Air Traffic Control: Status of the Current Modernization Program
and Planning for the Next Generation System (04-MAY-06,
GAO-06-738T).
Over a decade ago, GAO listed the Federal Aviation
Administration's (FAA) effort to modernize the nation's air
traffic control (ATC) system as a high-risk program because of
systemic management and acquisition problems. Two relatively new
offices housed within FAA--the Air Traffic Organization (ATO) and
the Joint Planning and Development Office (JPDO)--are now
primarily responsible for planning and implementing these
modernization efforts. Congress created ATO to be a
performance-based organization that would improve both the
agency's culture, structure, and processes, and the ATC
modernization program's performance and accountability. Congress
created JPDO, made up of seven partner agencies, to coordinate
the federal and nonfederal stakeholders necessary to plan a
transition from the current air transportation system to the
"next generation air transportation system" (NGATS). This
statement is based on GAO's recently completed and ongoing
studies of the ATC modernization program. GAO provides
information on (1) the status of ATO's efforts to improve the ATC
modernization program, (2) the status of JPDO's planning efforts
for NGATS, and (3) actions to control costs and leverage
resources for ATC modernization and the transformation to NGATS.
-------------------------Indexing Terms-------------------------
REPORTNUM: GAO-06-738T
ACCNO: A53242
TITLE: Air Traffic Control: Status of the Current Modernization
Program and Planning for the Next Generation System
DATE: 05/04/2006
SUBJECT: Air traffic control systems
Cost control
Enterprise architecture
Internal controls
Performance management
Performance measures
Program evaluation
Program management
Strategic planning
Systems conversions
Technology modernization programs
FAA Air Traffic Control System
Next Generation Air Transportation
System
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GAO-06-738T
* Background
* ATO Has Taken Steps to Improve ATC Modernization, but Challe
* ATO Has Begun Efforts to Transform Its Culture, Structures,
* ATO Has Begun to Address Systemic Causes of Delays and Cost
* FAA Met Its Acquisition Performance Goal for the Second Cons
* ATO Faces Human Capital Challenges in Creating a More Result
* FAA Faces Challenges in Ensuring Stakeholder Involvement in
* JPDO Has Made Progress in Planning for NGATS, but Faces Chal
* JPDO Has Begun to Facilitate Collaboration among Federal Age
* JPDO Is Structured to Involve Federal and Nonfederal Stakeho
* JPDO Is Using a Reasonable Process for Technical Planning, b
* JPDO Is Planning for Global Harmonization as Part of the NGA
* ATO and JPDO are Working to Address Funding Challenges
* ATO Has Begun to Take a Number of Steps to Address Rising Op
* ATO Faces Challenges in Funding NGATS
* Resources Available to Support NGATS Could Be Enhanced throu
* Concluding Observations
* Contact and Staff Acknowledgments
* Order by Mail or Phone
Testimony
Before the Subcommittee on Transportation, Treasury, the Judiciary,
Housing and Urban Development, and Related Agencies, Committee on
Appropriations, U.S. Senate
United States Government Accountability Office
GAO
For Release on Delivery Expected at 9:30 a.m. EDT
Thursday, May 4, 2006
AIR TRAFFIC CONTROL
Status of the Current Modernization Program and Planning for the Next
Generation System
Statement for the Record by Gerald L. Dillingham, Ph.D., Director Physical
Infrastructure Issues
GAO-06-738T
Mr. Chairman and Members of the Subcommittee:
We are pleased to present this statement for the record regarding the
status of efforts by the Air Traffic Organization (ATO) and the Joint
Planning and Development Office (JPDO) to modernize and transform the
nation's air traffic control (ATC) system. Both offices are within the
Federal Aviation Administration (FAA) and represent recent efforts by
Congress to, among others things, ensure a national airspace system that
is safe, efficient, and capable of meeting a growing demand for air
transportation-a demand that is expected to triple by 2025. ATO has
responsibility for operating, maintaining, and modernizing the current ATC
system. ATO was authorized as a performance-based organization (PBO)1 in
2000 and includes 36,000 of FAA's roughly 46,000 employees. JPDO,
authorized in 2003, is responsible for planning and coordinating the
broader and longer-term transformation (through 2025) to the "next
generation air transportation system" (NGATS).
The ATC system is composed of an array of subsystems, including radars;
automated data-processing, navigation, and communications equipment; and
ATC facilities. These systems work together to support all phases of
flight for aircraft operating in U.S. airspace. The ATC system also
includes the FAA employees who manage, operate, and maintain ATC equipment
and facilities. Over a decade ago, we designated FAA's ATC modernization
program as high risk because of systemic management and acquisition
problems, which we have reported on and made recommendations to address
over the years.
Efforts to modernize and transform the ATC system will be costly, yet FAA
anticipates lean capital budgets for the immediate future. Thus, to
maintain the current ATC system while preparing for the next, FAA will
have to work even harder to make the best and most efficient use of
increasingly scarce resources. These transformation efforts are getting
under way and will continue as the United States confronts multiple
challenges and demands for resources. ATC transformation also involves the
recognition that other nations are upgrading their aviation technologies,
creating a need for global harmonization to support international travel.
1PBOs are discrete units, led by a Chief Operating Officer, that commit to
clear objectives, specific measurable goals, customer service standards,
and targets for improved performance.
Our statement focuses on three key questions. (1) What is the status of
ATO's efforts to improve its performance as it modernizes our nation's air
traffic control system? (2) What is the status of JPDO's planning efforts
for NGATS? (3) To what extent are efforts being made to control costs and
leverage resources to support ATC modernization and the transformation to
NGATS? My statement is based on our recently completed and ongoing studies
of FAA's ATC modernization program, together with updated information from
ATO and JPDO officials and aviation stakeholders.2 Later this year, we
expect to issue two detailed reports related to the issues discussed in
this statement. One report will provide our assessment of the status of
JPDO's efforts to develop NGATS. Another report will examine a variety of
cost-saving and financing options for FAA in the 21st century. We are
performing our work in accordance with generally accepted government
auditing standards.
The following is a summary of our findings to date:
o Created as a performance-based organization, ATO has been
working to establish a results-oriented organizational culture, a
more accountable management structure, and more businesslike
management and acquisition processes, but continued management
attention will be required to institutionalize these initiatives.
To bring about cultural change, ATO has adopted core values such
as integrity, accountability, and fiscal responsibility and is
using FAA Employee Attitude Survey data to establish a baseline
for assessing changes in attitudes over time. ATO has begun to
hold managers accountable for cost control through its performance
rating and bonus system. To improve its acquisitions process, FAA
is, for example, evaluating all investment decisions, including
those for systems in service beyond 2 years, to ensure that all
decisions support agency goals. Recently, FAA has reported
positive results: For the past 2 fiscal years, FAA has met its
major acquisition performance goal-to have 80 percent of its
acquisitions meet scheduled milestones and be within 10 percent of
budget. However, FAA still faces challenges, including sustaining
ATO's transformation to a results-oriented culture, hiring and
training thousands of air traffic controllers to replace those
expected to retire, ensuring stakeholder involvement in major
system acquisitions to ensure that the acquisitions meet users'
needs, and keeping major acquisitions, such as the FAA
Telecommunications Infrastructure (FTI) on schedule and within
budget.
o JPDO has made progress in planning for the NGATS that is
described in its December 2004 Integrated Plan and its March 2006
Progress Report. JPDO's focus has included facilitating
collaboration among federal agencies, ensuring active
participation of stakeholders, addressing technical planning, and
factoring global harmonization into its planning, but several
challenges exist. Our work has shown that it is important for
collaborating agencies to leverage resources and define roles and
responsibilities.3 JPDO has facilitated collaboration among its
federal partner agencies, but faces challenges in continuing to
leverage the partner agencies' resources and in defining the roles
and responsibilities of the various agencies involved. JPDO is
structured in a way that involves federal and nonfederal
stakeholders, but could find it difficult to sustain the support
of nonfederal stakeholders over the longer term and has had
difficulty obtaining the participation of current air traffic
controllers. JPDO is using an iterative process for technical
planning, but has not completed some key activities. For example,
JPDO's Evaluation and Analysis Division is beginning to model
anticipated changes in air traffic controller workload, but has
not completed human factors modeling to determine the effects of
potential changes in pilot workload. JPDO has taken the initial
steps to develop an enterprise architecture (a blueprint for
NGATS) and will have an early version by the end of fiscal year
2006. The robustness and timeliness of JPDO's enterprise
architecture is critical to many of JPDO's future NGATS planning
activities.
o ATO has taken a number of steps to control costs and leverage
resources that, in combination with other actions, can provide
funds for ATC modernization and transformation to NGATS. ATO has
established performance metrics for cost control, developed a cost
accounting system, and is using its performance management system
to hold its managers accountable for controlling costs. ATO has
also developed a formal cost control program that includes (1)
conducting annual business case reviews for its capital programs,
(2) decommissioning and consolidating ATC facilities, (3)
improving its project management of its operations programs, (4)
pursuing cost reduction opportunities through outsourcing, (5)
assisting Congress in identifying projects for funding priority,
and (6) reducing or avoiding personnel costs through workforce
attrition and efficiency gains. However, ATO's cost control
efforts are at an early stage, and ATO lacks a consistent process
to validate savings estimated for operations cost control
initiatives. Cost control will become increasingly important
during the transition from the current ATC system to NGATS, when
ATO is expected to remain responsible for the costs of operating
and maintaining the current ATC system while assuming major
responsibility for the costs of demonstrating and developing new
NGATS technologies. Opportunities exist for greater savings and
cost control. Many of these opportunities will require risk-based
decision making and significant congressional support. ATO and
JPDO have collaborated on developing rough near-term estimates of
the funding requirements for defining concepts and developing
systems for surveillance, communications, and other key NGATS
components. However, these funding requirements are not currently
in ATO's budget-constrained capital spending plan. ATO's NGATS
funding burden could be reduced to the extent that JPDO is
successful in leveraging resources from its partner agencies.
Further enhancement to NGATS funding could be achieved by ATO
utilizing its existing funding flexibility.
In 1981, FAA began a program to replace and upgrade ATC facilities
and equipment. However, systemic management issues, such as
frequent turnover in agency leadership, an ineffective
organizational culture, and problems with its acquisition process,
contributed to cost growth, schedule slippages, and performance
shortfalls, leading us to classify FAA's ATC modernization program
as high risk in 1995.4 That same year, Congress passed legislation
that exempted FAA from most federal personnel and acquisition laws
and regulations on the premise that FAA needed such freedom to
better manage ATC modernization.5 In December 2000, President
Clinton signed an executive order and Congress passed supporting
legislation that, together, provided FAA with the authority to
create ATO as a performance-based organization (PBO) to control
and improve FAA's management of the modernization effort. In
February 2004, FAA reorganized, transferring 36,000 employees,
most of whom worked in air traffic services and research and
acquisitions, to ATO.
Even with the creation of ATO, the current approach to managing
air transportation is becoming increasingly inefficient and
operationally obsolete. In late 2003, Congress created JPDO6 to
plan NGATS, a system intended to accommodate what is expected to
be three times more air traffic by 2025 than there is today.
JPDO's scope is broader than traditional ATC modernization in that
it is "airport curb-to-airport curb," encompassing such issues as
security screening and environmental concerns. Additionally,
JPDO's approach will require unprecedented collaboration and
consensus among many stakeholders-federal and nonfederal-about
necessary system capabilities, equipment, procedures, and
regulations. Key to this collaboration will be the work of JPDO's
seven partner agencies: the Departments of Transportation,
Commerce, Defense, and Homeland Security; FAA; the National
Aeronautics and Space Administration (NASA); and the White House
Office of Science and Technology Policy. Each of these agencies
will play a role in creating NGATS. For example, the Department of
Defense has deployed "network centric" systems, originally
developed for the battlefield, that are being considered as a
framework to provide all users of the national airspace system-FAA
and the Departments of Defense and Homeland Security-with a common
view of that system. JPDO began its initial operations in early
2004. A Senior Policy Committee, chaired by the Secretary of
Transportation and including senior representatives from each of
the participating departments and agencies, provides oversight to
JPDO. JPDO is located within FAA and reports to the FAA
Administrator and to the Chief Operating Officer within ATO.7 See
figure 1.
Figure 1: Organizational Chart of JPDO
Concurrent with JPDO's efforts, the European Commission8 is
conducting a project to harmonize and modernize the pan-European
air traffic management system. Known as the Single European Sky
Air Traffic Management Research Programme (SESAR), the project is
overseen by the European Organization for the Safety of Air
Navigation (Eurocontrol).9 Eurocontrol has contracted out the work
of SESAR to a 30-member consortium of airlines, air navigation
service providers, airports, manufacturers, and others. The
consortium is receiving 60 million euros ($73 million)10 to
conduct a 2-year definition phase and produce a master plan for
SESAR.
To improve its management of ATC modernization, ATO has taken
steps toward having a more results-oriented culture; a flatter,
more accountable management structure; and more businesslike
management and acquisition processes. In addition, ATO is
implementing recommendations we have made to address systemic
factors that have contributed to cost, schedule, and performance
problems with major ATC acquisitions. For the past 2 fiscal years,
FAA has met its acquisition performance goals. However, FAA still
faces human capital challenges, such as institutionalizing a
results-oriented culture and hiring thousands of air traffic
controllers during the next decade. FAA also faces challenges in
keeping its major system acquisitions on track.
ATO is working to establish the results-oriented organizational
culture, structures, and processes that are generally associated
with a PBO. FAA, through ATO, has established a strategic goal to
become a results-oriented organization. One key element of ATO's
strategy is to identify core values and track employees' attitudes
about those values to monitor cultural change.11 To implement this
element, ATO has identified multiple core values: integrity and
honesty, accountability and responsibility, commitment to
excellence, commitment to people, and fiscal responsibility. ATO
is using FAA Employee Attitude Survey data to determine employee
attitudes toward these values and has developed a baseline of
employee attitudes for use in monitoring changes in attitudes over
time.12 Another key element of ATO's strategy is to establish a
viable, stable, and sustainable organization that can transcend
changes in leadership.
In our past work, we noted that FAA's acquisitions workforce did
not have an organizational culture and structure that supported
the acquisition and deployment of sophisticated technology on the
scale used in the national airspace system.13 For example,
acquisitions were impaired because employees and managers acted in
ways that did not reflect a strong commitment to mission focus,
accountability, adaptability, and coordination. Specifically,
officials performed little or no mission needs analysis, made
unrealistic cost and schedule estimates, and moved to producing
systems before completing their development. We also reported that
accountability was not well defined or enforced for decisions on
requirements and contract oversight. Additionally, vertical lines
of authority impaired communication across organizations that
needed to coordinate, particularly the acquisitions and operations
areas of FAA. Finally, we reported that FAA's culture of
conservatism and conformity rewarded employees for simply
following the rules rather than considering innovation. We
recommended that FAA develop a strategy for cultural change.
Although FAA responded to our recommendation by developing a
cultural change strategy and some other related initiatives, these
initiatives were neither fully implemented nor sustained.
ATO has put a new management structure in place and established
more businesslike management and acquisition processes. ATO is
structured as a discrete management unit within FAA and is headed
by a Chief Operating Officer (COO), who is appointed to a 5-year
term. It has become a flatter organization, with fewer management
layers. As a result, managers are in closer contact with the
services they deliver. ATO is also taking some steps to break down
the vertical lines of authority, or organizational stovepipes,
that we found hindered communication and coordination across FAA.
For example, the COO holds daily meetings with the managers of
ATO's departments and holds the managers collectively responsible
for the success of ATO through the performance management system.
According to the COO, the daily meetings have been a revelation
for some managers who were formerly only focused on and
responsible for their own departments.
ATO has begun to revise its business processes to increase
accountability. For example, it has recently established a cost
accounting system and made the units that deliver services within
each department responsible for managing their own costs. Thus,
each unit manager develops an operating budget and is held
accountable for holding costs within specific targets. Managers
track the costs of their unit's operations, facilities and
equipment, and overhead and use this information to determine the
costs of the services their unit provides. Managers are evaluated
and rewarded according to how well they hold their costs within
established targets. Our work has shown that it is important, when
implementing organizational transformations, to use a performance
management system to assure accountability for change.14
Finally, ATO is revising its acquisition processes, as we
recommended,15 and taking steps to improve oversight, operational
efficiency, and cost control. To ensure executive-level oversight
of all key decisions, FAA plans to revise its Acquisition
Management System to incorporate key decision points in a
knowledge-based product development process by June 2006.
Moreover, as we have reported, ATO formed an executive council to
review major acquisitions before they are sent to FAA's Joint
Resources Council.16 To better manage cost growth, this executive
council also reviews project breaches of 5 percent or more in
cost, schedule, or performance. FAA has issued guidance on how to
develop and use pricing, including guidelines for disclosing the
levels of uncertainty and imprecision that are inherent in cost
estimates for major ATC systems. Additionally, ATO has begun to
base funding decisions for system acquisitions on a system's
expected contribution to controlling operating costs. Finally, FAA
is creating a training framework for its acquisition workforce
that mirrors effective human capital practices that we have
identified, and the agency is taking steps to measure the
effectiveness of its training.
ATO has begun taking actions to address systemic factors that our
work has shown contribute individually or collectively to schedule
delays or cost overruns in major system acquisitions. Such factors
include funding acquisitions at lower levels than called for in
agency planning documents, not considering all information
technology investments as a complete portfolio, not adequately
defining a system's requirements or understanding software
complexity, and not adequately considering customer needs in a
system's functional and performance requirements.
Funding acquisitions at lower levels than called for in agency
planning documents. When FAA initiates a major system acquisition,
it estimates, and its top management approves, the funding plan
for each year. However, when budget constraints do not allow all
system acquisitions to be fully funded at the previously approved
levels, FAA must decide which programs to fund and which to cut,
according to its priorities. When a system acquisition does not
receive the annual funding called for in its planning documents,
the acquisition may fall behind schedule. This may also postpone
the benefits of the new system and can require FAA to continue
operating and maintaining the older equipment that the acquisition
is intended to replace. For example, reduced funding was one
factor that caused FAA to reduce the initial deployment of its
ASR-11 digital radar system from 111 systems to 66 systems, as
well as defer decisions on further deployment pending additional
study. In the meantime, FAA will have to continue maintaining the
aging analog radars that the new system was intended to replace.
To address this issue, we recommended that, to help ensure key
administration and congressional decision makers have more
complete information, FAA identify and annually report which
activities under the ATC modernization program have had funding
deferred, reduced, or eliminated, and provide detailed information
on how those decisions have affected FAA's ability to modernize
the ATC system and related components in the near, mid, and longer
term.17 Such information would make clear how constrained budgets
will affect modernization of the national airspace system and how
FAA is working to live within its means. According to FAA, the
agency intends to better inform Congress in the future by
providing information in its capital investment plan, submitted to
Congress annually with the President's Budget, that will identify
changes from the preceding year.
Not considering all information technology investments as a
complete portfolio. We pointed out that FAA does not evaluate
projects beyond the first 2 years of service to ensure that they
are aligned with organizational goals.18 Consequently, the agency
could not ensure that projects with a longer service history,
totaling about $1.3 billion per year, were still aligned with
FAA's strategic plans and business goals and objectives. We
recommended that FAA include these projects in its investment
portfolio management for review. FAA's current version of its
Acquisition Management Policy calls for periodic monitoring of
in-service systems to collect and analyze performance data to use
as the basis for sustained deployment. However, we have not yet
evaluated FAA's implementation of this policy.
Not adequately defining a system's requirements or understanding
software complexity. Inadequate or poorly defined requirements may
contribute to the inability of system acquisitions to meet their
original cost, schedule, or performance targets, since developing
or redefining requirements as an acquisition progresses takes time
and can be costly. In addition, unplanned development work may
occur when the agency misjudges the extent to which a
commercial-off-the-shelf or nondevelopmental item, such as one
procured by another agency, will meet FAA's needs. For example,
FAA sought to use an Army radio as the core of a new digital ATC
communication system, but found that the radio did not meet
established interference requirements, which contributed to
schedule delays. When FAA underestimates the complexity of
software development or misjudges the difficulty of modifying
available software to fulfill its mission needs, acquisitions may
take longer and cost more than expected. FAA's acquisition of the
Local Area Augmentation System (LAAS)-a system that would allow
precision instrument approaches and landings in all weather
conditions-is a case in point. FAA underestimated LAAS's software
complexity because it inadequately assessed the system's
technology maturity. In particular, the agency misunderstood the
potential for radio interference through the atmosphere, which
could limit LAAS's operations. The technical difficulties
encountered with LAAS, among other things, led FAA to suspend this
acquisition. To reduce these risks, FAA has developed and applied
a process improvement model to a number of acquisition projects.
This model is used to assess the maturity of FAA's software and
systems capabilities. As we reported, this approach has resulted
in enhanced productivity, higher quality, greater ability to
predict schedules and resources, better morale, and improved
communication and teamwork.19 However, FAA did not mandate the use
of the model throughout the organization. In response to our
recommendation that FAA institutionalize the model's use
throughout the organization, FAA has begun developing a
requirement that acquisition projects have process improvement
activities in place before seeking approval from FAA's investment
review board.
Not adequately considering customer needs in a system's functional
and performance requirements. We reported that FAA was not
applying best practices used in Department of Defense and
commercial product development. Best practices include balancing
customer needs with available resources. According to FAA, the
agency is now including in its acquisition guidance a requirement
that top-level functional and performance requirements reflect the
needs of the customer.
FAA has now met its acquisitions performance goal 2 years in a
row. The goal for fiscal years 2004 and 2005 was to have 80
percent of its system acquisitions on schedule and within 10
percent of budget. The goal gradually increases to 90 percent by
fiscal year 2008. The increase will make FAA's acquisition
performance goal consistent with targets set in the Department of
Transportation's strategic plan and will comply with the Federal
Acquisition Streamlining Act of 1994.
Having such a goal is consistent with the President's Management
Agenda, which calls for a commitment to achieve immediate,
concrete, and measurable results in the near term, and meeting
this goal is a positive step toward better acquisition management.
However, if the milestones for an acquisition have changed over
the years to reflect changes in its cost and schedule, then using
those revised milestones may not provide a complete picture of the
acquisition's progress over time. For example, the milestones for
3 of the 16 major system acquisitions that we reviewed in detail
during 2004 and 2005 were being revised to reflect cost or
schedule changes during 2005. These revised milestones, together
with revised targets for meeting them, will become the new
milestones for fiscal year 2006. While revising milestones and
targets that are no longer valid is an appropriate management
action, using revised rather than original targets for measuring
performance does not provide a consistent benchmark over time. The
extent to which an acquisition meets its annual performance
targets is one measure of its performance and should be viewed
together with other measures, such as its progress against
original and revised baselines. The variance reports provided to
the FAA Administrator and to Congress may also be useful in
evaluating an acquisition's performance.20
Since fiscal year 2003, the number of acquisition programs
measured by FAA has varied from 31 to 42. According to FAA, the
number varies from year to year, in part, because some programs
reach completion and others are initiated. The programs that are
selected each fiscal year represent a cross section of ATO
programs, including investments in new capabilities and others
that are ready for use without modification. FAA's Portfolio of
Goals, which provides supplementary information on the agency's
performance goals, asserts that no bias exists in the selection of
milestones for performance review, but does not state the basis
for this conclusion. The portfolio also states that the milestones
selected represent the program office's determination of the
efforts that are "critical" or important enough to warrant
inclusion in the acquisition performance goal for the year.
However, we have not conducted a detailed examination of the
reliability and validity of FAA's metrics for its acquisition
program performance.
ATO faces a challenge in sustaining and institutionalizing
management focus on its transformation to an effective PBO and a
results-oriented culture. Our work has shown that successful
transformations and the institutionalization of change in large
public and private organizations can take 5 to 7 years or more to
fully implement.21 To ensure that FAA's focus on cultural change
does not diminish as it did in the past, we recommended that FAA
provide sustained oversight of efforts to achieve a more
results-oriented workforce culture, including periodically
monitoring the agency's progress against baseline data.22 As
discussed, ATO has established a baseline of employee attitudes
for use in monitoring cultural change, and similar long-term
management attention will be needed to conduct this monitoring and
assess ATO's progress toward becoming a PBO.
FAA also faces the challenge of hiring and training thousands of
air traffic controllers during the coming decade. According to its
controller staffing plan, FAA expects to lose about 11,000 air
traffic controllers due to voluntary retirements or mandatory
retirements at age 56, as well as other reasons.23 These
retirements stem from the 1981 controller strike, when President
Ronald Reagan fired over 10,000 air traffic controllers and FAA
then had to quickly rebuild the controller workforce. From 1982
through 1991, FAA hired an average of 2,655 controllers per year.
These controllers will become eligible for retirement during the
next decade. To replace these controllers, as well as those who
will leave for other reasons, and to accommodate forecasted
increases in air traffic, FAA's plan calls for hiring a total of
12,500 new controllers over the next 10 years.24
Adequately involving stakeholders in a system's development is
important to ensure that the system meets users' needs. In the
past, air traffic controllers were permanently assigned to FAA's
major system acquisition program offices and provided input into
air traffic control modernization projects. In June 2005, FAA
terminated this arrangement because of budget constraints.
According to FAA, it now plans to obtain the subject-matter
expertise of air traffic controllers or other stakeholders as
needed in major system acquisitions. It remains to be seen whether
this approach will be sufficient to avoid problems such as FAA
experienced when inadequate stakeholder involvement in the
development of new air traffic controller workstations (known as
the Standard Terminal Automation Replacement System (STARS))
contributed to unplanned work, which, in turn, led to significant
cost growth and schedule delays.25
Three systems-all communications-related-missed the fiscal year
2005 acquisition performance goal for schedule. According to FAA,
the $310 million FTI acquisition, which is replacing costly
existing networks of separately managed systems and services by
integrating advanced telecommunications services, was behind
schedule because initial plans did not allow sufficient time for
installations. To complete the installations in fiscal year 2008,
as originally scheduled, FAA initiated a plan to put the program
back on schedule and has met the plan's milestones since August
2005. Two other communications acquisition programs also missed
the acquisition performance goal for schedule-the $325 million
Next Generation Air-to-Ground Communication system, segment 1A,
which replaces analog communication systems with digital systems,
and the $85 million Ultra High Frequency Radio Replacement, which
replaces aging equipment used to communicate with Department of
Defense aircraft. According to an FAA official, as the agency
assessed its priorities for fiscal year 2005, a decision was made
that these programs would receive fewer resources. The resources
that were then available were not sufficient to allow the programs
to meet established milestones.
To the extent that delays in FTI persist, FAA will lose the cost
savings that the system was expected to produce. The Department of
Transportation's Office of the Inspector General has reported that
FAA did not realize $32.6 million in anticipated operating cost
savings in fiscal year 2005 because of the limited progress made
in disconnecting legacy circuits. The office also reported that
without a nearly tenfold increase in its rate of transferring
service to FTI and disconnecting legacy circuits, FAA stands to
miss out on an additional $102 million in cost savings in fiscal
year 2006. As an alternative to continuing the current FTI
program, some experts have suggested that FAA consider outsourcing
this activity, as it recently did for its flight service
stations.26
In summary, ATO has made a number of promising moves toward
becoming a results-oriented organization, and we view ATO's
efforts to improve its culture, management, and acquisitions
process as positive steps. However, ATO has been established for
only slightly more than 2 years. Work remains to ensure that these
processes become institutionalized. Although it is still too early
to evaluate the effectiveness of many of these steps, we are
monitoring ATO's progress. As ATO moves forward, it will play a
key role in implementing NGATS, as planned by JPDO. I will now
discuss the status of JPDO's planning efforts.
JPDO has engaged in practices that facilitate collaboration among
its partner agencies, but faces challenges in continuing to
leverage resources from these agencies and in defining the roles
and responsibilities of the various entities involved. JPDO has
been structured to involve both federal and nonfederal
stakeholders, but maintaining the support of nonfederal
stakeholders over the long term and soliciting the participation
of some stakeholders may prove difficult. JPDO is using a
reasonable process for technical planning, but several key
technical planning activities remain. Lastly, JPDO is including
efforts toward global harmonization in its planning for NGATS, but
other opportunities for cooperation have not been fully explored.
Our work to date shows that JPDO is facilitating the federal
interagency collaboration that is central to its mission and
legislative mandate. According to our research, agencies must have
a clear and compelling rationale for working together to overcome
significant differences in their missions, cultures, and
established ways of doing business. In developing JPDO's
integrated plan,27 the partner agencies agreed to a vision
statement and eight strategies that broadly address the goals and
objectives for NGATS. These strategies formed the basis for JPDO's
eight integrated product teams (IPT), and various partner agencies
have taken the lead on specific strategies. Our research has also
shown that it is important for collaborating agencies to include
the human, technological, and physical resources needed to
initiate or sustain their collaborative effort. To leverage human
resources, JPDO has staffed the various levels of its organization
with partner-agency employees, many of whom work part time for
JPDO. To leverage technological resources, JPDO conducted an
interagency program review of its partner agencies' research and
development programs to identify work that could support NGATS.
Through this process, JPDO identified early opportunities that
could be pursued during fiscal year 2007 to produce tangible
results for NGATS, such as the Automatic Dependent
Surveillance-Broadcast (ADS-B)28 program at FAA.
However, while JPDO's legislation, integrated plan, and governance
structure29 provide the framework for institutionalizing
collaboration among multiple federal agencies, JPDO is
fundamentally a planning and coordinating body that lacks
authority over the key human and technological resources needed to
continue developing plans and system requirements for NGATS.
Consequently, the ability to continue leveraging resources of the
partner agencies will be critical to JPDO's success. However,
beginning around 2008, JPDO expects a significant increase in its
IPTs' workloads. JPDO officials told us that although the partner
agencies have not yet expressed concerns over the time that their
employees spend on JPDO work, it remains to be seen whether
agencies will be willing to allow their staff to devote more of
their time to JPDO. In addition, JPDO anticipates needing more
agency resources to plan and implement demonstrations of potential
technologies to illustrate some of the early benefits that could
be achieved from the transformation to NGATS.
This challenge of leveraging resources arises, in part, because
the partner agencies have a variety of missions and priorities
other than supporting NGATS. NASA, for example, while conducting
key aeronautical and safety research relevant to NGATS,
nonetheless has other competing missions. Recently, NASA's
management determined that for the agency to meet its other
mission needs, it would not develop new aviation technologies to
the extent that it had in the past. As a result, additional
development costs related to NGATS will have to be borne by JPDO,
industry, or some combination.
JPDO also faces the challenge of clearly defining its partner
agencies' roles and responsibilities. Our work has shown that
collaborating agencies should work together to define and agree on
their respective roles and responsibilities, including how the
collaboration will be led. In JPDO's case, there is no formal,
long-term agreement on the partner agencies' roles and
responsibilities in creating NGATS. According to JPDO officials, a
memorandum of understanding that would define the partner
agencies' relationships was being developed as of August 2005, but
has not yet been completed.
Defining roles and responsibilities is particularly important
between JPDO and ATO, because both organizations have
responsibilities related to planning the national airspace
system's modernization. ATO has primary responsibility for the ATC
system's current and near-term modernization, while JPDO has
responsibility for planning and coordinating a transformation to
NGATS over the next 20 years. The roles and responsibilities of
each office are currently being worked out. ATO now plans to
expand its Operational Evolution Plan so that it applies FAA-wide
and represents FAA's piece of JPDO's overall NGATS plan. 30 As the
roles and responsibilities of the two offices become more clearly
defined, there is also a need to better communicate these
decisions to stakeholders.
JPDO has structured itself to involve federal and nonfederal
stakeholders throughout its organization. Our work has shown that
involving stakeholders can, among other things, increase their
support for a collaborative effort. Federal stakeholders from the
partner agencies serve on JPDO's Senior Policy Committee, board,
and IPTs. Nonfederal stakeholders may participate through the
NGATS Institute (the Institute). Through the Institute, JPDO
obtained the participation of over 180 stakeholders from over 70
organizations for the IPTs. The NGATS Institute Management
Council, composed of top officials and representatives from the
aviation community, oversees the policy and recommendations of the
Institute and provides a means for advancing consensus positions
on critical NGATS issues.
Although JPDO has developed the mechanisms for involving
stakeholders and brought stakeholders into the process, it faces
challenges in sustaining nonfederal stakeholders' participation
over the long term. Much as with the federal partner agencies,
JPDO has no direct authority over the human, technical, or
financial resources of its nonfederal stakeholders. To date, these
stakeholders' investment in NGATS has been through their
part-time, pro bono participation on the IPTs and the NGATS
Institute Management Council.31 The challenge for JPDO is to
maintain the interest and enthusiasm of these nonfederal
stakeholders, which will have to juggle their own multiple
priorities and resource demands, even though some of the tangible
benefits of NGATS may not be realized for several years. For
example, stakeholders' support will be important for programs such
as System Wide Information Management (SWIM),32 which is a
prerequisite to future benefits, but may not produce tangible
benefits in the near term.
In the wake of past national airspace modernization efforts, JPDO
also faces the challenge of convincing nonfederal stakeholders
that the government is financially committed to NGATS. While most
of FAA's major ATC acquisition programs are currently on track,
earlier attempts at modernizing the national airspace system
encountered many difficulties. In one instance, for example, FAA
developed a datalink communications system that transmitted
scripted e-mail-like messages between controllers and pilots. One
airline equipped its aircraft with this new technology, but
because of funding cuts, FAA ended up canceling the program. In a
similar vein, we have reported that some aviation stakeholders
expressed concern that FAA may not follow through with its
airspace redesign efforts and are hesitant to invest in equipment
unless they are sure that FAA's efforts will continue. One expert
suggested to us that the government might mitigate this issue by
making an initial investment in a specific technology before
requesting that airlines or other industry stakeholders purchase
equipment.
In addition to maintaining stakeholder involvement, JPDO faces
challenges in obtaining the participation of all stakeholders. In
particular, JPDO does not involve current air traffic controllers,
who will play a key role in NGATS. The current air traffic control
system is based primarily on the premise that air traffic
controllers direct pilots to maintain safe separation between
aircraft. In NGATS, this premise could change and, accordingly,
JPDO has recognized the need to conduct human factors research on
such issues, including how tasks should be allocated between
humans and automated systems, and how the existing allocation of
responsibilities between pilots and air traffic controllers might
change. The input of current air traffic controllers who have
recent experience controlling aircraft is important in considering
human factors and safety issues, as our work on STARS has shown.
However, as mentioned, no current air traffic controllers are
involved in NGATS. In June 2005, FAA terminated its liaison
program through which air traffic controllers had been assigned as
liaisons to its major system acquisition program offices. This
included the liaison assigned to JPDO. Since that time, the
National Air Traffic Controllers Association (NATCA), the labor
union that represents air traffic controllers, has not been a
participant in planning NGATS. Although the NGATS Institute
Management Council includes a seat for the union, a NATCA official
told us that the union's head had been unable to attend the
council's meetings. According to JPDO officials, the council has
left a seat open in hopes that the controllers will participate in
NGATS after a new labor-management agreement between NATCA and FAA
has been settled.
To conduct the technical planning needed to develop NGATS, JPDO is
using an iterative process that appears to be reasonable given the
complexity of NGATS. Two fundamental pieces of this technical
planning are modeling and developing an enterprise architecture (a
tool, or blueprint, for understanding and planning complex
systems).
JPDO has formed an Evaluation and Analysis Division (EAD),
composed of FAA and NASA employees and contractors, to assemble a
suite of models that will help JPDO refine its plans for NGATS and
iteratively narrow the range of potential solutions. For example,
EAD has used modeling to begin studying how possible changes in
the duties of key individuals, such as air traffic controllers,
could affect the workload and performance of others, such as
airport ground personnel. NGATS could shift some tasks now done by
air traffic controllers to pilots. However, EAD has not yet begun
to model the effect of this shift on pilots' performance because,
according to an EAD official, a suitable model has not yet been
incorporated into the modeling tool suite. According to EAD,
addressing this issue is difficult because data on pilot behavior
are not readily available to use in creating such models.
Furthermore, EAD has not studied the training implications of
various NGATS-proposed solutions because further definition of the
concept of operations for these solutions has not been completed.
As the concept of operations matures, it will be important for air
traffic controllers and other affected stakeholders to provide
their perspectives on these modeling efforts. In addition, as the
concept of operations and plans for sequencing equipment matures,
EAD will be able to study the extent to which new air traffic
controllers will have to be trained to operate both the old and
the new equipment.
To develop an enterprise architecture, JPDO has taken several
important first steps and is following several effective practices
that we have identified for enterprise architecture development.
However, JPDO's enterprise architecture is currently a work in
progress. Development of the NGATS enterprise architecture is
critical to JPDO's planning efforts, and many of JPDO's future
activities will depend on the robustness and timeliness of its
architecture development. The enterprise architecture will
describe ATO's operation of the current national airspace system,
JPDO's plans for the NGATS, and the sequence of steps needed to
transition between them. The enterprise architecture will provide
the means for coordinating among the partner agencies and private
sector manufacturers, aligning relevant research and development
activities, integrating equipment, and estimating system costs.
To date, JPDO has formed an Enterprise Architecture Division and
plans to have an early version of the architecture by the end of
fiscal year 2006. The office has established and filled a chief
architect position and established an NGATS Architecture Council
composed of representatives from each partner agency's chief
architect office. This provides the organizational structure and
oversight needed to develop an enterprise architecture. JPDO's
phased "build a little, test a little" approach for developing and
refining its enterprise architecture is similar to a process that
we have advocated for FAA's major system acquisition programs. In
addition, this phased development process will allow JPDO to
incorporate evolving market forces and technologies in its
architecture and thus better manage change.
Global harmonization is one of the important strategies underlying
NGATS, and JPDO has started to plan for harmonization. JPDO
officials said they recognize the need to work toward the global
harmonization of systems and have met with officials from various
parts of the world, including China, East Asia, and Europe, to
assess the potential for cooperative NGATS demonstrations. JPDO
has a global harmonization IPT, led by managers from ATO's
International Operations Planning Services International and FAA's
Office of International Aviation. The IPT's mission is to
harmonize equipment and operations globally and advocate for the
adoption of U.S.-preferred transformation concepts, technologies,
procedures, and standards. The harmonization IPT finalized its
charter in March 2006 and is working to develop an international
strategy and outreach plan. In addition to external efforts, the
harmonization IPT plans to work as a crosscutting IPT that will
raise awareness of global interoperability and standards issues
within the other IPTs as they consider product development.
JPDO officials have noted the need to work toward harmonization
with the Single European Sky Air Traffic Management Research
Programme (SESAR), a major initiative to modernize the airspace
system of the European Union. Eurocontrol has been designated to
conduct SESAR to both modernize and integrate European air traffic
management systems. While similar in many respects to the NGATS
planning effort, Eurocontrol has contracted with an industry
consortium to conduct the 2-year planning phase of the project.
According to several European officials with whom we spoke, global
harmonization (and harmonization with the U.S. system
specifically) is considered to be a key ingredient for the success
of SESAR. Several of these officials said that although the
European organization invited JPDO to participate as a full member
in SESAR and the organization has indicated its willingness to
have reciprocal participation with the United States, personnel
exchanges are just beginning to occur. JPDO officials recognize
the importance of cooperative efforts and noted that if Europe and
the United States were to implement different and incompatible
standards and technologies, there could be a major adverse impact
on airlines that serve international markets. Nonetheless, these
officials point out that JPDO, as a U.S. government entity, could
not participate as a member in a private industry effort like the
SESAR consortium. FAA is, however, a member of the European
Commission's Industry Consultation Body, which provides advice to
SESAR. The JPDO officials also said personnel exchanges and other
cooperative activities, such as information exchanges and a joint
working group on technical standards, are now being conducted
under a memorandum of cooperation between FAA and Eurocontrol.
While FAA and the harmonization IPT are planning cooperative
activities, our research has identified several other areas where
cooperation does not appear to be fully developed. For example,
the SESAR and NGATS initiatives, despite their similarities, do
not have coordination activities such as peer reviews of relevant
research, cooperation on safety analysis (such as through the
pooling of accident data), or validation of technologies. It is
possible that greater cooperation and exchange between NGATS and
SESAR might develop once planning has progressed to the
development and validation stage.
In the face of rising operating costs, ATO has implemented a
number of cost control initiatives. Savings realized from ATO
efforts to control costs could be used for modernization efforts,
including the development of NGATS. Funding flexibility could also
help to address these challenges. In addition to the cost savings
efforts initiated by ATO, JPDO is identifying potential ways to
leverage available resources to support initial NGATS initiatives.
To address rising operating costs and improve performance, ATO has
developed a formal cost control program that includes completing
the development of a cost accounting system and using information
from the system to conduct activity value analysis-that is, to
assess the value of its products and services to its customers.
The cost control program also includes conducting annual business
case reviews, primarily for its capital programs, and assisting
Congress in identifying funding priorities. To control costs, ATO
is decommissioning and consolidating ATC facilities, improving its
contract management, pursuing cost reduction opportunities through
outsourcing, and avoiding or reducing personnel costs through
workforce attrition and efficiency gains.
ATO has made significant progress in developing its cost
accounting system.33 In doing so, ATO is addressing our
long-standing concern that FAA lacked the cost information
necessary for decision making and could not adequately account for
its activities and major projects, such as its ATC modernization
programs. ATO officials have also noted that the system will
enhance their ability to accurately determine the costs of
providing specific services or products and to compare those costs
with the value provided to the organization's customers. This
information will be valuable in prioritizing activities and
weighing the costs and benefits of various courses of action when
developing and supporting proposed budgets. It will also allow FAA
to base funding decisions for system acquisitions on their
contribution to reducing the agency's operating costs. These
efforts facilitate ATO's activity value analysis, through which
ATO determines (1) the costs of the products and services
provided, (2) the factors that affect the costs, and (3) the value
of these products and services, as perceived by ATO's customers.
By comparing the costs of providing services with their value to
customers, ATO officials expect the process to help them eliminate
activities with low customer value and determine ways to reduce
the costs of activities with high customer value.
ATO expects business case reviews of its capital programs to
reduce its ATC modernization costs by about $62 million in fiscal
year 2007 and by nearly $400 million by fiscal year 2008. Over the
last 2 years, ATO conducted business case reviews of 81 programs,
including 67 capital programs and 14 operations programs. Through
these annual reviews, ATO examines each program to ensure that its
funding is justified, and if ATO determines that the funding is
not justified, it may terminate or restructure the program. To
date, ATO has terminated or restructured 6 programs after
reviewing the business cases for them, including its Medium
Intensity Airport Weather System (MIAWS) program. ATO canceled
this program's $4 million spending request.34 ATO also reduced the
funding for a radar replacement program after reviewing its
business case and identifying opportunities to conduct more
effective maintenance rather than replace radars. Through these
combined efforts, FAA expects to reduce costs by $32 million in
fiscal year 2007.
ATO is working with Congress to discuss proposed projects and
maximize capital funds, as we previously recommended.35 ATO
reported that Congress designated approximately $300 million for
specific projects in fiscal years 2003 and 2004. In fiscal year
2005, according to ATO, designated projects totaled almost $430
million. In fiscal year 2006, ATO staff met with Senate offices to
provide input on projects,36 and the value of the congressionally
designated projects declined, as indicated in table 1.
2Because ATO includes the majority of FAA employees, this statement will
refer to ATO initiatives, even though some may apply FAA-wide.
3GAO, Results-Oriented Government: Practices That Can Help Enhance and
Sustain Collaboration among Federal Agencies, GAO-06-15 (Washington, D.C.:
Oct. 21, 2005).
Background
4ATC Modernization has remained on our high-risk list since 1995. See GAO,
High Risk Series: An Update, GAO-05-207 (Washington, D.C.: January 2005).
5P.L. 104-50, Fiscal Year 1996 Department of Transportation Appropriations
Act.
6P.L. 108-176, Vision 100-Century of Aviation Reauthorization Act,
December 12, 2003.
7For more information on JPDO, visit www.jpdo.aero.
8The European Commission is a politically independent institution that
prepares and implements legislative instruments.
9Eurocontrol is an autonomous organization established in 1963 with the
intention of creating a single upper airspace in Europe.
ATO Has Taken Steps to Improve ATC Modernization, but Challenges Remain
ATO Has Begun Efforts to Transform Its Culture, Structures, and Processes to
Operate More Efficiently as a PBO
10A portion of this funding is in-kind services from Eurocontrol. To
convert euros to U.S. dollars, we used 1.2098, the foreign exchange rate
for March 21, 2006, as published in The Washington Post.
11FAA, Employee Attitudes Within the Air Traffic Organization (Washington,
D.C.; December 2004).
12Because the most recent FAA Employee Attitude Survey was conducted in
September 2003, prior to the formation of ATO, FAA combined survey data
from the FAA organizations that were merged into the ATO.
13GAO, National Airspace System: Transformation Will Require Cultural
Change, Balanced Funding Priorities, and Use of All Available Management
Tools, GAO-06-154 (Washington, D.C.: Oct. 14, 2005).
14GAO, Results-Oriented Cultures: Implementation Steps to Assist Mergers
and Organizational Transformations, GAO-03-669 (Washington, D.C.: July 2,
2003).
15GAO, Air Traffic Control: FAA's Acquisition Management has Improved, but
Policies and Oversight Need Strengthening to Help Ensure Results,
GAO-05-23 (Washington, D.C.: Nov. 12, 2004).
16The Joint Resources Council is an FAA body responsible for approving and
overseeing major system acquisitions.
ATO Has Begun to Address Systemic Causes of Delays and Cost Overruns in ATC
Modernization
17GAO, The National Airspace System: FAA Has Made Progress but Continues
to Face Challenges in Acquiring Major Air Traffic Control Systems,
GAO-05-331 (Washington, D.C.: June 10, 2005).
18GAO, Information Technology: FAA Has Many Investment Management
Capabilities in Place, but More Oversight of Operational Systems Is
Needed, GAO-04-822 (Washington, D.C.: Aug. 20, 2004).
FAA Met Its Acquisition Performance Goal for the Second Consecutive Year, but
Use of Revised Milestones Does Not Provide Consistent Benchmarks
19GAO, Air Traffic Control: System Management Capabilities Improved, but
More Can Be Done to Institutionalize Improvements, GAO-04-901
(Washington, D.C.: Aug. 20, 2004).
ATO Faces Human Capital Challenges in Creating a More Results-Oriented Culture
and Hiring and Training Thousands of Air Traffic Controllers
20According to FAA, the agency tracks acquisition program performance from
its original baseline or any subsequently approved baselines approved by
the Joint Resource Council, and reports variances to the Administrator and
to Congress as required.
21 GAO-03-669 .
22 GAO-06-154 .
FAA Faces Challenges in Ensuring Stakeholder Involvement in Major System
Acquisitions and Keeping Acquisitions on Schedule and within Budget
23FAA, A Plan for the Future: The Federal Aviation Administration's
10-Year Strategy for the Air Traffic Control Workforce (Dec. 21, 2004).
24Since issuing its controller staffing plan, FAA has achieved
productivity gains that have reduced the need to hire about 460 air
traffic controllers.
25 GAO-05-331 .
26In February 2005, FAA awarded a contract for the operation of its flight
service stations.
JPDO Has Made Progress in Planning for NGATS, but Faces Challenges and
Opportunities in Several Areas
JPDO Has Begun to Facilitate Collaboration among Federal Agencies, but Faces
Challenges in Continuing to Leverage Resources and in Defining Roles and
Responsibilities
27The Vision 100 Act called for JPDO to create and carry out an integrated
plan for NGATS. This integrated plan was developed by the partner agencies
and submitted to Congress on December 12, 2004.
28ADS-B is a surveillance technology that transmits an aircraft's
identity, position, velocity, and intent to other aircraft and to ATC
systems on the ground, thereby enabling pilots and controllers to have a
common picture of airspace and traffic. By providing pilots with a display
that shows the location of nearby aircraft, the system enables pilots to
collaborate in decision making with controllers, safely allowing reduced
aircraft separation and thereby increasing NAS capacity.
29Some of JPDO's governance structure was determined by Vision 100, which
directed the Secretary of Transportation to establish a Senior Policy
Committee and set forth the membership of this committee. In addition,
JPDO has established a Board of Directors, a Master IPT, and several
divisions.
JPDO Is Structured to Involve Federal and Nonfederal Stakeholders, but Faces a
Challenge in Soliciting and Maintaining Support over the Long Term
30Currently, FAA's Operational Evolution Plan monitors how NAS capacity
will change over a rolling 10-year planning horizon depending on numerous
variables, such as the demand for air travel, the completion of new
runways, and the availability of new ATC systems.
31Nonfederal stakeholders' participation varies from approximately 10
percent to 25 percent of their time per week on the IPTs and involves
approximately one meeting per month for members of the council.
32SWIM is expected to help transition the NAS to network-centric
operations by providing the infrastructure and associated policies and
standards to enable information sharing among all authorized NAS users,
such as the airlines, other government agencies, and the military.
JPDO Is Using a Reasonable Process for Technical Planning, but Has Not Yet
Completed Key Activities
JPDO Is Planning for Global Harmonization as Part of the NGATS Effort, but
Additional Cooperative Activities Have Not Been Fully Explored
ATO and JPDO are Working to Address Funding Challenges
ATO Has Begun to Take a Number of Steps to Address Rising Operating Costs
33FAA is using its cost accounting system to potentially allocate costs of
its services to users to better align its costs with revenues through a
new funding mechanism. GAO is currently examining this effort as part of
an ongoing study examining FAA financing options.
34MIAWS was intended to provide real-time displays of storm positions and
estimated storm tracks for airports and airlines.
35GAO, National Airspace System: FAA Has Made Progress but Continues to
Face Challenges in Acquiring Major Air Traffic Control Systems, GAO-05-331
(Washington, D.C.: June 10, 2005).
Table 1: Congressionally Designated Projects for ATO, Fiscal Years 2003
through 2006
Dollars in millions
Fiscal year
2003 2004 2005 2006
Amount Amount Percentage Amount Percentage Amount Percentage
change change change
from prior from prior from prior
year year year
Total $295,905 $282,280 -4.6% $429,160 52.0% $245,800 -42.7%
Source: GAO analysis of ATO data.
ATO has saved about $84 million to date through initiatives to control its
costs. For example, ATO has begun to decommission ground-based
navigational aids, such as compass locators, outer markers and
nondirectional radio beacons, and to close related ATC facilities as it
transitions to a satellite-based navigation system. In fiscal year 2005,
ATO decommissioned 177 navigational aids for a savings of $2.9 million.
However, ATO has thousands of navigational aids in use, many of which
could be decommissioned during the transition to NGATS. Consolidating ATC
facilities, including terminal radar approach control (TRACON) facilities
and air traffic control centers, can also save costs. According to one
estimate, undertaking all of these actions could save ATO approximately
$600 million per year. We have also found, in researching cost control
efforts undertaken by international air navigation service providers, that
consolidating regional administrative offices offers additional potential
cost savings.
While efforts to decommission navigational aids and close ATC facilities
offer potential savings, we found that ATO lacks a consistent process for
identifying the costs and benefits associated with these efforts. For
example, although ATO reported saving $2.9 million in fiscal year 2005 by
decommissioning 177 navigational aids, its report did not offset these
savings with the costs of decommissioning activities, such as real
property disposition (including buildings or real property leases, standby
power systems, and fuel storage tanks), site cleanup, and restoration.
Experts estimate that the costs of decommissioning all possible
navigational aids and conducting the needed environmental remediation
could total about $300 million. Opportunities may exist for ATO to reuse
these sites to reduce or eliminate environmental cleanup costs. For
example, sites could be used for cell phone towers, generating about
$100,000 per year in revenue per site. Other sites could be leased as
warehouses. Together, these efforts could potentially save FAA up to $14
million per year. However, without a transparent and verifiable process
for determining both the costs and benefits, it remains difficult to
accurately determine financial savings.
36The House of Representatives did not have any designated projects for
FAA for fiscal year 2006.
As ATO proceeds with these efforts, stakeholders caution that
decommissioning navigational aids and closing facilities should entail
comprehensive risk mitigation to ensure that ATO retains adequate safety
levels. This includes risk prevention, which focuses on elements that the
agency can prevent, and risk recovery, which recognizes that some events
cannot be prevented and the system must recover from them. It is important
that facility closures happen within the context of a logical,
well-documented, and reasoned process in consultation with congressional
oversight committees. Any process to determine closures or consolidations
should use consistent, accurate data collection and a common analytical
framework to ensure the integrity of the process.
ATO is also attempting to examine existing service contracts to better
control costs. For example, it has saved about $2 million by renegotiating
task orders and modifying contracts for technical assistance provided by
contractors that manage facilities and equipment projects. According to
ATO, these renegotiations did not affect the associated programs. In
addition, ATO has saved about $1 million to date by negotiating cell phone
contracts with four large service providers. Formerly, ATO employees
arranged individual plans for their work cell phones. ATO also entered
into a new contract with natural gas and electricity providers at its
Technical Center that has saved about $358,000 to date. Lastly, through a
strategic sourcing initiative, it has newly negotiated purchasing deals
for support services, including printing and mail services, office
equipment and supplies, and information technology hardware and software.
As another cost-saving measure, ATO is exploring opportunities for
outsourcing work that is now performed by the government. Under the Office
of Management and Budget's Circular A-76 (Revised), federal agencies can
compete with and rely on the private sector to enhance productivity.
Recently, FAA contracted with Lockheed Martin to operate its flight
service stations. According to FAA, this contract will cost approximately
$2.2 billion less over 10 years than FAA would have had to pay to operate
the stations itself. FAA's estimate includes the savings it expects to
realize as the contractor assumes the costs of providing the services and
paying their utility and maintenance costs. FAA is currently working to
identify other opportunities to reduce costs through the A-76 process.
Some experts have suggested that the time may be right for FAA to examine
opportunities to contract out the ground portion of its FTI program,
through which FAA is replacing air-ground telecommunications networks.
According to these experts, this approach could save FAA up to $130
million a year beginning in fiscal year 2008. The FTI program is not
expected to provide financial savings until fiscal year 2010; however, the
savings might take longer to be realized because the program is falling
behind schedule.
ATO is working to control personnel costs through both attrition and
improved productivity. According to ATO, these efforts have saved about
$67 million from the beginning of fiscal year 2005 to date. For example,
ATO has saved about $44 million from the attrition of both nonsafety and
Flight Service staff. ATO further expects efficiencies and lower training
costs to allow a 10 percent reduction in the controller workforce over the
next decade. These efficiencies include relying on part-time employees and
job-sharing arrangements, implementing split shifts, and improving the
management of overtime through an optimal mix of increased staffing and
overtime hours to meet workload demands. Through gains in air traffic
controllers' productivity, ATO has reduced its hiring requirements by
about 460 controller positions, thereby avoiding salary costs of about $23
million, according to ATO. In addition, ATO is considering the feasibility
of saving air traffic controller training costs by allowing graduates of
its Air Traffic Collegiate Training Initiative (CTI) to bypass the FAA
Academy, where FAA provides initial qualification training to new hires.37
According to an FAA Academy official, the proposal to allow these
graduates to bypass the academy is being considered as part of a
comprehensive review of the Collegiate Training Initiative that will be
completed this fall. We had previously identified this effort as offering
potential savings.38
37Graduates of schools participating in the Collegiate Training Initiative
have college degrees, a broad knowledge of the aviation industry, a basic
level of training in air traffic control, and a demonstrated interest in
the field. The Department of Transportation Inspector General reported
that course work in these collegiate programs duplicates a portion of the
academy-provided training.
ATO Faces Challenges in Funding NGATS
As the organization primarily responsible for implementing NGATS, ATO will
face substantial funding requirements beyond those needed to maintain the
current system. Funding constraints have required ATO to carefully
scrutinize capital projects and defer or eliminate funding for systems
that could support NGATS, such as a precision-landing system augmented by
satellites (LAAS), a digital e-mail-type communication system between
controllers and pilots (CPDLC), and the next generation air/ground
communication system (NEXCOM).
Although the cost of NGATS is not yet known, JPDO and ATO are
collaborating in developing rough near-term funding requirements for
NGATS's concept definition and development for major categories of air
traffic control functions such as automation, communications, navigation,
surveillance, and weather. While these funding requirements are not in
FAA's current 5-year spending plan, they could be included once JPDO
presents, and FAA accepts, business cases, according to an FAA official.
JPDO has identified some key factors that will drive NGATS costs. One of
the drivers is the technologies expected to be included in NGATS. Some of
these are more complex and thus more expensive to implement than others. A
second driver is the sequence in which NGATS technologies will replace the
technologies now in use. A third driver is the length of time required to
transition to NGATS, since a longer transition period would impose higher
costs. JPDO held the first in a series of investment analysis workshops to
determine the basis for developing future NGATS cost estimates on April 25
and 26, 2006. This first workshop focused on recommendations from
commercial and business aviation, equipment manufacturers, and systems
developers.
38GAO, National Airspace System: Transformation Will Require Cultural
Change, Balanced Funding Priorities, and Use of All Available Management
Tools, GAO-06-154 (Washington, D.C.: Oct. 14, 2005).
Resources Available to Support NGATS Could Be Enhanced through Leveraging and
Funding Flexibility
Resources available to support NGATS could be enhanced to the extent that
JPDO leverages other partner agency resources. JPDO has already moved in
this direction by conducting a review of its partner agencies' research
and development programs to identify ongoing work that could support NGATS
and the potential for more effective interagency collaboration. Through
this process, for example, JPDO successfully requested that FAA pursue
funding to accelerate development of ADS-B and SWIM, which are two key
systems identified for NGATS. However, JPDO officials told us that, while
FAA did receive a funding increase for those systems, FAA did not receive
the full amount it had requested. As noted, our past work on FAA's
national airspace modernization program has shown that receiving fewer
resources than planned was one factor that contributed to delays in
implementing technologies and significant cost increases.
To further leverage resources for NGATS, JPDO has issued guidance to its
partner agencies identifying areas that JPDO would like to see emphasized
in the agencies' fiscal year 2008 budget requests. JPDO is also working
with the Office of Management and Budget to develop a systematic means of
reviewing partner agency budget requests so that the NGATS-related funding
in each request is easily identified. This includes a review of budgets
submitted by the Department of Homeland Security for efforts by the
Transportation Security Administration, and the Department of Commerce for
efforts by the National Oceanic and Atmospheric Association. Such a
process would help the Office of Management and Budget consider NGATS as a
unified program rather than as disparate line items distributed across
several agencies' budget requests.
Further enhancement to NGATS funding could be achieved by ATO utilizing
its existing funding flexibility. Under existing law, ATO has a 3-year
spending authority for Facilities and Equipment funds. It also has
discretion to shift as much as 10 percent of a given program's funds over
a fiscal year. This is important, since annual expenditures for several
large capital projects will soon be trending downward.39 Concurrently, FAA
is working to conduct business case reviews of existing capital projects
on an annual basis. These combined efforts could potentially yield
hundreds of millions of dollars to pursue initial NGATS projects.
39ATO expects that by fiscal year 2008, spending for its En Route
Modernization (ERAM), Oceanic Services, Standard Terminal Automation
Replacement System (STARS), Airport Surveillance Radar-Model 11 (ASR-11),
and FAA Telecommunications Infrastructure programs should begin trending
downward.
Concluding Observations
ATO has put mechanisms in place to change the culture and business
processes that have plagued the past modernization efforts of FAA. ATO's
new cost accounting system and management practices are important steps
toward improved accountability. Similarly, it has taken steps, in response
to our recommendations, to improve its acquisition processes. However, as
I mentioned, ATO faces challenges in sustaining and furthering its
transformation to a results-oriented culture, and in many cases, it is
still too early to judge the long-term success of these attempts at
fundamental organizational change. ATO must continue to measure its
progress and work to change the culture at all levels of the organization,
as our work has shown that these types of transformations can sometimes
take close to a decade to truly become entrenched within the organization.
We believe that, overall, ATO is moving in the right direction, and we
will continue to monitor its progress.
We also believe that JPDO is moving in the right direction in creating an
organizational structure that facilitates the federal interagency
collaboration that must occur for the office to be successful in its
mission. JPDO is working to leverage the various human, technological, and
financial resources of its partner agencies. This is key given the
coordinating role of JPDO and its lack of authority over key resources
needed to continue developing the NGATS plan. However, because of this
lack of authority, JPDO could be challenged to maintain partner agency and
stakeholder commitment to the NGATS effort in the long term. Also, much of
the NGATS planning and implementation depends on the development of the
NGATS enterprise architecture. Although JPDO has said that a version of
the enterprise architecture will be completed later this year, the
architecture will require further refinement and commitment from the
partner agencies into the future.
Transforming the national airspace system to accommodate what is expected
to be three times the current amount of traffic by 2025, providing
adequate security and environmental safeguards, and doing these things
seamlessly while the current system continues to operate, will be an
enormously complex undertaking. Both ATO and JPDO have been given
difficult tasks in a difficult budgetary environment. Going forward,
efforts to control costs and leverage resources will become even more
critical. Success also depends on the ability of ATO and JPDO to define
their roles and form a collaborative environment for planning and
implementing the next generation system.
Mr. Chairman, this concludes my statement for the record.
Contact and Staff Acknowledgments
For further information on this statement for the record, please contact
Gerald Dillingham at (202) 512-2834 or [email protected]. Individuals
making key contributions to this statement include Nabajyoti Barkakati,
Christine Bonham, Jay Cherlow, Elizabeth Eisenstadt, Colin Fallon, David
Hooper, Heather Krause, Elizabeth Marchak, Maren McAvoy, Edmond Menoche,
Faye Morrison, Richard Scott, Sarah Veale, and Matthew Zisman.
(540126)
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Highlights of GAO-06-738T , a statement for the record for the
Subcommittee on Transportation, Treasury, the Judiciary, Housing and Urban
Development, and Related Agencies, Committee on Appropriations, U.S.
Senate
May 4, 2006
AIR TRAFFIC CONTROL
Status of the Current Modernization Program and Planning for the Next
Generation System
Over a decade ago, GAO listed the Federal Aviation Administration's (FAA)
effort to modernize the nation's air traffic control (ATC) system as a
high-risk program because of systemic management and acquisition problems.
Two relatively new offices housed within FAA-the Air Traffic Organization
(ATO) and the Joint Planning and Development Office (JPDO)-are now
primarily responsible for planning and implementing these modernization
efforts. Congress created ATO to be a performance-based organization that
would improve both the agency's culture, structure, and processes, and the
ATC modernization program's performance and accountability. Congress
created JPDO, made up of seven partner agencies, to coordinate the federal
and nonfederal stakeholders necessary to plan a transition from the
current air transportation system to the "next generation air
transportation system" (NGATS). This statement is based on GAO's recently
completed and ongoing studies of the ATC modernization program. GAO
provides information on (1) the status of ATO's efforts to improve the ATC
modernization program, (2) the status of JPDO's planning efforts for
NGATS, and (3) actions to control costs and leverage resources for ATC
modernization and the transformation to NGATS.
ATO has taken a number of steps as a performance-based organization to
improve the ATC modernization program, but continued management attention
will be required to institutionalize these initiatives. ATO has adopted
core values, streamlined its management, and begun to revise its
acquisition processes to become more businesslike and accountable. For the
past 2 years, ATO has met its major acquisition performance goals. ATO
still faces challenges, including sustaining its transformation to a
results-oriented culture, hiring and training thousands of air traffic
controllers, and ensuring stakeholder involvement in major system
acquisitions.
JPDO has made progress in planning for NGATS by facilitating collaboration
among federal agencies, ensuring the participation of federal and
nonfederal stakeholders, addressing technical planning, and factoring
global harmonization into its planning, but JPDO faces challenges in
continuing to leverage the partner agencies' resources and in defining the
roles and responsibilities of the various agencies involved. JPDO could
find it difficult to sustain the support of stakeholders over the longer
term and to generate participation from some key stakeholders, such as
current air traffic controllers. JPDO has taken steps to develop an
enterprise architecture (the blueprint for NGATS) and will have an early
version later this year. The robustness and timeliness of this enterprise
architecture are critical to many of JPDO's future NGATS planning
activities.
ATO has taken a number of actions to control costs and maximize capital
funds, which will become increasingly important during the transition to
NGATS. ATO has established cost control as one of its key performance
metrics, developed a cost accounting system, and is using its performance
management system to hold its managers accountable for controlling costs.
ATO has developed a formal cost control program that includes, among other
things, (1) conducting annual business case reviews for its capital
programs, (2) decommissioning and consolidating ATC facilities, and (3)
pursuing cost reduction opportunities through outsourcing. These cost
control initiatives represent an important first step to improved
performance but will require review and monitoring.
Air Traffic Control Tower
*** End of document. ***