZQUEZ, New York, Ranking Member
                         KURT SCHRADER, Oregon
                        YVETTE CLARKE, New York
                          JUDY CHU, California
                        JANICE HAHN, California
                     DONALD PAYNE, JR., New Jersey
                          GRACE MENG, New York
                        BRAD SCHNEIDER, Illinois
                          RON BARBER, Arizona
                    ANN McLANE KUSTER, New Hampshire
                        PATRICK MURPHY, Florida

                      Lori Salley, Staff Director
                    Paul Sass, Deputy Staff Director
                      Barry Pineles, Chief Counsel
                  Michael Day, Minority Staff Director

                            C O N T E N T S

                           OPENING STATEMENTS

Hon. Sam Graves..................................................     1
Hon. Nydia Velazquez.............................................     2


John Uczekaj, President and CEO, Aspen Avionics, Albuquerque, NM, 
  testifying on behalf of the General Aviation Manufacturers 
  Association....................................................     3
Austin Heffernan, Owner and Manager, Royal Aircraft Services, 
  Hagerstown, MD, testifying on behalf of the Aircraft Owners and 
  Pilots Association.............................................     5
Jamail Larkins, President and CEO, Ascension Air, Atlanta, GA, 
  testifying on behalf of the National Business Aviation 
  Association....................................................     7
Kenneth J. Button, University Professor, George Mason University, 
  School of Public Policy, Director, Center for Transportation, 
  Policy, Operations and Logistics, Arlington, VA................     9


Prepared Statements:
    John Uczekaj, President and CEO, Aspen Avionics, Albuquerque, 
      NM, testifying on behalf of the General Aviation 
      Manufacturers Association..................................    26
    Austin Heffernan, Owner and Manager, Royal Aircraft Services, 
      Hagerstown, MD, testifying on behalf of the Aircraft Owners 
      and Pilots Association.....................................    31
    Jamail Larkins, President and CEO, Ascension Air, Atlanta, 
      GA, testifying on behalf of the National Business Aviation 
      Association................................................    38
    Kenneth J. Button, University Professor, George Mason 
      University, School of Public Policy, Director, Center for 
      Transportation, Policy, Operations and Logistics, 
      Arlington, VA..............................................    44
Questions for the Record:
Answers for the Record:
Additional Material for the Record:



                      WEDNESDAY, FEBRUARY 5, 2014

                  House of Representatives,
               Committee on Small Business,
                                                    Washington, DC.
    The Committee met, pursuant to call, at 1:00 p.m., in Room 
2360, Rayburn House Office Building. Hon. Sam Graves [chairman 
of the Committee] presiding.
    Present: Representatives Graves, Chabot, Luetkemeyer, 
Tipton, Hanna, Schweikert, Collins, Velazquez, Schrader, and 
    Chairman GRAVES. Today we are going to examine the general 
aviation industry, and in particular, just how the regulatory 
environment for small businesses in general aviation is 
inhibiting growth, and in some cases, threatening the solvency 
of small operations. General aviation is undoubtedly a small 
business issue. The Small Business Administration estimates 
that almost 95 percent of all businesses providing air 
transport services are small.
    The industry consists of about 223,000 aircraft in the U.S. 
carrying 166 million passengers to 5,000 public airports. Many 
of which have no scheduled commercial service. According to the 
National Air Transportation Association more than two-thirds of 
these 25 million flight hours per year are for business 
    In addition to the volume of its flights, the industry is a 
huge economic driver. If you take into account both operations 
and manufacturing, general aviation employs about 1.2 million 
people, and contributes approximately 150 billion dollars to 
the overall GDP. In 2012 alone general aviation manufacturers 
generated 4.8 billion dollars in exports of domestically 
manufactured aircraft equipment.
    There is no question that the general aviation industry is 
a very significant part of the national economy. Despite the 
industry's contribution to the economy, general aviation is 
facing some economic challenges. In recent years rising fuel 
costs, the decline in the number of pilots in the United 
States, coupled with the drop off in airline production has 
left the industry vulnerable. Given this, it is critical that 
the needs of small operators are understood by those who are 
regulating the industry. Unfortunately this is not the case.
    Many in the industry see the Federal Aviation 
Administration as out of touch, and the Agency's inefficient 
nature and arbitrary decision making is a real problem for 
small operators. Whether it is delays in the aircraft 
certification process or it is the inability for the FAA to 
implement new technologies to enhance safety, or the 
inconsistencies and air-worthiness standards from region to 
region, small general aviation businesses are negatively 
    We are fortunate enough today to have a group of small 
businesses in the general aviation industry. I look forward to 
learning first-hand how the FAA's regulatory regime is 
affecting their operations.
    With that I would definitely like to thank our 
distinguished group of panelists for being here and coming in 
today. I will now turn to ranking member Velazquez for her 
opening statement.
    Ms. VELAZQUEZ. Thank you Mr. Chairman. The U.S. economy is 
both vibrant and complex resulting in an ecosystem of 
businesses, suppliers, and consumers crisscrossing the nation. 
For small businessmen and women this may mean traveling at a 
moment's notice sometimes to towns not served regularly by 
commercial airlines. As a result general aviation and the 
flexibility it provides plays a key role in our nation's 
economy. In fact, general aviation directly generates more than 
20 billion dollars annually, and has an overall economic impact 
of nearly 80 billion dollars, employing nearly half a million 
workers. This contribution will grow as the economy continues 
to recover.
    Essential to this sector's success is ensuring the safety 
of its pilots, passengers, and those who live near airports. 
According to the National Transportation Safety Board there 
were 1,071 general aviation accidents in 2012 with 432 
fatalities. Conversely, U.S. commercial airline operations were 
fatality-free. Pursuing policies that improve safety are 
necessary, but they must be data driven and examined so they do 
not create excessive burdens for the industry and the workers 
that they employ.
    With this goal in mind the FAA is undertaking several non-
regulatory efforts to reduce general aviation accident 
fatalities by 10 percent. This strategy emphasizes training and 
outreach while focusing resources on the highest risk 
activities of general aviation. During today's hearing I am 
particularly interested in learning whether these airports are 
producing meaningful change within the industry.
    On the regulatory front several issues before the FAA could 
affect safety. This includes a petition by industry groups to 
exempt pilots from the third-class medical certificate. While 
it appears the safety data is available for the FAA to make a 
decision, they have not responded causing frustration to many 
of those in this room.
    In addition, aircraft certification remains a flashpoint 
for the Agency. Not unlike other areas of government, the FAA 
has reported that it has a backlog of more than 1,000 
certificate applications which are required for repair 
stations, flight school, and charter operations. Of that 
backlog over 130 have been waiting for more than 3 years. At 
least one has been delayed for more than seven years. These 
delays prevent new businesses from opening, and existing 
enterprises from expanding.
    All of these issues have one thing in common, they are 
largely dependent on the FAA's budget. For FY 2014 the FAA 
received 12.4 billion dollars, 168 million less than the year 
before. Sequestration and budget politics have made aviation a 
``hot potato'' lurching from crisis to crisis.
    In April of last year air traffic controller furloughs led 
to flight delays. Then in October 12,000 FAA employees were 
furloughed for 16 days. So if you are wondering why the FAA has 
not gotten back to you or has a large backlog, I think we all 
know the answer. The truth is that budget cuts, sequestration 
and shut-downs affect all areas of government, and aviation is 
no exception.
    However with that said we must try to do what we can to 
ensure the general aviation industry remains strong in light of 
these current fiscal challenges. It plays an important role in 
the U.S. economy particularly for areas that lack other 
transportation infrastructure, and is poised to grow stronger 
over the next 20 years. Through its presence it not only 
creates jobs, but also serves as an economic anchor for many 
rural communities. I think the panel of witnesses for traveling 
here today, and I look forward to their testimony. I yield 
    Chairman GRAVES. With that we are going to open it up to 
our witnesses. We do have a series of votes that are scheduled 
between 1:30 and 1:45, as it turns out, approximately five 
votes. I think we can get through our witnesses and then we 
will break and come back if that is all right with everybody.
    Our first witness is John Uczekaj who is the President and 
CEO of Aspen Avionics in Albuquerque, New Mexico. John has over 
33 years of experience in the avionics industry, and he started 
out as an engineer at Boeing before moving into management 
positions at Sperry and Honeywell.
    Immediately prior to joining Aspen John was the President 
and COO of NORDAM Group, an aviation parts manufacturer and 
maintenance company. In January of 2013, John was name 
Entrepreneur of the Year by the Living Legends of Aviation. He 
holds a bachelor's degree in electrical and computer 
engineering from Morgan State University, and an MBA from City 
University in Seattle, Washington.
    He is testifying on behalf of the General Aviation 
Manufactures Association. Thanks for being here, Mr. Uczekaj.


                   STATEMENT OF JOHN UCZEKAJ

    Mr. UCZEKAJ. Chairman Graves and ranking member Velazquez 
and distinguished members of the Committee, I really appreciate 
the opportunity to appear before you today to discuss the 
impact of the FAA on small business.
    My name is John Uczekaj as Congressman Graves says. I am 
President and Chief Executive of Aspen Avionics in Albuquerque, 
New Mexico. I also serve on the Board of Directors of the 
General Aviation Manufactures Association, and I am also Chair 
of the Flight Operations Policy Committee. I am really honored 
to give this testimony on their behalf as well today. I am also 
an instrument rated pilot and owner of an aircraft.
    Aspen was founded in 2004 and was founded by two aviation 
enthusiasts from Albuquerque with the mission of designing and 
manufacturing low-cost avionics for primary flight displays and 
multi-function displays for the lower end of the industry.
    In 2008 we delivered our first product which was a primary 
flight display which was groundbreaking in the general aviation 
industry as it brought technologies that up to now had been 
really reserved for the higher-end of the aircraft business 
jets and air transport aircraft.
    Our products bring electronic displays to the cockpit. 
Three dimensional terrain awareness is a platform for NextGen, 
display of NextGen, and modification of NextGen data, and 
really provides a wide range of functionality.
    We have 47 employees, and our entrepreneurial spirit is 
really the key to our success. We have been able to do quite a 
bit in a very short period of time. We have now 6,000 aircraft 
installed throughout the world, 27 percent of our business is 
done international.
    But also the key to our success is really discipline and 
managing costs and delivering a return to our investors. Aspen 
is run by a group of venture capital investors who demand a 
return on their investment, and require us to be able to be 
accountable to everything that we do.
    So one of the biggest challenges we have in a small 
business is response times from the FAA. Each week we get 
delays that cause us to lose hundreds or thousands of dollars, 
and if you multiply that across the entire business of small 
aircraft or small aerospace businesses you can imagine how big 
an impact it is.
    There are two things that affect us. One is the sequencing 
process, and the other is the actual process of certification. 
Sequencing process is the FAA's method of determining 
priorities. Often times the expectations around when we get 
through that process is very inconsistent. We have to plan 
buffers and plan in our financials the time it takes for us to 
get to the sequencing process.
    Once through the sequencing process we then get into the 
FAA certification process. In that process there are many 
inconsistencies between certification offices throughout the 
country. There are inconsistencies between programs. There are 
changes in personnel that further exacerbate the problem in 
that we have to make changes as we go along.
    Aspen, from our standpoint, we raise private capital to 
invest in new products. Those uncertainties that we have in the 
process create a lot of unnecessary cost that we must absorb, 
and it creates a lot of unnecessary time, which in fact has a 
big impact on bringing safety technologies for the industry.
    With that as Chairman Graves mentioned, in our world we do 
retrofit aircraft, and there are 157,000 aircraft that are 
facing a January 1, 2020 NextGen milestone. While that may seem 
like a long time away, but the reality of the matter is that we 
must convince 157,000 individual owners of aircraft to upgrade 
their aircraft and convince them that it makes sense to do 
that. The installation process alone is a long and arduous 
task. When the certification process of new products takes as 
long as it does it becomes a real problem for us.
    From our standpoint there are a lot of processes to go. The 
ODA process and technology of that is a good thing. 
Organizational Design Authority is a big process, but it is not 
cost effective for small business. We do not have the ability 
to do that. From our standpoint we need things like the Small 
Airplane Revitalization Act recently signed by President Obama. 
That process provided ability to segment markets and allows us 
to bring costs down. We really pushed hard for the thoroughness 
of that.
    The next thing is the Next Generation GA Fund which has 
recently been launched by the FAA Reform and Modernization Act 
of 2012. That allows funds for people to finance the putting of 
equipment on their aircraft, and we think that is a very, very 
important part of it.
    It is my opinion that the government should be doing 
everything to lift general aviation for the reasons that were 
discussed both by Congressman Graves and Congressman Velazquez. 
It is a very important sector of our economy. I really thank 
you for the opportunity to talk about how our business 
interacts with regulators in the FAA.
    I want to be clear though in closing that we appreciate the 
work of the FAA, their dedication and attention. I also believe 
their opportunities to improve and reform their efforts to 
maximize their benefits and improve safety. I look forward to 
discussing this further, and would be happy to answer any 
questions you may have. Thank you.
    Chairman GRAVES. Thank you. Our next witness is Austin 
Heffernan, owner and manager of Royal Aircraft Services in 
Hagerstown, Maryland. Founded eight years ago, Royal Aircraft 
Services is an FAA certified repair station specializing in 
aircraft painting, restoration, structural repair, and general 
maintenance activities.
    Royal paints military aircraft through subcontracts with 
Northrop Grumman, Lockheed Martin, and Sikorsky among others. 
His company is also prime aircraft painting contractor for 
NASA's Langley Research Center.
    Mr. Heffernan is a United States Army veteran with 
meritorious service medal, and received his bachelor's degree 
from Vanderbilt University in Nashville, Tennessee. He is 
testifying on behalf of the Aircraft Owners and Pilots 
Association. Welcome, Mr. Heffernan.


    Mr. HEFFERNAN. Thank you, Chairman Graves and members of 
the Committee. Thank you very much for having this hearing 
today and inviting me to present testimony.
    I am Austin Heffernan, the owner and general manager of 
Royal Aircraft Services. I am also a private pilot. Royal 
Aircraft Services is a highly regarded FAA certified repair 
station in Hagerstown, Maryland. Our staff of 14 employees 
provide structural repairs, painting, restoration, and 
maintenance for general aviation aircraft based throughout the 
Mid-Atlantic region. Today I am also representing the Aircraft 
Owners and Pilots Association. I've been an AOP member since 
    My testimony today covers the following key points. Number 
one, general aviation is a heavily regulated industry. Number 
two, general aviation cannot take advantage of the safety and 
operational benefits of new technology because regulations have 
not kept pace. Number three, FAA policies and internal 
structures are increasing the cost of general aviation flying 
without delivering added safety.
    General aviation directly supports thousands of small 
business from flight schools and line operations to repair 
shops like Royal Aircraft Services. Thousands more use general 
aviation to move people and products, reach new markets, and 
support their customers. In fact, an estimated 65 percent of 
all general aviation flights are made for business and public 
    The FAA oversees all aspects of general aviation, and over 
time the Agency's regulations have become increasingly complex 
and prescriptive. Today we often find that regulations intended 
to protect pilots and the public instead limit or slow the 
adoption of new safety technologies and practices.
    Quite often in my business we are unable to replace 
outdated 30-year-old technology in certificated aircraft. Even 
when better, less expensive technology is readily available to 
the owners of experimental aircraft. The primary reason is that 
the certification hurdles are so high that manufacturers cannot 
afford to seek the necessary FAA approvals.
    When a customer wants the benefits of a state of the art 
engine and fuel management system we often have to locate the 
unit in an area of the instrument panel that is out of the way 
or hard to reach, reducing its effectiveness. We must do this 
because we cannot legally replace the outdated, inaccurate, 
quote/unquote, primary instruments that were supplied with the 
aircraft decades ago.
    There are about 200,000 general aviation aircraft flying, 
and just over 1,000 new aircraft being produced each year. 
These numbers mean that the biggest safety pay-offs will come 
from upgrading older aircraft. Making it easier to upgrade 
aircraft will have another pay-off as well, creating well-
paying jobs for those who design, manufacture, and install this 
    The FAA's approach to medical certification also negatively 
impacts small businesses like ours. We see many more pilots 
leaving general aviation then we see new pilots getting 
started. The restrictive medical bureaucracy within the FAA is 
one of the primary reasons.
    Almost two years ago AOPA and the Experimental Aircraft 
Association filed a petition with the FAA that would reduce the 
hassle and cost of the medical certification process. Despite 
almost 16,000 overwhelmingly favorable comments on the 
petition, the FAA has not formally responded.
    This past December Chairman Graves and fellow AOPA member, 
Congressman Todd Rokita, both members of the House General 
Aviation Caucus, introduced the General Aviation Pilot 
Protection Act. The legislation goes a step beyond the AOPA EAA 
petition by allowing even more pilots and more types of 
aircraft to make non-commercial VFR flights without the need 
for an FAA medical certificate.
    Other areas of FAA oversight also impact small business. 
The current system requires the FAA to issue air agency 
certificates to many types of general aviation businesses 
including charter and on demand operations, some flight schools 
and training programs, and repair stations.
    The FAA has a backlog of more than 1,000 air agency 
certificate applications. A fact that is stopping small 
businesses like ours from opening or expanding. That is why I 
ask Congress to help small business owners like me by, number 
one, urging decision makers to consider changing the policies, 
guidance, and regulations in ways that will encourage and 
advance the use of modern technology in existing aircraft. 
Number two, urging decision makers to consider removing the 
internal issues that are preventing and delaying issuance of 
required FAA approvals.
    As a small business owner and pilot, I appreciate Congress' 
recent passage of the Small Aircraft Revitalization Act, 
directing the FAA to streamline aircraft certification. This 
will have a significant impact on deploying new and improved 
safety technologies to general aviation aircraft. I look 
forward to Congress taking action on the General Aviation Pilot 
Protection Act.
    Aviation is American. It started here, and we need to 
maintain our leadership in this area. We need to find ways to 
encourage and grow this amazing industry, and we appreciate 
your support.
    On behalf of the 14 employees of Royal Aircraft Services, 
and the nearly 400,000 members of AOPA, I thank you for your 
leadership in addressing the concerns of the general aviation 
industry so that it can continue to help small businesses 
nationwide grow and thrive.
    Thank you again for the opportunity to present here today 
before this Committee.
    Chairman GRAVES. Thank you. Up next is Jamail Larkins. He 
is the President and CEO of Ascension Aircraft in Atlanta, 
Georgia. An entrepreneur and pilot since the age of 14, Mr. 
Larkins has been responsible for overseeing the rapid growth of 
Ascension's private aircraft sales, leasing, financing, and 
management services since founding the company in 2004.
    He has been named the number one entrepreneur under the age 
of 30 by INC Magazine, was featured in Forbes Magazine as a 30 
under 30 energy and industry leader, and more recently has been 
named the emerging entrepreneur of the year by Black Enterprise 
    Mr. Larkins studied at Embry-Riddle Aeronautical University 
in Daytona Beach, Florida, and is testifying today on behalf of 
the National Business Aviation Association. Thanks for being 
here, Mr. Larkins.


    Mr. LARKINS. Chairman Graves, ranking member Velazquez, and 
the members of the Committee, good afternoon. My name is Jamail 
Larkins and I am a businessman from Atlanta, Georgia. I am 
pleased to be here as a member of the National Business 
Aviation Association, and my company, Ascension Aircraft has 
been an NBA member since 2008.
    This is the first time I have ever testified before 
Congress, and it is a privilege to be here. In 2008 I founded 
Ascension Aircraft, and today I serve as the company CEO. 
Although my company is a regional leader in the sale of 
fractional-ownership shares of piston aircraft, the business 
employs just 19 people including myself.
    Over the years I have found that one of the most effective 
ways to sell business aircraft is to use business aircraft. 
With a business airplane I can seize opportunities as they 
arise. The airplane I use for business is a Cirrus SR22, like 
the model one I have here before me.
    The airplane enables me to meet face to face with potential 
clients, and that level of service and accountability helps me 
get a leg up on my competition and also build my company. Of 
course, many of my clients are also small business owners and 
entrepreneurs. They are often located in out of the way places, 
and like me, they recognize the benefits an airplane can 
    With a business airplane an entrepreneur can travel for 
meetings, multiple cities in a single day, return to 
headquarters that same evening, and be back in the office the 
next day. With an airplane, a business person can transport 
tools or products that may be too large to fit into an 
airliners overhead bin or too delicate to be checked into the 
airliner's cargo hole.
    With a business airplane, an entrepreneur can efficiently 
manage work sites that are a distance from each other and often 
located in towns with little or no airline service. Simply put, 
business aviation is a big asset for small businesses. It is 
the tool that makes business models work.
    If there is anything that I would like you to take away 
from my testimony is this two-part premise. On the one hand, 
the United States not only has the world's largest, safest, 
move averse, and most efficient aviation system, it is also the 
best system in the world for allowing small companies like mine 
to succeed.
    On the other hand, there are a number of ways the FAA could 
strengthen its relationship with the small business community 
so that the Agency's policies are more workable and effective 
for the Agency and for businesses.
    When we think about the regulatory climate for business 
aviation today we know that, largely for safety reasons, 
stringent policy requirements are appropriately placed upon the 
industry. That means it is critically important that the Agency 
and the industry effectively collaborate. After all, when the 
FAA services go unmet or when the Agency implements onerous 
policies, business aviation suffers.
    Here are two examples to illustrate my point. First, we 
know that the FAA policies require that small aviation 
businesses, flight training centers, flight schools, and on 
demand charter operators be certified by the Agency before they 
can open. Unfortunately over the years the certification 
backlog has swelled, and today nearly 1,000 businesses are 
waiting for an approval which could take up to two to three 
    Small businesses like these are drivers of job creation, so 
we need to find ways for the FAA to streamline its approval 
processes for these companies. We want to work with the FAA to 
find those ways to do that.
    Now, I will point to an example of an instance when an 
effective collaboration has had a positive impact. It is on the 
operation's side of the industry. As we know, many of the 
companies using aircraft are subject to a host of government 
requirements for installing equipment like that that are needed 
for reduced vertical separation minima of RVSM.
    Thanks to government industry collaboration, RVSM 
requirements were recently smoothed, even as important safety 
standards were protected. We would like to work with the FAA to 
find similar areas where authorization procedures can safely be 
made more workable for operators today.
    Equally important, we want to find areas where our 
relationship can be more effective and collaborative when it 
comes to future aviation planning. For example, as the FAA and 
industry stakeholders come together to debate the next 
reauthorization I would like to reiterate general aviation's 
communities' long-standing guiding principles for FAA 
    First, when it comes to paying for use of the aviation 
system, the fuel tax works best for everyone in general 
aviation. As a small business owner, I know that we do not need 
any other funding mechanisms like user fees. We also do not 
need the giant federal bureaucracy required to collect them.
    Second, the general aviation community continues to believe 
that direct Congressional oversight of the FAA funding system 
is necessary. Third, a continued, strong Federal funding 
commitment is necessary to maintain the strength of our 
national air transportation system.
    In conclusion, Mr. Chairman, ranking member Velazquez, I 
also appreciate the leadership that you provide, and the 
bipartisan support that the committee extends to the small 
businesses community. I look forward to answering any questions 
you may have. Thank you.
    Ms. VELAZQUEZ. Thank you, Mr. Chairman. It's my great 
pleasure to introduce to the Committee, Professor Kenneth 
Button. He is Professor of Public Policy at George Mason 
University where he is the Director of the Center for 
Transportation Policy Operations and Logistics. He has 
published or has in press some 80 books, and over 400 academic 
papers in the field of transportation economics, aviation 
policy, and related subjects.
    Professor Button is the editor of numerous academic 
journals in the fields of aviation, aerospace policy, tourism, 
and transportation. Prior to coming to George Mason University 
in 1997 he served as a transportation expert for the OECD and 
taught at several universities throughout the world. Welcome.


    Mr. BUTTON. Thank you, ranking member Velazquez. Thank you, 
Chairman Graves, and the Committee for inviting me to give some 
comments at this meeting.
    First of all, I want to emphasize the importance of general 
aviation for my own work. I did some studies in Virginia, and 
as the ranking member noted, it plays an important role in 
small communities for stimulating jobs, jobs directly and 
indirectly. So it is very, very important.
    I want to focus on a slightly different aspect of the 
question to the previous speakers. I am interested in the 
demand for general aviation services rather than supply. There 
was quite an insightful article yesterday in the Wall Street 
Journal discussing the shortage and pending shortage, perhaps, 
of commercial pilots. Where do commercial pilots come from? 
They come from, by and large, general aviation.
    There is going to be a projected demand for future pilots, 
according to Boeing, of half a million extra pilots worldwide 
by the year 2032. In addition, a demand for something like 
nearly 600,000 technicians. Many of which also start their 
careers through one way or another, general aviation.
    Most of this market is in China. China has no real general 
aviation market. It trains about 50 general aviation pilots a 
year. There is a huge market out there for the gentleman on my 
left to penetrate, to make money in the future. They need 
equipment. They have about 1,800 general aviation planes. They 
need personnel.
    To get into that market, not only is there a need for some 
trade restrictions to be changed, but also to insure that the 
U.S. provides the appropriate hardware and the appropriate 
personnel, the pilots go out into that market, the training of 
those pilots.
    Now, what is the FAA's role in this? Well, my perception is 
that most markets work pretty well on their own. Well, there 
are some imperfections which do need dealing with through the 
intervention of government agencies like the FAA. Security is 
an obvious one in aviation, and that is not, I think, on the 
table today, but there is also safety.
    General aviation is an industry which is not perceived by 
the general public to be perhaps quite as safe as driving a car 
down the road. Although statistically you are much safer, I 
suspect, flying an aircraft then you are driving in a car down 
a road on Route 66, particularly this morning.
    Now, how can the FAA get involved in actually changing this 
perception and altering it? First of all, they need to be 
responsive, and they have gradually been responsive to 
segmenting the market so that the regulations are appropriate 
for particular types of general aviation. It is not a 
homogenous sector at all. It ranges at the one end from small 
aircraft with sales, sale craft, at the other end we now have a 
huge debate about unmanned general aviation which I think will 
be very important from small businesses in the future on the 
manufacturing side, the operation side, and the usage side. 
That is clearly something that is being debated.
    We also have a situation where there is taxation which I 
will not go into. I have expressed my views on that in the 
past. But what the FAA needs to do is to reassure the public. 
It is doing, as I said, by segmenting markets, introducing new 
legislation or being part of new legislation.
    What we do find with the FAA is some of the data is 
suspect. They do not collect as much data as they need to. They 
have not got the resources to do that, one suspects, as was 
pointed out earlier. But without having data and appropriate 
ways of analyzing that data, it is very difficult to come to 
firm conclusions about how well policies are going to work, and 
indeed, which policies should be introduced in the first place.
    So I do think there is an issue with the FAA with data 
resources. They are improving, but it is still a voluntary 
scheme, by and large, by pilots who have to give information 
after they have made Flights.
    Secondly, about adoption approach issue. It does take time 
to get your licenses. It does take time to get certified. 
Perhaps dividing the industry up into rather more detailed 
segments will facilitate are much more rapid certification 
process because at the moment there seems to be very much an 
issue of going for a higher standard. It may well be you might 
need to move down.
    Again, the FAA has been involved in this, but it has taken 
a long time to do. I do have some sympathies for an Agency 
which is rather stretched for resources. I say that unusually 
for the FAA, I did once write an article describing is at a 
last bastion of Marxism, so I am not exactly favorably disposed 
upon it for some other activities.
    But certainly as far as this is concerned, there does seem 
to be action. Not as fast as one would like, probably not 
always in the direction the manufacturers would like, but 
progress is being made, and one would hope that this progress 
will continue in the future.
    Chairman GRAVES. With that we will start questions. I am 
going to go to Mr. Collins first and we will just see what 
happens with vote. We will play that by ear. Mr. Collins?
    Mr. COLLINS. In full disclosure I am a pilot and so I have 
a bias. I'm not IFR, but VRF. Because of some life insurance 
issues currently I am not flying as I am not IFR.
    But, you know, I have noticed, and I want to talk about the 
third-class medical requirement every two years. Most of us are 
over 40 so every two years we have to get--and, you know, there 
are some fairly arbitrary things on blood pressure and various 
cardiovascular testing.
    I would like to, I guess, point out, you know, I am a 
boater. Boating you do not even need a license of any kind, let 
alone a medical certificate. So you are out in a boat and you 
have, you know, six or eight people in the boat, and whatever 
is going on you are not licensed.
    Driver's license, I know in New York they are good for 
eight years and you need a vision test which is not much of a 
test. I am actually a Formula open-wheel race car licensed 
driver. No requirement whatsoever. So I can go around a track 
at whatever speed I want and no license.
    So here we are, general aviation Class 3 medical every two 
years, arbitrary requirements, and it is just, to me, 
government intrusion into somebody's personal hobby. That, you 
know, we do not have, whether it is golf or tennis or race car 
    So I guess I would just like your opinion. I am a co-
sponsor of the bill that would remove the requirement for a 
third-class medical for those who are strictly recreational, 
limited number of passengers, and speed and altitude, and the 
like. Whether you think, you know, such a exemption would, at 
all, put the public in jeopardy in any way. I feel like any 
time the government steps in it is probably just one more 
reason somebody may not take up a sport.
    Just your opinion on that, and your answer to the nay 
sayers who say, oh my god, everyone's safety is going to be 
jeopardized if general aviation pilots are not taking a 
medical. Jump in.
    Mr. UCZEKAJ. Okay. So I was a pilot myself and over 40 
myself. I share your concerns quite a bit. It does seem almost 
to the point of being ludicrous when you compare them to the 
other safety critical type of things that you would do. I 
actually think this is a very important part of the future of 
aviation because we have a shrinking population, and for small 
businesses like Aspen and others we need pilots to fly and buy 
our products. More importantly, we need pilots to move up into 
the air transport category the day that it was there.
    All of us in aviation view that as one of the biggest 
problems facing us in terms of the pilot population. Putting 
more requirements in front of people to stop them from flying 
is a real problem.
    Also, more importantly, many people start flying later in 
their life. I started flying just recently, primarily because 
there are other requirements in your life, whether that be your 
family or otherwise, and at that time in your life when you can 
afford to fly is the not difficult time for you to do that.
    So I think you would find a widespread, almost 100 percent 
support of trying to work the third-class medical for pilots.
    Mr. HEFFERNAN. I think the third-class medical requirement 
is a definite detractor to business. As pilots age, and most of 
our general aviation pilots are getting up there now, this is 
just one more hurdle they have to face. It really doesn't seem 
to create any additional safety. It seems ludicrous a person 
has to have a third-class medical to get in a 2,500 pound 
Cessna 172, but they do not have to have any requirements to 
get in a 45 foot Zephyr motorhome and take it down the 
interstate. It does not make any sense.
    We are seeing more and more pilots leave general aviation 
as they get older because they have medical problems. It may be 
just perceived problems too. Their friend had some problems, 
they can envision themselves having that type of problem later 
on. When they are in this point of life where they want to look 
at the cost of upgrading an engine or overhauling an engine or 
upgrading an interior, painting the aircraft. All these 
expenses or new avionics, how can you justify putting that much 
money into your hobby when an arbitrary decision at a third-
class medical next year may take it all away from you. So why 
even do that? Go by a boat, you know?
    Mr. COLLINS. You don't need a license.
    Mr. HEFFERNAN. Right. Yeah.
    Mr. COLLINS. Mr. Larkins?
    Mr. LARKINS. Personally it is one of the issues that I do 
not have to immediately have to look forward to. But we 
actually have had some of our clients that are involved inside 
of our fractional program that have had to exit in the last 
couple years because of medical issues. So it is one of those 
things that I think if we could come up with a solution that 
would allow people to continue to fly without having to go 
through some of those onerous policies that are currently 
implemented would be helpful for the industry long-term.
    If you look at some of the other segments out there, ultra 
lights, LSA airplanes, people are being able to safely fly 
airplanes without having to go through that currently today.
    Mr. COLLINS. Thank you. My time is expired, but real quick, 
Dr. Button.
    Mr. BUTTON. I tend to take a cautious view on this. I think 
safety has to do with public perception and not actuarial 
calculations. The data actually the FAA has on amounts of 
flying is rather Spartan and not particularly accurate, so 
making judgments about safety is difficult.
    As far as driving a motorhome or airplane is concerned, one 
involves two dimensional safety, one involves three dimensional 
safety. So I think we will have to be cautious. This is a 
perception issue of the public, and people are scared of planes 
dropping out of the sky on top of them.
    I would be perfectly happy for you to fly in the middle of 
the dessert on an aircraft with no one underneath, but I am 
worried about flying over open area. With the success of 
general aviation building up business around airports, 
airfields, that may be serious issue.
    Mr. COLLINS. My time is expired. Thank you, all.
    Ms. VELAZQUEZ. Thank you, Mr. Chairman. Dr. Button, as 
NTSB's data suggests, the majority of general aviation 
accidents are due to pilot error and loss of control. Both 
regulatory actions such as licensee requirements and non-
regulatory initiatives such as increasing training and raising 
awareness can play a part. In your opinion, what is the proper 
mix of these regulatory and non-regulatory approaches?
    Mr. BUTTON. Thank you. It is clear that safety is a human 
factor, as they say in engineering, for many accidents. I think 
what is important is actually to ask the question what are the 
main causes of accidents. It is not just human failure. There 
are different classifications, different types of aircraft, and 
so on, and to pinpoint exactly where these issues are.
    The Safety Board is very good at doing this. It does a 
detailed analysis. One should act on that. But certainly one 
does get concerned when we look at situations where drug and 
alcohol abuse causing accidents. I, myself was buzzed when I 
was a professor in England by an RAF student who had a conflict 
with his girlfriend, went and got a pilot's license, took an 
aircraft from the local airport, and buzzed the university. He 
took down some cables with his undercarriage. So the human 
factor is important.
    I am not sure you can handle the mental side. He was not an 
F-guy, I mean, they go through pretty rigorous training, but 
nevertheless the physical side is important. Have a heart 
attack in an airplane you are coming down. Have a heart attack 
in a Winnebago you drive to the side of the road. These is a 
    Ms. VELAZQUEZ. Thank you. In your testimony you point out 
that general aviation uses about 16 percent of air traffic 
control services, but only contributes about 3 percent of the 
cost. Does this mean that the taxpayers and commercial airlines 
are subsidizing general aviation activities?
    Mr. BUTTON. My personal view is that probably the gap is 
not as wide as that because general aviation does not need some 
of these whistles and bells that goes with the navigation 
    Nevertheless, I am a great believer in user charges. I 
think it is possible to isolate exactly what is used, not 
everything, but exactly for a large part of the cost, and those 
costs should be allocated appropriately.
    Ms. VELAZQUEZ. Thank you. Mr. Larkins, roughly two-thirds 
of air traffic control system carrying costs are financed 
through aviation excise taxes of some sort including ticket 
taxes, segment fees, international head taxes, and fuel taxes.
    If it is determined that additional funds are needed to 
continue to operate the air traffic control system and budget 
cuts makes it impossible to use additional tax payer's dollar, 
how would you suggest the FAA raise these funds?
    Mr. LARKINS. Personally I would say that I do not think 
anyone on the general aviation side would have an issue with 
continuing to pay through the fuel tax. Even if that needed to 
be adjusted to be able to pay more. We think that that is 
probably the most efficient use of it.
    Before I had the opportunity to get my first license here 
inside the United States, I actually had the opportunity to get 
my student pilot license in Canada. There, there are user fees 
that are currently being collected for aviation activities 
    Personally I can tell you from my own experience, going 
through Canada and having to pay for it there is not as 
efficient, is not as user friendly as what it is here inside 
the United States.
    So from my experience, over 2,000 hours of flight time in 
all sorts of different aircraft, and throughout a lot of parts 
of the world, I would definitely recommend that we continue to 
pay for our use of the system through fuel taxes versus any 
sort of user fees.
    Ms. VELAZQUEZ. Dr. Button, would you care to comment on my 
question? How do you suggest----
    Mr. BUTTON. I think user fees are important. The point 
about user fees are, they not just collected revenue which is 
an interest clearly to government a lot of the time, they 
actually effect behavior.
    At the moment, there are situations where we have--this is 
something no one has commented on, the increased number of 
hours to qualify for a commercial license gone up from 250 to 
1500 hours. It costs money to qualify as a commercial pilot. 
Basically to get your license you fly around in circles for two 
years, and then you get a license which is not very efficient.
    I think user fees may well be a better way of encouraging 
people to move in the industry. I think they may well be also 
tied, in particular ways, to the type of activity involved in 
those 1500 miles. Simply flying in circles does not seem to me 
to be a particularly effective way of increasing safety. Take-
offs and landings seem a bit more dangerous to me. I don't 
know. So I tie things together.
    Ms. VELAZQUEZ. Thank you, Mr. Chairman.
    Chairman GRAVES. I think what we will do is take a quick 
recess, and then we will come back and will continue with 
questions. We will get through this. I apologize for the 
inconvenience of the vote, but it is what it is. We will be in 
recess until we are done.
    Chairman GRAVES. We can go ahead and get started and then 
we will wait on the other members to come back. Again, I 
apologize for the vote series which is always an issue in 
    I will start my questions with Dr. Button, which I always 
get frustrated when we make generalities to try to make a 
point, and, you know, talking about third-class medicals and 
heart attacks. When you have a heart attack in a Winnebago you 
just pull off to the side of the road, but when you do in a 
plane you come down on top. Which I can make the same 
generality the other way. You have a heart attack in a 
Winnebago, you are going to cross the line, you are going to 
kill somebody, but if you have it in a plane you just land it.
    It is very frustrating to me when we see that, particularly 
when--just to clarify for folks, on third-class medicals, you 
know, it is a two-year process. You are basically self-
certifying anyway. Once you take that medical you have two 
years for it. You do not even have to mess with it.
    So I am very frustrated by that, but my question to you is, 
you know, when you were talking about a data-driven process 
with the FAA and we need more data to regulate, but then you 
turn right back around and said that safety should be a public 
perception process rather than data driven. Are you suggesting 
the FAA develop policy based on public perception?
    Mr. BUTTON. First of all, the comments about the Winnebago 
was also a data problem because the data, for example, the FAA 
has on flights by general aviation and so on is poor, so 
working off the probability of having an accident with someone 
having a heart attack in motor vehicles as opposed to an 
airplane is a tricky statistical one.
    No, I think the problem is that the--there are two things. 
First of all, I think policies are made on the basis of 
perception a lot of the time. I think that is because people 
perceive the benefits they enjoy from things, and there is an 
educational process required. That educational process is very 
difficult to achieve without adequate data. That was really my 
    Policy should be data driven, but nevertheless, unless 
people are confident in the data they will perceive things, and 
if you are a policymaker, my view is that you essentially adopt 
policies which people perceive to be good. That is right 
through the whole policy agenda as far as I can tell.
    Chairman GRAVES. I take a much more objective position on 
policy. I think policy ought to be based on that data, and not 
based on emotional arguments which drive perception. In the 
case of aviation, that can be at its worse. Again, making 
generalities, like you make, when it comes to driving a point.
    Mr. BUTTON. Well, let me drive the point in a slightly 
different way. How many column inches in newspapers are devoted 
to a general aviation crash, and how many inches are devoted to 
a car crash? There have been studies done on this, and clearly 
rare incidents of, I don't like to use the term to be honest, 
but it is probably the only one I can think of, spectacular 
events tend to attract public attention.
    Public attention does drive policy. I am not a politician, 
but certainly perception is important in the electoral process, 
and it is true in the policy process.
    I would like to have an objective-driven system to be blunt 
with you, but it is simply not the way it works. It is not the 
way the media works, and it is often not the way individual's 
minds work either. People are scared of flying still. It is the 
safest way of moving around the world, but they are still 
    That is a problem. They don't normally know the statistics. 
They just hear about serious accidents.
    Chairman GRAVES. That is unfortunate too. Just to use your 
example of column inches devoted to a car crash as opposed to 
the airplane crash, you are right. Because there are so many 
car crashes the sheer number and volume of the car accidents 
out there, of people getting killed by somebody else crossing 
the line.
    That is what is always a worry to me. You know, if I am 
driving down a two-lane road and I am going 60 miles an hour, 
and the person coming at me is going 60 miles an hour, that 
means we are closing at 120 miles an hour, and I hope like hell 
that he is going to say on his side of the road. I have to 
depend on somebody else, whereas in the air, I do not.
    It is very frustrating to me when we do use, again this 
emotional generalities, and then we talk about whether or not 
we should be basing public policy on perception.
    My next question is actually for Mr. Heffernan and Mr. 
Uczekaj, in fact, if anybody else wants to weigh-in, you are 
more than welcome to. We hear a lot of talk about the FAA and 
the backlog as a result of sequestration, budget cuts, whatever 
the case may be, which are fairly recent, to be quite honest 
with you.
    My question to you, you all have been in business for a 
long time. Was it the same way? Were there backlogs before? 
Were you having trouble getting responses out of the FAA or 
getting them to move in a timely manner prior to sequestration 
then after sequestration?
    Mr. HEFFERNAN. My opinion is no. We were not having any 
additional problems prior to or after. I think there has been 
just a tendency to kind of be stuck in the mud there in terms 
of getting things done. I have not seen that the budget cuts 
though have really done anything.
    Mr. UCZEKAJ. From our perspective there certainly is a 
difference. I mean, I have been certifying avionics for well 
over 30 years now, and what I have seen evolve over time, and 
most recently in the last six to eight months since 
sequestration, government shut-downs, and things of that 
nature, is that the FAA rank and file do not--their application 
of procedures and processes seems to vary a lot more than it 
did before. For, I'm sure a plethora of reasons, from job 
security to, you know, the perception that they have to be as 
safe as possible because of the pressures that are on them.
    We see the lack of consistency between applications between 
individuals and the FAA has increased since the pressures on 
resources and such have occurred. So from our view, at least 
from a manufacturer's standpoint, we think it is going in the 
wrong direction. We think there are a lot of things that can be 
done to improve that.
    Most notably is to simplify the process so that an 
individual, for whatever reason or whatever motivation, has the 
process and procedures supporting them, and they do not feel 
like there is any situation where they might be on a limb or 
something, and they may take the most conservative position as 
    Certainly resources at the FAA are a very, very big deal. 
There is no question about it. It plays into the sequencing. It 
plays into the way they work. It plays into, you know, where 
they are. We see change in personnel much more than we ever did 
in the past. People are changing roles and therefore, we get 
different interpretations.
    We feel very strongly that that change has occurred, and we 
would like to work with ways to do that. There are many ways to 
do that ranging from more delegation to the DER system, that as 
an engineering representative which, you know, we have these 
people that are 35 year experience people that have been 
certifying things for a long time. It seems like delegation is 
less and less used.
    So these kinds of things, I think, need to be addressed. I 
think it is very critical for businesses that are small because 
if you really think about it, we have fewer products, and if 
one product gets held up the impact on a small business is 
disproportionate. A company can fail as a result of one product 
being held up.
    We encourage everybody to work with the different Small 
Aircraft Revitalization Act to make things more simple, use 
more delegation so that the pressure on resources that is 
current and very real could be alleviated.
    Chairman GRAVES. Are you all hearing from the agencies you 
have to deal with, whether it is certification or flight 
standards, I mean, is anybody getting laid off in the FAA? Are 
they being released as a result of budget cuts? Do we have the 
same number of people just doing less work or more work? Are we 
making work for them? Are they making work for themselves?
    Mr. UCZEKAJ. We have not seen any kind of reduction in 
workforce. We have seen some people leave the FAA on a natural 
nothing out of the usual.
    You know, my sense is that there is just not enough 
specific procedures and processes for them to be able to follow 
and therefore they interpret on their own. We have not seen any 
reduction in resources in terms of lay-offs. That is for sure.
    Mr. HEFFERNAN. Nor have we.
    Chairman GRAVES. That is what I assume. You know, we keep 
hearing about not being able to do what they did before, but 
they have the same folks.
    I have a quick question for Mr. Heffernan about FSDOs, and 
in your line of work, which is a little bit different, I was 
just curious, have you ever lost business because your local 
flight standard's office was seen as too stringent or, you 
know, your customers as too stringent, and yet you hear of 
other FSDOs because there is so much various between them, 
other FSDOs, that are overlooking whatever it is that your 
particular FSDO is claiming as a problem? You see where I am 
    Mr. HEFFERNAN. Yes, sir. I do. We have seen a great 
disparity between FSDOs. It is one of the things that really 
concerns us right now. We have had customers, one customer 
example, has a Cessna 190, very old airplane. He has been 
coming to us for annual inspections year after year. This year 
we told him, you know, you probably need to pack it up and take 
it out to Montana. If we have to do the annual inspection here 
on it, the guidelines have gotten so stringent on corrosion 
that we are going to be replacing every piece of hardware on 
your airplane if we do the annual here. So my advice is, unless 
you want to incur that kind of expense take it elsewhere.
    We have seen quite a bit of conversation on the D.C. 
Pilot's website, some of the other pilot websites about people 
saying, you know, from now on they are going to be taking their 
airplanes to Pennsylvania or to another state for annual 
inspections because there is so much concentration right now on 
corrosion. The definition of what is and what is not acceptable 
    We all know unacceptable corrosion. If you get into an 
airplane and there is structural damage, there are rivets 
coming loose. Yeah, that is definitely taboo, but how much 
surface rust is inappropriate on a screw head or a bolt. You 
know, does to really weaken it? How do you know unless you do 
undestructive testing or destructive testing on the bolt?
    Things that were left up to NIA or to a repair station to, 
based on their 40, 50 years of experience doing maintenance on 
that make and model airplane, it was up to them to be able to 
make a judgment call as to whether they can pass it whether 
they can defer it to next year or whatever.
    Now that is not an opportunity. It is basically within our 
FSDO you replace it or you are in trouble. I just had a 
customer with a Grumman. It had a $12,000 dollar annual because 
we replaced every piece of hardware on there. A lot of was, I 
think pretty subjective, but that is the guidelines we are 
operating under.
    Chairman GRAVES. Mr. Hanna.
    Mr. HANNA. Thank you all for being here. I am a pilot, AOPA 
member for many years. I own an airport. I owned an airport, 
now I own a mortgage to an airport which incidentally is 
marginally better.
    My feelings about this business, and I am pretty familiar 
with it, is we have watched insurance go up, gas go up. We have 
watched licensing certification lessons go up to a point where 
if it is true, and I believe all of you have confirmed this, if 
we are going to have commercial pilots, we need a health GA 
business, right?
    Well, I submit to you that GA is really in big trouble 
because there is such a thing as critical mass. As a point 
where an industry is fundamentally dying rather than growing. I 
think that that is where GA has become.
    So I say to you, to the extent that the FAA's inability to 
go through this process more efficiently, and I have bought 
airplanes, I have waited years for certifications, is really 
killing the business. That it is not just all of you 
collectively and how you suffer day in and day out. You are a 
part of an industry that is in big trouble. The hobby that I 
love, and I know Sam and other people, members here do, is in 
danger of evaporating because you just cannot sustain the 
infrastructure we need to sustain if there isn't some amount of 
    So to the extent that things like additional gas taxes 
which, you know, everybody would prefer that over a user fee, 
particularly in this country where I can go into a dozen 
airports in a single day and go and come at my leisure. Whereas 
in Canada it is much more problematic. I have flown in both 
    I normally do not make this kind of statement, but I feel 
strongly about it, and I feel badly for the circumstances 
because it is unique in this country. It is an asset that is 
unique in the world to us, and it is a freedom that we have, 
that people enjoy. I look forward to my little boy learning to 
fly. He already owns an airport that I am going to give him, 
you know, in spite of your 12,000 dollar annuals every year.
    I guess I would ask you a question about it. We could argue 
about user fees. I mean, you are an academic. I am a realist. I 
don't mind paying more money, but I do not like user fees 
because they simply create as much of an expense as they 
pretend to collect money. In this country particularly, the 
airport I own, the idea of me having to be there to collect a 
fee to send to the FAA would be an utter and complete joke. It 
would not happen. I would have to leave a can at the end of the 
runway, you know, and some of you would have to drop five bucks 
in there.
    But do you think there is any truth in what I am saying? Do 
you think the whole industry is in trouble because of this? 
Cessna, you said there is 1,000 planes being made a year. 
Cessna just a few years ago was making 1,500, 1,600, you know, 
and you have seen consolidations with Beechcraft, and you have 
seen Columbia, and your plane, the Cirrus, right?
    It is not in good shape. By the FAA holding up the 
opportunity to move things more quickly, and frankly for us to 
be so litigious that everything we do has to be--if a third of 
the cost of an airplane is bound up in extraneous insurance 
costs, you know, that is crazy too. So I will just ask you to 
comment on my little talk. Thanks.
    Mr. BUTTON. I think the industry is in trouble. It has a 
big future though, as I said earlier, if it can think 
internationally and start selling its wares overseas, selling 
its pilot training skills, which is still does, to some extent 
in this country. There is a market.
    The law situation I think is much more of a problem, the 
litigation and so on is much more of a problem than the FAA 
rules. We talk about a few licenses being held up, but the 
number of court cases, the way the aircraft are operated and 
used, they are influenced. I was talking to some people while 
you were doing your democratic duties of voting. There are 
serious problems that are deterred from doing things.
    I think there is something else that one has to remember. I 
told the story earlier to someone. When my father was alive he 
used to talk about people and himself when he was young wanting 
to be a train driver. My generation in Britain, okay, we do not 
have too much general aviation, a lot of people want to become 
    These days the younger generation want to play on 
computers, and it is exciting for them to play on computers. 
They are used to flying. The younger generation get inside of a 
regional jet, a small regional jet, they get bounced around a 
few times. They have got their kicks.
    So I think there is a cultural change which is taking place 
which is often missed by people actually involved in it. I am 
outside so I tend to look at it. But I do not think the 
industry is dead. I think it has a huge future if it can start 
thinking--I think it does think internationally by the way. I 
don't want to----
    Mr. HANNA. Well, Cessna is building in China right now, 
    Mr. BUTTON. Exactly. But half the Chinese general aviation 
planes which is about 1,800 that are actually built in China do 
not work very well. They have very few pilots, very few 
training schools. They have huge taxes on imports. That is one 
reason Cessna is there.
    There is the Anglo-Chinese aviation operation.
    Mr. HANNA. When I got my license it cost me 1,000 bucks, 
    Mr. BUTTON. Yeah.
    Mr. HANNA. I took 40 hours.
    Mr. BUTTON. Yeah.
    Mr. HANNA. I was lousy at it, but I got by. Today it is 
5,000 minimum, and does not begin to give you any of the steps 
you need to become what Sam is and others here.
    Mr. BUTTON. May I pose the question, not acquiring the 
license, how much insurance did you need in those days compared 
to now?
    Mr. HANNA. It is an incredible difference. My point is, and 
we apparently agree, that every step of this business has 
gotten more expensive, more difficult. Whether kids want to 
stare at their computers or not, we have fundamentally taken 
away the opportunity for young people to look at it as an 
affordable outlet for a pastime or a career.
    Mr. BUTTON. I highly agree. But also I think a career is 
the important thing mentioned at the end where we have pilots 
moving into commercial aviation. They are earning 20,000 a 
year. I don't know. It is very low.
    There is some imperfection in the commercial aviation 
market which is discouraging people from moving into that area. 
It may be pay. It may be conditions. That needs to be examined 
    Mr. HANNA. According to you it is not supply and demand 
though? And with all due respect, somehow there is a gap there.
    Mr. BUTTON. There is a gap. The market is not working 
perfectly. You start hearing stories of airlines now 
recruiting, regional airlines recruiting pilots who formerly 
they would not have recruited. They got some blemish on the 
record, and they simply in the past would have stood back. Now 
they recruit them. There is a shortage there.
    There is a market failure up the chain. This is what I am 
mainly interested in, the use of aviation and training, the 
sales overseas. There is something not working well. Certainly 
change is required.
    I think the trade agreements are important. I think the FAA 
needs--and I think it is moving in the right direction, it is 
the speed that is the problem, but I think things need to be 
    It is your perception is because you are inside. I think if 
you stand back and look at the global market, the U.S. has got 
sort of the best planes in the world, the best training 
facilities in the world. There are huge developments in Asia. 
There are huge developments in South America. There is a huge 
opportunity out there which needs to be dealt with.
    I think the main problem is with trade barriers as opposed 
to domestic barriers. But having said that, and I said it 
earlier, you have to have a strong domestic industry, a strong 
domestic sector----
    Mr. HANNA. But if the creation is taking place here, and 
there are small manufacturers. I bought a few plans from a 
wonderful company, Jim Richmond, CubCrafters. You guys know 
him. He has been in business all his life. He loves it. I doubt 
if the guy is ever going to get rich, but he makes a marvelous, 
marvelous product.
    It took him five years to get a wing load changed to go 
from 1,700 pounds to 2,000 pounds. I know because I waited for 
that. It is ridiculous.
    So those things are things that we can do on the margin. 
And I apologize for my time, Chairman. That we can do on the 
margin to change that dynamic and slow down what I think is an 
industry approaching critical mass, we should do it every 
opportunity. With that I will thank you for your indulgence.
    Chairman GRAVES. Mr. Payne. Sorry, I did not see you over 
    Mr. PAYNE. Thank you, Mr. Chairman. To all the panelists, 
thank you for your testimony. Today general aviation provides 
approximately 18,000 aviation related and dependent jobs in New 
Jersey, and contributes to at least 624 million to household 
incomes and an estimated 1.7 billion in annual economic 
benefits. So I certainly have an interest in preserving and 
protecting small business in this industry.
    However, as Dr. Button's testimony mentioned, I believe our 
challenge is not only to consider the impact of regulation on 
small businesses, but also to consider the general public 
interest particularly in the area of safety.
    Your testimonies have been helpful today, and I am hopeful 
that we can balance support for the important work that you do 
with the safety of the people we represent. So I look forward 
to working with my colleagues on the Committee on striking a 
    With that, I yield back the balance of my time.
    Chairman GRAVES. Thanks Mr. Payne. A question for Mr. 
Larkins, and anyone else can answer too, but in your testimony 
you briefly touched on the sleep apnea issue which, you know, 
sent reverberations throughout the aviation community. We have 
basically got four segments of aviation out there. The GA 
community, we have corporate aviation, we have those folks that 
use aviation for their businesses and need to use it, but they 
may not necessarily be their business, we have hobbyists, and 
then we have the airlines out there too.
    My question to you is, when you have something that is just 
an out-of-nowhere ruling by the FAA, and we are talking about 
resources, talking about finite amount of resources to be able 
to use when it comes to regulating aviation, and you go through 
the medical process which we have talked about earlier, you 
cannot even ask an applicant about their heart attack history, 
but yet now they want to know about the circumference of your 
neck and how that relates to your body mass, and the size of 
your head and whether or not you have sleep apnea which I have 
not heard of anybody, and this may go back to a data issue, but 
I do not know of anybody that has crashed because they fell 
    But the truth of the matter is, how does that affect you 
and your business when it comes to potential clients when you 
have these things that just come out of nowhere and people do 
not know what to expect?
    Mr. LARKINS. It is an important issue and it touches on 
what we talked about earlier in the oral testimony that 
industry working with the FAA is extremely important. We look 
at RVSM certification as one example of that. That when the 
industry and the FAA meet together we can come up with the 
reasonable solutions that ensure safety, but at the same time 
allows the industry to continue to operate.
    When there are things that pop up out of nowhere, like the 
sleep apnea thing, and there is not enough opportunity for the 
industry to communicate on it initially that is when a lot of 
issues start to come up.
    Without the FAA getting the opportunity to talk to some of 
the pilots and the operators inside of the industry then I 
think that we see some of these issues of overreactions, in a 
lot of ways, that may happen. I am very proud to see some of 
the potential legislation that is coming out that will prevent 
the FAA from getting the opportunity to implement some of those 
things without more interaction and feedback from the industry 
right now.
    Chairman GRAVES. Anyone else? Uczekaj?
    Mr. UCZEKAJ. Clearly things that come out of the blue are 
probably the most damaging things to our industry. Whether they 
be the sleep apnea or regulation changes that have no basis of 
either fact or experience. That creates a very damaging 
environment for us to develop and create safety products.
    I want to refer back to Mr. Payne's comments about safety. 
Aerospace is no different than any other industry that we are 
striving to develop products, and striving to put in processes 
and procedures for individuals to make flying more safe. 
Whether that be a sleep apnea issue or a health issue or a 
functional issue.
    But when the system itself does not allow for the proper 
due process, and once that due process is in a method to 
efficiently implement change, this is technically what you get. 
You get people and statements made out of the blue, and then we 
spend as an industry valuable dollars and time countering that 
when we should be spending time on doing the things--creating 
better safety products, better safety processes, so that we can 
improve both the reality and the perception of aviation.
    It is very frustrating as a pilot and as a manufacturer 
that so much time and effort was spend on that particular 
subject instead of other subjects of more relevance to safety.
    Chairman GRAVES. Mr. Heffernan?
    Mr. HEFFERNAN. We have spoken here a bit about perception 
and perception driving things. I think this is one of the areas 
where perception is driving people out of the aviation market, 
out of general aviation. As they get older they see these 
things cropping up out of the blue, and they see their friends 
that lose their medicals for one reason or another, cannot get 
them back.
    There are people that could probably get their medicals 
back, but they have lost the interest or the will to continue 
to pursue it. When they see things come out of the blue like 
this it reinforces their decision to get out of aviation and 
just go buy a boat or whatever.
    I think, you know, one of the things that has always 
bothered me about the medical is I don't know any pilots that 
have gone through all the training and all the sacrifice, and 
everything it takes to become a pilot and to be certified, that 
want to be unsafe. People want to be safe. I think they will 
self-police themselves.
    I think the dollars will be much better spent doing 
training to help people assess if they are physically qualified 
to fly, if there are any warning signs they should be looking 
for. That would be a much better approach, spending the dollars 
on that aspect rather than trying to legislate some off the 
wall, out of the blue condition.
    It has always amazed me that you read all the list of drugs 
that would prevent you from flying. You look at things that 
people take for granted that--we all know people that are 
taking these, anti-depressants. You can't fly and take anti-
depressants. Are people really going to tell the truth during 
their medical exam that they are actually taking those or are 
they going to make the decision to fly and not take them, so we 
have a lot of depressed pilots flying around. That is not safe 
    I just think there is an avenue here for people to police 
themselves, and I think education is the way to do it.
    Mr. BUTTON. My only observation is looking at the data of 
what causes--some of the data on contributory factors. You do 
have drugs and alcohol being influential in a number of 
crashes. You do have intentional disregard being a factor.
    I take the point about self-policing. I think most people 
self-police when we drive or whatever we do. Most people are 
very, very sensible.
    My argument about perception is probably slightly 
different. I think people have got to perceive the system to be 
working, and at the moment we do not know whether it is working 
very well. When you present this sort of data to an individual 
where you do have drugs and alcohol involved in accidents, not 
a large number, but some accident, intentional disregard. I am 
not quite sure if that is, to be blunt, suicidal tendency, I am 
not sure. That is something which worries the general public.
    Now, I'm not sure, and I sent the questions out about the 
Winnebago versus the aircraft, the general aviation aircraft. 
I'd like to just know more information which does not seem to 
be available from the FAA. They do take decisions, as you 
rightly said, sir, and the panelists said, and just something 
appears. You just get something coming out from the FAA.
    I think that may be a flaw in the FAA in terms of its 
public relations or it may be a flaw in its data sources. I 
don't know, but it is a problem.
    You can't just suddenly have some arbitrary notion that 
someone may suddenly fall asleep. I mean, I find that rather 
    Chairman GRAVES. You mentioned alcohol and drug abuse in 
accidents and being a fair number. Do you have any suggestions 
on policing that?
    Mr. BUTTON. Well, it could be the alcohol have a sort of 
Breathalyzer kit you have in a car. Basically you cannot start 
a car unless you breathe into a piece of technology that tells 
the technology not subject to alcohol. I am not sure that is 
too expensive either, actually.
    Drugs I do not know about. I am not sure what drugs are 
out. I am not an expert on drugs, but it does not seem to me to 
be too expensive, and for everyone's benefit to actually 
breathe into a Breathalyzer on a plane and not be able to start 
it without being clean.
    Chairman GRAVES. Should we do that with cars, trucks, 
    Mr. BUTTON. I think we should.
    Chairman GRAVES. Busses, boats?
    Mr. BUTTON. I certainly do, yes.
    Mr. HANNA. Chairman, do you mind if I ask a question? Since 
there is no one on the other side, so. I will tell you what my 
experience with pilots is, and I know hundreds of them. I owned 
an airport. I watched them.
    They are a unique group of people, very much focused on 
what they do, but if there is any group that I have ever seen 
that can adjust what they do individually to their skill level 
it is pilots. People who are not IFR current, they are the 
first ones to know, but they can still have a current capacity 
to do that.
    What is see is older people knowing they have, or whatever 
their situation is, they do not fly enough. Incidentally, 
average pilot flies about 19, 20 hours a year. It is not nearly 
enough. We should encourage them to fly more to make it safer, 
therefore make it cheaper, not more expensive.
    But what I see is people only fly in good weather. They 
only fly in the afternoon and in the morning. How about you, 
Sam, is that what your experience is?
    Chairman GRAVES. I think very much so.
    Mr. HANNA. People pretty much self-police. It is pretty 
easy to fall under the radar if you want to. You do not need to 
get your annual. You do not need to get a bi-annual. You do not 
even need insurance, frankly.
    I think the more punitive we become, this industry is 
becoming the victim of the death of a thousand cuts. Pick an 
area of it that is not punitive and yet in this country we are 
more free doing it than any place in the world.
    I just think we should encourage it and not be so inclined 
to tell people that they should not want to kill themselves 
because they already know that. Thank you.
    Chairman GRAVES. I want to thank all of you for 
participating today. I want to, again, apologize for the vote 
series, but the testimony has been very good. I think it is 
critical to the success of general aviation, to the entire 
industry, that the FAA does a much better job of working with 
stakeholders so they can better meet the needs of those that it 
regulates, and boost the industry rather than dragging it down.
    General aviation is a significant contributor to our 
economy, and, you know, I think the FAA has to keep up with the 
advances in the industry to allow it to continue as a very 
dynamic force in our economy.
    It is a very important issue to be, obviously, and I think 
it is an important issue to every community out there that 
depends on aviation, and that is just about every community out 
there, and so many businesses that depend on it.
    So with that I would ask unanimous consent that members 
have five legislative days to submit statements and supportive 
material for the record. Without objection that is so ordered, 
and with that the hearing is adjourned, and, again, I thank you 
all for coming.
    [Whereupon, at 3:32 p.m., the Committee was adjourned.]
                            A P P E N D I X

                              Statement of

          John Uczekaj, President and Chief Executive Officer,

                          Aspen Avionics, Inc.

      On Behalf of the General Aviation Manufacturers Association

                      Committee on Small Business

                     U.S. House of Representatives

                     FAA Impact on Small Businesses

                            February 5, 2014

    Chairman Graves, Ranking Member Velazquez and distinguished 
members of the Committee, I appreciate the opportunity to 
appear today to discuss the impact of the FAA on small 
businesses in the general aviation industry and want to thank 
you for your holding this important hearing. As a leader of a 
small business, I look forward to highlighting some examples of 
the impact specific FAA policies and internal organizational 
structures have on small aerospace businesses.

    My name is John Uczekaj and I am president and chief 
executive officer of Aspen Avionics located in Albuquerque, New 
Mexico, I also serve as a board member for the General Aviation 
Manufacturers Association (GAMA), with a leadership position 
within GAMA as chair of their Flight Operations Policy 
Committee and am honored to provide testimony to the Committee 
on their behalf as well today. Finally, as an instrument-rated 
pilot and aircraft owner, the opportunity to testify before 
this Committee is especially significant to me.

    In 2004, Aspen was founded by two aviation enthusiasts with 
a mission of designing and manufacturing the most advanced 
avionics technology and capability for general aviation 
cockpits at a price that was affordable to small aircraft 
owners. Aspen Avionics' products increase a pilot's situational 
awareness in the cockpit, support the implementation of NextGen 
technologies, and reduce pilot workload, making it easier and 
safer to fly in both visual and instrument conditions.

    In 2008, Aspen Avionics began delivering FAA certified, 
ground breaking technologies to the lower end of the certified 
general aviation industry. These products included simplified 
lower cost installation architectures, flat panel displays, 
three dimensional terrain awareness, battery backup, and 
NextGen capabilities. Prior to the entry of Aspen Avionics into 
the market these certified technologies were too expensive for 
a large portion of the general aviation fleet and were reserved 
for higher end aircraft including business jets and commercial 
air transport aircraft. Since that time over 6,000 of our Aspen 
systems have been installed into general aviation aircraft 
worldwide, which is a testament to our company, our employees 
and our product's capabilities.

    With just 47 employees, Aspen's entrepreneurial spirit is 
key to its success. Also key is the discipline we must have in 
managing costs and delivering a return to our investors. The 
company is guided by a Board of Directors, whose investment in 
Aspen is made with the expectation of a profit in the future. 
In order to keep costs low for our customers we operate on 
tight margins.

    One of the biggest challenges we face as a small business 
is response times for FAA approvals. Each week, small aerospace 
businesses like Aspen are losing hundreds of thousands of 
dollars due to approval delays from the FAA. In recent years, 
when a small business begins the process of developing a 
certified product it must submit to a sequencing process by FAA 
of certification projects. The process in unpredictable and 
often results in increased product development times and costs 
as companies develop the product and wait for the FAA to apply 

    Once through the sequencing process, companies must deal 
with a lack of clarity in expectations and inconsistency 
between certification offices in different regions and within 
individual offices at FAA. This is a major barrier to success 
and often survival. Various offices interpret guidelines 
differently. More importantly, even within a certification 
office, procedures followed on previous programs are 
implemented and interpreted differently on later programs. FAA 
has proposed changes to the sequencing process but the totality 
of the entire process and the threat of costly delay remains a 
real concern for our company and many others.

    Changes in personnel in the middle of a program further 
exacerbate our problem and are compounded by agency personnel 
adding or changing tasks at the end of a program with great 
impacts. Aspen specifically has been affected during a recent 
program where additional work levied late in one program 
resulted in unplanned, increased costs and a resulting loss of 
13 high paying quality jobs (20% of our overall workforce) in 
October 2013. Imagine this outcome, multiplied by hundreds of 
small aerospace businesses who experience this on a regular 
basis. The money saved by instituting clear procedures, 
consistent training, and detailed certification guidelines to 
FAA personnel would boost productivity, grow the industry, and 
secure jobs.

    As a small business Aspen Avionics also has raised private 
capital for investment in new products. Our inability to 
accurately plan our tasks associated with certification is a 
major disadvantage for companies of all sizes, but particularly 
for small business like mine. We need to account for these 
inefficiencies in our costs projections, thereby lowering our 
potential returns and making it very difficult to draw the 
interest of financial investors.

    To be successful, businesses, and in particular small 
businesses, need to clearly understand the tasks and be able to 
expect the FAA to respond in a timely fashion. Certification 
plans provided early in the process need to be approved and 
followed without new requests being levied late in the 
programs. This will allow us to plan our tasks, execute them, 
and keep costs down, bringing safety critical products to the 
market on time and at affordable costs.

    Many companies like ours are developing new and innovative 
solutions to meet FAA NextGen mandates to equip over 157,000 
aircraft facing a January 1, 2020 deadline. These aircraft 
operators will have a limited time to schedule and complete 
these avionics upgrades. While 2020 may seem like a long time 
from now, current delays in the certification process shortens 
that time period exponentially. In my opinion, accelerating the 
efficiency and response time for approvals is one of the top 
issues we must work together to solve. If not addressed soon, 
certification delays for NextGen avionics will become 
overwhelming and the significant investment in the ATC 
infrastructure could be compromised. With Congress, FAA, and 
the private sector working together, we can address NextGen 
equipage effectively and make the overall program a success. 
Urgent and real safety benefits can be delivered if we invest 
the resources and develop the approvals and guidelines to speed 
up the certification process.

    One crucial way to address these issues, particularly for 
larger companies, is through the establishment of 
Organizational Design Authorities (ODA). The cost, however, of 
supporting an ODA for a small business can be prohibitive. 
Aspen does employ and contact with some of the most experienced 
Designated Engineering Representatives (DER) in the country for 
systems, flight test, software, and structures at great 
expense. Many of these individuals have over 35 years of 
experience. In addition, the senior members of our company have 
similar levels of experience in avionics development. We hire 
such capable individuals to ensure our products meet and exceed 
the requirements of the most stringent regulatory procedures. 
We have a vested financial interest to ensure our products are 
safe, reliable, robust and perform as promised. Our success 
depends on it. The success of our competitors depend upon it.

    Likewise, we also understand that the FAA is working under 
increased fiscal pressures. With limited resources it is even 
more critical that we leverage the expertise of companies like 
Aspen to improve safety, drive innovation, and improve 
certification efficiency. Delegation to companies like Aspen 
that have invested in experienced and industry-respected DER 
resources is a viable answer for our businesses and the FAA. We 
encourage the FAA to make more consistent use of this very 
valuable tool to ensure safety and the viability of innovative 
small businesses in aviation.

    I also propose we look at ways in which we can work 
together to grant some sort of airworthy certification 
authority for small businesses to help ``cross the finish 
line'' and speed up the certification process. People in small 
businesses like ours, and especially those that work in 
aerospace, have a passion for the industry and work in this 
business because they want to--not because they have to. To 
help alleviate the workload, aligning the division of 
responsibilities and the authority properly is essential to 
ensuring the vitality of aviation small businesses and the 
advancement, growth and safety of general aviation.

    Such creative thinking and collaboration is exemplified by 
the Small Airplane Revitalization Act which was signed into law 
by President Obama in late November. On a bipartisan basis, 
members of Congress came together and passed legislation which 
will improve safety, encourage innovation, and promote growth 
in aviation. A legislative focus on small businesses in 
aerospace could result in similar benefits.

    From an Aspen Avionics perspective, another wonderful 
example of this collaboration is the NextGen FA Fund. When 
Congress passed the FAA Reform and Modernization Act of 2012, 
they included Section 221 to incentivize GA equipage through 
use of a public private partnership (PPP), where 100% of 
funding for low interest loans are underwritten by private 
sector investors. The PPP, called the NextGen GA Fund, is ready 
to launch and we are optimistic about its impact on the 
industry. Just announced last week, Aspen Avionics is the first 
small business to support this important initiative. I only 
mention this as an example of the ways we can work on together 
to help small businesses in the aerospace industry to continue 
to contribute to an important part of the country's economy. It 
is my opinion that this is what government should be doing to 
lift general aviation as an important economic sector.

    Thank you for the opportunity to testify about how my small 
business interacts with our regulator, the FAA. I want to be 
clear, we appreciate their work, dedication, and attention, but 
also believe there are opportunities to improve and reform 
their efforts to maximize benefits, improve safety, and allow 
small businesses like Aspen Avionics to flourish. I look 
forward to discussing this further and would be happy to answer 
any questions you may have.


    Chairman Graves and Members of the Committee:

    I am Austin Heffernan, Owner and General Manager, Royal 
Aircraft Services.

    Royal Aircraft Services is a highly regarded FAA Certified 
Repair Station located in Hagerstown Maryland. Our staff of 14 
employees handles major structural repairs, aircraft painting, 
aircraft restoration and general maintenance for General 
Aviation aircraft owners based throughout the Mid-Atlantic 
United States.

    I'm also representing the Aircraft Owners and Pilots 
Association (AOPA) of which I have been a member of since 2002. 
AOPA is a not-for-profit individual membership organization 
representing nearly 400,000 members. AOPA's mission is to 
effectively represent the interests of its members as aircraft 
owners and pilots concerning the economy, safety, utility, and 
popularity of flight in general aviation (GA) aircraft.

    My testimony today will cover the following key points:

          1. General aviation is a heavily regulated industry;

          2. Rapidly changing technology offers new safety and 
        operational benefits, but regulations have not kept 
        pace with technological advancements, preventing 
        general aviation from receiving these benefits; and

          3. FAA policies and internal structures are 
        increasing the cost of participation in general 
        aviation without providing commensurate safety 

    General Aviation

    As pilots flying in the United States, we are fortunate to 
have access to the safest and most efficient air transportation 
system in the world. The aviation network of 5,200 public-use 
airports, complemented by the more than 13,000 privately owned 
landing facilities is a unique national resource. General 
aviation is a significant economic engine that contributes 
approximately $150 billion to the annual gross domestic product 
and approximately 1.2 million jobs in communities nationwide. 
Each year, 170 million passengers fly using personal aviation, 
the equivalent of one of the nation's major airlines.

    General aviation is of special importance to small 
businesses and an estimated 65% of all general aviation flights 
are conducted for business and public services. Additionally, 
the Small Business Administration has estimated that 
approximately 94% of the firms that provide cargo and passenger 
air transportation services are considered small businesses, as 
are 90% of businesses involved in the development and 
manufacture of aircraft and parts.

    In addition to these businesses, general aviation activity 
directly supports thousands of small businesses from flight 
schools to repair shops to line operations. Thousands more 
small businesses of every type use general aviation to 
transport personnel, move products, extend their geographical 
reach, meet clients, provide support services, and manage 
distant operations.

                       FAA's Regulatory Oversight

    General Aviation is Heavily Regulated

    The FAA oversees all aspects of general aviation, including 
recreational, private, business, and commercial flying. Pilot 
training, medical certification, aircraft certification and 
maintenance, operations in the National Airspace System, and 
many other aspects of utilizing aircraft and operating aviation 
businesses are regulated directly or indirectly by the FAA. 
These regulations have evolved over time into a complex and 
intertwined legal morass that often limits or slows the 
adoption of new safety enhancing technologies and practices.

    The FAA routinely finds its hands tied by existing 
regulations when it wants to encourage the adoption of newer 
technologies and practices that could enhance safety. In many 
instances, the regulations have evolved in a way that forces 
the FAA to go well beyond its role as regulator and become 
directly involved with the operational aspects of the industry.

    Impacts on the General Aviation Industry

    While the amount of regulation increases, the general 
aviation industry shows many indications of decline and 
stagnation. Since 1991, the industry has seen a steady decline 
in the total number of pilots, with the greatest decrease in 
the number of private pilots--a loss of nearly 6,000 per year. 
These private pilots are the main market for many of the on-
airport small businesses that make up the general aviation 
industry. Businesses providing flight training, aircraft rental 
and repair, engine overhauls, fuel, and other products and 
services are impacted by this decline.


    Regulations Prevent General Aviation from Benefitting from New 

    Current regulations, policies, and procedures make it 
difficult or impossible for general aviation to adopt and 
implement new technology. The following examples are 
representative of the types of challenges facing general 
aviation operators who want to use new safety technologies.

    Technology in Flight Training - Use of Flight Simulation

    Pilots and flight training providers have benefited greatly 
from advancements in simulation technology. Simulators give 
pilots a realistic experience of a wide range of flight 
conditions in a way that is far safer, more efficient, and more 
cost-effective than attempting to provide equivalent training 
while airborne.

    While commercial and corporate aviation have had access to 
simulation for many years, affordable simulators have become 
available to most general aviation training providers only in 
the past decade or so. The FAA has been challenged to keep up 
with the advances in this area and has struggled to provide 
consistent, effective, and flexible oversight.

    In January, the FAA issued a new policy in an attempt to 
update and standardize its patchwork of existing guidance, 
letters of authorization, and advisory circulars. Rather than 
promoting the use of this proven technology, the new policy 
actually reduces the amount of time a simulator can be used in 
some types of flight training until regulatory changes can be 
made. Industry has asked the FAA to rescind the new policy 
statement, initiate expedited rulemaking to allow a higher 
number of simulator hours to be credited, and then reissue its 
current guidance and standards.

    Aircraft Certification Reform - Technology in New Aircraft

    Just last week, the FAA Administrator and his senior staff 
met with the leaders of the major general aviation associations 
to discuss safety and the need to bring new technology into 
general aviation. Today's prescriptive and outdated rules 
inhibit innovation and are the major barrier to developing and 
producing safer aircraft. AOPA has long advocated streamlining 
the aircraft certification process and we are encouraged that a 
major FAA-industry effort is underway to reform the aircraft 
certification regulations (Part 23) so as to increase safety 
while decreasing cost. AOPA is actively engaged in this 

    In November, these efforts get a boost when the Small 
Airplane Revitalization Act was passed by Congress and signed 
into law by the President. I'd like to thank Chairman Graves 
and Small Business Committee Members Hanna, Heulskamp, and 
Collins for cosponsoring this bill.

    Existing Aircraft Must Also Benefit from New Technology

    While streamlining certification for new aircraft is 
important, reform efforts must be expanded to ensure that 
owners of existing aircraft can make safety improvements. The 
current FAA regulatory structure makes putting new technology 
into older aircraft challenging at best and prohibitive at 
worst. This issue was at the center of the industry-led portion 
of last month's safety discussions with the Administrator.

    There are approximately 200,000 GA aircraft flying, and 
manufacturers produce just over 1,000 new aircraft each year. 
These numbers clearly indicate that the biggest safety payoffs 
will come from upgrading older airplanes. Making it easier to 
upgrade aircraft will have another payoff as well--creating 
well-paying jobs for those who design, manufacture, and install 
the new equipment.

    The Part 23 Reorganization Aviation Rulemaking Committee 
has provided recommendations for changes to other regulations, 
such as Parts 21 and 43, and existing policies and procedures 
to improve the ability to modify, maintain, and upgrade 
existing aircraft. Industry would like the opportunity to work 
with the FAA to prioritize these areas and help develop changes 
that can enable and encourage the addition of safety 
enhancements, equipment upgrades, and new operational equipment 
for existing aircraft.

    Moving Forward on One Safety Improvement

    The FAA has indicated that, after nearly three years of 
work, it will soon release a new policy that is intended to 
streamline the approval of angle of attack indicators for 
existing aircraft. The angle of attack indicator is an 
important safety technology that could help reduce the number 
of accidents caused by loss of control--the leading cause of GA 
accidents. To date, retrofit of this technology has been 
hampered by the cost and complexity of the equipment--factors 
driven in large part by FAA regulations.

    We look forward to reviewing the new policy and we're 
hopeful that it will serve as a model for bringing other non-
required safety enhancements into general aviation more quickly 
and efficiently.

 FAA policies and Internal Structures that are Increasing the Cost of 
             Participation in the General Aviation Industry

    Medical Certification for Private and Recreational 

    The FAA third-class medical certificate is primarily used 
by pilots who want to fly recreationally or for private 
transportation. The cost and regulatory process associated with 
obtaining and renewing the medical certificate, and the fear of 
being denied and sent through the bureaucratic hoops and 
extensive testing required to get it back, are contributing to 
the precipitous decline in number of private pilots.

    A petition, presented by AOPA and EAA (Experimental 
Aircraft Association), seeks to reduce the cost and hassle of 
the FAA medical certification process while maintaining and 
potentially increasing safety through education. The petition 
would expand the FAA's existing driver's license medical 
standard to more aircraft and operations than currently 
allowed. That standard, which allows pilots who also hold a 
valid driver's license to certify their own fitness to fly, 
already exists for pilots flying under Sport Pilot rules and 
has been proven safe. The proposal would expand that privilege 
to pilots flying certain small piston-powered aircraft under 
specific conditions and would add a level of safety by 
requiring pilots to take recurring training on how to 
effectively determine their fitness to fly.

    AOPA and EAA conservatively estimated that giving pilots 
the option to use a driver's license standard instead of a 
third-class medical for certain operations would save pilots 
$241 million over 10 years while saving the government $11 
million over the same period. Granting the petition wo9uld keep 
pilots flying and therefore supporting the small businesses at 
their local airports.

    More than 16,000 comments were filed on the petition, and 
they were overwhelmingly favorable, but almost two years after 
the petition was filed, the FAA has not provided a formal 

    On December 11, 2013, Chairman Graves and fellow AOPA 
member Congressman Todd Rokita, both members of the House 
General Aviation Caucus, introduced the General Aviation Pilot 
Protection Act. The legislation goes a step beyond the AOPA-EAA 
petition. It would allow pilots to use the driver's license 
medical standard for noncommercial VFR flights in aircraft 
weighing up to 6,000 pounds with no more than six seats.

    FAA Unable to Provide Approvals Required by Regulations

    The current regulatory system requires the FAA to issue 
approvals, in the form of Air Agency Certificates, to many 
areas of general aviation operations. In some cases, these 
approvals are required before businesses can begin operating. 
Air Agency Certificates are required for charter/on demand 
operations (Part 135), flight schools (Part 141), training 
centers (Part 142), and repair stations (Part 145). In many of 
these areas of responsibility and in many parts of the country, 
FAA backlogs in issuing these certificates are significantly 
hindering the ability of small businesses to operate.

    At the October 30, 2013 Aviation Subcommittee hearing on 
Certification Reform, the assistant inspector general for 
aviation audits for the Department of Transportation reported 
that the FAA has a current backlog of 1,029 air agency 
certificate applications. Of that backlog, 138 applications 
have been awaiting approval for more than three years and one 
has been stalled since 2006.

    Industry is willing to work with the FAA to find a way to 
address these delays and to move forward with granting these 
approvals. It is troubling that the FAA implements these 
requirements by regulation but cannot provide the resources 
when operators are ready to demonstrate compliance.


    In conclusion, we believe there are a number of steps the 
FAA can take to address the overregulation of general aviation 
while maintaining or increasing safety. Additionally, these 
changes will increase participation in general aviation, 
benefit small businesses, increase employment, and promote 
economic growth.

          1. Congress should continue to urge decision makers 
        to consider changing the policies, guidance, and 
        regulations in ways that will encourage and advance the 
        use of modern technology in all aspects of aviation, 
        especially the installation of technology in existing 

          2. Congress should urge decision makers to focus 
        attention on resolving the internal issues that are 
        preventing and delaying issuance of required FAA 
        approvals, thereby preventing many small businesses 
        from starting or expanding.

          3. We appreciate Congress' recent passage of the 
        Small Aircraft Revitalization Act directing the FAA to 
        streamline aircraft certification. This will have a 
        significant impact on deploying new and improved safety 
        technologies to general aviation aircraft. We look 
        forward to Congress taking action on the General 
        Aviation Pilot Protection Act, which if passed, would 
        reduce the regulatory burden and cost on general 
        aviation and encourage people to fly.

    Aviation is American. It started here in this country and 
we need to maintain our leadership in this area. We need to 
find ways to encourage and grow this amazing industry and we 
appreciate your support. On behalf of the 14 employees of Royal 
Aircraft Services and the nearly 400,000 members of AOPA, thank 
you for your leadership in addressing the concerns of the 
general aviation industry so that it can continue to help small 
businesses nationwide grow and thrive.

    Thank you for the opportunity to appear before this 
                              STATEMENT OF

                             JAMAIL LARKINS

                        ASCENSION AIRCRAFT, INC.

                            REPRESENTING THE




                     U.S. HOUSE OF REPRESENTATIVES




                           AVIATION INDUSTRY

                            FEBRUARY 5, 2014

    Chairman Graves, Ranking Member Velazquez and members of 
the Committee, my name is Jamail Larkins, and I'm a businessman 
from Atlanta, Georgia.

    I'm pleased to be here as a proud member of the National 
Business Aviation Association. My company, Ascension Aircraft, 
has been a member with the association since 2008.

    While NBAA often appears before Congressional Committees to 
represent its Members, this is the first time I've testified 
before Congress. It's a privilege to be here.

    Business Aviation: A Big Benefit for Small Businesses 
Across the U.S.

    In 2008, I founded Ascension Aircraft, and today I serve as 
the company's CEO. Although my company is a regional leader in 
the sale of fractional-ownership shares of piston aircraft, the 
business employs just 19 people, including myself.

    Over the years, I have found that one of the most effective 
ways to sell business aircraft is to use business aircraft. 
With a business airplane, I can quickly seize opportunities as 
they arise. The airplane enables me to meet face-to-face with 
potential clients, providing a level of service and 
accountability that helps me get a leg up on my competition, 
and build my company.

    Of course, many of my clients are small business owners and 
entrepreneurs themselves. They are often located in out-of-the-
way places, and like me, they recognize the many benefits an 
airplane can bring to their enterprises.

    With a business airplane, an entrepreneur can travel to 
multiple cities for meetings in a single day, return to 
headquarters that same evening, and be back in the office the 
next day. With an airplane, a businessperson can transport 
tools or products that may be too large to fit into an 
airliner's overhead bin, or too delicate to be checked into an 
airliner's cargo hold. With a business airplane, an 
entrepreneur can efficiently manage work sites that are distant 
from each other, and are often located in small towns with 
little or no airline service.

    Simply put, for many small business owners and 
entrepreneurs--people like me--the use of an airplane is vital 
to success. It is the tool that makes the business model work.

    Interestingly, you don't often hear about companies like 
Ascension Aircraft when people talk about business aviation. 
Instead, people tend to focus on large Fortune 500 companies. 
But for every Fortune 500 company that relies on business 
aviation, there are eight or nine companies like mine--in fact, 
the business aviation community is made up mostly of small and 
mid-size enterprises.

    Every member of this Committee has small businesses like 
mine in their state. And the use of an airplane often enables 
those companies, and the jobs that come with them, to remain in 
communities that can sometimes be harder to reach than the 
metropolitan areas.

    That's a win not just for the companies using the 
airplanes, and their employees--it's a win for the countless 
thousands of workers at community airports where business 
aircraft fly. It's also a win for the many additional thousands 
of employees in the towns surrounding those airports, because 
their businesses often exist due to the activity at the local 

    The reason you've asked me here today is not just to talk 
about the benefits of business aviation to small enterprises, 
but about how the work of the Federal Aviation Administration 
affects those of us with small businesses.

    If there is anything I'd like you to take from my 
testimony, it is this: The United States not only has the 
world's largest, safest, most diverse and most efficient 
aviation system--it is also the best system in the world for 
allowing small companies like mine to optimize business 
aviation, so that we can succeed in today's enormously 
competitive global economy.

    That said, while America's aviation system is an enormous 
public benefit--one that should continue to be run by the 
government, with oversight from Congress--there are a number of 
ways the FAA could strengthen its relationship with the small 
business community, so that the policies and procedures 
involving the agency are more workable and effective, for the 
both the agency and the businesses that rely on an airplane.

    In fact, I would offer that because business aviation is 
more regulated than other industries, the relationship between 
the FAA and the small businesses utilizing aircraft must be a 
productive one--not just today, but also when we think about 
the aviation system of the future, and how small businesses 
like mine will operate in it.

    A Highly Regulated Community, A Need For FAA/Industry 

    When we think about the regulatory regime for business 
aviation today, we know that, largely for safety reasons, 
stringent policy requirements are appropriately placed upon the 

    The services needed to meet those requirements are largely 
provided by the FAA, which makes the agency critically 
important to the business aviation community. And when those 
services go unmet, or when onerous policies are implemented--
sometimes without sufficient industry input--business aviation 
suffers, and its benefits to citizens, companies and 
communities, is jeopardized. Here are four examples to 
illustrate my point.

    Example 1: Government Shutdowns Take A Terrible Toll on 

    We know that the government shutdown last year led to the 
closure of the FAA's U.S. Aircraft Registry. As a result, 
aircraft could not be purchased, sold, imported, exported, and 
in some cases, flown.

    I'm in the business of selling aircraft, so I have a first-
hand understanding of the toll the registry shutdown had on 
companies in my line of work. These are mostly small 
businesses, often family owned, and comprised of just a few 
people. They're located across the country, and when the 
government was shuttered, their business was stuck in an 
unending layover.

    Fortunately, after 17 days, the government shutdown 
concluded, and the registry was reopened. But, the effects of 
the shutdown were felt by many in the aircraft-transaction 
business for weeks following the shutdown. Government and 
industry would be well served by working together to ensure 
that if a shutdown were to occur again, the registry would 
remain open.

    Example 2: Aviation-Business Approval Backlog Has Hamstrung 
Job Creation

    We also know that FAA policies are central to the operation 
of small aviation businesses, such as training centers, flight 
schools and on-demand charter operators, which require approval 
from the FAA before conducting business.

    At the same time, as FAA resources are dwindling, the 
backlog of businesses attempting to gain certification and 
begin soliciting customers has swelled to nearly 1,000. Some 
businesses have been told that their wait for approval could 
take two to three years.

    We know that small businesses like these are the lead 
drivers of job creation and economic investment in the U.S., 
which means we need for the FAA to find ways to streamline its 
start-up approval processes. That way, the growing number of 
general aviation businesses facing these needless delays can be 
approved to get underway, creating jobs and investing in local 

    Example 3: Some Complicated Operating Requirements Need 

    On the operations side of the industry, we know that many 
companies use aircraft that are subject to a raft of often-
complex government requirements, related not only to equipage 
with specific navigation, communication and surveillance 
capabilities, but also requirements for specific government 
approval for the operator to use that equipment onboard the 

    Among these requirements are rules for approval of aircraft 
operations using equipment allowing for Reduced Vertical 
Separation Minima (RVSM). Thanks to government/industry 
collaboration, RVSM-authorization requirements were recently 
smoothed, even as important safety standards were protected. 
There are many other, similar authorizations that could be 
streamlined as well, reducing the burden on businesses and 
government officials alike.

    Example 4: Alarming New Policies for Pilots Are Emerging, 
Absent Industry Input

    As an additional matter of concern for business aviation, 
I'll point to a policy under consideration that members of this 
Committee are likely familiar with: the FAA's controversial 
plan to begin subjecting pilots with a body mass index (BMI) of 
40 or greater to Obstructive Sleep Apnea (OSA) screening prior 
to receiving a medical certification.

    When this plan was introduced at the end of last year, 
NBAA, and its Member Companies--like mine--were alarmed. It 
seems that available data to confirm a link between OSA and 
flight safety is lacking, and that there is no clear indication 
that an additional screening requirement would improve aviation 

    Just as troubling, the vast majority of pilots weren't 
provided an opportunity to learn of the FAA's plans, or been 
given a mechanism for providing feedback on the proposal. As a 
businessperson who has been a certificated pilot since my 
teenage years, this is a troubling development.

    Mr. Chairman, the legislation which you and several of your 
Small Business Committee colleagues joined in co-sponsoring--
H.R. 3578--would require the FAA to consult with industry 
stakeholders through the established rulemaking process before 
issuing any final requirement for pilots to undergo OSA 

    It will also require the FAA to conduct a fully 
transparent, data-driven justification process for its 
proposal, which takes into account the full spectrum of costs, 
benefits and other important criteria before any OSA rule or 
regulation can take effect.

    The Senate has introduced similar legislation. On behalf of 
NBAA and its Member Companies, I want to thank you and other 
Congressional leaders for supporting these measures.

    So, Mr. Chairman and members of this Committee, as I said, 
it's clear that the relationship between the FAA and the small 
businesses operating in the aviation system which the agency 
manages, is a critically important one. And, with the four 
examples I just mentioned, there are ways we can enhance that 
relationship today. We can make it a more collaborative, 
effective relationship.

    But equally important, we must ensure that, as we look to 
the future of the aviation system, government leaders 
understand what small business owners, and other stakeholders 
in general aviation, consider fundamental to America's 
continued aviation leadership.

    An Imperative to Continue Strengthening A World-Leading 
Aviation System

    When it comes to preserving the nation's leadership in the 
aviation arena, we know that much of the debate about how best 
to do that will take place in the context of the coming FAA 

    While the current authorization does not expire for almost 
two years, discussion on the next one has appropriately begun. 
And, it's with that in mind that I'll note the industry's long-
standing, united view on some guiding principles for FAA 
reauthorization, and the related imperative of continued 
aviation system modernization.

           First, when it comes to paying for use of 
        the aviation system, the fuel tax works best for 
        everyone in general aviation. I know that, in past 
        reauthorization debates, user fees have been proposed 
        from some corners as a replacement for the fuel tax. As 
        a small business owner, I also know that we don't need 
        user fees--and the giant federal bureaucracy needed to 
        collect them--when fuel taxes have long been an 
        efficient, reliable and proven method of collecting 
        revenue to support aviation-system management and 

           Second, as I mentioned earlier, the general 
        aviation community continues to believe that direct 
        Congressional oversight of the FAA funding system is 
        necessary to ensure the availability of stable, 
        consistent funding levels for our national aviation 
        system. Congressional oversight will also ensure that 
        the specific needs of all aviation industry 
        stakeholders are taken into account when it comes to 
        aviation policymaking.

           Third, a continued, strong, federal-funding 
        commitment is necessary to maintain the strength of our 
        national air transportation system.

    I know that there will be a robust debate in the coming 
months on this issue, and I very much appreciate this 
opportunity to share with this committee my views as a small 
business entrepreneur who depends on our national aviation 
system to conduct and expand my business.

    In conclusion, Mr. Chairman and Ranking Member Velazquez, I 
also appreciate the strong leadership you provide, and the bi-
partisan support which this committee extends to the small 
business community.

    I look forward to responding to any questions you may have. 
Thank you.
 The FAA's Impact on Small Businesses in the General Aviation Industry

           Kenneth J. Button, PhD, AcSS, FCILT, FCIHT

                      University Professor

                    School of Public Policy

                    George Mason University

  Evidence to the U.S. House of Representative's Committee on 
                         Small Business

         Room 2360 of the Rayburn House Office Building

                        February 5, 2014

    The evidence considers the rationale for the Federal 
Aviation Administration intervening in markets for general 
aviation, and looks specifically at the public interest issues 
regarding safety, and the implications of policies to reduce 
accidents on the vitality of small businesses involved in 
general aviation. There is a focus on some elements of 
administrative costs of pursuing the social interest of 
increased safety. The evidence also offers some comments on 
recent and proposed legislation impacting on the way that the 
FAA handles regulations governing general aviation regulations 
and their reform.


    In the right context air transportation can provide a major 
economic stimulus to a region, city, or town. In a strict 
economic transportation sense it offers access to a larger 
market for local firms and can allow local residents to travel 
medium and long distances, albeit often not directly, for 
personal and business reasons. At a secondary level local 
airports, and the various aviation and non-aviation activities 
can provide local employment and generate income for the 
community. These benefits are clearly not true for all 
locations, there has, for example, to be a threshold of latent 
demand if any new airport is to be successful or an existing 
one expanded.

    These benefits hold at any scale of aggregation, from for 
example the gains for the high- and bio-technologies areas of 
the National Capital Region from having a major hub airport at 
Dulles \1\, to the economic advantages enjoyed by many of the 
smaller communities of Virginia that have local airports \2\. 
That airports, together with the air transportation associated 
with them, can, in an appropriate context, generate 
considerable economic gains for local residences and firms is a 
pretty consistent finding of academic and other studies.
    \1\ K.J. Button, and S. Lall, `The economic of being an airline hub 
city', Research in Transportation Economics, Vol. 5, pp. 75-106, 1999.
    \2\ K.J. Button, `The role of small airports in economic 
development' Journal of Airport Management, Vol. 4, No. 2, pp. 125-136, 

    The roles of general aviation, and the businesses 
associated with it, are numerous and vary across airports and 
aviation activities. The general economic advantages for a 
community of having a general aviation facility are not only 
from the direct aviation effects associated with the use of the 
airport that range from air taxi and charter services, pilot 
training, and crop-spraying through the access business jets 
provide to be commercial world, but also from the income that 
comes from the maintenance of aircraft, fuel sales, and airport 
fees, and non-aviation sales that are often present at 
airports, such as parking and catering services. There are also 
wider, social benefits, often described as ``public interest 
functions'', that are associated with general aviation and with 
its role in supporting policing, medical emergency activities, 
fire fighting, and accessibility of small communities often 
being highlighted \3\. In addition, the general aviation sector 
is responsible for large numbers of jobs in the manufacture of 
aircraft and associated hard and software.
    \3\ For more comprehensive study of the various roles of general 
aviation in economic development, see U.S. Federal Aviation 
Administration, General Aviation Airports: A National Asset, FAA, 
Washington DC, 2012.

    There is, however, an inherent danger in assessing these 
economic benefits because confusion may arise between 
correlations with causality. While general aviation can confer 
local economic benefits in terms of jobs and income, this 
causality in some cases may well run from the income levels and 
the interests of those living in an area to the development or 
enlargement of an aviation facility, rather than from the 
airport being the catalyst for local economic development. The 
few studies that have sought to separate out these causality 
effects, however, support the notion that by-and-large the 
general aviation facility is the driver, but these tend to use 
aggregate analysis and there may well be cases where causality 
is in the opposite direct.

    The challenge, and a major one that is confronted by the 
legal duties of the U.S. Federal Aviation Administration, is to 
ensure that these benefits from general aviation when they 
accrue, and which can be very diverse in their nature, are 
obtained without excessive social costs. In particular there 
are costs of safety that come into play. The challenge can be 
further broken down in administrative efficiency terms by 
considering the benefit and costs imposed by the actions of the 
FAA in pursuing its duties; i.e. could any safety objective be 
obtained at lower ``cost'' to the general aviation sector?

    The costs to general aviation of public interest 
interventions are diverse, and affect both the supply and 
demand side. They may involve direct costs to the manufacturers 
of hard or software in terms of standards and testing 
requirements, and periodical maintenance, and to airports in 
terms of the types of equipment needed to handle various forms 
and levels of traffic. These costs are in turn, and often in 
rather indirect ways, passed to the users of the hard- and 
software of the system. These users, essentially the pilots, 
also have to meet a variety of competence and health 
requirements, that can take both money and time to acquire, and 
often have to provide information on their activities, or at 
least are asked to do so. In addition, there are the costs of 
administering the system that is partly funded from taxation.

    The particular features of general aviation

    General aviation covers a wide range of activities. A 
standard definition is that it embraces all civil aviation 
operations other than scheduled air services and non-scheduled 
air transport operations for remuneration or hire. It thus 
range from gliders and cowered parachutes to corporate jet 
flights involving a professional pilot flying a business 
aircraft; about 11% of private flying is by business people on 
their way to meetings etc. It constitutes, in terms of aircraft 
and their movements, by far the largest component of civil 
aviation; there are around 19,000 airports, helipads, and 
seaplane bases of varying sizes serving general aviation in the 
U.S., and its territories; just over 2,900 handle the 
movements. These facilities vary considerably in terms of tower 
control, runway features and ground support facilities; 
although the FAA classifies them into four broad 
categorizations. There is nearly a quarter of a million general 
aviation aircraft; of which the bulk is piston or turboprop 
aircraft; and the average age of small planes is about 40 years 
    \4\ General Aviation Manufacturers Association, 2012, General 
Aviation Statistical, GAMA, Washington D.C., 2013.

    An emerging aspect of general aviation involves the use of 
unmanned systems (often termed ``drones''); such aircraft are 
without an onboard human pilot being controlled either 
autonomously by computers in the vehicle or under the remote 
control of a pilot on the ground or in another vehicle. They 
take a variety of shapes, sizes, configurations, and 
characteristics and are being used in a small but growing 
number of civil applications, such as policing and 
firefighting, and nonmilitary security work, such as 
surveillance of pipelines. At present the use of drones is 
severely limited in the U.S., with the FAA developing a road 
map to allow their integration into the US airspace 
system.\5\We do not discuss the issues of the regulation of 
drones here, but their importance for small businesses, as 
suppliers of the hardware required, in operating drone 
services, and as customers for such services would seem to pose 
a variety of future regulatory challenges.
    \5\ U.S. Federal Aviation Administration, Integration of Civil 
Unmanned Aircraft Systems (UAS) in the National Airspace System (NAS) 
Roadmap, FAA, Washington, D.C. 2013.

    A large part of general aviation involves private 
activities that are of limited interest to policy makers. They 
involve actions of individuals that do not impinge on the 
general public or any large part of it, and the transactions 
between the individuals and companies involved--airports, 
pilots, maintenance companies, fuel providers, aircraft owners, 
aircraft manufactuers--take place in fairly simple markets, and 
involve standard forms of transactions and contracts. Since 
there is ample evidence that such markets, although often not 
completely perfect because of such things as market power and 
incomplete knowledge on the part of those involved, are the 
best way of allocating resources, there is little reason for 
any significant interventions by government.

    There is significant governmental intervention, however, in 
this market for other reasons. The three areas of public 
interest, setting aside generic matters involving such things 
as commercial contracts between the various providers of 
general aviation services and customers, being largely in the 
realms of finance, security, and safety. The first two of these 
are hardly touched upon here.

           Financing the infrastructure of general 
        aviation is important in term of its efficient use but 
        raising money is largely outside of the remit of the 
        FAA, which is the subject of the hearing \6\. The FAA 
        has spending responsibilities for many areas of 
        spending and this does affect small businesses in 
        general aviation. The evidence here, however, is 
        general aviation uses approximately 16 percent of air 
        traffic control services but contributes only 3 percent 
        of the costs \7\. Raising this money and whether the 
        ratio of spending to revenue collection is socially 
        efficient is an on-going debate.
    \6\ It was also the subject of a previous recent hearing, 112th 
Congress, 2nd Session.
    \7\ US Department of Transportation's Inspector General Office, Use 
of the National Air Space System, CR-2008-028, Washington DC, 2008.

           Security is largely within the purview of 
        the Transportation Security Administration rather than 
        the FAA, although there are inevitable interfaces 
        between them.\8\
    \8\ Some discussion of the main security issues are found in; U.S. 
Government Accountability Office, General Aviation, Security 
Assessments at Selected Airports, GAO-11-298, Washington D.C., 2011.

    That safety, our main focus is important is of little 
doubt, but equally it is unrealistic (if not impossible) to 
have 100% safety; it is simply too costly even if a viable 
definition of absolute safety could be devised. What public 
policy is de facto concerned with is developing what is often 
called ALARP; ``as low as reasonably practical'' level of risk 
of an accident. This entails balancing the risks of, in our 
case, an incident involving general aviation against the social 
benefits that general aviation confers. In terms of a pilot and 
aircraft owner, if there were no-one else involved then a 
private market, possibly involving the activities of insurers, 
would suffice to offer the appropriate ALARP level of risk; 
safety is the sole concern of the pilot and the aircraft owner 
and any incident has no implications for third parties.

    The public interest element comes in when there is 
collateral damage with costs inflicted on:

           third-parties involved in general aviation, 
        including pilots and their aircraft and those working 
        at airfields;

           when there are costs of remedial action, 
        such as involved in search and rescue operations for a 
        crashed plane, and

           when individuals and ``hardware'' on the 
        ground are affected.

    While some of these items, such as property damage from a 
crashed aircraft or the medical bills of injured people, can be 
directly expressed in monetary terms, there is also clear 
evidence that people do value in monetary terms their safety in 
broader terms, and place a value on reductions in the risk of 
being killed or injured in an accident \9\. They also value a 
feeling of safety that can extend beyond fears of direct 
personal harm.
    \9\ Jones-Lee, M. and Looms, G. (2003) Valuation of Safety, in D.A. 
Hensher and K.J. Button (eds), Handbook of Transport and the 
Environment, Elsevier, Oxford, pp. 451-462.

    From an economic perspective, the issue is one of whether 
the ``private'' costs to the general aviation sector of safety 
regulations, and their implementation and enforcement, outweigh 
the benefits to third parties of the regulations. This involves 
not simply issues of objective measurement but also societal 
perceptions; as with security, it is often as much about what 
the public thinks the net benefits of general aviation are as 
about the actuarial calculations of the costs and be benefits. 
This boarder perspective essentially requires some form of 
benefit-cost assessment of the sector, and ipso facto of the 
policies of agencies such as the FAA.

    The safety situation

    The data show that over 90% of fatal aviation accidents in 
the U.S. involve general aviation, although the proportion of 
fatalities and injuries is far less because of the small 
vehicles involved. In terms of trends in the safety record of 
U.S. general aviation, Figure 1 shows a substantial decline in 
accidents since the 1960s with some flattening out in the 
downward trend after the 1990s (Some caution should be taken 
when inspecting the table, in that the time intervals prior to 
1990 are in five-year periods and in annual periods 
thereafter.) As a summary picture, the national Transportation 
Safety Board found that fatal accidents fell by 24% between 
1999 and 2011, and non-fatal accidents by 29%.

    To get a clearer picture of the risk associated with 
general aviation activities, accidents need to be set against 
the level of activity in the industry. A standard measure of 
this activity is flight hours, although other measures such as 
the number of flights may also form a legitimate basis for 
calculations; most accidents occur during take or landing. 
Figure 2 provides the details and again, although retaining the 
caveat about nature of the horizontal axis, a general downward 
trend is seen in all indicators of accidents, with some 
flattening out in recent years. The situation is somewhat 
better than in most other countries where general aviation 
plays a smaller role in the economy.


    A problem with this analysis, however, is that the data on 
fight hours for general aviation is poor, making genuine risk 
analysis, a core calculation for public policy making, 
difficult; similar data limitations seem to exist helicopter 
emergency medical services \10\ While there have been 
improvements in data collection, this inevitably comes at a 
cost to those engaged in general aviation and, in particular, 
in terms of additional documentation requirements. Further, in 
terms of data, to gain better insights into causes of 
accidents, the FAA has enhanced its collection and maintenance 
of data on each certified pilot's recurrent training; the costs 
presumably being bourn as part of the certification fee.
    \10\ U.S. Government Accountability Office Aviation Safety; 
Enhanced Oversight and Improved Availability of Risk-based Data Could 
Further improve Safety, GAO-12-24, Washington, D.C., 2013.

    In absolute terms the number of fatal accidents is 
relatively small in the U.S. (as a reference point, there were 
34,080 road deaths and 2,362,000 injuries in 2012), and, from a 
public policy perspective, the vast majority of those involved 
were not third parties. A similar picture emerges involving 
non-fatal incidents. The issue centers less on actuarial risk 
calculations, and more on the public perceptions of the risk of 
an individual being impacted by a general aviation aircraft 
falling from the skies; but it is this perceived risk that 
forms the basis for providing public policy.

    Although accidents can seldom be attributed to any single 
cause, or to a particular contributing factor, the overall 
pattern of causes and primary contributory factors to general 
aviation accidents have tended to remain fairly constant in 
recent years. It is clear that pilot error and loss of control 
are the main causes of accidents (NTSB data does suggest about 
70% of fatal accidents, and 59% of non-fatal are due to pilot 
error, with pilots having less than 100 hours in the accident 
aircraft being particularly prone to involvement), but the 
details of contributing factors vary considerably as seen in 
Figure 3. The long-standing problems of pilot errors has been 
attributed to a variety of factors, such as inadequate 
recurrent training and poor training in cockpit management and 
aeronautical decision making.


    In addition to the broad trends in accidents there are also 
micro-patterns to the incidents that differ according to the 
segment of the sector into which they fit \11\. Personal 
operations, for example have long dominated the accident 
statistics, and in terms of hardware, experimental, amateur-
built aircraft contribute disproportionately (some 22% of 
accidents between 2009 and 2013 for only 5% of general 
aviation's flight hours), whereas corporate operations, while 
accounting for about 14% of flight hours, are only responsible 
for about 1% of fatal accidents. The last statistics largely 
reflects the more advanced technologies employed by most 
aircraft engaged in corporate operations and greater pilot 
experience. In terms of time trends, these differences are 
important to appreciate; for example between 2008 and 2010, 
when the economy was in serious recession, personal flying 
hours fell by about 4%, whereas safer, corporate operations 
fell by 15% and hence raw accident figures may to some extent 
be reflecting changes in the composition of general aviation as 
much as changes in safety.
    \11\ U.S. Government Accountability Office, General Aviation 
Safety: Additional FAA Efforts could help Identify and Mitigate Safety 
Risks, GAO-13-36, Washington D.C., 2012.

    Recent reforms to FAA oversight

    The Federal Aviation Administration is essentially 
concerned with the public interest aspect of general aviation. 
It has the responsibility for administering aircraft and pilot 
certification, conducting safety oversight of pilot training 
and general aviation operations, and taking enforcement actions 
against pilots and others who violate federal aviation 
requirements and safety standards. It manifestly is a 
regulatory body.

    Measuring the net effects of such regulations is, however, 
difficult. At one level there is the generic problem in 
assessing safety regulation of defining the counterfactual; 
just what would the accident situation be without the 
regulation. There is then the matter of assessing whether the 
actions pursued are the best given that interventions are 
justified to enhance social welfare. Finally, there are issues 
about whether the administrative costs of enforcing regulations 
are minimized; this is generally a contentious issue for those 
who have to conform with regulations because the costs of them 
are often focused, but the benefits extend across many parties.

    In the latter context, and in relations to general aviation 
regulation, there have been concerns expressed about the burden 
of regulations, including the time and money costs of 
conformity and administration. Much of the discussion, however, 
has tended to be focused on anecdotal evidence and the 
collective views of those in professional and trade 
associations, capturing the views of the third parties affected 
is less easy \12\.
    \12\ The FAA does have general guidelines for values to be put into 
its decisions making (e.g. see GRA, Incorporated Economic Values for 
FAA Investment and Regulatory Decisions. A Guide, FAA, Washington DC, 
2004) although this does not cover the costs imposed on the regulated 
of meeting such things as pilot certification.

    The FAA has also itself responded to some of these 
concerns, pointing to streamlining certification processes that 
have been initiated since 2005 \13\. The challenges highlighted 
by the FAA in its responses include the problems posed by 
increases in the flow of new ``aviation products''; 
technologies, new rulemaking and fleet-wide safety initiative, 
and the migration of technologies from large transport 
airplanes to general aviation aircraft, but there is an 
acceptance that increased efficiency is still possible. A clear 
problem is that of public accountability, regulatory agencies 
are naturally risk averse because any failure regarding any 
individual application can affects others seeking 
    \13\ US Federal Aviation Administration Aircraft Certification 
Service, A Report from the Aircraft Certification Process Review and 
Reform Aviation Rulemaking Committee to the Federal Aviation 
Administration, Recommendation on the Assessment of the Certification 
and Approval Process, Washington DC, 2012.

    The Administration has also adopted a multiple faceted 
approach, largely based on changing the culture within general 
aviation, to improving the safety record of general aviation, 
with the stated goal of reducing the accident rate by 10% 
between 2009 and 2018 \14\. A number of GAO reports suggest 
that progress is being made to improving the record of general 
aviation, although not without some criticism regarding the 
pace of change, and a number of remaining deficiencies in data 
collection \15\. It is also unclear how such a general target 
can easily be translated across such a diverse range of 
activities and technologies as general aviation, and where the 
safety record is so variable.
    \14\ U.S. Federal Aviation Administration, Fact Sheet--General 
Aviation, FAA, Washington, January 27, 2014.
    \15\ U.S. Government Accountability Office, Aviation Safety: 
Certification and Approval Processes Are Generally Viewed as Working 
Well, but Better Evaluative Information Needed to Improve Efficiency, 
GAO-11-14, Washington, D.C., 2010; and U.S. Government Accountability 
Office, Aviation Safety: Status of Recommendations to Improve FAA's 
Certification and Approval Processes, GAO-14-142T, Washington D.C., 

    One issue is the difficulty in assessing the effectiveness 
of various initiatives because of inadequate informational 
bases. While the traditional data offers some general guidance 
as to safety tends, and there are efforts being made by the FAA 
to improve data, the industry is fragmented geographically, in 
terms of the services offered, and the by the types of 
suppliers involved making more issue specific statistics 
important to evaluate other than generic reforms.

    Added to this, data collection of some types of 
information, such as on flight-hours (which have traditionally 
involved self-reporting) and on good indicators of a pilot's 
experience (which are important in assessing both the wider 
costs and the benefits of general aviation) has not been 
completed, and is time-consuming for users of the system to 
contribute. (This, or a lack of appreciation of the importance 
of the information, may explain low response rates to surveys). 
The collection also impacts on the FAA budget with, presumably, 
costs being passed on through certification fees. The GAO, for 
example, has pointed explicitly to this issue.\16\ There is 
thus the age-old trade-off between data quality and the 
generalized costs of its collection; in this context it is 
important to up-date collection methods and what information is 
gathered as circumstances change.
    \16\ U.S. Government Accountability Office Aviation Safety FAA 
Efforts Have Improved Safety, but Challenges Remain in Key Areas, GAO-
13-442T, Washington, D.C., 2013.

    One such area regarding data collection and comparability 
that may reduce some burden on users of the general aviation, 
is that the FAA and NTSB seem to be improving cooperation \17\. 
Combined data banks and data collection should offer provide 
some opportunities to reduce surveys and reporting 
requirements. There may also be opportunities to combine data 
banks with the TSA.
    \17\ U.S. Government Accountability Office Aviation Safety FAA 
Efforts Have Improved Safety, but Challenges Remain in Key Areas, GAO-
13-442T, Washington, D.C., 2013.

    In terms of policy initiatives to reduce burdens on the 
general aviation sector, the Small Airplane Revitalization Act 
into law in November 2013 initiating moves on the adoption of 
new certification regulations intended to increase safety and 
reduce the certification costs of new Part 23 general aviation 

    The law requires the FAA to creation of a new category 
covering aircraft parts and other products aimed at 
streamlining the certification process for light airplanes and 
related aviation products. This would allow for the swifter 
adoption of new aircraft designs and safety equipment as well 
as cut costs. In particular, it aims to reduce certification 
costs by half for general aviation aircraft that weigh less 
than 12,500 pounds with the FAA implementing recommendations of 
the Aviation Rulemaking Committee, composed of aviation 
authorities and industry representatives. Basically, these 
aircraft will not have to be designed and certified under the 
same regulatory requirements as heavier, more complex and 
higher performing aircraft.

    From the industrial and users perspective, this should cut 
production costs and certification costs; in particular, for 
practical reasons, components are currently certified at the 
level of their highest customer base making them costly for 
lower end aircraft. The regulations are also intended to 
reflect the lack of need for some equipment in the light 
general aviation market, and particularly in the experimental 
and light sports segment.

    The concerns, and at this point they are concerns, are that 
the change is unlikely to make a difference because the 
bureaucratic nature of the FAA is unlikely to give up its power 
quickly, or to make certification easy, and that the issue of 
modifications of used planes, to update them with new safety 
equipment, autopilot, etc. is left unaddressed. Given the 
number of older aircraft, the impact on users is likely to be 
limited in the short run, although the measure should help 

    There is also the General Aviation Pilot Protection Act 
that has been under consideration, and is aimed at reducing 
bureaucracy relating to pilot activities. It would allow pilots 
to fly aircraft weighing less than 6,000 pounds, with six seats 
or less, flying under visual flight rules below 14,000 feet, 
and at speeds less than 250 knots as long as they meet the 
medical standards involved in attaining that current state 
driver's license, one argument being that a small plane is 
similar in size to an SUV and accidents due to ``driver 
impairment'' should be treated on a similar basis.

    The aim is to reduce the hassle and cost of obtaining the 
Class III medical currently required. The evidence that large 
numbers of people are deterred from flying because of this 
requirement does not, however, seem strong. The more worrying 
aspect from a policy perspective is the two years or so that 
the FAA has taken to consider the matter.


    That general aviation is important in a country as large, 
diverse and economically advanced as the U.S. seems difficult 
to question. That, by and large, the market has been effective 
in ensuring an efficient development of the sector, and 
allowing many of its benefits to be enjoyed also seems true. 
The challenge is that there is a public interest in general 
aviation that extends beyond those involved in the provision of 
the infrastructure and operational hardware, and those that 
make use of these.

    In particular, matters of safety extend beyond individual 
flights to accidents involving others either in the air or on 
the ground; in effect to third parties. There is also a public 
perception, in part brought about by rare, but highly visible 
accidents, that general aviation is unsafe. In response to the 
safety reality, together with heightened public perceptions, 
the sector has been the subject to a variety of regulations. 
This has resulted in a variety of additional costs being 
introduced into the sector. Any additional costs are an obvious 
impediment to the growth of a sector, and need to be monitored 
to ensure that at least commensurate public benefits result.

    That there is a need for some forms of regulation in the 
public interest seems reasonable, but it also needs to be 
focused on elements that generate the greatest safety risk 
otherwise there is a danger the development of the sector may 
be stymied by an over reaction by the public. In particular, 
given the number of accidents involving pilot errors of various 
types in smaller, older privately operated aircraft it seems 
efficient to focus attention on these rather than less 
accident-prone corporate operations. In sum, the degree and the 
ways that the FAA intervene in general aviation should be 
specific to particular issues so as to minimize the costs of 
its actions.