Air Traffic Control: Status of FAA's Standard Terminal Automation
Replacement System Project (Letter Report, 03/05/97, GAO/RCED-97-51).

Pursuant to a congressional request, GAO reviewed the Federal Aviation
Administration's (FAA) acquisition planning to date, focusing on the
extent to which: (1) the schedule estimate for the Standard Terminal
Automation Replacement System (STARS) is attainable; and (2) cost
estimates to make STARS operational are likely to change.

GAO noted that: (1) the STARS schedule, which calls for implementation
of 171 air traffic control facilities between December 1998 and February
2005, is attainable only if FAA is successful in its efforts to mitigate
certain risks; (2) specifically, FAA will need to obtain commitment by
key stakeholders to the STARS schedule, resolve schedule conflicts
between STARS and other modernization efforts, and overcome difficulties
in developing system software that could delay implementing STARS; (3)
FAA is aware that these issues pose a risk for STARS and has begun
several risk mitigation initiatives; (4) while such actions are
encouraging, it is too early to tell how effective they will be; (5)
FAA's cost estimate for STARS has the potential to increase; (6) FAA's
total cost estimate for STARS is $2.23 billion; (7) FAA approved this
estimate in January 1996, however, a September 1996 analysis by agency
officials pointed to potential cost increases that could drive the total
cost estimate to as much as $2.76 billion; (8) this possible increase is
attributable to expected higher costs for operating and maintaining
STARS equipment; (9) FAA officials are continuing to revise the STARS
cost estimate and now believe that cost increases may be significantly
lower; and (10) at this time, however, FAA could not provide GAO with an
updated estimate.

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  RCED-97-51
     TITLE:  Air Traffic Control: Status of FAA's Standard Terminal 
             Automation Replacement System Project
      DATE:  03/05/97
   SUBJECT:  Air traffic control systems
             Federal procurement
             Systems conversions
             Projections
             Life cycle costs
             Radar equipment
             Equipment maintenance
             Navigation aids
             Cost analysis
             Computer software
IDENTIFIER:  FAA Air Traffic Control System
             FAA Advanced Automation System
             FAA Air Traffic Control Modernization Program
             FAA Standard Terminal Automation Replacement System
             STARS
             FAA Automated Radar Terminal System
             FAA Terminal Radar Approach Control System
             FAA Digital Bright Radar Indicator Tower Equipment System
             FAA Terminal Advanced Automation System
             FAA Acquisition Management System
             ASR-7 Radar
             ASR-8 Radar
             
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Cover
================================================================ COVER


Report to the Chairman, Subcommittee on Transportation and Related
Agencies, Committee on Appropriations, House of Representatives

March 1997

AIR TRAFFIC CONTROL - STATUS OF
FAA'S STANDARD TERMINAL AUTOMATION
REPLACEMENT SYSTEM PROJECT

GAO/RCED-97-51

Air Traffic Control

(341497)


Abbreviations
=============================================================== ABBREV

  ASR -
  FAA -
  IPT -
  STARS -
  TRACON -

Letter
=============================================================== LETTER


B-275244

March 5, 1997

The Honorable Frank R.  Wolf
Chairman, Subcommittee on Transportation
 and Related Agencies
Committee on Appropriations
House of Representatives

Dear Mr.  Chairman: 

The Federal Aviation Administration (FAA) oversees the largest,
busiest, and most complex air traffic control system in the world. 
However, components of the system are aging and are difficult and
costly to maintain.  FAA projects that it cannot meet projected
traffic increases and make required safety and efficiency
enhancements without replacing equipment. 

Since the early 1980s, FAA's modernization efforts have experienced
lengthy schedule delays and substantial cost overruns.  Because of
such problems, in 1994, FAA restructured its acquisition of the
Advanced Automation System--the long-time centerpiece of its air
traffic control modernization program--into more manageable segments. 
One of these segments is called the Standard Terminal Automation
Replacement System (STARS) project.  This project is expected to
replace 15- to 25-year-old computers and related equipment used at
FAA facilities that track aircraft in the airspace surrounding
airports.\1 In September 1996, FAA contracted with Raytheon
Corporation to develop, produce, and install STARS. 

Given FAA's past schedule and cost problems and the significance of
the STARS project, you asked us to examine FAA's acquisition planning
to date.  Specifically, you asked us to determine to what extent (1)
the schedule estimate for STARS is attainable and (2) cost estimates
to make STARS operational are likely to change. 


--------------------
\1 STARS will also replace equipment at Department of Defense
facilities across the country.  Schedule and cost information
relating to Defense facilities is not included in this report. 


   RESULTS IN BRIEF
------------------------------------------------------------ Letter :1

The STARS schedule, which calls for implementation at 171 air traffic
control facilities between December 1998 and February 2005, is
attainable only if FAA is successful in its efforts to mitigate
certain risks.  Specifically, FAA will need to (1) obtain commitment
by key stakeholders to the STARS schedule, (2) resolve schedule
conflicts between STARS and other modernization efforts, and (3)
overcome difficulties in developing system software that could delay
implementing STARS.  FAA is aware that these issues pose a risk for
STARS and has begun several risk mitigation initiatives.  While such
actions are encouraging, it is too early to tell how effective they
will be. 

FAA's cost estimate for STARS has the potential to increase.  The
agency's total cost estimate for STARS is $2.23 billion.\2 FAA
approved this estimate in January 1996.  However, a September 1996
analysis by agency officials pointed to potential cost increases that
could drive the total cost estimate to as much as $2.76 billion. 
This possible increase is attributable to expected higher costs for
operating and maintaining STARS equipment.  FAA officials are
continuing to revise the STARS cost estimate and now believe that
cost increases may be significantly lower.  At this time, however,
the agency could not provide us with an updated estimate. 


--------------------
\2 The total cost includes facilities and equipment and operations
and maintenance costs.  For this report, all dollars are expressed in
current-year dollars, unless otherwise noted, because they are a
better indication of the dollar amount that the Congress may have to
appropriate. 


   BACKGROUND
------------------------------------------------------------ Letter :2

STARS is designed to replace FAA's automated radar terminal system,
which is composed of 15- to 25-year-old controller workstations and
supporting computer systems.  According to FAA, this system is prone
to failures, is maintenance intensive, and requires long repair
times.  The system also has capacity constraints that restrict the
agency from making required safety and efficiency enhancements. 
Automated radar terminal systems are located at 180 Terminal Radar
Approach Control facilities (TRACON) and allow FAA controllers to
separate and sequence aircraft near airports.\3

STARS equipment (see fig.  1) is also expected to provide the
platform needed to make system enhancements that would increase the
level of air traffic control automation and improve weather display,
surveillance, and communications.  In addition, STARS is expected to
permit FAA to consolidate some TRACONs and replace all Digital Bright
Radar Indicator Tower Equipment systems.\4

   Figure 1:  STARS Workstation

   (See figure in printed
   edition.)

   Source:  FAA.

   (See figure in printed
   edition.)

In September 1996, FAA signed a contract with Raytheon Corporation
and, as mentioned, currently plans to acquire as many as 171 STARSs. 
In producing STARS, Raytheon intends to rely fully on commercially
available hardware and, to a large extent, on commercially available
software.  Some original software development will still be required. 
In August 1996, the contractor projected that 124,000 new lines of
software code will need development to meet FAA's requirements.  This
estimate was revised in December 1996 to 140,000 new lines of code. 

STARS is an outgrowth of the troubled Advanced Automation System
acquisition.  As originally designed, the terminal segment of this
system, known as the Terminal Advanced Automation System, would
provide controllers in TRACONs with new workstations and supporting
computer systems.  However, in June 1994, the FAA Administrator
ordered a major restructuring of the acquisition to solve
long-standing schedule and cost problems.  These schedule delays were
up to 8 years behind the original schedule, and estimated costs had
increased to $7.6 billion from the original $2.5 billion estimated in
1983.  Specifically, regarding terminal modernization, the
Administrator canceled the Terminal Advanced Automation System and
expanded the STARS project to include all terminal facilities. 

In April 1996, FAA established a new acquisition management system,
as directed by the Congress.  Included in this system is the concept
of life-cycle management, which is intended to be a more
comprehensive, disciplined full-cost approach to managing the
acquisition cycle, from analysis of mission needs and alternative
investments through system development, implementation, operation,
and, ultimately, disposal. 

Under this new system, decisions related to resource allocation
(mission and investment) are made by FAA's Joint Resources Council,
which is composed of associate administrators for operations and
acquisition and other key executives.  Decisions associated with
program planning and implementation are made within Integrated
Product Teams (IPT).  IPTs are responsible for bringing together all
essential elements of program implementation, including scheduling,
allocation of funding, and the roles and responsibilities of
stakeholders.  To ensure successful program implementation, the
acquisition management system dictates that these issues be resolved
before contracts are awarded.  IPTs also generate schedule and cost
baselines, which the Joint Resources Council authorizes the teams to
operate under.  Team members include representatives from FAA units
responsible for operating and maintaining air traffic control
equipment and other stakeholders in the acquisition process. 


--------------------
\3 Because FAA plans to consolidate some of its 180 TRACONs, it plans
to buy 171 STARSs. 

\4 Digital Bright Radar Indicator Tower Equipment systems display
aircraft position data to controllers in towers.  These systems
enable controllers to monitor traffic in bright sunlight. 


   STARS SCHEDULE IS ATTAINABLE
   ONLY IF FAA IS SUCCESSFUL IN
   ITS EFFORTS TO MITIGATE RISKS
------------------------------------------------------------ Letter :3

To achieve the implementation schedule approved by the Joint
Resources Council in January 1996,\5 FAA will have to obtain
commitment from key stakeholders, resolve scheduling conflicts
between STARS and other terminal modernization efforts, and overcome
difficulties in developing the system.  FAA is aware that these
issues pose a risk for STARS and has begun several risk mitigation
initiatives.  While such actions are encouraging, it is too early to
tell how effective they will be. 


--------------------
\5 The schedule was based on a December 1994 FAA study, which
revalidated terminal requirements. 


      MILESTONES CALL FOR INITIAL
      IMPLEMENTATION BY DECEMBER
      1998
---------------------------------------------------------- Letter :3.1

FAA's schedule for developing and implementing STARS by its January
1996 approved baseline is shown in table 1.



                                Table 1
                
                  FAA's Schedule for Installing STARS

Date                                Activity
----------------------------------  ----------------------------------
November 1997                       Complete software development for
                                    initial STARS.\a

April-September 1998                Test initial STARS software.

September 1998                      Complete software development for
                                    full STARS.\b

December 1998                       Operate initial STARS at first
                                    site--Boston, Mass.

April-July 1999                     Test full STARS software.

January 2000                        Have full STARS ready for
                                    installation.

February 2005                       Operate full STARS at last site--
                                    Columbus, Ga.
----------------------------------------------------------------------
\a FAA expects that the initial STARS software will provide the same
functions as the current automated radar terminal systems. 

\b FAA expects that the full STARS software will enhance air traffic
controllers' abilities to move aircraft more safely and efficiently. 
For example, this software is expected to allow controllers to space
aircraft more precisely during landings and departures on converging
runways. 

Figure 2 shows FAA's plans for ordering, delivering, and operating
STARS.  FAA intends to begin operating STARS at only three TRACONs
before fiscal year 2000.  Operation increases after this time, with
FAA expecting to operate 55 additional systems in fiscal year 2002. 

   Figure 2:  Number of Systems
   Ordered, Delivered, and
   Operating, 1997 through 2005

   (See figure in printed
   edition.)

Note:  Three of the systems operating through fiscal year 1999 are
for training and computer support at FAA's Academy and Technical
Center. 

Source:  FAA. 


      LACK OF COMMITMENT FROM KEY
      STAKEHOLDERS
---------------------------------------------------------- Letter :3.2

FAA has yet to obtain commitment from all key stakeholders
responsible for ensuring that STARS equipment is properly installed. 
FAA's new acquisition management system stresses that IPTs need to
reach agreement before contracts are awarded.  Such agreement is
necessary to ensure that all stakeholders' roles are defined and
agreed upon, facilities are ready to receive STARS, and all other
equipment necessary for the operation of STARS is in place.  In the
past, poor coordination among key stakeholders has caused schedule
delays in other modernization projects at FAA.\6

The IPT for STARS has yet to obtain commitment to the STARS schedule
from the entire Airway Facilities Service--a key stakeholder. 
Located in headquarters and regions, maintenance technicians who work
for the Airway Facilities Service are responsible for installing and
maintaining air traffic control equipment.  FAA's current schedule
anticipates that STARS will be installed at most sites using a
turnkey concept whereby the contractor, not FAA employees, will
install the equipment.  This concept presumes that a significant
level of regional resources will still be required to support and
oversee contractor installation.  IPT officials told us that while
Airway Facilities Service officials at headquarters have committed to
the turnkey concept, regions' commitment is incomplete.  IPT and
Airway Facilities Service officials told us that a process has been
established to ensure regions' understanding and obtain their
commitment.  As part of this process, the IPT has begun regional
briefings and has formed implementation teams to gain regions'
commitment on turnkey issues. 

In addition, the IPT has yet to obtain commitment to the STARS
schedule from the Professional Airways Systems Specialists--the
technicians' union.  Top union officials told us that, as of late
February 1997, they have not been briefed on the STARS turnkey
concept and have not agreed as to how it will be implemented.  The
union is concerned that the turnkey installation may jeopardize the
job security of its members.  IPT officials said that while union
representatives have been involved in reviewing vendors' proposals
for STARS, the union has not been briefed on the specifics of STARS
deployment.  Although FAA's Acquisition Management System stresses
that all key program implementation issues be resolved before
contracts are awarded, the IPT believed that it could obtain the
union's commitment at a later date.  As required by the union's
collective bargaining agreement, in January 1997, the IPT initiated
actions to brief the union and obtain its commitment. 


--------------------
\6 Aviation Acquisition:  A Comprehensive Strategy Is Needed for
Cultural Change at FAA (GAO/RCED-96-159, Aug.  22, 1996). 


      POTENTIAL SCHEDULING
      CONFLICTS BETWEEN STARS AND
      OTHER MODERNIZATION EFFORTS
---------------------------------------------------------- Letter :3.3

FAA's schedule for STARS can be jeopardized by scheduling conflicts
with other modernization efforts.  For example, each year, various
TRACONs are scheduled to be renovated or replaced.  If STARS
equipment is delivered during this time, installation could be
delayed.  Currently, the IPT is unsure of the number of these
potential conflicts.  In September 1996, the IPT identified 12
potential scheduling conflicts at the first 45 STARS sites.  One
month later, the number of conflicts was reduced to four, but the
team did not provide us with an explanation for this decrease.  We
believe that the number of potential conflicts will not be known
until the IPT ascertains the readiness of each facility to receive
and install STARS equipment.  The IPT plans to start conducting site
reviews in 1997. 

Another potential scheduling conflict involves terminal surveillance
radars, which track aircraft position and use analog or digital
processing and communications to transmit the information to TRACONs. 
Many existing surveillance radars are not digital, but STARS requires
digital processing and communications.  FAA plans to replace
nondigital Airport Surveillance Radar-7s (ASR-7) with new digital
ASR-11s.  The agency has not decided yet whether to replace other
nondigital radar, ASR-8s, or to digitize them.  In January 1997, FAA
was concerned that 47 of 98 ASR-7s and -8s might not be upgraded in
time to meet the STARS schedule.  FAA officials told us that, as of
late February, they had reduced the number of potential conflicts
from 47 to 10 through efforts to coordinate the STARS and digital
radar schedules.  According to an IPT official, if digital radar does
not provide coverage for a TRACON's entire airspace, FAA may have to
delay STARS or reorder the sequence of TRACONs receiving STARS. 

FAA officials told us that they are taking actions to identify and
resolve potential scheduling conflicts.  The IPT has developed
project guides for the FAA regions receiving STARS.  These guides
identify possible scheduling conflicts with other modernization
efforts.  Also, Airway Facilities Service officials told us that as a
result of a recent reassessment in December 1996 of the schedule for
the first 39 STARSs, FAA was able to avoid potential conflicts by
repositioning the order in which TRACONs received STARS.  Finally,
the Airway Facilities Service is developing a database to assist the
IPT in maintaining current planning information. 


      POTENTIAL DIFFICULTIES IN
      DEVELOPING STARS SOFTWARE
---------------------------------------------------------- Letter :3.4

Although STARS depends on the use of commercial off-the-shelf
computer hardware and a significant amount of commercially available
software, FAA and Raytheon have numerous tasks to accomplish before
system development is completed.  However, the nature and extent of
these tasks are not completely known, and such development inevitably
poses continual managerial and technical challenges.  As noted in
table 1, FAA's schedule calls for software development to proceed in
two phases.  For the initial phase, the agency expects to complete
software testing in September 1998, about 2 years from the time when
the contract was awarded.  For the second phase, the agency expects
to complete testing of the full STARS software in July 1999. 

As an example of the challenge that software development poses for
FAA, as recently as December 1996, FAA and Raytheon were discussing
(1) how the system would provide specific functions and (2) whether
certain functions would be needed, and if so, whether the functions
would be included in the equipment with initial- or full-system
capability.  According to Raytheon officials, these discussions ended
with FAA and Raytheon coming to closure on all of the 28 issues
needing resolution.  As a result, some 16,000 lines of additional
software code--beyond the planned 124,000 lines of new code--must be
written.  Of the 140,000 lines of code, about 138,000 are for flight
data processing, training, and maintenance functions, and 2,000 are
to fulfill safety requirements, such as warning controllers when
aircraft are not maintaining proper separation or minimum safe
altitudes.  Raytheon officials believe the additional code
development will not affect their ability to meet the original
milestones.  All new code will have to be tested in conjunction with
the nearly 840,000 lines of existing STARS software code.  If
potential difficulties in developing and testing the system are
realized, initial implementation of STARS--particularly at the three
TRACONs targeted for operation before fiscal year 2000--will likely
be delayed. 


   COST ESTIMATES FOR STARS HAVE
   THE POTENTIAL TO INCREASE
------------------------------------------------------------ Letter :4

FAA's life-cycle cost baseline has the potential to increase--from
$2.23 billion, the level approved by the Joint Resources Council in
January 1996,\7 to as much as $2.76 billion.\8 This possible increase
is attributable to expected higher costs for operating and
maintaining STARS equipment.  FAA expects the estimate for facilities
and equipment costs to remain stable for the immediate future.\9

FAA's January 1996 facilities and equipment cost baseline is $940
million.  During 1996, this baseline was reviewed by the IPT. 
Through September 1996, the IPT was estimating that the baseline
could increase to $1.18 billion.  At that time, the IPT (1) estimated
higher expected costs for software development; (2) estimated higher
expected implementation, technical support, and maintenance costs
because of the addition of necessary equipment; and (3) included
costs for communications because the baseline estimate overlooked
them.  In December 1996, the IPT assessed the STARS costs on the
basis of the signed contract with Raytheon.  As a result, the IPT
determined, that while some cost elements will increase, other
elements will decrease.  Specifically, significantly lower costs for
hardware--key components were $40,000 less per unit than what FAA had
estimated--will enable the STARS project for the present time to stay
within the original baseline.  Table 2 shows the differences in cost
elements between the original cost baseline and the IPT's December
1996 assessment. 



                                Table 2
                
                STARS Facilities and Equipment Baseline
                         and Potential Changes

                         (Dollars in millions)

                                          December
                                 January      1996  Reasons for
Facilities and equipment cost       1996  assessme  differences in
element                         baseline        nt  cost estimates
------------------------------  --------  --------  ------------------
Development                        $25.4     $80.0  FAA determined
                                                     additional lines
                                                     of software code
                                                     needed
                                                     development. The
                                                     cost of
                                                     development
                                                     includes program
                                                     management,
                                                     testing, and
                                                     travel.
Hardware                           506.0     314.0  FAA added
                                                     equipment but
                                                     reduced its unit
                                                     costs because of
                                                     the contractor's
                                                     choice of less
                                                     expensive
                                                     equipment and
                                                     quantity
                                                     discounts.
Implementation                     164.8     219.5  FAA expects to
                                                     install more
                                                     equipment than
                                                     originally
                                                     planned and
                                                     better identified
                                                     sites' needs.
Technical support                  129.1     132.4  FAA expects to
                                                     install more
                                                     equipment than
                                                     originally
                                                     planned and
                                                     better identified
                                                     program office's
                                                     needs.
Planned product improvements        87.7     110.3  FAA is currently
                                                     refining
                                                     requirements. The
                                                     cost is the best
                                                     estimate to date.
Maintenance--first year\a           27.2      30.0  FAA expects to
                                                     install more
                                                     equipment than
                                                     originally
                                                     planned.
Communications                         0      54.0  FAA omitted these
                                                     costs from the
                                                     original
                                                     estimate.
======================================================================
Total                             $940.2    $940.2
----------------------------------------------------------------------
\a FAA policy states that the first year of maintenance for equipment
is paid for from the facilities and equipment account.  Thereafter,
all maintenance funds are paid from the operations account. 

Source:  FAA. 

FAA's January 1996 operations cost baseline is $1.29 billion. 
However, based on a September 1996 analysis,\10 FAA staff identified
a potential $529 million increase that could revise the baseline to
$1.82 billion.  FAA officials told us that this increase occurred, in
part, because the agency overlooked maintenance costs in the initial
estimates.  Also, the officials attributed the increase to FAA's
deploying more STARS equipment than originally planned. 

IPT officials told us that on the basis of more current information
from the contractor, operations and maintenance costs are expected to
be significantly closer to the $1.29 billion baseline estimate than
the $1.82 billion figure.  The officials could not, however, provide
us with an updated cost estimate or detailed support for their views. 
The IPT officials told us that they are reviewing the latest cost
estimates and expect to brief the Joint Resources Council on any
potential changes to the baseline in March 1997. 

Separate and distinct from STARS life-cycle costs are two additional
costs that FAA will incur to make STARS operational.  First, FAA will
have to prepare the TRACONs for the delivery of STARS equipment.  FAA
officials estimate that the agency will incur at least $18 million in
costs to get the first 46 TRACONs and related facilities ready to
accept the STARS equipment.  Roughly half of this amount is for
asbestos removal; the balance is for power upgrades and building
improvements.  FAA has yet to develop estimates for readying the
remaining sites.  Second, FAA will incur costs for upgrading radars. 
FAA plans to modernize the existing analog ASR-8 radars that provide
data to its TRACONs.  Because the implementation of STARS is
approaching, FAA is faced with an immediate decision between
digitizing these existing analog radars or replacing them with new
digital radars.  FAA officials estimate that the 20-year life-cycle
costs for modifying and digitizing all the ASR-8s will be $459
million and for replacing them will be $474 million.  According to
FAA officials, the estimated cost difference between digitizing
existing radars and buying new radars is minimal because of the
higher costs of maintaining older analog equipment.  The agency is
continuing to refine these cost estimates, and it expects to decide
later this year on which option to select. 


--------------------
\7 This estimate was based on the December 1994 FAA study that
revalidated associated costs.  The reliability in estimating costs is
discussed in our report Air Traffic Control:  Improved Cost
Information Needed to Make Billion-Dollar Modernization Investment
Decisions (GAO/AIMD-97-20, Jan.  22, 1997). 

\8 The life-cycle cost estimates do not include the costs of
"technical refreshment"--planned periodic updating of a system's
technological capabilities.  We excluded these costs because of a
lack of comparable data between the January 1996 baseline and the
latest analysis dated September 1996. 

\9 The facilities and equipment appropriation account funds FAA's
efforts to acquire new equipment.  FAA's operations appropriation
account funds FAA's efforts to maintain and support equipment. 

\10 This analysis was prepared by FAA's Program Analysis and
Operations Research staff. 


   AGENCY COMMENTS
------------------------------------------------------------ Letter :5

We provided the Department of Transportation with a draft of this
report for its review and comment.  We met with FAA officials,
including the IPT leader for Terminal Air Traffic Systems
Development; the Program Director for National Airspace System
Transition and Implementation; and representatives of FAA's Air
Traffic and Airway Facilities Services.  FAA was concerned about our
use of the $1.82 billion estimate for operations and maintenance
costs.  The estimate came from a September 1996 study done by FAA's
Program Analysis and Operations Research staff.  FAA told us that
this estimate was preliminary and should not be reported as a basis
for evaluating the STARS project.  While FAA acknowledged that there
may be some cost growth in the STARS project, it did not anticipate
growth as large as we reported.  We continue to include the September
1996 estimate in this report.  This estimate was developed by
experienced cost analysts, including a member of the STARS IPT, and
was the only documented estimate available since the official
baseline was approved in January 1996.  Furthermore, FAA could not
provide us with a more current estimate or detailed support for its
views on why the September 1996 analysis may have overstated the cost
estimate for operations and maintenance. 

FAA also expressed concern about the way the draft report
characterized the extent to which key stakeholders were committed to
the implementation schedule, which relies heavily on the use of the
turnkey concept.  We revised the report to recognize that (1) while
regions' commitment is incomplete, Airway Facilities Service
officials at headquarters have committed to the turnkey concept and
(2) FAA has established a process, including the formation of
implementation teams to ensure regions' understanding and obtain
their commitment on turnkey issues.  However, because the turnkey
concept will affect regional resources and employees'
responsibilities, FAA agreed that the potential lack of regions'
commitment is a risk that must be mitigated throughout the
implementation of STARS. 


   SCOPE AND METHODOLOGY
------------------------------------------------------------ Letter :6

To obtain information for this report, we interviewed officials at
FAA headquarters, its New England Regional Office in Burlington,
Massachusetts, its New York Regional Office in Jamaica, New York, and
its William J.  Hughes Technical Center in Pomona, New Jersey.  We
reviewed agency documentation on current schedule and life-cycle
costs for STARS.  We reviewed guidelines pertaining to system
acquisition, compared FAA's actions to the guidance, and identified
key issues that could affect the success of the STARS project.  To
identify any labor issues that could affect the scheduled deployment,
we interviewed union officials with the Professional Airways Systems
Specialists.  We conducted our review from July 1996 through January
1997 in accordance with generally accepted government auditing
standards.  However, we did not assess the reliability of the process
used to generate cost information. 


---------------------------------------------------------- Letter :6.1

We are sending copies of this report to the Secretary of
Transportation, the Administrator of FAA, and other interested
parties.  We will also make copies available to others on request. 
Please call me at (202) 512-3650 if you or your staff have any
questions about this report.  Major contributors to this report are
listed in appendix I. 

Sincerely yours,

Gerald L.  Dillingham
Associate Director, Transportation Issues


MAJOR CONTRIBUTORS TO THIS REPORT
=========================================================== Appendix I

John H.  Anderson, Jr.
Gregory P.  Carroll
Robert E.  Levin
Peter G.  Maristch
John T.  Noto


*** End of document. ***