[Federal Register Volume 68, Number 62 (Tuesday, April 1, 2003)]
[Rules and Regulations]
[Pages 15884-15904]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-7653]



[[Page 15883]]

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Part III





Department of Transportation





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Federal Aviation Administration



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14 CFR Parts 121, 125, and 129



Collision Avoidance Systems; Final Rule

  Federal Register / Vol. 68, No. 62 / Tuesday, April 1, 2003 / Rules 
and Regulations  

[[Page 15884]]


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DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Parts 121, 125, and 129

[Docket No.: FAA-2001-10910; Amendment Nos. 121-286, 125-41, and 129-
37]
RIN 2120--AG90


Collision Avoidance Systems

AGENCY: Federal Aviation Administration (FAA), DOT.

ACTION: Final rule.

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SUMMARY: The FAA is revising the applicability of certain collision 
avoidance system requirements for airplanes. The current rules are 
based on passenger seating configuration and therefore exclude all-
cargo airplanes. This final rule will use airplane weight and 
performance characteristics as the basis for collision avoidance system 
requirements to capture cargo airplanes weighing more than 33,000 
pounds (lbs.) maximum certificated takeoff weight (MCTOW). This final 
rule is intended to reduce the risk of a mid-air collision involving a 
cargo airplane, which will increase safety for cargo crewmembers, the 
public on the ground, and occupants of airplanes that already have 
collision avoidance systems.

DATES: Effective May 1, 2003, except for the revisions of Sec. Sec.  
121.356, 125.224, and 129.18 which are effective January 1, 2005.

FOR FURTHER INFORMATION CONTACT: Alberta Brown, Air Carrier Operations 
Branch, Flight Standards Service, AFS-220, Federal Aviation 
Administration, 800 Independence Avenue, SW., Washington, DC 20591, 
telephone (202) 267-8321.

SUPPLEMENTARY INFORMATION:

Availability of Rulemaking Documents

    You can get an electronic copy using the Internet by:
    (1) Searching the Department of Transportation's electronic Docket 
Management System (DMS) web page (http://dms.dot.gov/search);
    (2) Visiting the Office of Rulemaking's web page at http://www.faa.gov/avr/arm/index.cfm; or
    (3) Accessing the Government Printing Office's web page at http://www.access.gpo.gov/su_docs/aces/aces140.html.
    You can also get a copy by submitting a request to the Federal 
Aviation Administration, Office of Rulemaking, ARM-1, 800 Independence 
Avenue SW., Washington, DC 20591, or by calling (202) 267-9680. Make 
sure to identify the amendment number or docket number of this 
rulemaking.
    Anyone is able to search the electronic form of all comments 
received into any of our dockets by the name of the individual 
submitting the comment (or signing the comment, if submitted on behalf 
of an association, business, labor union, etc.). You may review DOT's 
complete Privacy Act statement in the Federal Register published on 
April 11, 2000 (Volume 65, Number 70; Pages 19477-19478) or you may 
visit http://dms.dot.gov.

Small Business Regulatory Enforcement Fairness Act

    The Small Business Regulatory Enforcement Fairness Act (SBREFA) of 
1996 requires FAA to comply with small entity requests for information 
or advice about compliance with statutes and regulations within its 
jurisdiction. Therefore, any small entity that has a question regarding 
this document may contact SBREFA. You can find out more about SBREFA on 
the Internet at our site, http://www.faa.gov/avr/arm/sbrefa.htm. For 
more information on SBREFA, e-mail us at [email protected].

Background

Statement of the Problem

    Current FAA rules do not require collision avoidance systems on 
all-cargo airplanes. When the FAA issued the traffic alert and 
collision avoidance system (TCAS) rules for passenger airplanes in 
1987, the overnight cargo industry expansion was in its infancy, it 
operated few airplanes and those were primarily at night. Congress, in 
its legislation directing installation of TCAS in passenger airplanes, 
determined that those cargo airplanes did not represent a significant 
risk to passenger-carrying airplanes, which operated primarily during 
the day.
    In promulgating the rules the FAA recognized that those few cargo 
airplanes would benefit some from the TCAS requirement for passenger 
airplanes because transponder-equipped cargo airplanes are displayed to 
pilots of TCAS-equipped passenger airplanes. Cargo airplanes also 
benefit because of the large number of passenger airplanes that are 
equipped with TCAS. In addition, the FAA determined that the cost/
benefit analysis and risk level at that time did not support requiring 
cargo operators to equip their airplanes with TCAS.
    Since those early days of TCAS, cargo operations have grown 
significantly and we now believe the increase in traffic presents an 
increased risk of a mid-air collision involving a cargo airplane. We 
are issuing this amendment to use airplane weight and performance 
characteristics to encompass cargo as well as passenger airplanes and 
to standardize and clarify the collision avoidance rules in parts 121, 
125, and 129. The FAA believes this would reduce the risk of midair 
collisions, increasing public safety in the air and on the ground.

History

    On April 5, 2000, the Wendell H. Ford Aviation Investment and 
Reform Act (AIR-21) was enacted (Pub. L. 106-181) and later codified at 
49 U.S.C. 44716(g). That section directs the FAA to require all cargo 
airplanes of more than 15,000 kilograms (kg.) MCTOW to be equipped with 
collision avoidance equipment by December 31, 2002. It also provides 
for an extension of up to 2 years for safety or public interest 
reasons.
    Section 44716(g) defines collision avoidance equipment as 
``equipment that provides protection from mid-air collisions using 
technology that provides cockpit-based detection and conflict 
resolution guidance, including display of traffic; and a margin of 
safety of at least the same level as provided by the collision 
avoidance system known as TCAS II.''
    Before Congress passed AIR-21, the FAA had been working on a 
proposal to require collision avoidance systems on cargo airplanes. The 
justification for that effort was:
    [sbull] The large increases in all-cargo traffic volume (night and 
day operations),
    [sbull] Two near mid-air collisions (NMACs) involving cargo 
airplanes,
    [sbull] A petition for rulemaking to put TCAS on cargo airplanes 
from the Independent Pilots' Association (representing United Parcel 
Service pilots),
    [sbull] The International Civil Aviation Organization (ICAO)'s 
recommendation to equip all airplanes with an airborne collision 
avoidance system (ACAS), which is equivalent to TCAS II, version 7.0, 
and
    [sbull] The National Transportation Safety Board (NTSB)'s 
recommendation urging the FAA to require TCAS II and a Mode S 
transponder on certain airplanes.

The Proposed Rule

    On November 1, 2001, the FAA published Notice of Proposed 
Rulemaking (NPRM) No. 01-12 (66 FR 55506) ``Collision Avoidance 
Systems.'' That document proposed collision avoidance requirements for 
part 121, 125, and 129 operators of certain airplanes. Specifically, 
turbine-powered

[[Page 15885]]

airplanes of more than 33,000 lbs. (15,000 kg.) MCTOW operated under 
part 121, 125, or 129 would be required to be equipped with TCAS II, or 
equivalent. Turbine-powered airplanes of 33,000 lbs. or less MCTOW 
operated under part 121, 125, or 129 would be required to be equipped 
with at least TCAS I, or equivalent. All piston-powered airplanes, 
regardless of weight, conducting operations under part 121 or 125 would 
be required to be equipped with at least TCAS I, or equivalent.

Discussion of Comments

    The comment period for notice No. 01-12 ended on December 31, 2001. 
In response to that notice we received 465 comments. The overwhelming 
majority of commenters were strongly in support of the proposal. Cargo 
pilots from United Parcel Service (UPS) comprised the largest group of 
commenters, accounting for 238 comments in favor of the proposal. Other 
air cargo pilots from DHL, Fed Ex, Kittyhawk Aircargo, and Polar Air 
Cargo added approximately 100 more comments in favor of the proposal. 
Passenger carrier pilots, military pilots, and general aviation pilots 
also commented in favor. Other commenters represent pilot labor unions, 
pilot associations, air carriers, air carrier associations, an avionics 
manufacturer, a civil aviation authority, the NTSB, and many 
nonaffiliated individuals. The FAA reviewed and considered all comments 
during deliberations of this final rule.
    We received approximately 280 comments, half of which were nearly 
identical in content, expressing very general support of the proposal. 
Most of these comments did not address specific issues except 
indicating that the rule would enhance safety for cargo pilots, for 
persons on the ground, and in the national airspace system. One person 
in this group of commenters states that there should be no distinction 
between cargo and passenger aircraft regarding the collision avoidance 
systems installed. Another commenter feels there is no equipment that 
exceeds the value of TCAS. One commenter adds that requiring consistent 
TCAS rules across all fleets just makes good sense. Several commenters 
echoed that sentiment citing the need for ``one level of safety'' for 
passenger and cargo airplanes, regardless of how many occupants are 
carried. Many of these commenters urge the FAA to issue the final rule 
as soon as possible and indicate that this rule is long overdue.
    Nearly all commenters were supportive of the general concepts of 
the proposal; however, some included specific concerns related to: (1) 
The compliance period, (2) the requirement for TCAS II, version 7.0, 
(3) alternative systems to TCAS, (4) transponder requirements, (5) 
aircraft performance capability to respond to resolution alerts (RAs), 
and (6) the cost of the rule. The strongest criticism of the proposed 
rule came from four supporters of automatic dependent surveillance-
broadcast (ADS-B) and from those who believe the rule is not necessary 
for some piston-powered airplanes. Some commenters urge us to seriously 
consider the capabilities of ADS-B as an alternative to TCAS. One 
commenter states the proposal would not improve safety in the national 
airspace system because the rule's restrictive nature could prevent the 
development of new and improved systems.
    Below is the summary of the more specific comments. We introduce 
each topic with what the NPRM proposed, followed by a discussion of the 
comments and our response to those comments. Our response includes the 
FAA's decision to leave the rule as proposed or to change it.

Compliance Date

Proposed Rule

    In notice No. 01-12, the FAA proposed that all airplanes without 
TCAS and weighing over 33,000 lbs. MCTOW install a collision avoidance 
system by October 31, 2003. Section 44716(g) of 49 U.S.C. directs the 
FAA to require collision avoidance equipment that has a margin of 
safety of at least the same level as provided by TCAS II by December 
31, 2002, and allows a 2-year extension for public interest or safety. 
In the proposal, we felt that a compliance date of October 31, 2003, 
would provide adequate time for air carriers to schedule the 
installation of collision avoidance during a major C or D check.

Comments

    Several commenters, all representing cargo carriers, disapproved of 
the compliance period and recommended that we extend it. We received an 
equivalent number of comments requesting that we not extend it. For 
example, the FedEx Pilots Association (FPA) recommended adopting 
Congress's earlier compliance date of December 31, 2002, and the NTSB, 
and various pilots requested that we not extend the compliance date 
beyond the proposed October 31, 2003. The NTSB strongly encourages the 
FAA to adhere to the equipment requirements and schedule contained in 
the proposed regulatory amendments and to expedite the implementation 
of these important rules.
    Nearly 140 commenters (submitting similar form letters), 
representing the Coalition of Airline Pilots and primarily UPS pilots, 
believe the earlier Congressionally mandated date--December 31, 2002--
is reasonable. They state that the December 2002 date coincides with 
ICAO recommendations, the hardware is readily available, most aircraft 
have approved installation procedures for TCAS, and many are prewired 
for TCAS. They suggest an extension to October 1, 2003, only in 
extenuating circumstances.
    However, we heard from many air carriers indicating that the 
compliance schedule we proposed would be too difficult to comply with. 
Among the reasons cited were the schedules of individual carriers' C 
and D maintenance checks and various proposed Mode S modifications. 
FedEx Express, Supplemental Air Operations states that it would not 
complete a C or D check on its entire fleet before October 31, 2003, 
even without the collision avoidance rule. It states that the short 
compliance period does not allow time for operators to bid, select, 
engineer, schedule, and perform the work required for the installation 
of collision avoidance. It suggests a compliance date of March 29, 
2005, to coincide with the terrain awareness warning system/enhanced 
ground proximity warning system (TAWS/EGPWS) compliance date and 
minimize disruptions to operations.
    The Air Transport Association (ATA) recommends that we establish a 
compliance date when we issue the final rule to ensure the date 
coordinates with other regulatory initiatives, namely domestic and 
international transponder modifications. Its recommendation, echoed by 
Airborne Express and Northern Air Cargo, Inc., is to allow 24 months 
after the publication date of the rule for installation of collision 
avoidance. According to Airborne Express, the percentage of aircraft 
without collision avoidance during the last year of the compliance 
period would be small, which would have an insignificant effect on 
safety. Airborne Express also supports its request to extend the 
compliance date because it will have to install Mode S transponders on 
many of its airplanes.
    FedEx Express, Air Operations Division (FedEx) also commented on 
the compliance date, stating that the short period would impose special 
down time with considerable operational impact to install collision 
avoidance on an estimated 41 airplanes that do not already have TCAS. 
Also, FedEx notes that security-related requirements for transponder 
system modifications will

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affect the TCAS-related Mode S transponder. It believes that 
incorporating those requirements into the collision avoidance 
transponder requirements would avoid future retrofitting. FedEx 
recommends a compliance date of December 31, 2004, for those reasons.
    Several other air carriers suggest a 24-month compliance period to 
install collision avoidance. The Cargo Airline Association (CAA) and 
UPS recommend December 31, 2004, but UPS earmarks the extension to 
allow the certification and orderly installation of ADS-B. The CAA also 
suggests that the FAA consider a phase-in compliance period, with a 
certain percentage of airplanes equipped with collision avoidance by 
October 31, 2003, and 100 percent compliance by December 31, 2004. One 
individual recommends a compliance date of December 31, 2004, but gives 
no reason for the extension. The Aerospace Industries Association (AIA) 
recommends 3 years to coincide with reduced vertical separation minimum 
(RVSM) operations, and USA Jet Airlines, Inc., recommends a 5-year 
compliance period to coincide with TAWS and RVSM. Evergreen 
International Airlines, Inc., recommends that the compliance date 
coincide with any hijack-mode modifications to transponders.

FAA's Response

    When Congress mandated the FAA to require collision avoidance 
systems for cargo airplanes by December 31, 2002, it also allowed an 
extension of the compliance date to December 31, 2004. That extension 
is marked for ``a safe and orderly transition to the operation of a 
fleet of cargo aircraft equipped with collision avoidance equipment; or 
other safety or public interest.'' Based on public comments and FAA's 
rulemaking experience, we have determined that an extension is needed 
for orderly installation and training associated with this new 
equipment. This extension meets the intent of Congress. Any suggested 
compliance date beyond December 31, 2004, is not allowed in the 
Congressional mandate.
    This final rule will require affected operators to install a 
collision avoidance system on affected airplanes by December 31, 2004. 
The compliance date is 1 year and 2 months later than the proposed date 
of October 31, 2003.
    As CAA suggested, we did consider a phase-in approach for collision 
avoidance system compliance, which we have used with other rulemaking 
projects. We used a phase-in compliance period, for example, the 
original TCAS rule, and the digital flight data recorder rule. We found 
that such a compliance mechanism is labor intensive and difficult to 
implement. The FAA believes that a phase-in approach is impractical in 
this case because this rule covers passenger-carrying and cargo 
airplanes. It is better to allow operators to schedule their own 
installations.

Grandfathering/Early Compliance

Proposed Rule

    In the NPRM, we proposed to allow those operators that had 
installed TCAS II version 6.04A Enhanced before December 3, 2001 (which 
has been required for passenger-carrying airplanes for years), to 
continue operating with that system until it can no longer meet the 
TCAS II version 6.04A Enhanced technical standard order (TSO C-119a) 
(''grandfathering''). However, installation of TCAS II for the first 
time after December 3, 2001 (30 days after the publication date of the 
NPRM), would have to be TCAS II version 7.0 (``early compliance'').

Comments

    Some commenters disagree with using the NPRM publication date as a 
compliance date because it constitutes retroactive compliance. FedEx 
believes that it contradicts the spirit of due process and effectively 
reduces the rate of TCAS II installations. It states that some 
operators planning on installing TCAS II version 6.04A Enhanced on 
their aircraft may now have to defer installation based on the 
availability of version 7.0--working against the goal of early 
equipage. FedEx adds that this requirement would not affect them 
because they have been installing version 7.0 since December 1, 2001. 
The CAA also believes that requiring ``early compliance'' for version 
7.0 goes against the interests of early equipage and enhanced safety. 
It adds that this requirement would cause TCAS II installations to stop 
or would cause version 6.04A Enhanced to become obsolete at a later 
date. It states that this compliance requirement would result in fewer 
TCAS-equipped airplanes in the short run and would disrupt carefully 
constructed industry compliance schedules.
    Eurocontrol takes another point of view in its concern that TCAS II 
version 6.04A Enhanced units currently in service will not be upgraded 
on the compliance date or any defined schedule. Its position is that 
version 7.0 offers important safety and air traffic control (ATC) 
operational compatibility advantages. It also believes that all 
airplanes subject to the Congressional mandate should be required to 
install version 7.0 and that we should encourage passenger-carrying 
operators with airplanes already fitted with version 6.04A Enhanced to 
upgrade to version 7.0.
    The Airline Pilots Association (ALPA) strongly supports the 
proposal to require version 7.0 for first-time installations and to 
include the early compliance date, crediting the operational 
improvements gained between version 6.04A Enhanced and 7.0.
    AIA interprets the proposal to mean that all airplanes delivered 
after the publication date of the NPRM must be operated with TCAS II 
version 7.0. It indicates that Boeing is still delivering TCAS II 
version 6.04A Enhanced units to domestic carriers that have opted not 
to upgrade to TCAS II version 7.0. AIA recommends we delete early 
compliance and encourage operators to convert to version 7.0 as soon as 
practicable.

FAA's Response

    We drafted the proposal so that no operator--passenger or cargo--
would be required to retrofit its TCAS II unit to version 7.0 if 
version 6.04A Enhanced was installed before December 3, 2001. We 
included the ``grandfathering'' provision in the proposal as a 
compromise to requiring a retrofit to version 7.0 for all airplanes 
requiring TCAS II and have maintained it in the final rule.
    The FAA included the ``early compliance'' provision to prevent new 
installations of older TCAS equipment, i.e., allow new installations of 
version 6.04A Enhanced, instead of version 7.0 after the NPRM was 
published. Although the FAA concerns had validity, commenters have 
convinced us that the proposed date for early compliance is 
inappropriate. Consequently, we have amended that provision in the 
final rule. We believe that realistically, most airplanes will be 
equipped with version 7.0 before the final compliance date of this 
rule, even though grandfathering continues to be allowed. This is 
because many flights are in countries that require TCAS II version 7.0. 
Operators may also elect to conduct RVSM operations, which requires 
version 7.0 if the airplane has TCAS II installed.
    Some commenters were concerned that the FAA was in effect writing a 
final rule in the NPRM by using a retroactive installation date for 
TCAS II version 7.0. We feel that because a newer, improved version is 
available, all first-time installations should be version 7.0. TCAS II 
version 7.0 includes a

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number of upgrades that improve the quality of TCAS II. Version 7.0 has 
the advantage of harmonizing with ICAO, improving ATC efficiency, 
accuracy, and RVSM capability. We believe that it will not be a burden 
for cargo carriers to buy version 7.0, rather than version 6.04 since 
they will have to buy one or the other. We researched availability of 
version 7.0 and are convinced that supplies are sufficient to support 
this rule.
    Based on the comments, the FAA has decided to allow installation of 
version 6.04A Enhanced until 30 days after the publication of the final 
rule instead of the proposed 30 days after publication of the NPRM. 
This provision applies to operators that buy, sell, or lease airplanes 
with TCAS II version 6.04A Enhanced.
    In response to AIA's comment regarding a manufacturer that 
continues to deliver airplanes with version 6.04A, the rule language 
only refers to the date the equipment is installed, not when it is 
delivered. Operators would be responsible for ensuring that its 
collision avoidance systems were installed before the required 
compliance date.

Alternative Collision Avoidance Systems and Other Equipment Issues

Proposed Rule

    To accommodate any future technology that may be equivalent to TCAS 
I or II, we provided for alternatives in lieu of TCAS I or II in the 
proposal. An alternative system must be approved by the FAA.

Comments on ADS-B

    One of the most popular issues that commenters addressed was 
comparing TCAS to ADS-B. Over 135 commenters (most via form letters 
from cargo pilots) believe that ADS-B eventually will be a 
``commendable'' system, but until it is fully proven, TCAS should be 
the required collision avoidance system. Approximately 12 commenters 
indicate that ADS-B is not equivalent to TCAS. Three of those 
commenters, including Eurocontrol, indicate that this is because ADS-B 
does not provide conflict resolution capability. ALPA echoes those 
sentiments stating that ``* * * other technologies are under 
development but lack the potential to operate independently in any part 
of the world. Any potential equivalent system must function 
independently from ground-based systems, demonstrate TCAS II 
capabilities, be interoperable with TCAS and assure the redundancy to 
perform as the pilots' last resort safety assurance system.''
    Eurocontrol supports allowing a truly equivalent system that is 
interoperable with TCAS. It believes ICAO is the appropriate forum to 
agree on equivalence at the international level; however, it is 
concerned that there does not currently exist an agreement among 
aviation authorities as to what constitutes equivalence.
    Eurocontrol believes the FAA is overemphasizing the potential of 
ADS-B and finds FAA's description misleading and confusing. According 
to Eurocontrol, ADS-B, like Secondary Surveillance Radar (SSR), 
supports the surveillance infrastructure, which it indicates is more 
importantly used for separation rather than collision avoidance. 
Eurocontrol maintains that it is critical to keep distinct and separate 
the concepts of separation and collision avoidance. Eurocontrol 
indicates that the ``primary use of ADS-B data should be for the 
provision of separation, and the system employing the data should be 
constructed to a level of performance and integrity, which would make 
collision avoidance virtually unnecessary.''
    Finally, Eurocontrol states that TCAS II provides collision 
avoidance protection based on an independent measurement of range and 
ADS-B does not.
    ALPA supports the FAA's decision that any potential equivalent 
system must: (1) Function independently from ground-based systems, (2) 
demonstrate TCAS II capabilities, (3) be interoperable with TCAS, and 
(4) assure the redundancy to perform as the pilots' last resort safety 
assurance system. It adds that the FAA should proceed with a known, 
proven product.
    On the other end of the spectrum are four supporters of ADS-B's 
potential. They believe that ADS-B is misrepresented in the NPRM and 
made suggestions for improvement. Many of the criticisms of the 
proposal stem from perceptions that the rule imposes onerous 
restrictions on non-TCAS systems, well beyond what Congress mandated.
    The CAA states that AIR-21 requires an equivalent level of safety 
to TCAS II but does not necessarily require interoperability or 
coordinated maneuvers between any new system and TCAS. It concludes 
that the legislation was not technology-specific, which opens the door 
for alternative systems that do not have to be interoperable with TCAS. 
According to the CAA, the FAA's apparent prejudice against ADS-B 
violates the spirit of AIR-21.
    The CAA asserts that the FAA provides no relevant analysis on the 
safety implications of the need for interoperability. It adds that RTCA 
SC-186, Working Group 1 has studied the issue and has provided 
alternatives to the ``coordinated maneuvers'' requirement.
    The CAA argues that the FAA does not seriously consider the 
possibility of an alternative system based on ADS-B technology. It 
contends that the analysis contains inaccuracies and omissions that 
could preclude the certification of a system that is more accurate and 
could provide a significantly safer air transportation system than 
TCAS. It states that the FAA ignores the potential use of traffic 
information service-broadcast (TIS-B), which it indicates would allow 
ADS-B to ``see'' TCAS-equipped aircraft. The CAA recommends we delete 
and reexamine our analysis of the potential use of ADS-B to meet 
Congress's intent of encouraging, not discouraging, innovative 
solutions to the collision avoidance question.
    United Parcel Service Airlines (UPS) supports the deployment of 
ADS-B as an alternative collision avoidance system and believes that it 
could address many shortcomings of TCAS. According to UPS, TCAS 
provides no information regarding target identification, speed, 
heading, type, or intent, whereas ADS-B does. In addition, it maintains 
that:
    [sbull] ADS-B provides accurate target information below 1,000 feet 
above ground level (AGL) and on the ground,
    [sbull] ADS-B derives altitude from GPS, thereby making vertical 
conflict resolution more reliable and less prone to error than TCAS,
    [sbull] ADS-B displays range greater than 120 miles, whereas TCAS 
is typically 12 miles, and
    [sbull] The bearing accuracy of ADS-B can support horizontal 
conflict resolution, which TCAS cannot.
    UPS criticizes the collision avoidance proposal because it believes 
that it imposes restrictions on non-TCAS systems that prevent an 
applicant from pursuing an alternative technology. It lists examples of 
purported errors from the proposed rule that it believes support its 
claim that the FAA implicitly is requiring only TCAS as a collision 
avoidance system.
    UPS also criticizes the FAA for not outlining standards to measure 
potential equivalent collision avoidance systems. It adds that the FAA 
must perform the necessary analysis to produce a uniform measurement of 
safety. This will allow the comparison of benefits provided by TCAS II 
and other collision avoidance technologies. UPS argues that in PL 106-
181, Congress intended for the FAA

[[Page 15888]]

to create the yardstick to evaluate the margin of safety of TCAS 
alternatives. UPS further contends that, because PL 100-223 calls for 
the FAA to implement horizontal guidance and PL 106-181 requires 
conflict resolution guidance, Congress likely required the deployment 
of an ADS-B-based collision avoidance system. UPS states that TCAS has 
neither of these capabilities.
    Finally, UPS makes suggestions to amend the proposed regulatory 
text. It recommends that we eliminate the requirement that an 
equivalent system be capable of coordinating with TCAS units. It 
suggests instead that an equivalent system reduce the risk of collision 
to a level equivalent to the reduction provided by a TCAS II that meets 
TSO C-119a. It also recommends that we add the requirement that any 
collision avoidance system used must comply with PL 100-223 and provide 
horizontal resolution.
    One commenter believes the rule will not improve safety in the 
national airspace system (NAS), because its restrictive nature could 
prevent new and improved systems from being developed. More 
specifically, he contends that the rule will stifle the development of 
ADS-B's pertinent application, Airborne Conflict Management (ACM), 
which he says will improve safety and increase capacity in the NAS.
    The commenter adds that TCAS does not resolve all potential 
collision encounters, but that ADS-B contains more information content, 
resulting in more effective collision avoidance maneuvers in both the 
horizontal and vertical planes. He believes that ADS-B can be used to 
develop a more effective collision avoidance system and traffic 
management system than TCAS. The commenter argues that TCAS is not 
totally independent from the ground-based secondary surveillance radar 
system because it shares the transponder and altimeter in the aircraft. 
According to the commenter, the altimeter is a common point of failure 
that can result in false TCAS resolution advisories.
    The commenter disagrees with our proposal to require maneuver 
coordination for any equivalent system used in lieu of TCAS. He states 
that the ACM sub-group of RTCA-186 has been working on a system that 
could overcome some of the limitations of TCAS and has determined that 
coordination is not necessary. He concludes his comment with 
recommendations to change the regulatory text. He suggests that we 
eliminate the provisions that an equivalent system be capable of 
coordinating with TCAS units. In place of it, the commenter suggests 
adding that equivalent systems reduce the risk of collision to a level 
equivalent to the reduction provided by TCAS.
    Another commenter also supports the potential of ADS-B as an 
equivalent system to TCAS. He believes that TCAS was the correct system 
for collision avoidance before the development of global positioning 
systems (GPS). However, according to the commenter, the FAA made two 
mistakes implementing TCAS requirements: (1) Not recognizing the 
contribution GPS would eventually make to traffic conflict and 
collision prevention, and (2) using Air Traffic Control Radar Beacon 
System (ATCRBS) Mode S as the vehicle for TCAS. He believes that these 
two mistakes caused collision avoidance to cost 10-100 times what it 
should and that it still experiences false alarms. According to the 
commenter, pilots ignore half of all TCAS resolution alerts (RAs) 
because they feel that although TCAS has prevented some collisions, it 
will eventually cause one.
    The commenter argues that the Capstone project in Alaska shows that 
ADS-B is a mature system, capable of providing collision avoidance 
functions. (The Capstone project is an FAA-funded evaluation, in which 
ADS-B is installed on certain airplanes under controlled conditions. 
The Capstone project is further explained in the FAA's response to this 
comment below.) He states that the accuracy and integrity of ADS-B 
nearly eliminates the need for collision avoidance. He adds that the 
susceptibility of ADS-B to the loss of GPS will be eliminated when the 
FAA and other agencies adopt the existing Loran-C as the back-up 
navigation source.
    The commenter makes suggestions to amend the proposed regulatory 
text. He recommends, identical to UPS, that we eliminate the 
requirement that an equivalent system be capable of coordinating with 
TCAS units. He suggests instead that an equivalent system reduce the 
risk of collision to a level equivalent to the reduction provided by a 
TCAS II that meets TSO C-119a. He also adds that the proposed rule 
document has too many errors to list and that RTCA would address those 
issues.

FAA's Response to ADS-B Comments

    The FAA supports the development of ADS-B. The intent of the rule 
is to provide the opportunity for future equipment to be certified to 
either meet or exceed the collision avoidance function of the current 
TCAS system. The burden to show equivalence is on the applicant. The 
developers of ADS-B have not requested that FAA approve ADS-B as 
equivalent to TCAS. Some commenters referred to systems being studied 
by RTCA; however, the FAA did not receive comments from RTCA.
    While the FAA has set out the elements it considers to be part of a 
TCAS equivalent such as interoperability, it is not appropriate in this 
rule to set specific technical standards for individual equipment. It 
is not the intent of the FAA to approve or disapprove equipment as 
equivalent to TCAS through this regulation. If, in the future, a 
collision avoidance system is presented to the FAA for certification 
and approval, we will examine the applicant's data to determine if the 
system is equivalent.
    The FAA agrees with Eurocontrol that it would be beneficial for 
there to be agreement between Authorities as to what would constitute 
equivalence, and that ICAO would be the appropriate forum. An 
international agreement on equivalence could open the door for new 
technologies. The FAA, however, must have its own standard for findings 
of equivalency. It is our intent to then make every effort to harmonize 
these standards.
    It is our position that an equivalent system to TCAS II must be 
interoperable with TCAS II, provide protection against the same 
population addressed by TCAS II, and coordinate with currently approved 
devices meeting the requirements of Sec. Sec.  121.356, 125.224, and 
129.18. This is what we interpret Congress to mean when it defined in 
49 U.S.C. 44716(g)(3) collision avoidance equipment as ``equipment that 
provides protection from mid-air collisions using technology that 
provides'a margin of safety of at least that same level as provided by 
the collision avoidance system known as TCAS II.'' While Congress did 
not specifically use the term ``interoperability,'' the FAA has 
determined that without interoperability, another alternative collision 
avoidance system would not be equivalent to TCAS.
    Although commenters suggest that an alternative system to TCAS need 
only provide an equivalent reduction in collision risk, we are 
responding to a Congressional direction that requires more than just a 
reduction in collision risk. Congress mandated ``collision avoidance 
equipment that provides protection from mid-air collisions using 
technology that provides cockpit-based collision detection and conflict 
resolution guidance, including display of traffic; * * *'' Congress has 
defined collision avoidance equipment as technology equivalent to TCAS. 
At this

[[Page 15889]]

time there is no system equivalent to TCAS.
    This final rule provides the opportunity for future developments 
without requiring more rulemaking. It is not intended to discourage 
private-sector, on-going efforts. However, at this time, neither the 
FAA nor other regulatory authorities are sponsoring programs to develop 
alternatives to TCAS II/ACAS II (the international equivalent to TCAS 
II version 7.0) to meet U.S. or international requirements. Allowing 
for an equivalent system is meant to be helpful to affected parties.
    The FAA is responding to Congress and cannot delay this rulemaking 
for future development. We have extended the compliance date as 
discussed; however, we cannot extend beyond the date imposed by 
Congress. It is not the FAA's intent to delay or cancel incentives for 
new development of systems. The FAA has established a commitment to the 
development of the ADS-B technologies and works in the international 
forum with ICAO, Eurocontrol, and others to further this promising 
technology.
    In regard to the comment about Capstone, the FAA is very familiar 
with ADS-B use in Alaska under the Capstone program. FAA funds were 
used to equip certain airplanes in Bethel, Alaska, with ADS-B. So far 
there are approximately 150 participating airplanes. Other than the 
Cessna 208, which is turbine, all of the airplanes are piston-powered. 
Most are operated in accordance with part 135, which this rule does not 
address. Capstone is a demonstration under very controlled conditions 
where every airplane involved has the necessary equipment. Capstone has 
demonstrated the utility of an avionics suite containing GPS receivers, 
moving map display, terrain awareness feature and ADS-B. In Alaska, 
ADS-B has been approved for provision of radar like services by Air 
Traffic Control. The Capstone program is entering a second phase which 
will utilize the Wide Area Augmentation System (WAAS) to provide more 
precise and robust navigation capabilities and allow for new routes 
previously unavailable to operators and will continue to develop ADS-B 
capabilities.
    In the lower 48 states, the Safe Flight 21 program office has 
entered into a joint government-industry effort to develop ADS-B 
applications that will provide an impetus for widespread equipage by 
commercial and general aviation operators in the United States. There 
are numerous applications of ADS-B that, when implemented, could 
improve safety through greatly enhanced situational awareness. ADS-B 
installations have been approved in transport category aircraft 
utilizing the 1090 MHz (transponder) data link. Installations in the 
Capstone program have utilized the Universal Access Transceiver (UAT) 
as the data link for ADS-B transmissions. We currently do not have 
sufficient evidence showing that ADS-B would be a substitute for TCAS.
    One commenter's reference to non-compliance to RAs ignores data 
analysis that shows such non-compliance occurs when pilots acquire the 
other aircraft visually and determine that a threat does not exist. In 
other words, there are times when non-compliance with an RA may be 
appropriate. When the pilot is in instrument meteorological conditions, 
the only action available to the pilot is to respond to the alert. This 
same commenter stated that TCAS could cause collisions. However, his 
statements are unsupported and contrary to the numerous airline pilots' 
comments received and FAA's experience. The commenter did not provide 
any data to support his claim that nuisance or unnecessary alerts are 
costly.

Comments on Other Equipment

    In addition to the system alternative issues, three commenters 
addressed Mode S transponder issues. One commenter indicates that a 
Mode S is sufficient for collision avoidance without TCAS because it 
can continuously provide a ``squitter'' of barometric and GPS position 
with heading and speed, giving all aircraft and ground listeners the 
opportunity to locate and avoid the transmitter. He says British 
Airways has implemented this technology on an experimental basis. 
According to the commenter, adding a Mode S squitter would increase 
receiver-equipped aircraft four-fold within 6 years. He believes 
military and public aircraft without transponders could listen to 
position reports using the low-cost, uncertified receivers. He requests 
that all future mandates for collision avoidance systems include Mode S 
squittering of altitude, latitude, and longitude.
    For clarification, the term ``squitter'' refers to a system 
designed to transmit and receive signals from a transponder, without 
active interrogation of the transponder. It also refers to a signal 
transmitted by the system. TCAS II requires a Mode S transponder, which 
is interrogated by other TCAS II equipment and replies to that 
equipment. A squitter system would be able to transmit and receive any 
information from the transponders, but it would not actively 
interrogate other aircraft as a TCAS II would.
    Ryan International Corporation (Ryan) suggests we include traffic 
advisory system (TAS) Class A as a less expensive equivalent 
alternative to TCAS I. It makes this suggestion on the basis of the 
high cost to install a Mode S transponder. Another commenter agrees 
with Ryan in that we should include a less expensive form of TAS in 
lieu of TCAS I. That commenter believes that while TCAS provides a very 
useful tool to improve the safety of our airways, it is also very 
costly.
    Ryan also inquires as to whether Mode S is required for TCAS I 
installations. It states that that does not seem to be the case in the 
preamble of the proposal, but in the proposed regulatory text, it 
appears that Mode S is required for TCAS I, or equivalent.

FAA's Response Regarding Other Equipment

    In response to Ryan's inquiry regarding whether Mode S is required 
for TCAS I, Mode S is not required for those airplanes that need only a 
TCAS I. It is not our intent to mandate Mode S in this rule for TCAS I 
installations because it is not an integral part of the TCAS I 
installation. The commenter's confusion may have resulted from the 
appearance of the table in the Federal Register.
    It should be noted that there are Mode S requirements described in 
existing Sec. Sec.  121.345(c)(2), 125.224(a), and 129.18(a)(2). In 
addition, an appropriate class of Mode S is required to be installed as 
a part of a TCAS II installation, which is consistent with the existing 
rule and the proposed rule. In the final rule, the Mode S reference 
will remain in Sec. Sec.  121.356, 125.224, and 129.18 because it is a 
required element in a TCAS II system.
    We did make one change to the Mode S reference from the proposed 
rule. We inserted, for clarification, that the Modes S must be an 
appropriate class. This is similar language to the existing TCAS II 
rule. There are multiple classes of Mode S transponders within TSO C-
112 and currently TCAS II functions only with at least a class 2 Mode S 
transponder. At the time of the issuance of this final rule, there is 
still no system found to be equivalent to TCAS.

Exceptions/Applicability

Proposed Rule

    The FAA proposed that part 121, 125, and 129 turbine-powered 
airplanes that weigh more than 33,000 lbs. MCTOW would require TCAS II, 
or equivalent. We proposed that part 121 and 125

[[Page 15890]]

turbine-powered airplanes weighing 33,000 lbs. MCTOW or less, and all 
121 and 125 piston-powered airplanes would require at least a TCAS I, 
or equivalent. We proposed that part 129 turbine-powered airplanes 
weighing 33,000 lbs. MCTOW or less would require TCAS I, or equivalent.

Comments

    Two commenters request that we except some airplanes from the 
collision avoidance rule. According to one of these commenters, older, 
piston-powered, large aircraft conducting all-cargo operations do not 
have the performance necessary for rapid climbs. He states that 
passenger aircraft already equipped with TCAS can more safely maneuver 
to avoid an aircraft in steady-state flight. He states that this rule 
is not in the public interest and will put small air cargo operators 
with these airplanes out of business.
    The second commenter, Northern Air Cargo, agrees that its B727-100 
aircraft should be TCAS II-equipped, but it requests that we except 
ADS-B-equipped DC-6 aircraft operating under the Capstone project 
within the State of Alaska. The commenter states that its DC-6 aircraft 
cruise at much lower altitudes and airspeeds and do not fly among other 
TCAS-equipped aircraft during most phases of flight. It adds that most 
of its DC-6 aircraft are Capstone-equipped and operate solely within 
the State of Alaska and, occasionally, into remote areas of Canada and 
the lower 48 states.
    ALPA, on the other hand, suggests that the proposal could be more 
restrictive. It asserts that some turbine-powered airplanes weighing 
less than 33,000 lbs. MCTOW, and some piston-powered airplanes, could 
respond to TCAS II RAs. It does not agree that certain airplanes 
operated under part 129 are too small to operate practically with 
collision avoidance. It states that the same type of piston-powered 
airplanes could be operating in the same airspace under part 121, 125, 
or 129, but the piston-powered, part 129 airplane would not be required 
to have TCAS I. It believes that we should use only a performance 
threshold to capture all airplanes in parts 121, 125, and 129 
uniformly.
    Eurocontrol provides a preliminary study demonstrating that light 
airplanes can respond to RAs. Eurocontrol recommends that we require 
TCAS II version 7.0 for all airplanes, including those that we proposed 
to use TCAS I, or equivalent.

FAA's Response

    The FAA has decided not to include cargo airplanes weighing 33,000 
lbs. or less in this final rule. This is a change from the NPRM, in 
which we proposed collision avoidance requirements for all airplanes 
weighing 33,000 lbs. MCTOW or less. We made this decision to reduce a 
burden on the operators of these airplanes. However, the FAA did 
maintain the proposed TCAS I (or equivalent) requirement for piston-
powered airplanes weighing more than 33,000 lbs.
    We have already reduced the burden for the older piston-powered 
airplanes weighing more than 33,000 lbs. MCTOW. We proposed and will 
require only TCAS I, or equivalent, for those airplanes. Part 129 
already excepts piston-powered airplanes from collision avoidance 
requirements. The FAA proposed to continue that exception and we have 
decided to adopt the rule as proposed.
    The FAA received comments from ALPA and Eurocontrol requesting that 
we expand the scope of the proposal. The FAA did not propose TCAS II 
requirements for piston-powered airplanes because of the lack of 
performance capabilities for those airplanes. Although the commenters 
contend that there may be piston-powered airplanes that can effectively 
use TCAS II, they did not provide any specific make and model airplanes 
that they feel could safely respond to RAs. In further telephone 
discussion with ALPA, the FAA determined that the primary intent of the 
comment was to point out inconsistencies between the proposal and the 
existing passenger-carrying TCAS rule. ALPA wants ``one level of 
safety.''
    The minimum rate of climb required to respond to a TCAS II RA is 
1,500 feet per minute (f/m), with the ability to increase the rate to 
2,500 f/m. The FAA did not conduct a study on the performance 
capabilities of piston-powered airplanes. However, the FAA does have 
extensive knowledge of and experience with piston-powered airplanes 
currently operating under part 121, weighing more than 33,000 lbs. 
MCTOW. (Most of those airplanes were manufactured in the 1940's and 
1950's.) Based on that information, the FAA determined that those 
airplanes were not capable of meeting the performance standards to 
respond to a TCAS II RA under the worst-case situation for climb 
performance, i.e., maximum gross weight, high temperature, high 
pressure altitude.
    Further, the equipment and labor to install TCAS II can, in some 
cases, approach the value of the airplane. Most of those piston-powered 
airplanes are operated by small entities. For example, the conservative 
value of a DC-6 is approximately $500,000; whereas, the cost of 
installing TCAS II on that airplane could reach $180,000. That cost 
does not include down-time and training. This final rule provides a 
safe and economical solution for piston-powered airplanes weighing more 
than 33,000 lbs. MCTOW. The FAA has determined that it cannot justify 
including in this rule installation of TCAS II (or equivalent) on 
piston-powered cargo airplanes weighing more than 33,000 lbs. MCTOW and 
has adopted the rule as proposed.
    Because the FAA will not include airplanes weighing 33,000 lbs. or 
less in this rule, we will maintain the existing passenger-seating rule 
language for any passenger-carrying airplanes other then those with 
more than 30 seats. As proposed, we updated the collision avoidance 
requirement for passenger-carrying airplanes to allow for collision 
avoidance systems equivalent to TCAS.
    Eurocontrol advocates TCAS II for all airplanes, but recognizes 
that there could be operational differences between the United States 
and Europe that could support a need for TCAS I. In reference to the 
Eurocontrol study, the FAA appreciates Eurocontrol providing this 
preliminary study, which is in its beginning stages. We found the study 
interesting but are not convinced that these airplanes have the 
performance capability to respond to RAs as necessary. The FAA 
developed two levels of TCAS (TCAS I and TCAS II) since the 1980's for 
the sole purpose of relieving small airplanes from purchasing equipment 
that may not be more useful or safer for them. Many countries do not 
yet mandate TCAS at all, but those that do require TCAS II and only 
require it on those airplanes equivalent to our part 121 airplanes with 
more than 30 seats. In Europe, the first TCAS mandate for their largest 
airplanes did not occur until the year 2000. The next stage of the 
mandate occurs in 2005 when airplanes with more than 19 seats will be 
required to have TCAS II. They have not mandated anything for ``light'' 
aircraft. They are able to mandate ACAS II (TCAS II, version 7.0) for 
airplanes with more than 30 passenger seats (2000) and more than 19 
passenger seats (2005) without a retrofit because it is the initial 
mandate in both cases.
    Compared to Europe, the United States has a large community of 
smaller commercial airplanes transporting passengers and cargo. This 
rule to add cargo airplanes weighing more than

[[Page 15891]]

33,000 lbs. also includes the passenger-carrying airplanes because of 
the switch to weight; however, the seat definition in the current rule 
is compatible with the proposed weight definition. The decision has 
already been made to not require a retrofit of TCAS equipment from one 
version to another. Retrofits are very expensive and, in this case, the 
FAA does not find the benefit of a retrofit to be worth the cost.
    In response to Northern Air Cargo's comment that we should accept 
all Capstone participants, we note that Capstone currently applies to 
Alaska only (specifically, Bethel, Alaska). Although the FAA is pleased 
with the progress made during the Capstone demonstration, ADS-B is not 
a collision avoidance system and we have not received any application 
for its FAA approval as a collision avoidance system. Currently, the 
ADS-B equipment installed for the Capstone project is not equivalent to 
TCAS I or TCAS II. It currently would not be an acceptable alternative 
to TCAS under this proposal either inside Alaska or outside Alaska.
    Northern Air Cargo's DC-6 weighs more than 33,000 lbs. If the FAA 
had adopted the existing rule language and simply added cargo airplanes 
and used the weight threshold, the DC-6 would have needed TCAS II. This 
rule provides significant relief to operators of large piston-powered 
airplanes, including those that operate in Alaska by requiring only 
TCAS I.

Economic/Risk Analysis/Alternatives

Comments

    Several commenters specifically address the costs and benefits of 
the rule, the risk analysis used, and some alternatives to reduce the 
cost of the rule.
    Ryan suggests that our estimated cost of equipage for TCAS I is 
low, suggesting that the estimate left out the cost of the elements 
themselves. It also states that if Mode S is required for TCAS I 
installations, the costs would be even higher, and recommends that we 
remove the Mode S requirement for TCAS I installations.
    The CAA suggests that we overstated the benefits and minimized the 
costs in our analysis. It quotes from the cost section of the NPRM that 
we did not include the cost of air carriers that have voluntarily 
equipped their fleets with TCAS or that are equipped with TCAS as 
required by foreign governments. However, it states that our benefits 
section assumes that no cargo aircraft are equipped with TCAS. It 
argues that the numbers used for the benefits section are either drawn 
from unknown sources or are misinterpretations of other existing 
documents. It recommends that we task MITRE Corporation to review the 
proposed rule and to submit comments on the benefits that the proposal 
might generate.
    Another commenter indicates that the cost of installing TCAS on 
older piston-powered cargo aircraft is cost prohibitive. He believes 
this rule will ground these aircraft, putting small cargo aircraft 
companies out of business, depriving the public of much needed cargo 
service. He argues that these aircraft typically fly only a few hundred 
hours a year and are in their last 10 years' of service life.
    USA Jet Airlines, Inc., questions the necessity of so many 
equipment requirements in the near future. It indicates that in the 
next 3 years, a DC-9 and Falcon operator will pay $250,000 per aircraft 
for TCAS II, $125,000 per aircraft for TAWS and a significant sum for 
the domestic RVSM system. It agrees that these systems have merit, but 
believes the cost of all the systems precludes implementation for many 
carriers.
    UPS contends that the FAA misinterpreted the MITRE study, which the 
NPRM indicated that the risk of a mid-air collision with a passenger 
airplane in the United States would be reduced 17 percent if cargo 
airplanes were also equipped with TCAS. According to UPS, the study 
reported that the risk of a mid-air collision for passenger airplanes 
in the United States would be reduced by 1 percent. UPS criticizes the 
study for not calculating the reduction in the risk of passenger 
airplane runway incursion accidents if cargo airplanes were equipped 
with ADS-B.
    UPS also believes that the benefits are uncorroborated. It believes 
that because the FAA did not quantify the benefit of TCAS equipage, it 
is not possible to calculate a cost-benefit. UPS further asserts that 
the mid-air collision risk over the next 20 years involving a cargo 
airplane (40 percent) is unsupported. It argues that because there has 
never been a mid-air collision in the United States involving a cargo 
airplane, it is difficult to comprehend how this value could have been 
computed.

FAA's Response

    In response to Ryan's assertion that we left out the cost of TCAS I 
units, the FAA's cost estimate does include estimates for both 
equipment and installation costs. As noted above, TCAS I equipment does 
not need a Mode S to function, nor did we propose to require Mode S. 
Therefore, the cost of Mode S is not considered to be a cost imposed by 
this rule.
    To address the CAA's comments, in the final rule regulatory 
evaluation, air-cargo carriers' voluntary compliance has now been 
factored into both the cost and benefit sections. A large percentage of 
air cargo carriers voluntarily complied with the rule, even before the 
publication of the NPRM. Both the costs and the benefits are reduced by 
the extent of voluntary compliance. The FAA finds it unnecessary to 
task MITRE Corporation since we have made the corrections.
    In response to the individual operating older piston-powered cargo 
airplanes, as previously discussed, the FAA has reduced the burden for 
those airplanes from TCAS II to TCAS I as much as we can. In response 
to USA Jet Airlines, Inc., the FAA realizes there is a cumulative 
effect of rules; however, in this case, the FAA is required by 
Congressional mandate to issue this rule.
    UPS questioned the validity of a 40-percent chance of at least one 
mid-air collision involving a cargo aircraft in the next 20 years. That 
probability refers to the value in the Poisson distribution table when 
the mean of the distribution is 0.5. The Poisson distribution is an 
accepted probability distribution for rare events. Just because a 
collision has not occurred does not mean that the probability of a 
collision occurring is zero. The economic evaluation discusses the 
impact of near-miss situations on the FAA's analysis.
    The 17-percent and 1-percent reduction in risk estimates, as 
mentioned in the full regulatory evaluation, are both correct. The 
MITRE study, which is in the docket, reports (pages 49 and 50), ``If 
cargo aircraft were TCAS-equipped this relative risk would drop to 
0.058 (as compared to the pre-TCAS baseline situation when no aircraft 
was TCAS-equipped). This corresponds to a Risk Ratio of 0.058/0.070 = 
0.828, which roughly corresponds to a 17-percent reduction compared to 
the current risk. The small proportion of encounters involving one 
passenger and one cargo aircraft means that equipping cargo aircraft 
with TCAS would only reduce the risk to the passenger aircraft by 
another one percent.''
    In response to UPS's assertion that the benefits of the rule are 
uncorroborated, the FAA sponsored a MITRE study to assist in the risk 
assessment of a mid-air collision. That report provided the basis of 
the safety benefits for collision avoidance for cargo aircraft. We made 
that study available in the docket, we provided a risk assessment, and 
we

[[Page 15892]]

presented a reasoned determination that the benefits justified the 
costs. It was not MITRE's task at the time of the study to address ADS-
B.
    Commenters responding to this rule have criticized us for not 
having enough accident data to justify the rule. In issuing this 
collision avoidance systems rule, we are being proactive about 
preventing accidents, rather than waiting for comprehensive mid-air 
collision data to give us overwhelming justification for this rule. 
Since the NPRM was published, a mid-air collision occurred in Germany 
on July 1, 2002, involving a DHL cargo Boeing B-757 and a passenger-
carrying Tupelov Tu-154. Both aircraft were equipped with ACAS II (TCAS 
II version 7.0). German authorities also reported that data from the 
aircraft Cockpit Voice Recorders (CVR) and Flight Data Recorders (FDR) 
indicated that both ACAS II systems alerted the flight crews and 
displayed coordinated RAs. The B-757 descended in response to its RA, 
but the Tu-154 did not climb in response to its RA. Rather, it 
descended in response to air traffic control instructions. The accident 
is under investigation and the probable cause is unknown at this time.

Paperwork Reduction Act

    Information collection requirements in the amendment to parts 121, 
125, and 129 previously have been approved by the Office of Management 
and Budget (OMB) under the provisions of the Paperwork Reduction Act of 
1995 (44 U.S.C. 3507(d)) and have been assigned OMB control Nos. 2120-
0008 and 2120-0085. The potential paperwork burden is any recordkeeping 
required to maintain the list of those pilots who have completed 
training and are certified as to their proficiency on the collision 
avoidance system operation. These recordkeeping requirements already 
are covered under the Paperwork Reduction Reports entitled ``Operating 
Requirements; Domestic, Flag, and Supplemental Operations'' and 
``Certification and operations: Airplanes having a seating capacity of 
20 or more passengers or a maximum payload capacity of 6,000 lbs. or 
more; and rules governing persons on board such aircraft.''
    An agency may not conduct or sponsor and a person is not required 
to respond to a collection of information unless it displays a 
currently valid Office of Management and Budget (OMB) control number.

International Compatibility

    International Standards and Recommended Practices (SARPs), Annex 6 
to the Convention on International Civil Aviation, Part I, seventh 
edition, July 1998 has the following four recommendations addressing 
collision avoidance systems:
    6.18 Aeroplanes Required to be Equipped with an Airborne Collision 
Avoidance System (ACAS II).
    6.18.1 From 1 January 2003, all turbine-engined aeroplanes of a 
maximum certificated take-off mass in excess of 15,000 kg. or 
authorized to carry more than 30 passengers shall be equipped with an 
airborne collision avoidance system (ACAS II).
    6.18.2 From 1 January 2005, all turbine-engined aeroplanes of a 
maximum certificated take-off mass in excess of 5,700 kg. or authorized 
to carry more than 19 passengers shall be equipped with an airborne 
collision avoidance system (ACAS II).
    6.18.3 Recommendation.-All aeroplanes should be equipped with an 
airborne collision avoidance system (ACAS II).
    6.18.4 An airborne collision avoidance system shall operate in 
accordance with the relevant provisions of Annex 10, Volume IV.

FAA Discussion of ICAO SARPs

    In keeping with U.S. obligations under the Convention on 
International Civil Aviation, it is FAA policy to comply with ICAO 
SARPs to the maximum extent practicable. The FAA has reviewed the 
corresponding ICAO Standards and Recommended Practices and has 
identified the following differences.
    The FAA agrees that ICAO should actively encourage the use of ACAS 
II, which is equivalent to TCAS II version 7.0, and agrees in principle 
with the SARPs. However, the FAA is concerned that some aspects of the 
SARPs may be unrealistic. ACAS II is appropriate for large, transport 
category airliners, which have been successfully using TCAS II version 
6.04A Enhanced in the United States for several years. However, some 
small airplanes lack the performance capability to respond to RAs 
provided by ACAS II (TCAS II version 7.0) and therefore would receive 
no benefit from the recommendation. The FAA believes that this rule 
provides a reasonable alternative for those airplanes for which ACAS II 
would be inappropriate. The FAA has considered the aerodynamic 
capability of certain airplanes and does not agree that ACAS II/TCAS II 
is the appropriate level for smaller airplanes. The FAA currently 
mandates TCAS I for airplanes with 10-30 passenger seats and has done 
so for more than a decade. Many of the 10-30 passenger-seat airplanes 
currently equipped with TCAS I weigh less than 5,700 kg. (12,500 lbs.). 
The FAA also has considered the cost of installing equipment that 
cannot be fully utilized by certain airplane operators.
    The FAA desires that all TCAS II/ACAS II users have the latest 
version (version 7.0) and the FAA believes that TCAS II version 7.0 has 
additional benefits. However, many airplanes currently required to have 
TCAS II have had version 6.04A Enhanced installed for several years. 
The purpose of this rule is to capture cargo airplanes for the first 
time, not to create retrofits for passenger airplanes. This rule allows 
airplanes that already are equipped with TCAS II version 6.04A Enhanced 
to continue using that version until those particular units can no 
longer be repaired to TSO C-119a standards. Air carriers that are 
installing TCAS II for the first time must equip their applicable 
airplanes with TCAS II version 7.0. Eventually, airplanes operating 
under parts 121, 125, and 129 that are required to have TCAS II would 
be required to be equipped with TCAS II version 7.0. This is because 
operators will need to replace version 6.04A Enhanced units when old 
units wear out, or they will choose to operate in RVSM airspace or in 
foreign countries that require version 7.0.

Economic Evaluation, Regulatory Flexibility Determination, Trade Impact 
Assessment, and Unfunded Mandates Assessment

    Changes to Federal regulations must undergo several economic 
analyses. First, Executive Order 12866 directs each Federal agency 
proposing or adopting a regulation to first make a reasoned 
determination that the benefits of the intended regulation justify its 
costs. Second, the Regulatory Flexibility Act of 1980 requires agencies 
to analyze the economic impact of regulatory changes on small entities. 
Third, the Trade Agreement Act prohibits agencies from setting 
standards that create unnecessary obstacles to the foreign commerce of 
the United States. In developing U.S. standards, this act requires 
agencies to consider international standards, and use them where 
appropriate as the basis of U.S. standards. Fourth, the Unfunded 
Mandates Reform Act of 1995 requires agencies to prepare a written 
assessment of the costs and benefits and other effects of proposed and 
final rules. An assessment must be prepared only for rules that impose 
a Federal mandate on State, local or tribal governments, or on the 
private sector, likely to result in a total expenditure of $100 million 
or

[[Page 15893]]

more in any one year (adjusted for inflation.)
    In conducting these analyses, the FAA has determined:
    (1) This rule has benefits that justify its costs. This rulemaking 
does not impose costs sufficient to be considered ``significant'' under 
the economic standards for significance under Executive Order 12866 or 
under DOT's Regulatory Policies and Procedures. Due to public interest, 
however, it is considered significant under the Executive Order and DOT 
policy.
    (2) This rule will have a significant impact on a substantial 
number of small entities.
    (3) This rule is in accord with the Trade Agreement Act.
    (4) This rule does not impose an unfunded mandate on state, local, 
or tribal governments, or on the private sector.
    The FAA placed these analyses in the docket and summarizes them 
below.

Benefits of the Final Rule

Introduction

    The implementation of this rule contributes to a long-standing 
effort by the Congress, the FAA, international aviation authorities, 
and industry to increase the use of Collision Avoidance Systems (CAS). 
Specifically, the expected benefit of this rule is a reduction in the 
risk of midair collisions involving at least one cargo airplane.
    There are many levels of safety built into the Air Traffic Control 
System that guard against the risk of midair collision. However, when 
human errors by pilots or controllers, or equipment failures occur, 
safety margins erode. In some instances, separation between aircraft is 
lost. Many different factors apply in such cases. There are such a 
variety of circumstances that it appears no single measure can entirely 
eliminate the risk of midair collision.
    Traffic Alert and Collision Avoidance System (TCAS) has been proven 
effective in providing additional protection against collision. TCAS 
was designed to supplement the safety margins of the ATC system by 
providing protection when other means fail. At present, TCAS is 
required in certain passenger-carrying airplanes and has also been 
voluntarily installed on some general aviation (primarily business) 
aircraft. In addition to the United States requirements, Europe, India 
and, recently China require collision avoidance systems. Within the air 
cargo industry, Northwest Airlines and Polar Air Cargo have already 
equipped their cargo airplanes with TCAS II and the all-cargo airlines 
Airborne Express and FedEx are voluntarily equipping their fleets with 
TCAS II. This voluntary compliance reduces the benefits of this final 
rule from those cited in the NPRM.
    Commenters' reports, Near Midair Collision (NMAC) filings, and the 
National Transportation Safety Board (NTSB) recommendations attest to 
occasions where safety benefits improved by using TCAS equipment. 
Often, these reports suggest that TCAS served as the final safety net 
that prevented an accident. A pilot's and a controller's view of a 
situation may differ, particularly in the degree of imminent danger 
associated with a loss of separation.
    The potential benefits of TCAS II have been studied by extensive 
computer simulations and validated by tens of millions of hours of 
operational experience. These safety benefits have been recognized by 
the International Civil Aviation Organization (ICAO) in its worldwide 
recommendation for TCAS II installation, which affects both passenger 
and cargo carriers.
    The worst midair collision occurred between a cargo airplane and a 
passenger airplane in India with nearly 350 fatalities. At the time of 
this writing another midair collision occurred with a cargo airplane 
and a passenger airplane in Europe. This most recent accident is a 
painful reminder that such accidents do occur.

A Look at the Environment

    Although no passenger air carrier airplanes have been involved in a 
midair collision since they were required to carry TCAS II, other types 
of airplanes continue to experience midair collisions. During the 
period 1994-1997, 61 midair collisions in the U.S. airspace have 
occurred resulting in 92 fatalities and 26 injuries. No collision 
involving a cargo airplane (which would be affected by this rule) 
occurred, but the following describes a recent near miss.
    Two U. S. cargo airline airplanes nearly collided at flight level 
330 over Kansas on March 2, 1999. A McDonnell Douglas cargo DC-10 had 
departed from Portland, Oregon, and was enroute to Tennessee. The other 
airplane was a cargo Lockheed L-1011 that had departed from Los 
Angeles, California, and was proceeding to Indiana. The minimum 
distance between the two airplanes at the time of the near-collision 
was reported as a quarter-mile (ATC recorded radar data) or 50-100 feet 
(crewmember estimate). The DC-10 captain reported that he never saw the 
L-1011 approaching. The L-1011 crewmembers saw the DC-10 to the left 
and slightly behind them at nearly the same altitude and took evasive 
action to avoid a collision.
    The (NTSB)'s investigation of the NMAC determined that air traffic 
controllers in two different air route traffic control centers failed 
to properly transfer control and radio communications for each airplane 
to the next sector that the flights would fly through according to 
their flight plans. As a result, both airplanes were not on the proper 
radio frequency (were under no one's control) as their flight paths 
converged at the same altitude over Kansas. While ATC was aware of the 
pending conflict, the controllers were unable to issue control 
instructions to separate the two airplanes, because they could not 
communicate with the flight crews on the proper radio frequency.
    The NMAC also highlighted a difference in the TCAS requirements 
between passenger and cargo airplanes. Currently, regulations require 
passenger carrying airplanes with more than 30 passenger seats 
operating in U. S. airspace to be equipped with TCAS II which alerts 
flight crews of potential conflicts and, if necessary, instructs them 
to climb or descend to resolve the conflict. Cargo airplanes receive no 
TCAS information because they are not currently required to be equipped 
with TCAS. This could cause a potential safety hazard because a cargo 
pilot without the advantage of a TCAS RA may inadvertently select the 
same response as the RA provided to the passenger airplane pilot.

Risk Assessment

    The above discussion outlines in general terms the benefits of 
equipping airplanes with TCAS II. In an effort to place these benefits 
in a more quantified context, the FAA performed the following risk 
assessment based on a study performed by MITRE.\1\
---------------------------------------------------------------------------

    \1\ The Mitre study, ``Assessment of Midair Collision Risk and 
Safety Benefits of TCAS II for Cargo Aircraft'', June, 1999, is 
available in the public docket for this rulemaking action.
---------------------------------------------------------------------------

    The scant air cargo airplane data in the United States on midair 
collisions and NMACs does not allow a definitive analysis of the 
numbers of accidents likely to be avoided by installing TCAS on cargo 
airplanes. Fortunately, there has been no actual midair collisions in 
U.S. airspace involving cargo airplanes affected by this rulemaking 
action. However, it does not follow from this circumstance that the 
risk of a midair collision involving a cargo airplane is zero.
    The following risk assessment attempts to arrive at a reasonable 
approximation of the risk of a MAC

[[Page 15894]]

involving at least one cargo airplane under the following 
circumstances:
    1. The current situation--no requirement for collision avoidance 
systems on cargo airplanes, and
    2. The reduction in risk with the implementation of this final 
rule.
    To do this, the FAA combined the risk reduction estimates developed 
by MITRE, with the FAA's estimate of risks.

Assumptions

    The estimates derived by Mitre depend on a number of simplifying 
assumptions. These assumptions are believed to be consistent with the 
level of accuracy that can be achieved when estimating the 
probabilities of such rare events as midair collisions or NMACs.
    The two major assumptions are:
    1. Exposure to a possible midair or near-midair collision is 
assumed to be approximately proportional to the number of airplane 
pairs flying through the same airspace at about the same time. The 
number of pairs increases in proportion to the square of the number of 
airplanes.
    2. The NMAC risk reduction estimates documented in the Safety 
Analysis of TCAS II Version 7, which were derived from airplane track 
data collected at major terminal areas for passenger flights, also 
apply to cargo airplanes.

Pre-TCAS II Accident Rates

    This section discusses the risk of cargo airplane midair collisions 
(MAC)s. The risk is the expected number of cargo airplane MACs with 
another cargo airplane, a commercial passenger airplane, or a general 
aviation airplane. Due to general aviation data limitations and the 
fact that passenger airplanes are presently equipped with TCAS, this 
assessment of risk is limited to that of cargo/cargo MAC. While to date 
there has not been a MAC involving a cargo airplane in the United 
States, there were two near midair collisions (NMAC) with cargo 
airplanes in 1999. The FAA believes there is a small, but significant, 
risk. Several methodologies are presented below which provide an 
approximation of the number of cargo airplane MACs that may occur in 
the future if cargo airplanes are not equipped with collision avoidance 
devices.
    Passenger midair accidents have occurred. In the FAA's 1988 
regulatory analysis of TCAS on passenger airplanes, it was noted that 
during the 15 years before the use of TCAS on airplanes, two midair 
collisions occurred, each of which involved at least one large air 
carrier passenger airplane. Accordingly, at that time the rate of 2 
MACs per 15 years was used as the estimate of future incidence in the 
absence of TCAS. By extending the time period to 20 years to coincide 
with the cost-analysis reference period of this analysis, the rate 
increased to 2.67. Because there are substantially fewer cargo 
airplanes than passenger airplanes operating in the United States, a 
rate of 2.67 defines the upper bound as the rate of MAC involving cargo 
airplanes. The actual rate is probably substantially less than this 
upper bound. The FAA has used this figure, however, as a basis for 
several different methods to approximate the actual risk. These methods 
include a direct ratio of numbers of aircraft, and proportions of pairs 
of both cargo aircraft and cargo operations. Taken together, the agency 
believes that the results of these methods define a reasonable 
approximation of the range of the actual risk.
    In the next 15 years the average number of operating cargo 
airplanes is projected to be about 1,545, or nearly 50 percent of the 
average number of passenger airplanes (3,230) that operated between 
1973 and 1987. If the MAC risk were solely a function of the number of 
airplanes, then the cargo MAC risk in the next 15 years could be 
considered to be 1.0 MAC (50 percent of 2.0). This approximation 
however is likely to overstate the actual risk, as cargo operations per 
airplane are lower than that of passenger airplanes. If the ratio of 
cargo to passenger departures-per-airplane remains roughly that of 
today (between .33 and .40), then multiplying the value of the 
departure-per-airplane ratios by 1.0 accidents results in range of .33 
to .40 MACs for 15 years, or nearly .44 to .53 MACs over 20 years.
    From a slightly different perspective, another approximation can be 
derived from information on the number of airplane pairs (a collision 
potential). As the number of years, and as the number of airplane pairs 
increase, the likelihood of a collision increases. The number of pairs 
can be calculated for the relevant period.\2\ Over the 1973 to 1987 
time period, the average annual number of in-service passenger 
airplanes was approximately 3,230. Over the fifteen-year period 2000 
through 2014, the average number of cargo airplanes is projected to be 
about 1,545. Based upon the assumption that risk is a function of the 
number of aircraft squared, the estimate of a MAC risk to cargo 
airplanes not equipped with collision avoidance equipment is estimated 
as 2.0 * (1,545)\2\/(3,230)\2\ = 0.45 accidents in 15 years, or 
approximately 0.60 accidents in 20 years.
---------------------------------------------------------------------------

    \2\ The number of pairs involving airplanes from the same 
population (cargo/cargo) can be calculated using the formula: N = 
n(n - 1)/2. For large numbers this formula can be approximated by: N 
= nn/2 for comparisons among different assumptions of the number of 
airplane pairs involved.
---------------------------------------------------------------------------

    A different application based on numbers of operations provides an 
effective lower bound of the likely range of risk for a cargo MAC. 
Total revenue departures summed from 1974 through 1988 (1973 data are 
not available) are 79.1 million. For a 15-year period from 2000 through 
2014 total cargo airplane departures are assumed for this analysis to 
grow at a 5 percent annual rate on an estimated base of 645,000 
departures in 1999. These total cargo departures sum to 14.6 million. 
Based upon the assumption that risk is a function of the number of 
operations squared, the estimate of a cargo MAC is approximated as 2.0 
* (14.6)\2\/(79.1)\2\ = 0.07 accidents in fifteen years. An additional 
five years raises this risk to nearly 0.1 accidents.
    The above methodologies provide a range from 0.1 to 0.6 mid air 
collision involving a cargo airplane over twenty years. Admittedly, 
these models are simplified representations of complex interactions of 
many other excluded factors such as the time of day, weather, airway 
congestion, hub concentration, and perhaps pilot error or 
malfunctioning airplanes. It is clear, regardless of methodology that 
the risk is low, but it is not zero.
    The Poisson probability distribution is often used to analyze rare 
and random events, and may be useful here. If 0.1 is assumed as the 
mean of a Poisson distribution, there is a 10 percent chance that there 
will be one or more mid air collisions involving a cargo airplane 
during the twenty-year period. If the actual risk rate is 0.6 MACs over 
20 years, there is nearly a 50 percent probability that there will be 
at least one MAC, and slightly more than a 10 percent chance there will 
be two or more. Such a level of risk is unacceptable.
    The benefit sensitivity section will show the potential range of 
outcomes reflecting the above accident rate variation discussion. For 
the purpose of the analysis and to ease presentation, the FAA uses a 
single estimated rate of 0.5 MACs involving a cargo airplane over the 
next 20 years if they are not equipped with collision avoidance 
devices.

Risk Reduction--Cargo Airplane Perspective

    The following table (Table 4-11 of the MITRE report) shows the 
MITRE

[[Page 15895]]

derived pair probabilities conditioned on encounters involving at least 
one cargo airplane as well as the relevant TCAS risk reduction factors.

                                       Risk Reduction for Cargo Airplanes
----------------------------------------------------------------------------------------------------------------
                                                                                      Cargo/          Cargo/
                                                    Cargo/cargo      Cargo/GA        passenger      unspecified
----------------------------------------------------------------------------------------------------------------
Conditional pair probability....................           0.324           0.174           0.503           1.000
Risk--when cargo is not TCAS-equipped...........           1.000           1.000           0.092           0.544
Risk--when cargo is TCAS-equipped...............           0.023           0.092           0.023           0.035
----------------------------------------------------------------------------------------------------------------

    The current risk to cargo airplanes when they are not TCAS equipped 
and passenger airplanes are equipped with TCAS II is 0.544 (as compared 
to the pre-TCAS baseline situation when no airplane was TCAS-equipped). 
This risk reduction occurs because the equipage of passenger airplanes 
with TCAS II has already reduced the risk to cargo airplanes. Even 
though the cargo airplanes are not equipped with TCAS II, the passenger 
airplanes can see the cargo airplanes on their cockpit displays. This 
reduces the risk to both passenger and cargo airplanes.
    If cargo airplanes were to be TCAS II equipped, this remaining 
relative risk would drop to 0.035 (as compared to the pre-TCAS baseline 
situation when no airplane was TCAS-equipped). This results in a 
comparative risk ratio of 0.035/0.544=0.064, which roughly corresponds 
to a 94 percent reduction (0.544 `` 0.035)/.544 = .936) compared to the 
present risk. In other words, cargo airplanes could experience a 
reduction in their NMAC risk by about 94 percent as compared to the 
current risk by installing TCAS II.

Risk Reduction--Passenger Airplane Perspective

    For passenger airplanes that already have TCAS II, the perspective 
is considerably different because the cargo airplanes would represent 
only a small portion of their potential close encounter traffic. The 
following table (Table 4-12 in the MITRE study) shows the MITRE derived 
pair probabilities conditioned on encounters involving at least one 
passenger airplane as well as the relevant TCAS risk reduction factors.

                                     Risk Reduction for Passenger Airplanes
----------------------------------------------------------------------------------------------------------------
                                                    Passenger/c     Passenger/      Passenger/p     Passenger/u
----------------------------------------------------------------------------------------------------------------
Conditional pair probability....................           0.076           0.281           0.643           1.000
Risk--when cargo is not TCAS-equipped...........           0.092           0.092           0.023           0.070
Risk--when cargo is not TCAS-equipped...........           0.023           0.092           0.023           0.058
----------------------------------------------------------------------------------------------------------------

    Combining these risks in a weighted manner according to the 
conditional pair probabilities shown in the first row of the above 
table, the risk to passenger airplanes when cargo airplanes are not 
TCAS-equipped is reduced by 93 percent to 0.070 (as compared to the 
pre-TCAS baseline situation when no airplane was TCAS-equipped). If 
cargo airplanes were to be TCAS-equipped this relative risk would drop 
to 0.058 (as compared to the pre-TCAS baseline situation when no 
airplane was TCAS-equipped). This corresponds to a Risk Ratio of 0.058/
0.070=0.828, which roughly corresponds to a 17 percent reduction (0.070 
`` 0.058)/0.070 = 0.171) compared to the current risk to passenger 
airplanes.
    The small proportion of encounters involving one passenger and one 
cargo airplane means that equipping cargo airplanes with TCAS would 
only reduce the risk to the passenger airplanes by another one percent 
(reducing the 0.070 risk by 17 percent) beyond the 93 percent already 
enjoyed through their TCAS equipage. Therefore, the total risk 
reduction for passenger airplanes from the installation of TCAS II on 
both passenger and cargo airplanes would be approximately 94%. 
Coincidentally, this is the same reduction as the risk reduction to 
cargo aircraft going to TCAS from no TCAS protection. This should be 
kept in mind to avoid confusion in understanding the following 
analyses.

Post-TCAS II On Cargo Airplanes Accident Rates

    Without TCAS II on all-cargo airplanes, the approximated MAC rate 
adopted in the previous section, for this analysis, was 0.5 MACs per 
20-year period for all-cargo airplanes. The above analysis indicated 
that the installation of TCAS II on all-cargo airplanes will reduce the 
risk of all-cargo airplane NMACs by 94 percent. This will reduce the 
MAC rate for all-cargo airplanes to 0.06 x 0.5 or 0.03 per 20-year 
period.
    If this rule were implemented, MITRE estimates that passenger 
airplanes will experience approximately a 17 percent risk reduction, or 
the risk factor for passenger airplanes will be reduced from 0.07 to 
0.058.
    One way to make these probabilities more meaningful is through the 
use of a Poisson probability distribution, a statistical tool often 
employed to describe rare events. If the factors for cargo airplane 
midair collisions (0.5 for the cargo fleet without TCAS and 0.03 for 
the cargo fleet with TCAS) are assumed to be the mean values of the 
Poisson probability distribution, then those distributions imply that 
in the absence of this rule there will be a 40 percent chance that one 
or more midair collisions involving a cargo airplane will occur in the 
U.S. airspace within the next 20 years. On the other hand, this rule 
will reduce that likelihood of a midair collision involving cargo 
airplanes to a 1 percent chance.
    If this rule were implemented, MITRE estimates that passenger 
airplanes will experience approximately a 17 percent risk reduction, or 
the risk factor for passenger airplanes will be reduced from 0.07 to 
0.058. This small reduction in the risk of a passenger and cargo 
airplane colliding is a direct result of passenger airplanes already 
being equipped with collision avoidance systems (TCAS II) and because 
the cargo fleet is much smaller than the passenger fleet. None-the-
less, a real reduction in the risk to passenger airplanes occurs when 
cargo airplanes are equipped with collision avoidance systems.

[[Page 15896]]

Risk Assessment Summary

    The above calculations are probabilistic estimates and are not 
precise calculations. These estimates are intended to convey a sense of 
the reduced MAC risk that will result from this rule. The rule will 
result in reduced collision risk to all types of airplanes with the 
greatest risk reduction benefiting cargo airplanes.

Quantifiable Benefits of Collision Avoidance Systems for Air Cargo 
Airplanes

Introduction
    This section quantifies, to the extent possible, the expected 
dollar benefits of installing CAS on cargo airplanes. The process is to 
determine the risk of a MAC between different types of airplanes, 
incorporate the expected number of accidents without the final rule, 
estimate the cost of potential accidents, and finally estimate the 
expected loss.
Accidents: Risk
    Earlier in the benefits analysis the FAA estimated that the number 
of cargo airplane MAC's will be 0.5 accidents in a 20 year time period. 
The risk of a cargo airplane MAC with another airplane depends on the 
pairs of airplanes present in the same airspace at about the same time 
and whether such airplanes have a CAS. This section estimates the risk 
of a cargo airplane MAC with another airplane.
    MITRE computes the conditional pair probabilities of three 
combinations of airplanes that fly in the same U.S. airspace at about 
the same time. In this case, a conditional pair probability is a pair 
of airplanes where at least one of the airplanes is a cargo airplane. 
It is assumed that the risk of a near midair collision (NMAC) is 
proportional to the pair probabilities. The risk of a NMAC is used 
rather than the risk of a MAC, because most of the statistical models 
used in studying the safety of TCAS II were derived from encounter data 
and not from MAC data. Accordingly, risk reduction estimates from 
equipping cargo airplanes can be obtained by multiplying the pair 
probability of each relevant pair by the risk reduction factor 
associated with collision avoidance equipage.
    There are three cargo airplane potential MAC combinations: a cargo 
airplane and another cargo airplane, a cargo airplane and a general 
aviation airplane, and a cargo airplane and a passenger airplane. MITRE 
calculated that the conditional pair probability for two cargo 
airplanes is 0.324, for a cargo and general aviation airplane, 0.174, 
and for a cargo and passenger airplane, 0.503 (Row 1 of Table V-1 in 
the full Regulatory Evaluation).
    These conditional pair probabilities are based on cargo airplane 
proximity with other airplanes. However, passenger airplanes are 
already equipped with CAS, thereby reducing their risk of a MAC. The 
cargo/passenger conditional pair probability is multiplied by the 
MITRE-estimated passenger-equipped CAS risk ratio of 0.092 to obtain 
the NMAC cargo/passenger conditional risk probability (Row 3 of Table 
V-1 in the full Regulatory Evaluation). This calculation results in a 
cargo/passenger NMAC probability of 0.046 and a total NMAC risk of 
0.544 for all combinations (Row 3, Column 4 of Table V-1 in the full 
Regulatory Evaluation). Finally, the percentage of risk by equipment 
(Row 5) is determined by dividing the conditional pair probabilities 
(Row 3) by 0.544. Then, given that there is a cargo airplane MAC, 
approximately 60 percent of these accidents will be with a cargo 
airplane, 32 percent will be with a general aviation airplane, and 9 
percent will be with a passenger airplane.
    The expected number of accidents without the final rule has 
previously been estimated to be 0.5 over the next 20 years. Multiplying 
this expected number of cargo accidents by the percentage of risk (or 
probability in Table V-1 in the full Regulatory Evaluation) by 
equipment results in the expected number of accidents by equipment. 
Thus the expected number of cargo airplane MAC accidents without this 
final rule equals 0.298 with another cargo airplane; 0.160 with a 
general aviation airplane; and 0.043 with a passenger airplane.
Expected Costs of Accidents
    The expected costs of a cargo airplane MAC is equal to the 
probability of such an accident with another airplane multiplied by the 
value of averted fatalities and equipment, plus the collateral damages. 
Unlike accidents occurring on an airport, it is assumed that a midair 
collision will result in fatalities for all passengers and crew, rather 
than some percentage attributed to various classifications of injuries. 
The value per averted fatality is estimated to be $3.0 million. This 
estimate increased from the $2.7 million used in the IRE because the 
Department of Transportation increased this value for benefit/cost 
analysis purposes. Cargo airplanes are valued here at $5 million each 
with 2 crew for each airplane resulting in an estimated benefit of $22 
million per averted MAC. An averted cargo airplane MAC with a general 
aviation airplane is valued at $23.5 million, with the general aviation 
(GA) airplane valued at $500,000 with one GA pilot and with three GA 
passengers. Given the wide range of seating for commercial airplanes, 
herein the FAA uses a representative 150-seat airplane with a 75 
percent load factor. With such a passenger airplane valued at $30 
million dollars, then an averted midair collision with a cargo airplane 
is valued at $396.5 million. The expected averted value of a cargo 
airplane MAC then is the percent of expected accidents by equipment 
multiplied by the value of the averted accidents, summed for the three 
possible cases, or approximately $27 million in a 20 year time period.
    Collateral damage is the damage on the ground that occurs as a 
result of a MAC. Collateral damage may be the greatest cost of a MAC. 
However, the costs of collateral damage are very dependent on where the 
accident occurs. If the MAC occurs over a relatively unpopulated area, 
the costs of the collateral damage may be relatively low. However, even 
in unpopulated areas collateral damage can be serious and costly. For 
example, collateral damage from a MAC could start a fire with ensuing 
damage. The FAA assumed a low collateral damage estimate of $1 million, 
essentially a couple of buildings and no loss of life.
    The expected total averted loss equals the sum of expected accident 
loss by equipment plus the $1 million collateral damage. This estimate 
is very conservative in not including emergency response and legal/
court costs estimated at approximately $120,000 per averted fatality. 
The total expected loss is approximately $28 million over twenty years. 
However, operators of approximately 65 percent of the existing cargo 
fleet have voluntarily equipped their airplanes with TCAS. Therefore, 
only 35 percent of the fleet will undergo the costs of installing TCAS 
purely as a result of this rule. Reflecting the voluntary compliance of 
65 percent of the air cargo fleet, the total benefit of this rule is 
reduced to approximately $10 million ($28 million multiplied by .35).
Sensitivity Analysis
    The estimated benefit of $10 million is the product of an expected 
accident rate, the percent of the fleet whose operators have not 
voluntarily complied, and the expected preventable loss of a midair 
collision with a cargo airplane and another airplane. As the above 
discussion just outlined the value of a preventable midair collision is 
many times greater than $10 million.

[[Page 15897]]

This section discusses how sensitive the benefit estimate is to changes 
in the expected number of accidents.
    The above discussion uses a 0.5 expected number of accidents 
throughout. Earlier in the Pre-TCAS II Accident Rate section the FAA 
outlined four different methods to establish a reasonable expected 
number of midair collisions involving a cargo airplane. If the cargo 
accident rate equaled that of the passenger airplane rate used in the 
FAA 1988 regulatory analysis of TCAS on passenger airplanes, the 
expected number of midair collisions involving a cargo airplane was 
2.67 accidents over 20 years. The FAA believes that figure is too high, 
nevertheless 2.67 was the high estimate. The lower bound estimate of 
0.1 was based on total cargo departures.
    If the accident rate equals 2.67 accidents, instead of 0.5, then 
the expected benefits increase from $10 million to $53.4 million. On 
the other hand if the accident rate is 0.1 the expected benefits 
decrease to $2.0 million.
    To further develop the sensitivity range, the expected benefit is 
based just on a cargo airplane colliding with just one of the three 
possible airplane types. If the number of expected accidents is 2.67 
and the cargo airplane collides with an average passenger airplane, the 
expected benefit is $370.5 million. If the number of expected accidents 
are 0.5 and the collision occurs between two cargo airplanes, the 
expected benefit is $4.9 million. If the expected accidents are 0.1 and 
the air cargo airplane collides with a general aviation airplane, the 
expected benefit is $1.1 million.
    The sensitivity analysis reveals that various conservative changes 
to key parameters lower the expected benefits, but these values are 
relatively close to the base case of $10 million. On the other hand, 
changing the parameters to the high end of the range results in 
substantial increases in estimated benefits. Even though the FAA 
believes the higher estimates are not likely, the decision risk here is 
not to underestimate key parameters.
Number of Near Mid Air Collisions (NMAC's)
    Unfortunately, the risk of a MAC as measured by NMACs has not 
declined. Table V-2 in the full Regulatory Evaluation shows the 
reported number of NMAC's involving at least one cargo plane during the 
ten year period 1992 through 2001. During this period, there has been a 
total of 28 NMAC's, or about 3 NMAC's per year. The number of NMAC's 
has ranged from a low of zero in 1993 and 1995 to a high of six in 
2001. Six NMAC's is particularly troubling given the most recent MAC 
and the 1999 NMAC with the DC-10 and L1011 cargo airplanes where an 
eyewitness said that the airplanes were 50 to 100 feet apart.
Summary of Benefits
    This final rule requires that all part 121, 125, and 129 airplanes 
with a MCTOW greater than 33,000 pounds, operating in the U.S. airspace 
be equipped with a collision avoidance system. The rule will provide an 
airspace where virtually all large airplanes are protected by Collision 
Avoidance Systems which, in turn, reduces the risk of mid-air 
collisions involving at least one cargo airplane. Further, this 
reduction in risk could avert an accident with a cost savings many 
times the greater than the cost of compliance. The recent midair 
collision in Europe is a sad reminder that reductions in probability 
and associated benefit estimates pale next to the human and monetary 
costs of an actual tragedy.
    This final rule also responds to a Congressional mandate, responds 
to the petition for rulemaking from the Independent Pilots Association, 
responds to NTSB Safety Recommendations, and responds to the hundreds 
of professional airline pilots who commented on the NPRM requesting 
that this rule be implemented as soon as possible.

Costs of the Final Rule

Part 121 All-Cargo Operator Costs

    The estimated part 121 cargo operator compliance costs include 
equipment, installation, additional maintenance and operating costs, 
and pilot training costs. After reviewing the information received from 
manufacturers and carriers, the FAA concluded that the original unit 
cost data used in the NPRM are still valid. However, since the NPRM was 
published, the affected fleet has changed and in the final rule the FAA 
extended and revised the compliance date from 3 years to an estimated 2 
years October 31, 2003, to December 31, 2004. Therefore, the total cost 
of the final rule differs from that of the NPRM because of the change 
in the number of affected airplanes and the reduction in the compliance 
time.
    The three TCAS II manufacturers reported that the average cost of 
TCAS II elements, as described above, for a transport category cargo 
airplane is between $130,000 and $200,000. One company indicated that 
if purchased in quantity, the cost of a TCAS II system would be between 
$80,000 to $145,000 per airplane. The manufacturers also estimated that 
it would cost between $50,000 and $70,000 (depending upon the specific 
airplane model) to install a TCAS II unit on an existing airplane. This 
resulted in a possible range of prices for a TCAS II system installed 
in an existing airplane of $130,000 to $270,000, or an average of 
$200,000. The actual price would depend on a number of factors, 
including: (1) The type of unit installed, (2) the number of units 
ordered, and (3) whether or not it was necessary to include a display 
unit in the purchase price. Some airplanes may not need a separate TCAS 
display unit because the TCAS information can be displayed on an 
airplane's existing EFIS (Electronic Flight Information Display 
System).
    Based on these reported costs, for cost calculating purposes, the 
FAA used $211,000 for the initial costs of installing a TCAS II system 
into an existing airplane. This figure is estimated to include the 
necessary spare parts inventory.
    To calculate the total discounted present value of the compliance 
costs of this final rule, the FAA assumed that, given a 2-year time 
period to install TCAS for the first time, the cargo air carrier would 
minimize its airplane's time out-of-service by installing TCAS II 
during a regularly scheduled major maintenance (C or D) check. The FAA 
further assumed that equipping the total existing air cargo fleet would 
be spread evenly over the entire 2-year compliance period due to 
potential maintenance scheduling conflicts and potential maintenance 
personnel overtime if every cargo air carrier were to try to schedule 
this installation in year 2. The FAA estimates that the undiscounted 
initial capital costs of retrofitting the existing part 121 turbine-
powered all-cargo fleet with TCAS II will be approximately $67,000,000.
    The three TCAS II manufacturers reported that the TCAS II element 
costs would be identical for new and for existing airplanes. The FAA 
estimates that the initial (equipment plus installation) cost per newly 
manufactured cargo part 121 turbine-powered airplane will be $171,000.
    Based on 80 newly manufactured cargo airplane purchases over the 
20-year analysis period, the FAA has estimated that the total non-
discounted initial costs for purchasing and installing TCAS II in newly 
manufactured part 121 turbine-powered cargo airplanes will be 
approximately $14 million.
    In addition to the initial costs of the TCAS II units, the air 
carriers will also incur annual operation and

[[Page 15898]]

maintenance (O&M) expenses. The FAA estimates the annual O&M expenses 
for TCAS II units to be $1 per flight hour. Based on an estimated 
utilization rate of 2,000 hours per airplane per year, and the fleet 
flight hours estimated in the Regulatory Evaluation, the FAA estimates 
that the total non-discounted O&M expenses for the existing fleet will 
be approximately $12,000,000 and $2,000,000 for the newly manufactured 
fleet.
    The TCAS II equipment will increase the airplane's weight and, 
thereby, will increase the airplane's annual fuel costs to transport 
the additional weight. The FAA estimates that the incremental fuel 
costs resulting in the weight added by the TCAS II system will be 
approximately $0.36 per flight hour. This results in a total non-
discounted incremental fuel cost of approximately $4,000,000 for the 
existing fleet and $605,000 for the newly manufactured fleet.
    Air cargo flight crewmembers who have not trained on TCAS II will 
need such training to obtain the necessary knowledge, skills, and 
abilities to safely conduct operations in a TCAS II environment. The 
FAA estimates that the cost of pilot training will be approximately 
0.05 times the cost of the TCAS unit itself. This results in a training 
cost of approximately $7,000 per unit per year. The total non-
discounted cost of pilot training, for the 20-year analysis period, is 
estimated to be approximately $43,000,000 for the existing fleet and 
$6,000,000 for newly manufactured cargo airplanes.
    The FAA estimates that the total undiscounted TCAS II costs of the 
final rule, for the existing part 121 turbine-powered all-cargo fleet, 
during the 20-year analysis period, will be approximately $127,000,000. 
We also estimate that the discounted present value of the total costs 
of the final rule, for the existing part 121 turbine-powered all-cargo 
fleet over the next 20 years, will be approximately $92,000,000.
    The FAA estimates that the total undiscounted TCAS II costs of the 
final rule, for the newly manufactured part 121 turbine-powered all-
cargo fleet, during the 20-year analysis period, will be approximately 
$22,000,000. We also estimate that the discounted present value of the 
total costs of the final rule, for the newly manufactured fleet over 
the next 20 years, will be approximately $11,000,000.
    Thus, the FAA estimates that the total undiscounted costs of the 
final rule for the existing and future manufactured part 121 turbine-
powered all-cargo fleet, during the 20-year analysis period, will be 
approximately $149,000,000. The discounted present value of the total 
costs of this portion of the final rule over the next 20 years will be 
approximately $102,000,000.
    The final rule requires the installation of TCAS I, (or 
equivalent), on all part 121 piston-powered cargo airplanes with a 
MCTOW greater than 33,000 lbs. The FAA estimates that the total initial 
and installation costs of TCAS I on an existing part 121 cargo piston-
powered airplane would be approximately $75,000. This figure is 
estimated to include the necessary spare parts inventory.
    To calculate the total discounted present value of the compliance 
costs of the final rule, the FAA assumed that, given the 2-year time 
period to retrofit TCAS I equipment, the cargo air carrier would 
minimize its airplane's time out-of-service by installing TCAS I during 
a regularly scheduled major maintenance (C or D) check. The FAA further 
assumed that equipping the total air cargo fleet would be spread evenly 
over the entire 2-year compliance period due to potential maintenance 
scheduling conflicts and potential maintenance personnel overtime if 
every cargo air carrier were to try to schedule this installation in 
year 2. The FAA estimates that the undiscounted initial costs of 
retrofitting the existing part 121 piston-powered all-cargo fleet 
greater than 33,000 lbs. MCTOW with TCAS I will be approximately 
$2,000,000. In addition to the capital costs of the TCAS I units, the 
air carriers will also incur annual O&M expenses. The FAA estimates 
that the annual O&M expenses for TCAS I units to be $1 per flight hour. 
Based on an estimated utilization rate of 2,000 hours per airplane per 
year, the FAA estimates that the total non-discounted O&M expenses for 
the existing fleet will be approximately $1,000,000.
    The TCAS I equipment will increase the airplane's weight and, 
thereby, will increase the airplane's annual fuel costs just to 
transport the additional weight. The FAA estimates that the incremental 
fuel costs resulting in the weight added by the TCAS I system will be 
approximately $0.36 per flight hour, based on the weight of TCAS II. 
This results in a total non-discounted incremental fuel cost of 
approximately $365,000 for the existing fleet.
    Air cargo flight crewmembers who have not trained on TCAS I will 
need such training in order to obtain the necessary knowledge, skills, 
and abilities to safely conduct operations in a TCAS I environment.
    The FAA estimates that the cost of pilot training will be 
approximately 0.05 times the cost of the TCAS unit itself. This results 
in a training cost of approximately $3,800 per unit per year. The total 
non-discounted cost of pilot training for the 20-year analysis period 
is estimated to be approximately $3,500,000 for the existing fleet.
    The FAA estimates that the total undiscounted TCAS I costs of the 
final rule, for the existing part 121 piston-powered all-cargo fleet 
during the 20-year analysis period, will be approximately $7,000,000. 
The discounted present value of the total costs of the final rule for 
the existing fleet over the next 20 years will be approximately 
$4,000,000.
    It is anticipated that the existing part 121 fleet that will 
require TCAS I installation as a result of this final rule will not 
change in the study period. Therefore, the FAA does not expect 
additional costs.
    The FAA estimates that the total undiscounted costs of the final 
rule for the part 121 all-cargo fleet, during the 20-year analysis 
period, will be approximately $156,000,000. The discounted present 
value of the total costs of the final rule for part 121 all-cargo 
carriers over the next 20 years will be approximately $107,000,000.

Part 125 All-Cargo Commercial Operator Costs

    Part 125 all-cargo operators compliance costs and methodology are 
the same as those used to develop the cost estimates for part 121 all-
cargo operators. For the 25 part 125 airplanes requiring TCAS II (or 
equivalent) as a result of this rule, the total estimated cost is 
approximately $10 million with a present value of approximately $7 
million. For the 27 part 125 airplanes requiring TCAS I (or equivalent) 
as a result of this rule, the total estimated cost is $5 million with a 
present value cost approximately equal to $4 million.
    It is anticipated that no additional newly manufactured airplanes 
will be produced for part 125 commercial operators in the 20-year study 
period. Therefore, no additional compliance cost for newly manufactured 
airplanes is anticipated for part 125 operations.
    The total non-discounted compliance costs of collision avoidance 
system requirements for the part 125 operators are estimated to be 
approximately $15,000,000. The corresponding present value costs are 
estimated to be approximately $11,000,000.

Total Incremental Costs of the Final Rule

    The total non-discounted estimated compliance costs of collision 
avoidance system installations on part 121 all-

[[Page 15899]]

cargo airplanes and part 125 all-cargo commercial operators, over the 
next 20 years, are estimated to be approximately $172,000,000. The 
corresponding present value costs are estimated to be approximately 
$118,000,000.

Benefits and Costs Comparison

    The installation and use of TCAS for cargo airplanes is projected 
to reduce the probability of a cargo airplane MAC by 94% and a cargo/
passenger MAC by 17%. To obtain this benefit will cost operators 
slightly under $118 million in present value terms over 20 years.
    A 20 percent chance of a midair collision involving a cargo 
airplane can result in accident values from under $10 million to 
hundreds of millions of dollars. In the least costly case, a cargo 
airplane could have a midair collision with a general aviation airplane 
with no collateral damage. If a midair collision occurs over Los 
Angeles, San Diego, and other metropolitan areas, significant 
collateral damage can easily exceed hundreds of millions of dollars. 
MITRE estimated slightly more than 50 percent of all midair collisions 
are expected to occur over the suburbs or cities. With no collateral 
damage a collision with a large passenger airplane can result in costs 
well more than $300 million. The worst MAC occurred in 1996 with 349 
fatalities. Preventing such an accident is worth over a billion 
dollars.
    The benefits of the final rule of the proposed rule equal 
approximately $10,000,000. This benefit estimate is based upon avoiding 
a statistical 0.5 air cargo airplane midair collision with another 
airplane. If the expected number of accidents is reduced to 0.1 avoided 
midair collisions, then the estimated benefits decline to $1.1 million. 
Even though expected benefits are expressed in fractions of a 
preventable accident, a midair collision involves two airplanes with no 
survivors. If an accident does occur the benefits can easily exceed the 
cost of this rule.
    Despite the estimated dollar benefits being less than the estimated 
costs, the FAA believes the qualitative benefits justify the costs. The 
facts are that collision avoidance devices have prevented MACs and that 
midair collisions with cargo airplanes have occurred. This final rule 
will help to reduce the risk of MACs and NMACs. This risk includes six 
NMACs in 2001, one NMAC of less than 100 feet in 1999 and now two MACs 
involving cargo and passenger airplanes. Given these circumstances it 
is not surprising there is substantial favorable public interest in 
this rule. This final rule responds to a Congressional mandate, 
responds to the petition for rulemaking from the Independent Pilots 
Association, and responds to NTSB safety recommendations. Hundreds of 
professional airline pilots who commented on the NPRM requested that 
this rule be implemented as soon as possible. Much of the air cargo 
fleet is already in compliance with the rule by voluntary action by the 
carriers and most of the remaining air cargo fleet is scheduled to be 
in compliance by December 31, 2004.
    Therefore, the FAA believes that the benefits of this proposed 
rulemaking justify the projected costs.

Final Regulatory Flexibility Analysis

Introduction and Purpose of This Analysis

    The Regulatory Flexibility Act of 1980 (RFA) establishes ``* * * as 
a principle of regulatory issuance that agencies shall endeavor, 
consistent with the objective of the rule and of applicable statutes, 
to fit regulatory and informational requirements to the scale of the 
business, organizations, and governmental jurisdictions subject to 
regulation.'' To achieve that principle, the RFA requires agencies to 
solicit and consider flexible regulatory proposals and to explain the 
rationale for their actions. The RFA covers a wide range of small 
entities, including small businesses, not-for-profit organizations, and 
small governmental jurisdictions.
    Agencies must perform a review to determine whether a proposed or 
final rule will have a ``significant economic impact on a substantial 
number of small entities.'' If the determination is that it will, the 
agency must prepare a regulatory flexibility analysis as described in 
the RFA.
    The FAA determined that this proposal results in a significant 
economic impact on a substantial number of small entities. The purpose 
of this analysis is to ensure that the agency has considered all 
reasonable regulatory alternatives that will minimize the rule's 
economic burdens for affected small entities, while achieving its 
safety objectives.

Reasons for the Rule

    The Traffic Alert and Collision Avoidance System (TCAS) was 
developed to minimize the possibility of a midair collision by 
providing an on-board safety back-up system that operates independently 
of the air traffic control (ATC) system. Beginning December 30, 1990, 
in the United States, a TCAS II system was required in certain part 
121, 125 and 129 airplanes with more than 30 passenger seats. After 
December 31, 1995, a TCAS I system was required in all part 121 
airplanes with 10 to 30 passenger seats. Cargo airplanes were not 
covered.
    This rule is being promulgated because the FAA believes that the 
risk of midair collisions and potential collateral damage after a 
collision involving a cargo airplane is too high and that this rule, if 
implemented, will reduce this risk. In addition, the 106th Congress 
enacted Pub. L. 106-18 that directs the FAA Administrator to require, 
in part, that certain cargo airplanes be equipped with collision 
avoidance technology by December 31, 2002. The law provides for an 
extension of up to 2 years.

Significant Issues Raised by the Public Comments in Response to the 
IRFA

    There were no public comments that directly addressed the IRFA. 
However, a comment was made by a small entity. This comments is 
reproduced below.
    USA Jet Airlines, said, in part, ``Further, it is our position that 
a rash of mechanical and software technologies are becoming foisted 
upon aircraft without regard to fleet size, aircraft age or the 
existence of satisfactory equipment already on the aircraft. For 
example, in the next 3 years alone, a DC-9 and Falcon operator will, 
under proposed rules/regulations and existing rules/regulations pay 
$250,000 per aircraft for TCAS II, $125,000 per aircraft for the 
Terrain Awareness Warning System (TAWS) and a significant sum for the 
Domestic RVSM system being discussed by the FAA. We have not seen any 
indication of a need for these systems in the all-cargo industry.
    While certainly any of these proposals have merit in that they each 
seek a positive goal, the cost of the implementation of all systems, 
precludes their very implementation for many carriers.''
    Several other individual respondents also expressed a concern about 
the cost of the proposed regulation. Some small entities expressed a 
desire for more time to implement the final rule. One of these small 
entities requested at least a five-year compliance period. Another 
commenter said this rule will put small firms out of business.
    The FAA considers that these comment are reasonable for small 
firms. However, because the final rule is a Congressional Mandate, the 
FAA has little flexibility in changing the final rule. However, the FAA 
did reduce the TCAS requirement from TCAS II to TCAS I for piston-
powered airplanes because the FAA does not believe that piston-powered 
airplanes have the

[[Page 15900]]

necessary performance to respond to RAs. In addition, the FAA 
eliminated the requirement, in the NPRM, for TCAS I in turbine-powered 
airplanes of less than 33,000 pounds MCTOW. The FAA also set the rule's 
compliance date at the latest date allowed by the Congressional 
Mandate.

Number and Types of Small Entities Impacted

    Under the RFA, the FAA must determine whether or not a final rule 
significantly affects a substantial number of small entities. This 
determination is typically based on small entity size and cost 
thresholds that vary depending on the affected industry. The Small 
Business Administration (SBA) size standards are shown on their Web 
site (http://www.sba.gov) and are based on the North American Industry 
Classification (NAICS).
    Entities potentially affected by the final rule include: scheduled 
freight air transportation (NAICS Subsector 481112) and nonscheduled 
chartered air transportation (NAICS Subsector 481212). The FAA used a 
guideline of 1,500 employees or less per firm as the criteria for the 
determination of a small business. This corresponds with the SBA's 
definition of a small business in these areas. It should be noted that 
the IRE used the SIC (Standard Industrial Classification) numbers to 
determine the size of a small business. However, the SIC has been 
replaced by the NAICS. In spite of this the size of a small business 
has remained the same, at 1,500 or less employees.
    To determine which entities will be affected, the FAA segmented the 
various types of firms into four groups as follows:
    1. Part 121 all-cargo air carriers operating turbine-powered 
airplanes with a MCTOW greater than 33,000 pounds. This definition was 
the same in the IRE and the FRE. There are 24 firms in Group 1.
    2. Part 121 all-cargo air carriers operating turbine-powered 
airplanes of 33,000 pounds or less MCTOW and piston-powered airplanes 
regardless of weight. IRE)

    As a result of the change in the rule from the NPRM, the 
definition of Group 2 changed to: Part 121 all-cargo air carriers 
operating piston-powered airplanes greater than 33,000 pounds MCTOW 
in the FRE.

    There are 7 firms in Group 2.
    3. Part 125 all-cargo commercial operators who fly turbine-powered 
airplanes with a MCTOW greater than 33,000 pounds. This definition was 
the same in the IRE and the FRE. There are 7 firms in Group 3.
    4. Part 125 all-cargo commercial operators flying turbine-powered 
airplanes of 33,000 pounds or less MCTOW and piston-powered airplanes 
regardless of weight. (IRE)

    As a result of the change in the rule from the NPRM, the 
definition of Group 4 changed to: Part 125 all-cargo air carriers 
operating piston-powered airplanes greater than 33,000 pounds MCTOW 
in the FRE.

    There are 14 firms in Group 4.
    For simplicity these entities will be referred to as Group 1, 2, 3, 
or 4 in the remainder of this study.
    It should be noted that Groups 1 and 3 have the same definition in 
both the IRE and the FRE. However, the rule was modified between the 
NPRM and the Final Rule. The major change in the rule was the 
elimination of all airplanes with a MCTOW less than 33,000 pounds. 
Therefore, the definition of Groups 2 and 4 changed, as shown above. 
Groups 2 and 4 now contain only piston-powered airplanes with a MCTOW 
greater than 33,000 pounds. If the number of Group 2 and Group 4 small 
entities had remained the same between the IRE and the FRE the change 
in the rule would have eliminated thirteen Group 2 small entities and 
two Group 4 small entities. In practice, however, the combination of 
the change in the rule and other factors changed the number of small 
entities in each group.

Projected Reporting, Recordkeeping and Other Compliance Requirements of 
the Rule

    The final rule does not add any specific projected reporting, 
record keeping, and other requirements.

Steps the Agency Has Taken To Minimize the Significant Economic Impact 
on Small Entities

    FAA potentially reduced the economic impact on small entities in 
two ways. First, the FAA eliminated the NPRM TCAS1 requirement for 
turbine-powered airplanes with a MCTOW less than 33,000 pounds. Second, 
instead of a TCAS II requirement for piston-powered airplanes with a 
MCTOW greater than 33,000 pounds, the FAA required the use of TCAS I. 
The FAA determined that piston-powered airplanes of this weight lacked 
the performance to respond to TCAC II RAs. TCAS I cost less than 
TCASII. As small entities tend to be the primary operators of these 
airplanes, these two FAA actions are expected to benefit small 
entities.
    Finally, the FAA allowed the maximum amount of time for compliance 
that the Congressional Mandate allowed.

Cost and Affordability for Small Entities

    The FAA estimated the financial impact on Group 1 small entities in 
two steps. First, the FAA multiplied a compliance cost of $223,000 cost 
per airplane by the operator's fleet size to obtain an operator 
estimated one-year cost of this rulemaking. Then the FAA calculated an 
affordability measure by dividing this cost by the operator's 2001 
(parent company) revenues. As 2 percent is often less than the annual 
rate-of-inflation, the FAA believes that a compliance cost of 2 percent 
or less is affordable.
    Group 1 consists of 24 firms that qualify as small entities (see 
Table XI-1 in the full Regulatory Evaluation). Financial data was 
available for all but one of these firms. Two of these firms had 
recently or were emerging from Chapter 11 bankruptcy and were not 
included in the financial analysis. Seven of the Group 1 firms incur no 
financial impact because they did not operate aircraft that would be 
required to have TCAS. The remaining 14 firms 1 had compliance costs as 
a percentage of revenue ranging from 0.8% to 38.2%. Eleven of these 
firms are negatively impacted by the rule because their compliance cost 
as a percentage of revenue is 2 percent or greater. Of the 11 firms 
with a value above 2% for the ratio the percentage ranges from 2.9 
percent to 38.2 percent.
    In a similar fashion, the FAA estimated the impact on Group 2 small 
entities in two steps. In an effort to raise the safety standard and to 
minimize the impact on small firms, for firms in Group 2, the FAA 
proposed requirements are expected to be met by an investment of 
$82,000. For the first step, the FAA multiplied the cost per airplane 
of $82,000 by the operator's fleet size to obtain the estimated one-
year compliance cost of this rulemaking for each operator. This 
estimated operator compliance cost is then divided by the operator's 
2001 (parent company) revenues. This ratio provides a measure of 
affordability.
    Group 2 consists of a total of 7 firms (Table XI-2 in the full 
Regulatory Evaluation) that qualified as small businesses, based on the 
criteria of 1,500 employees per firm. Financial data was available for 
all but one of these firms. The financial data indicated that five of 
the six firms were adversely impacted by this final rule. The value of 
this ratio of cost per revenue is 2 percent or less for 1 of the 7 
Group 2 firms. For the remaining Group 2 firms the value of this ratio 
ranged from 2.2 percent to 9.4 percent.

[[Page 15901]]

    The FAA estimates that for the firm with no public financial data 
available was also adversely affected by the rule. Therefore, the FAA 
estimates that six of the Group 2 firms were adversely affected by the 
final rule.
    The FAA estimated the financial impact on Group 3 entities using 
the same methodology as that for Group 1. Group 3 consists of 7 firms 
(Table XI-3 in the full Regulatory Evaluation) that qualified as small 
entities. Financial data was available for two of the seven Group 3 
firms. Neither of the two firms had a value of this ratio of less than 
2%. The two firms had ratio values ranging from 5.9 percent to 25.5 
percent. In both cases the financial data indicated that the firms will 
be adversely affected by the final rule. Therefore, the FAA estimates 
that all seven firms will be adversely impacted.
    The FAA estimated the financial impact on Group 4 entities using 
the same methodology as that used for Group 2. Group 4 consists of 14 
firms (Table XI-4 in the full Regulatory Evaluation) that qualified as 
small entities. Financial data was available for four of these fourteen 
4 firms. One of the four firms had a value of this ratio of less than 
2%. The remaining three firms had ratio values ranging from 10.9 
percent to 32.8 percent. The FAA estimates that 13 of the 14 Group 4 
firms will be adversely affected by the final rule.
    Of the 33 firms considered to be small, and for which information 
was available, over 36 percent are estimated to have costs less than 2 
percent of annual revenue. For these firms the FAA believes compliance 
is affordable. For the remaining 64 percent of the firms the FAA 
estimates that there will be a significant, negative economic impact.

Competitive Analysis

    Nearly all of the firms considered to be small entities and with an 
affordability measure greater than 2 percent appear to operate in 
markets with little or no competition. These markets require very 
specialized service such as remote air delivery service. Of the 31 part 
121 only two were headquartered in the same city and most were located 
in remote locations. All of the part 125 operators, by regulation, 
provide non-competitive services. Part 125 operators are restricted 
from offering for-hire services to the public, such as advertising or 
marketing. To provide for-hire services, these operators must, in 
effect, have the customer find them. Thus in terms of competition, this 
rulemaking is expected to have a minimal competitive impact.

Disproportionality Analysis

    Relative to larger air cargo operators, smaller air cargo operators 
are likely to be disproportionately impacted by this rulemaking. Large 
cargo carriers' cost is a smaller percentage of their annual revenue, 
than those of the smaller cargo carriers.

Business Closure Analysis

    Seven firms have an extremely high compliance cost per annual 
revenue ratios (compliance cost greater than 10% of annual revenue). 
Some or even many of these firms could potentially face a business 
closure due to this final rulemaking. The FAA does not have sufficient 
information to provide a more refined estimate of the potential 
business closures.

Analysis of Alternatives

    The FAA acknowledges that the rule is likely to have a significant 
economic impact on a substantial number of small entities. For the 
final rule the FAA changed the NPRM requirements in way that may 
benefit small entities. The agency considered various four alternatives 
for the final rule. These alternatives are:
    1. Issue the rule as proposed in the NPRM.
    2. Exclude small entities.
    3. Extend compliance deadline for small entities.
    4. Establish lesser technical requirements for small entities.
    Based upon safety considerations the FAA concludes that the option 
to exclude small entities from all the requirements of the final rule 
is not justified.
    The FAA considered options that will lengthen the compliance period 
for small operators. The FAA believes that the compliance requirement 
will place only a modest burden on small entities. Small entities will 
have 2 years from the effective date of the rule to complete 
installation work. Further time extensions only provide modest cost 
savings and leave the system safety at risk. In addition, the 
Congressional Mandate does not provide for a time extension beyond 
December 31, 2004.
    The FAA considered establishing lesser technical requirements for 
small entities. However, the FAA believes that this will result in a 
lower level of safety than will the implementation of the final rule. 
The FAA believes that the greatest safety benefits will come from a 
common collision avoidance system for all operators who fly in the same 
airspace under the same operating environment.
    In contrast to the NPRM, the FAA eliminated the CAS requirement for 
the owners of turbine-powered airplanes weighing less than 33,000 
MCTOW. Operators of these airplanes tend to be small entities.
    The FAA considered alternatives that would lessen the economic 
burden to small entities and achieve the needed safety objectives. To 
that end the FAA removed the CAS requirement for turbine-powered 
airplanes weighing less than 33,000 MCTOW and the required only TCASI 
for piston-powered airplanes. Given the real safety concerns and the 
Congressional mandate, the FAA worked hard to provide additional 
flexibility to small entities and provide the safe operating 
environment expected.

International Trade Impact Analysis

    The Trade Agreement Act of 1979 prohibits Federal agencies from 
engaging in any standards or related activities that create unnecessary 
obstacles to the foreign commerce of the United States. Legitimate 
domestic objectives, such as safety, are not considered unnecessary 
obstacles. The statute also requires consideration of international 
standards and where appropriate, that they be the basis for U.S. 
standards. In addition, consistent with the Administration's belief in 
the general superiority and desirability of free trade, it is the 
policy of the Administration to remove or diminish to the extent 
feasible, barriers to international trade, including both barriers 
affecting the export of American goods and services to foreign 
countries and barriers affecting the import of foreign goods and 
services into the United States.
    In accordance with the above statute and policy, the FAA has 
assessed the potential affect of this final rule and has determined it 
uses international standards as the basis for U.S. standards. Thus this 
final rule is in accord with the Trade Agreement Act.

Unfunded Mandates Assessment

    Title II of the Unfunded Mandates Reform Act of 1995 (the Act), 
codified in 2 U.S.C. 1501-1571, requires each Federal agency, to the 
extent permitted by law, to prepare a written assessment of the effects 
of any Federal mandate in a proposed or final agency rule that may 
result in the expenditure by State, local, and tribal governments, in 
the aggregate, or by the private sector, of $100 million or more 
(adjusted annually for inflation) in any one year. Section 204(a) of 
the Act, 2 U.S.C. 1534(a), requires the

[[Page 15902]]

Federal agency to develop an effective process to permit timely input 
by elected officers (or their designees) of State, local, and tribal 
governments on a proposed ``significant intergovernmental mandate.'' A 
``significant intergovernmental mandate'' under the Act is any 
provision in a Federal agency regulation that will impose an 
enforceable duty upon State, local, and tribal governments, in the 
aggregate, of $100 million (adjusted annually for inflation) in any one 
year. Section 203 of the Act, 2 U.S.C. 1533, which supplements section 
204(a), provides that before establishing any regulatory requirements 
that might significantly or uniquely affect small governments, the 
agency shall have developed a plan that, among other things, provides 
for notice to potentially affected small governments, if any, and for a 
meaningful and timely opportunity to provide input in the development 
of regulatory proposals.
    This final rule does not contain a Federal intergovernmental or 
private sector mandate that exceeds $100 million in any 1 year.

Executive Order 13132, Federalism

    The FAA has analyzed this final rule under the principles and 
criteria of Executive Order 13132, Federalism. We determined that this 
action will not have a substantial direct effect on the States, or the 
relationship between the national Government and the States, or on the 
distribution of power and responsibilities among the various levels of 
government. Therefore, we determined that this final rule does not have 
federalism implications.

Environmental Analysis

    FAA Order 1050.1D defines FAA actions that may be categorically 
excluded from preparation of a National Environmental Policy Act (NEPA) 
environmental impact statement. In accordance with FAA Order 1050.1D, 
appendix 4, paragraph 4(j), this rulemaking action qualifies for a 
categorical exclusion.

Energy Impact

    The energy impact of this rule has been assessed in accordance with 
the Energy Policy and Conservation Act (EPCA) Public Law 94-163, as 
amended (42 U.S.C. 6362) and FAA Order 1053.1. It has been determined 
that the final rule is not a major regulatory action under the 
provisions of the EPCA.

List of Subjects

14 CFR Part 121

    Air carriers, Aircraft, Airmen, Aviation safety, Charter flights, 
Reporting and recordkeeping requirements, Safety, Transportation.

14 CFR Part 125

    Aircraft, Airmen, Aviation safety, Reporting and recordkeeping 
requirements.

14 CFR Part 129

    Air carriers, Aircraft, Aviation safety, Reporting and 
recordkeeping requirements, Security measures.

The Amendment

0
In consideration of the foregoing, the Federal Aviation Administration 
amends Chapter I of Title 14, Code of Federal Regulations as follows:

PART 121--OPERATING REQUIREMENTS: DOMESTIC, FLAG, AND SUPPLEMENTAL 
OPERATIONS

0
1. The authority citation for part 121 continues to read as follows:

    Authority: 49 U.S.C. 106(g), 40113, 40119, 41706, 44101, 44701-
44702, 44705, 44709-44711, 44713, 44716-44717, 44722, 4901, 44903-
44904, 44912, 46105.


0
2. In Sec.  121.356, revise the section heading and add paragraph (d) 
to read as follows, effective on May 1, 2003:


Sec.  121.356  Collision avoidance system.

* * * * *
    (d) Effective May 1, 2003, if TCAS II is installed in an airplane 
for the first time after April 30, 2003, and before January 1, 2005, no 
person may operate that airplane without TCAS II that meets TSO C-119b 
(version 7.0), or a later version.

0
3. Revise Sec.  121.356 to read as follows, effective January 1, 2005:


Sec.  121.356  Collision avoidance system.

    Effective January 1, 2005, any airplane you operate under this part 
must be equipped and operated according to the following table:

                       Collision Avoidance Systems
------------------------------------------------------------------------
                                            Then you must operate that
          If you operate any--                   airplane with--
------------------------------------------------------------------------
(a) Turbine-powered airplane of more     (1) An appropriate class of
 than 33,000 pounds maximum               Mode S transponder that meets
 certificated takeoff weight.             Technical Standard Order (TSO)
                                          C-112, or a later version, and
                                          one of the following approved
                                          units:
                                         (i) TCAS II that meets TSO C-
                                          119b (version 7.0), or takeoff
                                          weight a later version.
                                         (ii) TCAS II that meets TSO C-
                                          119a (version 6.04A Enhanced)
                                          that was installed in that
                                          airplane before May 1, 2003.
                                          If that TCAS II version 6.04A
                                          Enhanced no longer can be
                                          repaired to TSO C-119a
                                          standards, it must be replaced
                                          with a TCAS II that meets TSO
                                          C-119b (version 7.0), or a
                                          later version.
                                         (iii) A collision avoidance
                                          system equivalent to TSO C-
                                          119b (version 7.0), or a later
                                          version, capable of
                                          coordinating with units that
                                          meet TSO C-119a (version 6.04A
                                          Enhanced), or a later version.
(b) Passenger or combination cargo/      (1) TCAS I that meets TSO C-
 passenger (combi) airplane that has a    118, or a later version, or
 passenger seat configuration of 10-30   (2) A collision avoidance
 seats.                                   system equivalent to has a TSO
                                          C-118, or a later version, or
                                         (3) A collision avoidance
                                          system and Mode S transponder
                                          that meet paragraph (a)(1) of
                                          this section.
(c) Piston-powered airplane of more      (1) TCAS I that meets TSO C-
 than 33,000 pounds maximum               118, or a later version, or
 certificated takeoff weight.            (2) A collision avoidance
                                          system equivalent to maximum
                                          TSO C-118, or a later version,
                                          or
                                         (3) A collision avoidance
                                          system and Mode S transponder
                                          that meet paragraph (a)(1) of
                                          this section.
------------------------------------------------------------------------


[[Page 15903]]

PART 125--CERTIFICATION AND OPERATIONS: AIRPLANES HAVING A SEATING 
CAPACITY OF 20 OR MORE PASSENGERS OR A MAXIMUM PAYLOAD CAPACITY OF 
6,000 POUNDS OR MORE; AND RULES GOVERNING PERSONS ON BOARD SUCH 
AIRCRAFT

0
4. The authority citation for part 125 continues to read as follows:

    Authority: 49 U.S.C. 106(g), 40113, 44701-44702, 44705, 44710-
44711, 44713, 44716-44717, 44722.


0
5. In Sec.  125.224, revise the section heading and add paragraph (c) 
to read as follows, effective on May 1, 2003:


Sec.  125.224  Collision avoidance system.

* * * * *
    (c) Effective May 1, 2003, if TCAS II is installed in an airplane 
for the first time after April 30, 2003, and before January 1, 2005, no 
person may operate that airplane without TCAS II that meets TSO C-119b 
(version 7.0), or a later version.

0
6. Revise Sec.  125.224 to read as follows, effective January 1, 2005:


Sec.  125.224  Collision avoidance system.

    Effective January 1, 2005, any airplane you operate under this part 
125 must be equipped and operated according to the following table:

                       Collision Avoidance Systems
------------------------------------------------------------------------
                                            Then you must operate that
        If you operate any . . .                  airplane with:
------------------------------------------------------------------------
(a) Turbine-powered airplane of more     (1) An appropriate class of
 than 33,000 pounds maximum               Mode S transponder that meets
 certificated takeoff weight.             Technical Standard Order (TSO)
                                          C-112, or a later version, and
                                          one of the following approved
                                          units:
                                         (i) TCAS II that meets TSO C-
                                          119b (version 7.0), or a later
                                          version.
                                         (ii) TCAS II that meets TSO C-
                                          119a (version 6.04A Enhanced)
                                          that was installed in that
                                          airplane before May 1, 2003.
                                          If that TCAS II version 6.04A
                                          Enhanced no longer can be
                                          repaired to TSO C-119a
                                          standards, it must be replaced
                                          with a TCAS II that meets TSO
                                          C-119b (version 7.0), or a
                                          later version.
                                         (iii) A collision avoidance
                                          system equivalent to TSO C-
                                          119b (version 7.0), or a later
                                          version, capable of
                                          coordinating with units that
                                          meet TSO C-119a (version 6.04A
                                          Enhanced), or a later version.
(b) Piston-powered airplane of more      (1) TCAS I that meets TSO C-
 than 33,000 pounds maximum               118, or a later version, or
 certificated takeoff weight.            (2) A collision avoidance
                                          system equivalent to TSO C-
                                          118, or a later version, or
                                         (1)(3) A collision avoidance
                                          system and Mode S transponder
                                          that meet paragraph (a)(1) of
                                          this section.
------------------------------------------------------------------------

PART 129--OPERATIONS: FOREIGN AIR CARRIERS AND FOREIGN OPERATORS OF 
U.S.-REGISTERED AIRCRAFT ENGAGED IN COMMON CARRIAGE

0
7. The authority citation for part 129 continues to read as follows:

    Authority: 49 U.S.C. 106(g), 40104-40105, 40113, 40119, 41706, 
44701-44702, 44712, 44716-44717, 44722, 44901-44904, 44906.


0
8. In Sec.  129.18, revise the section heading and add paragraph (c) to 
read as follows, effective on May 1, 2003:


Sec.  129.18  Collision avoidance system.

* * * * *
    (c) Effective May 1, 2003, if TCAS II is installed in an airplane 
for the first time after April 30, 2003, and before January 1, 2005, no 
foreign air carrier may operate that airplane without TCAS II that 
meets TSO C-119b (version 7.0), or a later version.

0
9. Revise Sec.  129.18 to read as follows, effective January 1, 2005:
    Effective January 1, 2005, any airplane you, as a foreign air 
carrier, operate under part 129 must be equipped and operated according 
to the following table:

                       Collision Avoidance Systems
------------------------------------------------------------------------
If you operate in the United States any     Then you must operate that
                 . . .                            airplane with:
------------------------------------------------------------------------
(a) Turbine-powered airplane of more     (1) An appropriate class of
 than 33,000 pounds maximum               Mode S transponder that meets
 certificated takeoff weight.             Technical Standard Order (TSO)
                                          C-112, or a later version, and
                                          one of the followign approved
                                          units;
                                         (i) TCAS II that meets TSO C-
                                          119b (version 7.0), or takeoff
                                          weight a later version.
                                         (ii) TCAS II that meets TSO C-
                                          119a (version 6.04A Enhanced)
                                          that was installed in that
                                          airplane before May 1, 2003.
                                          If that TCAS II version 6.04A
                                          Enhanced no longer can be
                                          repaired to TSO C-119a
                                          standards, it must be replaced
                                          with a TCAS II that meets TSO
                                          C-119b (version 7.0), or a
                                          later version.
                                         (iii) A collision avoidance
                                          system equivalent to TSO C-
                                          119b (version 7.0), or a later
                                          version, capable of
                                          coordinating with units that
                                          meet TSO C-119a (version 6.04A
                                          Enhanced), or a later version.
(b) Turbine-powered airplane with a      (1) TCAS I that meets TSO C-
 passenger-seat configuration,            118, or a later version, or
 excluding any pilot seat, or 10-30      (2) A collision avoidance
 seats.                                   system equivalent to excluding
                                          any TSO C-118, or a later
                                          version, or
                                         (3) A collision avoidance
                                          system and Mode S transponder
                                          that meet paragraph (a)(1) of
                                          this section.
------------------------------------------------------------------------



[[Page 15904]]

    Issued in Washington, DC, on March 24, 2003.
Marion C. Blakey,
Administrator.
[FR Doc. 03-7653 Filed 3-31-03; 8:45 am]
BILLING CODE 4910-13-P