Aviation Safety: FAA Oversight of Repair Stations Needs Improvement
(Chapter Report, 10/24/97, GAO/RCED-98-21).

Pursuant to a congressional request, GAO examined the Federal Aviation
Administration's (FAA) oversight of the aviation repair station
industry, focusing on: (1) the nature and scope of the oversight of
repair stations conducted by FAA personnel; (2) how well FAA follows up
on inspections to ensure that the deficiencies in repair station
operations are corrected once they have been identified; and (3) the
steps taken by FAA to improve the oversight of repair stations.

GAO noted that: (1) FAA's records indicate that the agency is meeting
its goal of inspecting every repair station at least once a year; (2)
GAO examined FAA's 1996 inspection records on about one-fourth of the
2,800 repair stations doing work for air carriers and confirmed that
minimum inspection requirements had been met; (3) in addition, 84
percent of the inspectors GAO surveyed stated that they believed the
overall compliance of repair stations was good or excellent; (4)
however, more than half of the inspectors stated that there were areas
of compliance that repair stations could improve; (5) FAA relies
primarily on reviews by individual inspectors of most domestic repair
stations; (6) in a few cases, FAA also uses teams to assess compliance
at large, complex facilities; (7) at such facilities, a team approach
has been shown to be more effective at identifying problems than visits
by individual inspectors, uncovering more systemic and long-standing
deficiencies; (8) a few of FAA's offices have recognized that the
traditional approach of relying on one inspector may be inadequate in
such situations and have begun to use teams to inspect large repair
stations; (9) FAA officials acknowledge and support these initiatives;
(10) GAO could not find sufficient documentation to determine how well
FAA followed up to ensure that the deficiencies found during the
inspections of repair stations were corrected; (11) FAA does not tell
its inspectors what documentation to keep, and the resulting information
gaps lessen the agency's ability to determine how well its inspection
activities are working or to identify and react to trends; (12) these
gaps in documentation are particularly important because FAA is spending
more than $30 million to develop a reporting system that, among other
things, is designed to use the documentation to make inspection
decisions, such as where to apply the agency's inspection resources to
address those areas that pose the greatest risk to aviation safety; (13)
following the May 1996 crash of a ValuJet DC-9 in the Florida
Everglades, FAA announced new initiatives to upgrade the oversight of
repair stations; (14) these initiatives were directed at clarifying and
augmenting air carriers' oversight of repair stations, not at ways in
which FAA's own inspection resources could be better utilized; and (15)
however, FAA does have three other efforts under way that would have a
more direct bearing on its own inspection activities at repair stations.

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

 REPORTNUM:  RCED-98-21
     TITLE:  Aviation Safety: FAA Oversight of Repair Stations Needs 
             Improvement
      DATE:  10/24/97
   SUBJECT:  Inspection
             Transportation safety
             Airline regulation
             Commercial aviation
             Air transportation operations
             Aircraft maintenance
             Aircraft accidents
             Management information systems
             Human resources utilization
             Airline industry
IDENTIFIER:  FAA Program Tracking and Reporting Subsystem
             FAA National Aviation Safety Inspection Program
             FAA Regional Aviation Safety Inspection Program
             FAA Safety Performance Analysis System
             
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Cover
================================================================ COVER


Report to Congressional Requesters

October 1997

AVIATION SAFETY - FAA OVERSIGHT OF
REPAIR STATIONS NEEDS IMPROVEMENT

GAO/RCED-98-21

Aviation Safety

(341498)


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

  FAA - Federal Aviation Administration
  JAA - Joint Aviation Authorities
  NASIP - National Aviation Safety Inspection Program
  PTRS - Program Tracking and Reporting Subsystem
  RASIP - Regional Aviation Inspection Program
  SPAS - Safety Performance Analysis System

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


B-274165

October 24, 1997

The Honorable Wendell H.  Ford
Ranking Minority Member
Subcommittee on Aviation
Committee on Commerce, Science, and Transportation
United States Senate

The Honorable Ron Wyden
United States Senate

As you requested, this report examines the Federal Aviation
Administration's (FAA) oversight of the aviation repair station
industry.  Specifically, this report addresses the following
questions:  (1) What is the nature and scope of the oversight of
repair stations conducted by FAA personnel?  (2) How well does FAA
follow up on inspections to ensure that the deficiencies in repair
station operations are corrected once they have been identified?  (3)
What steps has FAA taken to improve the oversight of repair stations? 
This report contains recommendations to the Secretary of
Transportation for improving FAA's oversight of repair stations. 

As you requested, unless you publicly announce its contents earlier,
we plan no further distribution of this report until 30 days after
the date of this letter.  We will then send copies to the Secretary
of Transportation; the Director, Office of Management and Budget; and
other interested parties.  We will make copies available to others
upon request. 

If you or your staff have any questions, please call me at (202)
512-3650.  Major contributors to this report are listed in appendix
IV. 

Gerald L.  Dillingham
Associate Director,
 Transportation Issues


EXECUTIVE SUMMARY
============================================================ Chapter 0


   PURPOSE
---------------------------------------------------------- Chapter 0:1

U.S.  airlines and air cargo companies now operate more than 6,700
aircraft, nearly 1,000 more than in 1990.  Maintaining, repairing,
and renovating this fleet costs about $6.5 billion a year.  Nearly
half of this work is now done by about 2,800 independent repair
stations rather than by the air carriers themselves.  Located
worldwide, these repair stations vary greatly in size and scope. 
Some employ only a few people and fix a limited range of components,
such as radios or instruments.  Others have thousands of workers
doing everything from conducting routine engine maintenance to
rebuilding entire airframes.  Although repair stations have been part
of the aviation industry for decades, their use has grown
substantially in recent years, particularly by airlines and cargo
companies just entering the market.  These new carriers have found it
more economical to contract out much of their maintenance work rather
than hiring their own staffs and building extensive facilities. 

Because repair stations deal with virtually all aircraft components,
ensuring that their work is competently done is an important part of
enhancing aviation safety.  The Federal Aviation Administration (FAA)
is the federal agency responsible for doing so.  FAA conducts this
oversight in two main ways:  by sending its own inspectors to review
repair station operations and by making airlines and air cargo
companies responsible for ensuring that repair stations are following
proper procedures.  In recent years, FAA's oversight of repair
stations has become a matter of concern, in part because work
performed by repair stations has been identified as a factor in
several aircraft accidents.  For example, the National Transportation
Safety Board determined that the probable cause of an engine fire
that destroyed a ValuJet DC-9 on an Atlanta runway in June 1995 was
the inadequate procedures used by repair station personnel. 

The Ranking Minority Member of the Aviation Subcommittee of the
Senate Committee on Commerce, Science, and Transportation, and
Senator Ron Wyden asked GAO to examine FAA's oversight of repair
stations.  GAO's review focused on FAA's own inspection activities at
repair stations.  At a later date, GAO plans to conduct a more
detailed examination of FAA's role in requiring airlines and air
cargo companies to ensure that repair stations are following proper
procedures.  This current review examined the following questions: 

  -- What is the nature and scope of the oversight of repair stations
     conducted by FAA personnel? 

  -- How well does FAA follow up on inspections to ensure that the
     deficiencies in repair stations' operations are corrected once
     they have been identified? 

  -- What steps has FAA taken to improve the oversight of repair
     stations? 


   BACKGROUND
---------------------------------------------------------- Chapter 0:2

As the size of the airline and air cargo industries has grown, so has
the reliance on repair stations.  In 1990, repair stations performed
37 percent of air carriers' maintenance; by 1996, the figure was 46
percent.  More than 2,500 domestic and 270 foreign repair stations do
work for air carriers.  FAA's certification process establishes what
the repair stations are qualified to do.  While many repair stations
have fewer than 15 employees and a limited range of activities that
FAA has certified, some employ thousands of workers who completely
overhaul engines and renovate aging airframes for additional years of
service.  FAA's inspection activities are aimed at ensuring that
repair stations are still meeting the certification requirements. 

FAA had about 3,000 inspectors in fiscal year 1997.  About 600 of
them were involved in repair station inspections.  FAA's guidelines
require that each repair station be inspected at least once a year. 
These inspections involve checking such matters as whether repair
station staff have the appropriate qualifications to do the work and
whether repair procedures meet FAA regulations.  About 550 inspectors
oversee repair stations located in the United States, usually through
inspections conducted by individual inspectors.  For larger
facilities, these inspections may take place over several visits. 
Most of the inspectors are responsible for several repair stations as
well as other types of operations, such as helicopter operators and
training schools for pilots and mechanics.  The remaining 50
inspectors inspect foreign repair stations that work on aircraft
registered in the United States.  These inspectors have fewer
additional duties because FAA generally has no regulatory authority
over foreign operations that do not directly affect aviation in the
United States.  Unlike their counterparts on the domestic side, these
inspectors conduct most of their repair station inspections in teams. 


   RESULTS IN BRIEF
---------------------------------------------------------- Chapter 0:3

FAA's records indicate that the agency is meeting its goal of
inspecting every repair station at least once a year.  GAO examined
FAA's 1996 inspection records on about one-fourth of the 2,800 repair
stations doing work for air carriers and confirmed that minimum
inspection requirements had been met.  In addition, 84 percent of the
inspectors GAO surveyed stated that they believed the overall
compliance of repair stations was good or excellent.  However, more
than half of the inspectors stated that there were areas of
compliance that repair stations could improve.  FAA relies primarily
on reviews by individual inspectors of most domestic repair stations. 
In a few cases, FAA also uses teams to assess compliance at large,
complex facilities.  At such facilities, a team approach has been
shown to be more effective at identifying problems than visits by
individual inspectors, uncovering more systemic and long-standing
deficiencies.  A few of FAA's offices have recognized that the
traditional approach of relying on one inspector may be inadequate in
such situations and have begun to use teams to inspect large repair
stations.  FAA officials acknowledge and support these initiatives. 
They said they believe these initiatives need to be evaluated and, if
appropriate, used at other offices. 

GAO could not find sufficient documentation to determine how well FAA
followed up to ensure that the deficiencies found during the
inspections of repair stations were corrected.  Thus, it was
impossible to assess how completely or quickly repair stations were
bringing themselves into compliance.  FAA does not tell its
inspectors what documentation to keep, and the resulting information
gaps lessen the agency's ability to determine how well its inspection
activities are working or to identify and react to trends.  These
gaps in documentation are particularly important because FAA is
spending more than $30 million to develop a reporting system that,
among other things, is designed to use the documentation to make
inspection decisions, such as where to apply the agency's inspection
resources to address those areas that pose the greatest risk to
aviation safety. 

Following the May 1996 crash of a ValuJet DC-9 in the Florida
Everglades, FAA announced new initiatives to upgrade the oversight of
repair stations.  These initiatives were directed at clarifying and
augmenting air carriers' oversight of repair stations, not at ways in
which FAA's own inspection resources could be better utilized. 
However, FAA does have three other efforts under way that would have
a more direct bearing on its own inspection activities at repair
stations.  One effort would revise the regulations governing repair
station operations, and another would revise the regulations
governing the qualifications of repair station personnel.  The
revision of the repair station regulations began in 1989 and has been
repeatedly delayed.  The third effort is the addition of more FAA
inspectors, which should mean that more resources can be devoted to
inspecting repair stations. 


   PRINCIPAL FINDINGS
---------------------------------------------------------- Chapter 0:4


      CURRENT INSPECTION APPROACH
      LIMITS FAA'S ABILITY TO
      ENSURE COMPLIANCE AT LARGE
      REPAIR STATIONS
-------------------------------------------------------- Chapter 0:4.1

Most of FAA's offices use the approach of assigning an individual
inspector to a repair station, even one that is large and complex,
rather than assigning a team of inspectors.  Although this
one-inspector approach constitutes FAA's primary frontline
surveillance of repair stations, each year regional and national
decisions are made to use teams for more comprehensive reviews of a
few repair stations.  When direct comparisons could be made, teams
were shown to be more effective than individual inspectors in
identifying those areas in which repair stations were not in
compliance with FAA's rules and regulations, even if one inspector
visited the facility several times and the team visited it just once. 
GAO reviewed 19 instances in which large repair stations inspected by
one person had also been inspected by a special team during the same
year.  These special inspections are conducted at selected facilities
that FAA regards as needing additional attention.  The teams found a
total of 347 deficiencies, only 15 of which had been identified in
all of the visits made by individual inspectors in the year or more
leading up to the special inspections.  Deficiencies the teams
identified included many that were systemic and apparently
long-standing, such as inadequate training programs or poor manuals
for quality control.  Such deficiencies were likely to have been
present when the repair stations were inspected earlier by individual
inspectors. 

There are several reasons why team inspections identify a higher
proportion of the deficiencies that may exist in the operation of
large repair stations.  Teams are better than individuals at ensuring
that the inspection covers all areas of operations and that
inspectors stay focused on the task at hand.  Many FAA inspectors
responsible for conducting inspections on their own said that because
they have many competing demands on their time, their inspections of
repair stations may not be as thorough as they would like.  Another
reason is that team inspections make greater use of checklists or
other job aids for ensuring that all points are covered.  FAA's
guidance requires inspectors to address all aspects of repair
stations' operations but does not prescribe any checklist or other
means for specifying the items to be covered.  The lack of a
standardized approach increases the possibility that items will not
be covered.  Finally, inspectors believe team inspections help ensure
that their judgments are independent because most team members have
no ongoing relationship with the repair station.  By contrast,
individual-inspector reviews are conducted by personnel who have
continuing regulatory responsibility for the facilities. 

A few of FAA's offices have recognized that the traditional approach
of relying on one inspector may be inadequate for overseeing the
operations of large repair stations and have reconfigured their
inspection resources to do more team inspections without adversely
affecting other duties.  They have done so mainly by redirecting the
time formerly spent on reviews by individual inspectors into more
systematic inspections done by a team of local, in-house staff.  GAO
identified FAA offices in Scottsdale, Arizona; Miami, Florida; and
Seattle, Washington, as having initiated such changes on their own. 
FAA headquarters officials acknowledge and support these offices'
initiatives.  They said they believe these initiatives need to be
evaluated and, if appropriate, used at other offices. 


      FOLLOW-UP AND DOCUMENTATION
      NEED ATTENTION
-------------------------------------------------------- Chapter 0:4.2

FAA's guidance is limited in specifying for inspectors what documents
pertaining to inspections and follow-up need to be maintained in
repair station files.  The closest thing to a requirement is a
statement in the Airworthiness Inspector's Handbook that the
deficiency letter FAA sends to the repair station describing all
deficiencies should be included in the repair station case file.  GAO
examined records of 172 instances in which FAA sent deficiency
letters to domestic repair stations.  The responses from the repair
stations were not on file in about one-fourth of these instances, and
FAA's assessments of the adequacy of the corrective actions taken by
the repair stations were not on file in about three-fourths of the
instances.  GAO also examined computer-based reports summarizing
inspection information for FAA managers and found these reports were
even less complete.  Without complete documentation, it was
impossible to assess how completely or quickly repair stations were
bringing themselves into compliance. 

Better documentation is needed not only to allow FAA to demonstrate
how quickly and thoroughly repair stations are complying with
regulations, but also because it can affect FAA's ability to identify
performance trends involving the inspection of repair stations and to
make informed decisions about them.  FAA is spending more than $30
million to develop a reporting system that, among other things, is
designed to use this documentation to make decisions on applying
inspection resources to those areas posing the greatest risk to
aviation safety.  Such a system will be of limited use if the
documentation on which it is based is inaccurate, incomplete, or
outdated.  FAA must have data to show where safety problems and
deficiencies exist and, thus, where to better target its limited
inspection resources.  In 1995, as part of a prior study examining
FAA's information management systems, GAO recommended that FAA
develop a comprehensive strategy for making data-related
improvements.  FAA agreed, but it fell behind in its schedule for
making improvements.  Continued monitoring will be needed to ensure
that the actions taken are sufficient to resolve the problems by
December 1999, when the new reporting system is scheduled for
completion. 

Documentation of inspections and follow-up was better in FAA's files
for foreign repair stations, perhaps in part because under FAA
regulations, foreign repair stations must renew their certification
every 2 years.  By comparison, domestic repair stations retain their
certification indefinitely unless they surrender it or FAA suspends
or revokes it.  Foreign repair stations appear to be correcting their
deficiencies quickly so that they qualify for certificate renewal. 
The 34 FAA inspectors GAO interviewed who had conducted inspections
of both foreign and domestic repair stations were unanimous in
concluding that compliance occurred more quickly at foreign
facilities.  They attributed the quicker compliance to the renewal
requirement and said that it allowed them to spend less time on
follow-up, freeing them for other surveillance work.  However,
because of the poor documentation in domestic repair station files,
GAO was unable to confirm whether foreign repair stations achieve
compliance more quickly than domestic repair stations do. 


      ACTIONS UNDER WAY DIRECTED
      PRIMARILY AT AIR CARRIERS'
      OVERSIGHT OF REPAIR STATIONS
-------------------------------------------------------- Chapter 0:4.3

The six repair station initiatives announced in June 1996 by the
previous FAA Administrator following the ValuJet crash are directed
at clarifying and augmenting air carriers' responsibilities for
overseeing repair stations.  For example, one initiative requires
that before an air carrier can add a repair station to the list of
repair stations doing substantial maintenance on its aircraft, the
carrier must conduct an audit to verify that the repair station is
capable of doing the work in accordance with the carrier's approved
programs.  GAO did not directly assess the initiatives in this review
because the initiatives are not focused on strengthening FAA's own
inspection and follow-up efforts.  FAA inspectors assigned to oversee
repair stations told GAO that the initiatives would have no effect on
their direct inspections of repair stations. 

Several other efforts unrelated to the June 1996 initiatives may hold
potential for improving FAA's own inspections of repair stations. 
Two involve initiatives to change the regulations covering repair
station operations and the certification requirements for mechanics
and repairmen.  FAA acknowledges that the existing regulations do not
reflect many of the technological changes that have occurred in the
aviation industry in recent years.  The FAA inspectors surveyed by
GAO strongly supported a comprehensive update of repair station
regulations as a way to improve repair stations' compliance.  This
update began in 1989, has been repeatedly delayed, and still remains
in process.  The most recent target--to have draft regulations for
comment published in the Federal Register during summer 1997--was not
met.  Similarly, the update of the certification requirements for
maintenance personnel has been suspended since 1994.  Because of
these long-standing delays, completion of both updates may require
additional attention on management's part to help keep both efforts
on track.  The third effort involves increasing FAA's inspection
resources:  Since fiscal year 1995, FAA has been in the process of
adding more than 700 inspectors to its workforce who will, in part,
oversee repair stations.  Survey responses from current inspectors
indicated that the success of this effort will depend partly on the
qualifications of the new inspectors and on the training available to
all those in the inspector ranks. 


   RECOMMENDATIONS
---------------------------------------------------------- Chapter 0:5

To improve FAA's oversight of repair stations, GAO recommends that
the Secretary of Transportation instruct the Administrator of FAA to
take the following actions: 

  -- Expand the use of locally based teams for repair station
     inspections, particularly for repair stations that are large,
     complex, have higher rates of noncompliance, or meet
     predetermined risk indicators; and develop and use checklists or
     job aids for inspectors as a way of bringing about more
     comprehensiveness and standardization. 

  -- Specify what documentation should be kept in repair station
     files to record complete inspection results and follow-up
     actions. 

  -- Monitor the implementation of the strategy for improving the
     quality of the data to be used in FAA's new management
     information system. 

  -- Expedite the efforts to update regulations pertaining to the
     oversight of repair stations, and establish and meet schedules
     for completing the updates. 


   AGENCY COMMENTS
---------------------------------------------------------- Chapter 0:6

GAO provided the Department of Transportation and FAA with a draft of
this report for their review and comment.  GAO met with FAA
officials, including the Deputy Associate Administrator for
Regulation and Certification (acting on behalf of the FAA
Administrator) to obtain FAA's comments.  FAA agreed with the draft's
overall message and recommendations. 

FAA said it will build on its already successful repair station
inspection program to enhance the oversight of this sector of the
aviation industry.  FAA cited several agency initiatives that it said
are under way to do that.  FAA's 90-day safety review conducted last
year recommended the creation of an analytic unit that could provide
safety trend data to inspectors.  FAA said an office within the
Flight Standards Service was created on May 20, 1997, to provide data
that will help focus inspection and other resources.  The review also
recommended that field and division managers be given the flexibility
to determine the skills needed in a particular field office to ensure
the appropriate mix of technical, paratechnical, support, and
clerical expertise.  FAA said that this flexibility will be supported
through the establishment of new staffing standards--a long-term
project that is already under way. 

Additionally, FAA provided some technical comments and corrections on
the draft report.  GAO revised the report as appropriate to reflect
FAA's technical comments and corrections. 


BACKGROUND
============================================================ Chapter 1

Passenger airlines, air freight companies, and other air carriers in
the United States spend almost $6.5 billion every year maintaining
and repairing their aircraft, according to industry estimates.  While
these carriers have traditionally performed much of this maintenance
and repair work themselves, many are now contracting an increasing
portion of the work to about 2,800 repair stations in the United
States and other countries.\1 As the agency responsible for
overseeing the aviation industry, the Federal Aviation Administration
(FAA) has the primary responsibility for ensuring that repair
stations are operating in accordance with laws and regulations. 


--------------------
\1 Although nearly 5,000 repair stations are certified by FAA, data
provided in FAA's Vital Information Subsystem specifically identified
about 2,800 of those as performing work on aircraft with 10 or more
seats.  Of these facilities, more than 2,500 are in the United
States, and 273 are in foreign countries.  This report addresses the
oversight of these 2,800 repair stations. 


   GROWING AIR CARRIER INDUSTRY
   CREATES ADDITIONAL NEED FOR
   MAINTENANCE AND REPAIR SERVICES
---------------------------------------------------------- Chapter 1:1

Commercial air carriers certified in the United States now operate
more than 6,700 aircraft, nearly 1,000 more than in 1990.  Operators
include more than 150 airlines, freight carriers, charter firms, and
other companies certified by FAA and operating under part 121 of the
Federal Aviation Regulations.\2 The aircraft they operate range from
planes such as a Fairchild Metroliner III, which typically carries a
maximum of 19 passengers or about 5,000 pounds of cargo, to planes
such as a Boeing 747-400, which is capable of carrying more than 400
passengers or 122 tons of cargo.  Some of the largest companies, like
United Airlines or American Airlines, may have 500 or more aircraft. 

With more aircraft flying, the need for maintenance and repair
services has grown.  Air carriers spent almost $6.5 billion for
maintenance and repair on their aircraft in 1996, according to an
industry estimate.\3 This amount is an increase of $1.2 billion, or
23 percent, over the estimate of $5.3 billion in 1990.  The term
"maintenance and repair" encompasses a wide variety of activities. 
Some activities involve frequent servicing, such as overhauling
tires, wheels, and brakes.  Others include more extensive renovation,
such as airframe maintenance, that must be done as aircraft get
older.  FAA classifies maintenance and repair activities into six
rating categories (see table 1.1), which it uses to designate the
type of maintenance or activity it has certified a repair station to
perform. 



                               Table 1.1
                
                    Repair Station Rating Categories

                                          Examples of service
Rating\a                                  performed
----------------------------------------  ----------------------------
Accessory                                 Functional check and
                                          calibration of fuel control
                                          unit

Airframe                                  Inspection and repair for
                                          corrosion and fatigue damage

Instrument                                Calibration of air speed
                                          indicator

Power plant                               Borescope inspection of
                                          internal engine components

Propeller                                 Examinations and repair of
                                          cracks, nicks, and
                                          deformations

Radio                                     Measurement of frequency and
                                          power of transmitting unit
----------------------------------------------------------------------
\a FAA also issues limited ratings for items such as nondestructive
testing, maintenance on emergency equipment or landing gear, or other
specialized services not included in the aircraft rating categories. 

Some major air carriers, such as American Airlines and United
Airlines, have substantial maintenance facilities of their own. 
However, many air carriers, including smaller air carriers, have used
third-party repair stations rather than invest in the additional
staff and hardware needed to do the work in-house.  Some new air
carriers entering the passenger or air freight markets have chosen to
rely heavily--and in some cases, almost exclusively--on repair
stations. 


--------------------
\2 Air carriers now operating under part 121 use aircraft configured
for 10 or more passengers.  New rules adopted by the FAA in 1995
require certain commuter operators conducting scheduled operations
under part 135 to conduct those operations under part 121 beginning
in March 1997.  Included were those air carriers conducting scheduled
operations carrying passengers with aircraft configured for 10 to 30
seats.  This report uses the term "air carriers" to refer to
companies operating under part 121, including those that formerly
operated under part 135. 

\3 This figure includes air carriers with revenues exceeding $100
million annually. 


   WHAT ARE REPAIR STATIONS? 
---------------------------------------------------------- Chapter 1:2

The term "repair station" spans a wide variety of operations.  In
1996, there were almost 5,000 repair stations certified by FAA, about
2,800 of which performed maintenance work on aircraft used by air
carriers.\4 A repair station's certificate specifies the types of
maintenance it can perform.  Some repair stations specialize in one
particular maintenance and repair category, while others may conduct
work in several categories.  As figure 1.1 shows, the types of
maintenance most often included in the certificates of these 2,800
repair stations were for accessories and airframes. 

   Figure 1.1:  Types of
   Maintenance Performed by Repair
   Stations

   (See figure in printed
   edition.)

Note:  Some repair stations are certified for more than one type of
maintenance. 

Source:  FAA data. 

In addition to specifying the types of maintenance a repair station
can perform, FAA may limit the scope of a repair station's
activities.  For example, whenever appropriate, FAA may issue a
rating that limits a repair station's work to maintaining or altering
only certain types of airframes, power plants, propellers, radios,
instruments, or accessories.  Such a rating may be limited to a
specific model of aircraft, engine, or constituent part or to any
number of parts made by a particular manufacturer.  FAA also issues
limited ratings for specialized work, such as nondestructive testing,
maintenance on landing gear or emergency equipment, or other specific
areas not included in any of the six standard rating categories.\5

Repair stations vary considerably in size and scope of operations. 
For example, Tramco, Inc., located in Everett, Washington, is one of
the largest repair stations in the United States, with hangar
facilities of 450,200 square feet and a workforce of more than 2,000. 
At one time, this facility can accommodate five wide-body aircraft,
such as Boeing 747s, and five narrow-body aircraft, such as Boeing
737s.  The repair station primarily conducts regularly scheduled
maintenance and modifications, and it also modifies new aircraft when
specifications are changed after manufacturing is completed.  Figure
1.2 shows maintenance being done on a Boeing 727 at this facility. 
By contrast, Precision Avionics & Instruments in Atlanta, Georgia, is
a much smaller repair station.  It employs 35 workers and has a
facility of 24,000 square feet where it primarily services
instruments, electrical and electronic components and accessories. 

   Figure 1.2:  Maintenance Being
   Done on a Boeing 727 at Tramco,
   Inc., Everett, Washington

   (See figure in printed
   edition.)

While most domestic repair stations are operated independently of
commercial airlines, a few are in-house maintenance operations that
conduct work for other airlines on a contractual basis.  For example,
at its own maintenance facilities, Delta Airlines performs power
plant maintenance for such carriers as American Airlines, Air
Jamaica, Trade Winds, and Aeroflot Russian International Airlines. 

Repair stations that work on the aircraft of U.S.  carriers are found
throughout the rest of the world, though not in as great a number as
repair stations in the United States.  In all, about 270
FAA-certified foreign repair stations perform repair work for U.S. 
air carriers.  For example, Sabena Technic, the maintenance arm of
Sabena Belgian World Airlines, does engine repair work for Federal
Express and other carriers at its facility in Brussels.  Sabena has
FAA's approval for work on airframes, power plants, radios,
instruments, and accessories. 


--------------------
\4 The other 2,200 certified repair stations worked on general
aviation aircraft which are regulated under part 91 of the Federal
Aviation Regulations.  General aviation comprises all civil aircraft
operations except those involving such commercial activities as the
transport of revenue-paying passengers.  Over 90 percent of the
aircraft registered in the United States are general aviation
aircraft. 

\5 As of Nov.  15, 1996, 251 repair stations performing work for air
carriers held one or more limited ratings for items such as
nondestructive testing, maintenance on emergency equipment or landing
gear, or other specialized service or maintenance not included in the
aircraft rating categories. 


   HOW DOES FAA OVERSEE REPAIR
   STATIONS? 
---------------------------------------------------------- Chapter 1:3

FAA's oversight of repair stations is divided into two
phases--certification and surveillance.  Certification initially
involves a repair station's applying to FAA for authority to perform
certain types of maintenance on certain types of aircraft.  FAA
inspects the repair station to ensure that the applicant's proposed
procedures are effective and that the equipment meets regulatory
requirements.  In addition, FAA also inspects facilities, personnel,
and material as well as the repair station's inspection system.  If
FAA finds these things to be in order, it issues a certificate with a
set of "operation specifications" that cover what maintenance
activities the repair station is authorized to perform. 
Certification is handled in one of two ways, depending on whether the
repair station is in the United States or abroad.  FAA requires
foreign repair stations to renew their certification at least every 2
years, but for domestic repair stations, certification is permanent
unless it is surrendered by the applicant or suspended or revoked by
FAA.\6

Surveillance, usually in the form of inspections, follows
certification.  FAA's guidelines require its safety inspectors to
perform a facility inspection of each domestic and foreign repair
station at least once every year.  For many of the larger domestic
repair stations, this inspection is broken into multiple visits.  For
example, FAA inspectors visited Evergreen Air Center, one of the
larger repair stations we reviewed in depth, more than 20 times
during fiscal year 1996.  Located in Marana, Arizona, Evergreen
employs about 590 workers who conduct all types of maintenance on
most types of large transport aircraft.  FAA divides repair station
inspections into two categories, avionics and maintenance.  Avionics
inspections focus on a repair station's overall program for aircraft
electronic components, including personnel training, policies, and
procedures.  Maintenance inspections cover a repair station's overall
maintenance program, including personnel training, policies, and
procedures. 

FAA's certification and inspection activities are carried out by
inspectors based in the United States and abroad (see table 1.2).\7
On the domestic side, certification and inspection activities are
carried out by more than 550 FAA inspectors, most of whom have many
other responsibilities as well.  Unless they are assigned to one of
the largest operations, inspectors usually are responsible for more
than one repair station.  We examined the workloads of 98 inspectors
at the FAA offices we visited and found that the number of repair
stations these inspectors were responsible for ranged from 1 to 42,
with a median workload of 12 repair stations.  These repair stations
varied in size and complexity.  Most of the inspectors had many other
surveillance responsibilities as well, such as overseeing training
schools for pilots and mechanics, helicopter operators, agricultural
operators, and air taxis.  On the foreign side, about 50 FAA
inspectors handle the oversight of repair stations, again with
responsibility for multiple repair stations.  Unlike their
counterparts in the United States, however, inspectors in these
offices generally have the oversight of repair stations as their
primary responsibility. 



                               Table 1.2
                
                    Comparison of FAA's Oversight of
                  Domestic and Foreign Repair Stations

                                Domestic            Foreign
------------------------------  ------------------  ------------------
Number of FAA principal         552                 49
inspectors assigned to oversee
repair stations as of Nov. 15,
1996

Location of FAA principal       86 FAA offices      7 FAA offices--
inspectors assigned to oversee  throughout the      Brussels, Dallas/
repair stations                 United States       Fort Worth,
                                                    Frankfurt, London,
                                                    Miami, San
                                                    Francisco, and
                                                    Singapore

Number of repair stations       2,504\a             273\a
inspectors are responsible for

Responsibility for oversight    Varies with other   Primary
of repair stations              oversight duties    responsibility
----------------------------------------------------------------------
\a These numbers only include those repair stations identified in
FAA's Vital Information Subsystem as performing work on aircraft with
10 or more seats. 


--------------------
\6 Repair stations are regulated under 14 C.F.R.  part 145. 
Specifically, under FAA regulations, a foreign repair station's
certificate, or rating, expires 12 months after the date on which it
was issued, unless it is surrendered, suspended, or revoked before
that time.  FAA can make subsequent renewals for periods of up to 24
months. 

\7 In addition to inspectors with direct oversight, other FAA
inspectors may also visit repair stations.  An inspector responsible
for an air carrier that contracts with a repair station may also
review the repair station's operations, but only insofar as they
pertain to the work being done for the air carrier.  If an inspector
is not based near a repair station, he or she may request that
another inspector--called a geographic inspector--close to the
facility make the visit. 


   WHO ELSE HAS OVERSIGHT
   RESPONSIBILITY FOR REPAIR
   STATIONS? 
---------------------------------------------------------- Chapter 1:4

Under Federal Aviation Regulations, air carriers must ensure that
repair stations are conducting work that conforms with the air
carriers' manuals and the applicable FAA regulations.\8 As part of
meeting this requirement, air carriers may use one or both of the
following means: 

  -- They may conduct their own audits of repair stations--generally
     every 2 years--to ensure that the facilities have the capability
     to perform the work in accordance with the air carriers'
     maintenance policies, procedures, and requirements. 

  -- They may rely on audits conducted by the Coordinating Agency for
     Supplier Evaluation, an international industry organization of
     major airlines and aerospace and marine contractors.  These
     audits are conducted--again, generally every 2 years--by staff
     from member airlines who use a standardized approach that
     includes Federal Aviation Regulation requirements.  Because many
     airlines use the same repair stations, these audits eliminate
     the expense of redundant evaluations of repair stations. 

Repair stations, both foreign and domestic, are also potentially
subject to review by the regulatory agencies of other countries. 
Many of the national aviation authorities in countries where repair
stations are located have developed their own extensive inspection,
surveillance, evaluation, and certification programs for repair
facilities.  Like FAA, many of these agencies review repair stations
in other countries as well (including the United States). 
Twenty-seven European nations have banded together to coordinate
their efforts through an organization called the Joint Aviation
Authorities (JAA), but many nations such as China conduct reviews on
their own.\9 Like FAA, these other regulators have set up their
programs to help ensure compliance with their own national standards. 

Figure 1.3 summarizes the relationship of the various parties
involved in the oversight of repair stations. 

   Figure 1.3:  Overview of the
   Oversight Given Repair Stations

   (See figure in printed
   edition.)


--------------------
\8 See subpart L of part 121 and subpart J of part 135. 

\9 Under the provisions of the Bilateral Aviation Safety Agreement,
FAA is negotiating maintenance implementation procedures with
European countries that are members of JAA to provide reciprocal
acceptance of surveillance information on FAA-certified repair
stations in Europe, and JAA-approved maintenance organizations in the
United States.  We did not address these negotiations in our review
because discussions are still largely in the formative stage and
little or no near-term effect is anticipated. 


   WHY HAS FAA'S OVERSIGHT OF
   REPAIR STATIONS BEEN A MATTER
   OF CONCERN? 
---------------------------------------------------------- Chapter 1:5

Concern has arisen about FAA's oversight of repair stations for three
reasons:  Air carriers are relying on repair stations much more than
in the past.  Several recent accidents have involved aircraft
maintained by repair stations.  And FAA's oversight of repair
stations is comparatively limited. 

Steady growth in air carriers' use of repair stations is one
development that has focused additional attention on how FAA is
carrying out its responsibility to oversee repair stations.  Reliance
on repair stations among air carriers has grown from an estimated 37
percent of total maintenance in 1990 to an estimated 46 percent in
1996. 

Reliance on repair stations has been particularly heavy among newer
carriers such as ValuJet, Western Pacific, Reno Air, and Frontier
Airlines.  According to FAA officials with whom we spoke, newer
carriers use repair stations extensively because they do not have
enough repair work to make performing it themselves economical or
because they want to ensure that they get an experienced cadre of
mechanics with sound practices and procedures.  For example, Reno Air
uses AAR Oklahoma, Inc., to perform heavy airframe maintenance and
major alterations of its MD-80s and MD-90s.  Operating only 30 of
these aircraft does not warrant Reno Air's investing in the in-house
repair capabilities for this type of maintenance.  And even though
established air carriers tend to use repair stations less extensively
than smaller, newer air carriers, the amount of maintenance they
conduct is so great that if only a small percentage of their
maintenance is performed at repair stations, it still represents a
substantial amount of work.  For example, a United Airlines official
estimated that while the company contracts out only about 7 percent
of its maintenance budget to repair stations, this amounted to about
$126 million worth of work in 1996. 

A second, and significant, reason for concern about FAA's oversight
of repair stations stemmed from domestic aviation accidents in 1995
and 1996.  Table 1.3 describes four aviation accidents for which the
National Transportation Safety Board found contributing factors that
involved inadequate inspection or maintenance or improper handling of
hazardous cargo by repair stations. 



                               Table 1.3
                
                  Recent Accidents Involving Aircraft
                 Maintained by Contract Repair Stations

                                                    Link to repair
Airline, aircraft, and date     Nature of accident  station activity
------------------------------  ------------------  ------------------
ValuJet DC-9, June 8, 1995      During a takeoff    The National
                                at Atlanta, an      Transportation
                                uncontained engine  Safety Board (the
                                failure caused a    Board) determined
                                fire that           that the probable
                                destroyed the       cause of the fire
                                aircraft's          was the failure of
                                fuselage. Several   repair station
                                people were         personnel to
                                injured during the  conduct a proper
                                evacuation.         inspection of the
                                                    engine assembly.

Atlantic Southeast Airlines     The aircraft lost   The Board
Embraer-120, August 21, 1995    a propeller while   determined that
                                climbing above      the probable cause
                                18,100 feet. It     of the loss of the
                                crashed during an   propeller was a
                                emergency landing,  fatigue fracture
                                killing 8 and       from corrosion
                                injuring 21 others  pits that were not
                                on board.           discovered or
                                                    properly repaired
                                                    by the
                                                    manufacturer's
                                                    repair station.

ValuJet DC-9, May 11, 1996      A fire broke out    In an abstract of
                                in a cargo          the final report,
                                compartment of the  the Board said a
                                aircraft, which     probable cause of
                                crashed in the      the accident was
                                Florida             the failure of a
                                Everglades,         repair station to
                                killing all 110 on  properly prepare,
                                board.              package, identify,
                                                    and track
                                                    unexpended oxygen
                                                    generators, a
                                                    hazardous
                                                    material.

Tower Air                       The aircraft        The Board found
Boeing 747-136, June 17, 1996   sustained minor     problems
                                damage when an      associated with a
                                engine accessory    repair station's
                                gearbox caught      overhaul and
                                fire during the     assembly of a
                                descent for         drive unit.
                                landing. No one
                                was injured.
----------------------------------------------------------------------
Source:  National Transportation Safety Board. 

A third reason for concern is the relatively limited amount of
oversight that FAA gives repair stations compared with the oversight
it gives air carriers.  FAA is responsible for ensuring that repair
stations comply with regulations, and the agency's annual guidance
for surveillance sets forth minimum inspection requirements for all
certificate holders.  For fiscal year 1997, each repair station was
to have a minimum of one facility inspection, while each air carrier
was required to have many more inspections.  An air carrier such as
Alaska Airlines, for instance, had to have a minimum of 62
inspections. 


   OBJECTIVES, SCOPE, AND
   METHODOLOGY
---------------------------------------------------------- Chapter 1:6

The Ranking Minority Member of the Aviation Subcommittee of the
Senate Committee on Commerce, Science, and Transportation, and
Senator Ron Wyden asked us to examine FAA's oversight of repair
stations.  Specifically, we were asked to address the following
questions: 

  -- What is the nature and scope of the oversight of repair stations
     conducted by FAA personnel? 

  -- How well does FAA follow up on inspections to ensure that
     deficiencies in repair stations' operations are corrected once
     they have been identified? 

  -- What steps has FAA taken to improve the oversight of repair
     stations? 

Our analysis was based in part on agencywide data FAA provided and in
part on a detailed review of a cross-section of airlines, repair
stations, FAA offices, and FAA inspectors.  In general, we did the
following: 

  -- We reviewed the use of repair stations by eight air carriers,
     chosen because, like the industry as a whole, they varied
     greatly in the extent to which they used repair stations.\10 The
     number of aircraft operated by these carriers ranged from 3 to
     659. 

  -- We reviewed operations at 10 repair stations, chosen because
     they represented a wide variety of locations (both domestic and
     foreign), types of repair activities, and size of operations.\11
     The repair stations ranged from a wheel and brake specialist
     with about 20 employees to facilities conducting many types of
     maintenance and employing more than 3,000 workers. 

  -- We examined oversight activities and discussed the oversight of
     repair stations at FAA headquarters, 4 of FAA's 9 regional
     offices, 8 of FAA's 86 Flight Standards district offices, and 6
     of FAA's 7 offices with international responsibilities.\12 Our
     work at these offices included reviewing inspection files for
     nearly 500 repair stations. 

  -- We conducted a survey of 275 FAA principal inspectors on their
     views about ways to improve the oversight of repair stations. 
     Our survey had a response rate of 90 percent, and its results
     can be generalized to all FAA inspectors with responsibility for
     repair stations. 

We conducted our review from August 1996 through October 1997 in
accordance with generally accepted government auditing standards.  In
September 1997, we provided the Department of Transportation and FAA
with a draft of this report for their review and comment.  We met
with FAA officials, including the Deputy Associate Administrator for
Regulation and Certification (acting on behalf of the FAA
Administrator) to obtain FAA's comments.  Those comments and our
responses are included in the executive summary and chapters 2, 3,
and 4.  For a more detailed discussion of our scope and methodology,
see appendix I. 


--------------------
\10 The air carriers were Alaska, American, America West, Delta,
Sierra Pacific, Simmons, Southwest, and United. 

\11 The repair stations were Advanced Material Technologies, Inc.,
Tempe, Arizona; AeroControls, Inc., Auburn, Washington; B.F. 
Goodrich Component Services Division, Tempe, Arizona; Chromalloy Los
Angeles, Gardena, California; Evergreen Air Center, Marana, Arizona;
Greenwich Air Services, Inc., Miami, Florida; Lufthansa Technik AG,
Frankfurt, Germany; Precision Avionics and Instruments, Inc.,
Atlanta, Georgia; Sabena Technic, Brussels, Belgium; and Tramco,
Inc., Everett, Washington. 

\12 Regional offices reviewed were the Northwest Mountain, Southern,
Southwest, and Western-Pacific; Flight Standards district offices
were Atlanta, Dallas, Dallas/Fort Worth, Fort Worth, Los Angeles,
Miami, Scottsdale, and Seattle; offices with international
responsibility were Brussels, Dallas/Fort Worth, Frankfurt, London,
Miami, and San Francisco. 


CURRENT INSPECTION APPROACH LIMITS
FAA'S ABILITY TO ENSURE COMPLIANCE
============================================================ Chapter 2

Although FAA is meeting its oversight goal to inspect every domestic
and foreign repair station at least once a year, the use of
one-person inspections at large, complex facilities restricts the
agency's ability to identify deficiencies and ensure compliance with
regulations.  We reviewed 19 instances in which FAA conducted a
special team inspection of a facility that had received a one-person
inspection within the previous year.  These special team inspections
identified far more deficiencies than inspections done by individual
inspectors.  Team inspections tend to be more comprehensive and
focused, and team members are more organizationally independent of
the repair station and have a more standardized approach to ensuring
that all aspects of compliance with rules and regulations are
checked.  Many inspectors acknowledged the advantages of using a team
rather than an individual inspector to review such facilities,
stating that the pressure of other duties keeps them from conducting
inspections on their own that thoroughly identify deficiencies and,
thus, ensure compliance.  Some FAA offices we visited have developed
ways to conduct inspections using teams rather than individual
inspectors and to do so without adversely affecting other demands on
inspectors' time.  Their actions hold promise as a "best practice"
that FAA could examine for broader application. 


   NUMBER OF INSPECTIONS CONDUCTED
   MEETS THE REQUIRED MINIMUM
---------------------------------------------------------- Chapter 2:1

Surveillance is one of the most important functions FAA inspectors
perform to ensure safety and regulatory compliance in the aviation
system.  Each year, FAA identifies specific surveillance activities
that must be conducted during the year, including an inspection of
each repair station.  This inspection is conducted by the FAA Flight
Standards district office that maintains a repair station's
certificate.  According to FAA's guidance, the inspection is to cover
all aspects of a repair station's operations, including the currency
of technical data, facilities, calibration of special tooling and
equipment, and inspection procedures.  The inspection is also to
ensure that the repair station is performing only work that it has
approval to do.  While FAA's guidance does not prescribe precisely
how each inspection must be conducted, it provides some direction on
how to perform a repair station inspection.  It does not require
inspectors to follow checklists or other prescribed approaches to
conduct the inspection. 

FAA's guidance requires, at minimum, one maintenance or avionics
facility inspection of each repair station per year.  Those repair
stations with both maintenance and avionics ratings receive at least
two facility inspections, one examining maintenance capabilities and
the other, avionics functions.  The standard of one inspection per
year has not changed in recent years as air carriers have increased
their reliance on repair stations.\1

All 2,800 repair stations in the United States and around the world
doing work on aircraft flown by FAA-certified air carriers received
the inspections FAA's guidance required in fiscal year 1996,
according to officials at FAA headquarters.  As partial verification
of the FAA officials' statement, we reviewed FAA's Program Tracking
and Reporting Subsystem (PTRS) data from the 13 FAA offices we
visited to determine if the offices had made the facility inspections
of the repair stations assigned to them.  In all, these 13 offices
were responsible for more than 950 inspections at over 750 repair
stations working for FAA-certified air carriers.  Our analysis of the
data confirmed that these minimum inspection requirements were met. 


--------------------
\1 Under fiscal year 1997 guidelines, FAA required inspectors
conducting facility inspections to also inspect the repair stations'
procedures for the detection of suspected unapproved parts. 


      TYPE OF INSPECTION VARIES
-------------------------------------------------------- Chapter 2:1.1

How repair stations are inspected varies based on decisions made by
both FAA managers and the inspectors themselves.  The approach also
varies depending on whether the repair station is in the United
States or abroad.  Moreover, review of some repair stations'
activities is not limited to the annual facility inspection.  Each
year, FAA selects a few facilities for special, in-depth inspections,
which FAA officials stated complement the surveillance conducted by
individual inspectors.  In the past 4 years, an average of only 23 of
these inspections have been conducted at repair stations per year
(less than 1 percent of the repair stations performing work for air
carriers). 

In practice, most facility inspections of domestic repair stations
are conducted by the individual inspectors who have been assigned the
oversight responsibility for the repair stations.  This approach is
FAA's front line of surveillance of repair stations.  The inspectors
assigned responsibility for repair stations are also assigned
oversight of other aviation activities such as air taxis,
agricultural operators, helicopter operators, and training schools
for pilots and mechanics.  In addition, the inspectors have other
duties such as certifying new operators and investigating accidents
and incidents. 

In performing routine surveillance, an inspector may make repeated
visits to a single facility to complete the inspection because there
is too much to accomplish in just one visit.  This is particularly
true at larger, more complex repair stations.  Inspectors responsible
for such repair stations told us that they often make multiple visits
to complete a single inspection.  FAA's guidance to inspectors also
recognizes that because the size of repair stations can vary from a
one-person operation to a large overhaul facility, the size and
complexity of the facility may warrant the inspection being conducted
by a team, rather than by an individual inspector.  Some FAA offices
do, in fact, assign teams to inspect some facilities. 

Like domestic repair stations, foreign repair stations are inspected
every year.  Unlike domestic repair stations, however, foreign repair
stations must renew their certification with FAA at least every 2
years.  The renewal inspection assesses whether the foreign repair
station continues to meet Federal Aviation Regulations and fulfills
FAA's requirement for an annual facility inspection.  The renewal
inspection and the facility inspection cover the same aspects of
repair station operations, according to FAA officials and inspectors
with both domestic and foreign oversight experience.  Like the
facility inspection, the renewal inspection can be performed by an
individual or by a team of inspectors.  In the six offices we visited
with responsibility for the oversight of foreign repair stations,
both types of inspections were generally conducted by teams,
particularly at larger repair stations. 

Each year, FAA does special, in-depth inspections at a small portion
of the repair stations in the United States and abroad through its
National Aviation Safety Inspection Program (NASIP) or its Regional
Aviation Inspection Program (RASIP).  FAA determines which facilities
should receive additional oversight through these comprehensive
reviews, selecting them on the basis of submissions from district and
regional offices.  In general, inspectors recommend, through their
offices, facilities for special inspections based on inspection
results or other reasons such as the size and complexity of
operations.  Although FAA's emphasis has been on in-depth inspections
of air carriers, repair stations have been part of the special
inspection effort.  In fiscal years 1993 through 1996, FAA conducted
428 special, in-depth inspections, 92 (or 21 percent) of which were
of repair stations.  Unlike the facility or renewal inspections,
special inspections are performed by teams of inspectors that are
independent of the district offices that have oversight
responsibility for the carriers or facilities being inspected. 


   TEAM INSPECTIONS PROVIDE MORE
   DETAILED REVIEW THAN THOSE
   CONDUCTED BY INDIVIDUAL
   INSPECTORS
---------------------------------------------------------- Chapter 2:2

Individual inspectors generally identify far fewer deficiencies than
teams do.  Although most repair stations are not inspected by both
individuals and teams, at the FAA offices we reviewed, 16 repair
stations routinely inspected by individuals were also inspected by
one or more special teams during fiscal years 1993 through 1996. 
These teams found a total of 347 deficiencies, of which only 15 (or 4
percent) had been identified by the individual inspectors in the 12
to 18 months prior to the special facility inspections. 

Because many of the deficiencies relate to work on specific aircraft
or components, and because aircraft or components at a repair station
vary from day to day, some variation in inspection findings is to be
expected.  However, a close look at the results suggests that
individual inspectors, even when they make multiple visits to repair
stations, may not identify many of the deficiencies that teams find. 
The special inspections we reviewed turned up many systemic
deficiencies, such as problems with training or quality assurance,
that appeared to be long-standing and that therefore could have been
detected in earlier inspections.  For example, a team conducting a
special inspection found that a repair station's manual contained
procedures for aircraft fuel servicing and fuel tank maintenance that
may have been counter to the policies of the air carriers for which
the work was done.  The individual inspector, who had visited this
repair station many times in the previous 18 months had not reported
this problem. 

Often, the deficiencies identified in the special inspections but not
in the regular inspections were significant.  The findings of special
inspections are categorized as (1) violations of Federal Aviation
Regulations, (2) violations of the repair stations' FAA-approved
repair station manuals, or (3) lack of systems to ensure continuing
compliance.  Of the deficiencies reported in the 19 special
inspections on 16 repair stations we reviewed, one-third involved
violations of FAA regulations (see fig.  2.1).\2 For example, an
inspection team found that a repair station was not segregating new
and serviceable parts from those parts that were not serviceable.  In
another case, a repair station on three occasions approved an
aircraft for return to service following a major repair that,
according to the inspector's report, was not completed "based on
FAA-approved technical data."

   Figure 2.1:  Types of
   Deficiencies FAA Teams
   Identified During Special,
   In-Depth Inspections

   (See figure in printed
   edition.)

Note:  Percentages are based on a total of 317 reported deficiencies. 
Although 347 deficiencies were reported, 30 were not categorized. 

Source:  FAA's data. 

Violations of a repair station's approved manual also accounted for
about one-third of the deficiencies.  For example, one team found a
repair station did not inspect subcontracted work in accordance with
its manual.  A floor mechanic was performing these inspections,
rather than the quality control inspector. 

We contacted 13 inspectors responsible for the repair stations
covered by the 19 special inspection reports to obtain their views on
why the special inspections found so many more deficiencies,
including ones that appeared to be long-standing.  They said the
pressure of other duties kept their individual reviews from being
more comprehensive.  For example, one inspector was responsible for 7
other repair stations, 11 air taxi operators, 3 helicopter and
agricultural operators, 11 executive aircraft, and more than 30
airmen.  In addition, while they were at the repair stations,
inspectors had to deal with employees' questions or concerns about
matters unrelated to the inspections.  All 13 inspectors said that
for reasons such as these, an individual inspector has a greater
chance of not identifying deficiencies, even after repeated visits. 


--------------------
\2 FAA does not have comparable data for deficiencies identified
during regular inspections.  Deficiencies are categorized only for
special inspections. 


      ATTRIBUTES OF QUALITY
      INSPECTIONS MORE PREVALENT
      IN TEAM INSPECTIONS THAN IN
      INDIVIDUAL INSPECTIONS
-------------------------------------------------------- Chapter 2:2.1

The quality of repair station inspections is important because
surveillance is one of FAA's primary means for ensuring that repair
stations continually meet Federal Aviation Regulations.  FAA's
guidance to inspectors states that if surveillance is to meet its
intended purpose, quality inspections are essential.  We developed
four characteristics of a quality inspection based on our initial
discussions with FAA officials and inspectors, staff from the U.S. 
Department of Transportation's Office of the Inspector General who
were involved with repair station work, Department of Defense
officials responsible for audits of carriers with contracts for
transporting military personnel, and airline quality assurance
officials.  These four characteristics, explained in table 2.1, are
independence, comprehensiveness, focus, and standardization.  In
subsequent discussions, FAA officials and inspectors agreed that a
quality inspection should have these four characteristics. 



                               Table 2.1
                
                Characteristics of a Quality Inspection

Characteristic                            Definition/explanation
----------------------------------------  ----------------------------
Independence                              Inspectors need to be free
                                          of undue interest or
                                          complacency regarding the
                                          repair station's operation.
                                          Inspectors who must deal
                                          with a repair station on an
                                          ongoing basis can lose their
                                          objectivity because they may
                                          feel they already know that
                                          the repair station's
                                          operations are in good
                                          order.

Comprehensiveness                         Each inspection needs
                                          sufficient time to cover all
                                          of the elements that are
                                          supposed to be covered.

Focus                                     The inspection needs to be
                                          performed without
                                          distraction. This means
                                          minimizing competing
                                          demands, such as dealing
                                          with repair station
                                          employees' questions or
                                          concerns about other
                                          matters. Too many
                                          distractions can prevent
                                          inspectors from conducting a
                                          thorough inspection.

Standardization                           Even though repair stations
                                          are different, each one
                                          needs to be reviewed for all
                                          of the applicable
                                          requirements. Use of an
                                          agreed-upon checklist or job
                                          aid helps to ensure that all
                                          similar inspections are
                                          conducted in a similar
                                          fashion.
----------------------------------------------------------------------
The size and complexity of many large repair stations are such that
an individual inspector may have difficulty maintaining these quality
characteristics.  In examining FAA's facility inspection records, and
in discussions with inspectors, we found these four characteristics
were more prevalent in facility inspections conducted by teams than
in those conducted by individual inspectors. 


         INDEPENDENCE
------------------------------------------------------ Chapter 2:2.1.1

Inspectors assigned to teams have no ongoing responsibility for the
repair station and have no relationship with its operator.  By
contrast, the individual inspector who conducts a facility inspection
is usually the one assigned to manage the repair station's
certificate for an extended period of time.  During this period, the
primary contact the repair station has with the FAA is through this
inspector.  Inspectors we spoke with during field visits consistently
stated that an inspector with a "fresh set of eyes" often identifies
deficiencies that the principal inspector misses. 


         COMPREHENSIVENESS
------------------------------------------------------ Chapter 2:2.1.2

Teams cover all subject areas during the course of their inspections,
whereas individual inspectors' other duties may limit the time they
can spend and the extent of work they can do during their visits to
repair stations.  Many of the inspectors responding to our survey
indicated that their ability to conduct a quality inspection was
affected by factors related to comprehensiveness (see fig.  2.2). 
For example, 75 percent of the respondents said having too many
inspection duties affected their ability to conduct comprehensive
inspections to some degree, with 43 percent saying it was a major
reason for the problem.  (For a more detailed breakdown of the survey
results for these and other survey topics, see app.  III.) In
addition, inspectors we spoke with at field offices said that it was
very difficult to cover everything at a large or complex repair
station.  For example, one inspector said the week he spends at a
large engine repair station is not enough time to complete a facility
inspection.  The size of the repair station and the complexity of the
work being done, he said, makes it difficult to ensure that he is
making a comprehensive inspection. 

   Figure 2.2:  FAA Inspectors'
   Responses on Barriers to
   Comprehensive Inspections

   (See figure in printed
   edition.)

Note:  Percentages may not add to 100 because a few respondents said
they had no basis to make a judgment. 


         FOCUS
------------------------------------------------------ Chapter 2:2.1.3

In a team inspection, completing a portion of an inspection is the
only duty of each team member.  An inspector conducting an inspection
alone faces work demands from other locations as well as divided
responsibilities at the repair station being inspected.  Inspectors'
responses to our survey also reflected concerns about their ability
to focus sufficiently during inspections (see fig.  2.3).  For
example, 80 percent of the inspectors responding indicated that
spending time on other duties had an effect on the quality of the
inspections they performed.  For example, during our interviews,
inspectors said they needed to spend time during inspection visits
answering questions or clarifying regulations for repair station
employees.  They said such duties were part of their job, but some
noted that these conflicting demands can interfere with their ability
to focus on the inspection they are trying to conduct. 

   Figure 2.3:  FAA Inspectors'
   Responses on Barriers to
   Focusing During Inspections

   (See figure in printed
   edition.)

Note:  Percentages may not add to 100 because a few respondents said
they had no basis to make a judgment. 


         STANDARDIZATION
------------------------------------------------------ Chapter 2:2.1.4

Inspection results can be more useful to inspectors and FAA if there
is assurance that all areas have been adequately covered.  If all
areas are covered, inspectors have greater assurance that the repair
station complies with regulations.  Checklists or other similar job
aids are one way to provide this assurance and to do so in a
structured, consistent manner.  A checklist or similar job aid for
repair station inspections would include all areas that inspectors
must review as part of the inspection as well as how the regulations
governing repair station activities relate to these areas.  At
present, however, FAA does not require the use of a checklist during
a repair station inspection. 

We found evidence from a number of sources that the use of an
effective checklist plays an important role in a thorough inspection. 
Officials from FAA, industry, and the Department of Defense (which
reviews air carriers before awarding defense contracts) told us that
they would question the comprehensiveness of any facility inspection
of a repair station that was not done using a job aid or checklist. 
Air carriers and the Department of Defense reported that their own
inspectors use such aids to guide their work.  They said the scope of
the inspection of many repair stations is large enough that it is not
difficult to overlook a portion of what must be covered. 

While FAA does not require the use of a checklist or job aid for
routine surveillance, teams, whether conducting routine or special
inspections, are more likely than individual inspectors to use
checklists or other job aids that help ensure that all areas are
covered, based on our observations.  We found that during team
inspections, team members use the same structured approach, typically
in the form of an inspection job aid or checklist, such as the NASIP
checklist.  For example, one overseas office that conducts its
inspections with in-house teams has a job aid covering each portion
of the inspection.  By contrast, we found that the approaches used by
inspectors conducting their own inspections varied greatly, and
individual inspectors were less likely to use checklists or other job
aids to ensure that all areas had been covered.  For example, while
one inspector showed us a detailed checklist he developed combining
guidance from the Airworthiness Inspector's Handbook with the
regulations applicable to repair stations, others said they do not
use any job aid and work instead from memory when inspecting repair
stations. 

We also found that when individual inspectors use a checklist, they
tend to use one that is not detailed enough to ensure that compliance
with regulations is checked.  FAA's standard, most commonly used job
aid, which is available to inspectors through the Flight Standards
Automated System, is not directly tied to the standards that repair
stations must meet.  Although it lists items to review, it does not
provide references to the regulations governing repair stations.  By
contrast, the checklist used during NASIP inspections provides this
link, as do the checklists and job aids the aviation industry uses to
evaluate repair stations.  Officials at the regional and office
levels have indicated that knowing how an inspection finding relates
to the regulations is important for pursuing enforcement action when
a violation is identified.  We found one office that requires all
inspectors to use a job aid tied to the regulations.  The office
manager said that by having all inspectors use a standardized
approach, he has greater assurance that effective and comprehensive
inspections are being performed and that repair stations are in
compliance with regulations. 

We asked FAA headquarters officials what they thought of encouraging
inspectors to make greater use of checklists and other job aids. 
They said that guidance and job task lists provided to inspectors
encourage the development of good work processes by each inspector
without removing the flexibility required for them to evaluate a
repair station's compliance.  However, the greater use of checklists
or other job aids to help ensure that comprehensive inspections are
being performed could be instituted in a way that does not diminish
the inspectors' flexibility.  At a minimum, these types of tools
would serve to remind the inspectors of the elements of the
inspection that are the most critical to safety. 


      INSPECTORS DESCRIBE OVERALL
      REPAIR STATION COMPLIANCE
      FAVORABLY, BUT SEE A NEED
      FOR IMPROVEMENT IN MANY
      AREAS
-------------------------------------------------------- Chapter 2:2.2

Most inspectors responding to our survey responded favorably when
asked for their general impressions about repair stations' overall
compliance with regulations.  Sixteen percent of the inspectors put
compliance at that top, or "excellent" level, 68 percent rated
compliance as "good," and 12.5 percent rated it as "fair." (See fig. 
2.4.)

   Figure 2.4:  FAA Inspectors'
   Views on the Current Overall
   Compliance of Repair Stations

   (See figure in printed
   edition.)

Inspectors acknowledged, however, that there was room for
improvement.  We asked inspectors about eight areas of compliance,
such as the repair stations' use of up-to-date manuals from
manufacturers and air carriers.  In each of the eight areas, more
than half of the inspectors surveyed saw the need for at least some
improvement.  Specifically, in none of the eight categories was the
percentage higher than 38 percent for respondents who thought little
or no improvement was needed.  By contrast, the percentage of
inspectors who saw a need for some or moderate improvement ranged
from 39 to 52 percent, and those who saw the need for great or very
great improvement ranged from 18.5 to 33 percent.  (See fig.  2.5.)

   Figure 2.5:  FAA Inspectors'
   Responses on Amount of
   Improvement Needed for Repair
   Station Compliance

   (See figure in printed
   edition.)

Note:  Percentages may not add to 100 because a few respondents said
they had no basis to make a judgment. 


   DIFFERENT APPROACHES TO REPAIR
   STATION SURVEILLANCE SHOW
   PROMISE
---------------------------------------------------------- Chapter 2:3

How could FAA offices, already facing a diverse and extensive mix of
responsibilities, do a better job of inspecting repair stations
without adversely affecting other operations?  To determine if there
were workable answers to that question, we turned to the field
offices themselves.  FAA field offices are given some flexibility by
FAA headquarters in deciding how to accomplish their surveillance
programs.  We looked to see if some of these offices had developed
alternative approaches that might hold promise for other locations. 
We identified several offices that had adopted approaches that might
prove useful on a broader scale.  In general, their practices fell
into two main categories:  (1) placing greater emphasis on the
oversight of repair stations and (2) finding ways to shift local
staff resources so that they could conduct more repair station
inspections with teams rather than with individual inspectors.\3 FAA
headquarters is also examining a revised approach to surveillance
that could help improve the inspection process. 


--------------------
\3 One criterion for our consideration of possible approaches was
that the approach require no additional resources beyond what the
field office believed it could commit to the oversight of repair
stations at current or anticipated staffing levels.  However, under
staffing increases approved by the Congress, many field offices will
have more inspectors.  Ch.  4 discusses the staff increases in
greater detail. 


      PLACING HIGHER PRIORITY ON
      INSPECTIONS OF REPAIR
      STATIONS
-------------------------------------------------------- Chapter 2:3.1

Some of the FAA field offices we reviewed, departing from the
standard approach to assigning inspectors' responsibilities, have
developed new approaches on their own to place greater emphasis on
repair stations.  Typically, inspectors working in a field office are
separated into two disciplines:  general aviation and air carrier. 
General aviation inspectors are assigned to specific repair stations
and also inspect operators covered by part 135 of the Federal
Aviation Regulations--that is, air taxi operators.  In addition, they
inspect other aspects of the industry such as agricultural aircraft
operators, technical schools for pilots and mechanics, and helicopter
operators.  Air carrier inspectors are responsible for operations
covered by part 121 of the Federal Aviation Regulations--that is, for
domestic air carriers.  They are assigned specific carriers to
inspect, and may, in that context, inspect the carriers' in-house
repair stations or those the carriers use, assessing whether repairs
being made conform with the carriers' FAA-approved maintenance
manuals.  Two FAA offices we visited have found this structure does
not recognize the importance of overseeing repair stations and are
pursuing other approaches that place a higher priority on it. 
Officials at FAA headquarters said they supported these efforts but
will first evaluate the results and then, if appropriate, use the
approaches at other offices. 


         SCOTTSDALE FLIGHT
         STANDARDS DISTRICT
         OFFICE, WESTERN-PACIFIC
         REGION
------------------------------------------------------ Chapter 2:3.1.1

In the Western-Pacific Region, officials have approved a new
organizational structure at the Flight Standards district office in
Scottsdale, Arizona.  Under the new structure, the district office is
divided into an air transport and an air commerce unit.  The air
transport unit oversees air carriers and large repair stations, while
the air commerce unit oversees air taxis, technical schools for
pilots and mechanics, and other operators.  Within the air transport
unit, one team focuses its work on the five largest repair stations
in the area, all of which perform heavy airframe maintenance. 
According to a district office supervisor, two additional staff
members with significant repair station experience have been hired in
the last 3 years.  The expanded staff made it possible to establish a
repair station team without asking for additional resources. 
Large-component repair stations, such as those working on landing
gear or engine parts, may be added to the team's responsibility at a
future date, an official said. 

According to district office staff, the office has been concerned
with FAA's lack of surveillance of larger, more complex repair
stations.  Inspectors stated that the reorganization will allow them
to spend more time on those facilities without affecting the
surveillance of smaller repair stations.  In conjunction with the
reorganization, office management also redistributed the repair
station workload among inspectors to allow them to provide more
effective surveillance of larger facilities. 


         SEATTLE FLIGHT STANDARDS
         DISTRICT OFFICE,
         NORTHWEST MOUNTAIN REGION
------------------------------------------------------ Chapter 2:3.1.2

The Seattle Flight Standards district office revised the position
description of several inspectors to place a greater emphasis on the
oversight of repair stations.  Under these revised position
descriptions, three maintenance inspectors, each with an assistant,
will be responsible for the nine largest and most complex repair
stations in the district.  According to a district office official,
FAA headquarters must approve this change because under the present
set of position descriptions for inspectors, all repair stations are
considered to have the same degree of complexity.  In a letter to the
regional office justifying the new positions, the district office
manager stated that the office has not had the resources to "become
proactive in the day-to-day activities of the facilities." For
example, at a repair station that works on over 400 aircraft annually
with a staff of 2,000, adequate surveillance was not provided in
several areas, such as compliance with customer airline procedures
and regulatory requirements, according to office staff.  In addition,
adequate spot checks of maintenance performed by the company had not
been made.  The inspectors responsible for this facility were
responsible for other facilities as well and did not have enough time
to do a comprehensive review of the repair station. 

Under the new position descriptions, the principal inspectors have
fewer responsibilities and so will be able to spend more time at each
of the large facilities assigned to them.  As in Scottsdale, the
workload for the inspectors in Seattle will change dramatically.  For
example, one inspector will go from overseeing 16 repair stations, 8
air taxi operators, 4 executive aircraft operators, 2 helicopter
operators, 2 agricultural operators, 45 airmen, and a pilot school to
overseeing just 7 repair stations, all of which are facilities
working on aircraft component parts.  The remaining responsibilities
will be distributed among existing and projected additional staff.\4


--------------------
\4 See ch.  4 for further discussion of FAA's approved staff
increases. 


         EUROPEAN INTERNATIONAL
         FIELD OFFICES, EASTERN
         REGION
------------------------------------------------------ Chapter 2:3.1.3

The Eastern Region has four international field offices, three in
Europe and one in New York.\5 Because the European offices are not
faced with many of the other responsibilities that domestic offices
must handle--such as overseeing pilot and mechanic schools,
agricultural aircraft, and certificate management of air
carriers--the primary focus of their work program is on the
certification and surveillance of repair stations along with limited
surveillance of U.S.  air carriers.  (The New York office handles
other responsibilities such as the oversight of foreign air carriers
and the International Aviation Assessment Program.) Consequently,
inspectors at the European offices are able to spend more time on the
surveillance of repair stations than their U.S.-based counterparts. 
All of the inspectors we interviewed at the European offices said
they spent 80 percent or more of their time on repair stations,
whereas inspectors at domestic offices said they spent only about 30
percent of their time on surveillance of all types of facilities,
including repair stations. 


--------------------
\5 The three European offices are in London, Brussels, and Frankfurt. 


      CONDUCTING MORE LOCALLY
      BASED TEAM INSPECTIONS
-------------------------------------------------------- Chapter 2:3.2

A second and closely related development we observed was the use of
locally based teams to conduct surveillance.  The use of in-house
teams in these offices ranges from making them the typical
surveillance approach, as in the international field offices, to
using them occasionally for areas in which problems have been
identified.  Because these teams are made up of local office staff,
the cost is lower than for special inspections conducted by NASIP or
RASIP teams assembled from around the country or around the region. 
Moreover, because local resources are used, the office can assess the
effect of this approach on the office's other responsibilities.  The
move toward team-based surveillance inspections was supported by the
inspectors we surveyed.  Officials at FAA headquarters also said they
support these efforts but will assess them before asking other
offices to make greater use of in-house teams. 


         SCOTTSDALE FLIGHT
         STANDARDS DISTRICT
         OFFICE, WESTERN-PACIFIC
         REGION
------------------------------------------------------ Chapter 2:3.2.1

Prior to the office's restructuring, staff at the Scottsdale Flight
Standards district office routinely performed team inspections on the
largest repair stations each year.  They also performed team
inspections on selected smaller facilities.  According to one
official at the office, team inspections are a big part of the
overall surveillance program because the office believes such
inspections are the only way it can ensure that the repair stations
are meeting all applicable regulations.  Use of team inspections is
expected to increase under the new office organization.  Team
inspections at the Scottsdale office are led by the principal
inspector, the person with the most knowledge about a repair station. 


         SEATTLE FLIGHT STANDARDS
         DISTRICT OFFICE,
         NORTHWEST MOUNTAIN REGION
------------------------------------------------------ Chapter 2:3.2.2

The Seattle Flight Standards district office has increasingly relied
on in-depth reviews conducted by teams of inspectors as a way to
strengthen its oversight of repair stations.  According to officials
in the region's Flight Standards Division, current surveillance of
repair stations, as well as surveillance of other certificate
holders, is not as effective as it should be.  As evidence, they cite
national statistics indicating that only five enforcement actions
(such as a warning notice or a civil penalty) result from every 1,000
inspections FAA conducts (an enforcement rate of 0.5 percent).  By
contrast, NASIP inspections, which are more in-depth, result in an
enforcement rate of 20 percent. 

District office officials said that the team approach is being used
so that the staff is more aware of what is happening at the
facilities they oversee.  Moreover, the office has found team
inspections conducted to date to be very successful.  For example, a
recent team inspection at a large component shop repair station
identified 17 deficiencies that the principal inspector said he had
not identified in several prior inspections.  According to the
inspector, his workload and the complexity of this repair station
prevented him from performing an inspection comprehensive enough to
identify the kinds of deficiencies found by a team.  This inspector,
along with others we interviewed at the district office, agreed that
team inspections are necessary for adequate surveillance in some
cases, particularly for larger, more complex repair stations. 


         MIAMI FLIGHT STANDARDS
         DISTRICT OFFICE, SOUTHERN
         REGION
------------------------------------------------------ Chapter 2:3.2.3

The Miami Flight Standards district office has established a quality
assurance unit that, among other activities, performs team
inspections of repair stations.  The teams inspect air carriers,
repair stations, and other operators in response to complaints or an
inspector's request.  According to a regional office official and the
district office supervisor of the inspection teams, the inspections
are more objective and comprehensive than the routine inspections. 
In addition, the inspections allow the team to identify and correct
potential problems that if left unaddressed could develop into
compliance problems.  From fiscal year 1993 through 1996, 32 in-depth
team inspections were conducted by the office, 14 of them at repair
stations. 


         INTERNATIONAL FIELD
         OFFICES
------------------------------------------------------ Chapter 2:3.2.4

At all six of the offices we visited that oversee foreign repair
stations, inspections are typically conducted by teams, although
smaller repair stations with very few employees or capabilities may
be assigned to only one inspector.  For example, the Frankfurt office
specifies that annual surveillance on a repair station with more than
100 employees be performed by a team of up to five inspectors.  The
team approach is used because the office does not believe an
individual inspector can cover an entire facility.  According to the
office's manager, a team provides broader, deeper coverage and the
end result is that more deficiencies are identified. 

As in the NASIP and RASIP special inspections, segments of the
facility inspection are divided among the participating inspectors. 
For example, one inspector will review the landing gear and window
repair shops, while another will inspect the technical library and
the calibration laboratory.  The principal inspector assigned to the
facility acts as the team leader and prepares the findings presented
to the repair station at the conclusion of the inspection. 
Inspectors responsible for foreign repair stations said that although
they may visit some repair stations only once a year, less than when
they performed domestic repair station surveillance, the surveillance
of foreign repair stations is more thorough because of the team
approach. 


         INSPECTORS SUPPORT
         GREATER USE OF TEAM
         INSPECTIONS
------------------------------------------------------ Chapter 2:3.2.5

A substantial number of the inspectors we surveyed supported the use
of more team inspections.  Figure 2.6 shows survey responses on using
team inspections to improve compliance.  Results show that 71 percent
of the inspectors responding favor using team inspections staffed
from within the district office, and 50 percent favor an increase in
NASIP or RASIP inspections staffed from offices nationwide or within
the region.  Opposition was weak both to locally based team
inspections (11 percent) and to the increased use of NASIP or RASIP
inspections (16 percent). 

   Figure 2.6:  FAA Inspectors'
   Responses on Using Teams to
   Improve Compliance

   (See figure in printed
   edition.)

Note:  Percentages may not add to 100 because a few respondents said
they had no basis to make a judgment. 

This support was affirmed in our interviews with inspectors at the
offices we visited.  One inspector stated that while he worked in the
airline industry, the company would never send fewer than two
inspectors to a contract repair station.  Still other inspectors
stated that individually, they are unable to obtain reasonable
assurance of compliance with regulatory requirements at larger
facilities. 


      NEW INSPECTION APPROACH FOR
      AIR CARRIERS MAY HAVE
      APPLICABILITY FOR REPAIR
      STATIONS
-------------------------------------------------------- Chapter 2:3.3

Other developments within FAA may have future implications for how
repair station inspections are conducted.  One recommendation from
FAA's 90-Day Aviation Safety Review completed in September 1996 was
the creation of the Certification Program Office, which would include
a National Certification Team to assist local Flight Standards
district offices in processing new air carrier certifications.  In
addition, the new office will also include a centralized safety
analysis and information management office that will assist
inspectors in targeting surveillance resources and taking necessary
corrective actions to mitigate safety risks.  These approaches to
improving the surveillance of air carriers can also be applied to the
surveillance of repair stations' operations. 

In a separate effort, FAA is testing a method of surveillance that
emphasizes the compliance with specific regulations rather than the
completion of a series of inspections.  According to an FAA official
involved with this test, FAA is examining this new approach because
it is concerned that the current approach does not adequately link
inspections to specific regulations.  The test is being done on air
carriers, not repair stations, but it could potentially be extended
to repair stations, according to FAA personnel. 

FAA's current inspection approach is based on the National Program
Work Guidelines, issued annually by FAA headquarters.  These
guidelines list specific inspections that must be completed.  The
guidance tells inspectors what types of inspections to perform, but
it does not tell them what regulations they are to verify compliance
with. 

The new approach, called "virtual recertification," works in much the
opposite way.  Instead of specifying the types of inspections to
perform, it specifies the applicable safety regulations to be checked
and leaves it up to the inspector to determine how to verify
compliance.  Given this emphasis, the inspector must ensure that
surveillance activities are comprehensive enough to cover all aspects
of the regulations.  For example, an inspector would verify that the
repair station is meeting requirements under 145.47(b), specifically,
that the repair station ensures that all inspection and test
equipment is tested at regular intervals to ensure correct
calibration to a standard derived from the National Bureau of
Standards.  This approach may prove more successful at ensuring that
important safety requirements are not omitted from surveillance. 

FAA is testing the approach in one region, where it is being applied
to two air carriers.  The region would like to extend the test to one
large repair station as well, according to FAA officials.  Although
it is too early to judge the effects of this test on FAA's approach
to surveillance and its potential effect on repair stations is
unknown, it may influence how FAA headquarters and offices adjust
their future oversight of repair stations to provide the maximum
benefit with the limited resources available. 


   CONCLUSIONS
---------------------------------------------------------- Chapter 2:4

FAA appears to have the opportunity to enhance the effectiveness of
its repair station inspections.  While just one inspector may be
sufficient to conduct surveillance on smaller or more specialized
repair stations, this approach does not appear to be nearly as
effective at large, complex facilities.  At such facilities, team
inspections have proven more effective in identifying deficiencies. 
In addition, team inspections do a better job of incorporating the
four characteristics of quality inspections, in that they are more
independent, comprehensive, focused, and standardized than
inspections conducted by individual inspectors. 

Acting on their own, several FAA offices are reconfiguring their
staffs and adjusting their operations to conduct more team
inspections.  Their approaches hold promise both for making more
efficient use of inspection staff and for improving the quality of
surveillance.  FAA headquarters officials support these efforts but
will evaluate them before asking other offices to examine such an
approach.  We think it is appropriate for all district offices,
especially those with high concentrations of repair stations, to
reevaluate their organization and surveillance approach to determine
if they can make better use of their current inspection resources. 
For example, an office may determine that local team inspections are
appropriate and a good use of resources for repair stations that are
large, complex, or have higher rates of noncompliance. 

An analysis of the widely varying inspection approaches also
highlights the importance of a standardized checklist or other
effective job aid in ensuring that inspections are comprehensive. 
Repair stations can be very complex, and a checklist can help ensure
that all applicable areas are covered and that this coverage is
consistent from facility to facility.  Such checklists are in
widespread use by other organizations, such as air carriers and the
Department of Defense, that conduct similar types of inspections. 
Where they are already in use within FAA, they appear to improve both
comprehensiveness and standardization.  Wider use of such checklists
appears to be another appropriate way to increase the effectiveness
of FAA's inspection effort. 


   RECOMMENDATIONS
---------------------------------------------------------- Chapter 2:5

We recommend that the Secretary of Transportation instruct the
Administrator of FAA to (1) expand the use of locally based teams to
conduct routine facility inspections, particularly for facilities
that are large, complex, have higher rates of noncompliance, or meet
predetermined risk indicators; and (2) develop and use checklists or
job aids for inspectors that allow a greater degree of
comprehensiveness, standardization, and assurance that the repair
station complies with regulatory requirements. 


   AGENCY COMMENTS
---------------------------------------------------------- Chapter 2:6

FAA agreed with the recommendations.  With regard to expanding the
use of locally based teams to conduct inspections, FAA headquarters
officials said they support field office efforts currently under way
but will assess these efforts before asking other offices to make
greater use of in-house teams.  While agreeing with the
recommendation to provide better job aids for inspectors, FAA
officials did not provide specific details on how or when they would
implement this recommendation. 

In addition, FAA cited several agency initiatives that it said are
under way to enhance its oversight of the repair station sector of
the aviation industry.  FAA said its 90-day safety review conducted
last year recommended the creation of an analytical unit that could
provide safety trend data to inspectors.  FAA said an office within
the Flight Standards Service was created on May 20, 1997, to provide
data that will help focus inspection and other resources.  The review
also recommended that field and division managers be given
flexibility to determine the skills needed in a particular field
office to ensure the appropriate mix of technical, paratechnical,
support, and clerical expertise.  FAA said that this flexibility will
be supported through the establishment of new staffing standards--a
long-term project that is already under way.  FAA also said that it
had recognized the need to evaluate the air operators safety systems,
including those of repair stations, and had initiated a Surveillance
Improvement Program.  Under this program, a team of safety
inspectors, technical personnel, and managers, aided by Sandia
National Laboratories, investigated ways to improve the surveillance
process.  The team recommended improvements in standardization and
communication, as well as other areas that will allow FAA to evaluate
compliance more effectively.  Efforts are under way to implement the
fundamental changes to surveillance that were recommended by this
team. 


INCOMPLETE DOCUMENTATION OF
INSPECTIONS MAKES EXTENT OF
FOLLOW-UP DIFFICULT TO DETERMINE
============================================================ Chapter 3

In many instances, we were unable to determine how well FAA was
following up to ensure that repair stations corrected deficiencies
identified during inspections.  Particularly for domestic repair
stations, the lack of documentation made it impossible to assess how
quickly or thoroughly repair stations brought themselves into
compliance.  Documentation was better for foreign repair stations,
which generally appeared to be correcting deficiencies quickly to
qualify for renewal of their certificates.  Resolving problems with
documentation is particularly important because FAA is taking new
steps to use its management information systems to determine where
inspection resources should be targeted.  Incomplete data can make
such efforts less effective. 


   INFORMATION ON INSPECTION
   RESULTS IS IMPORTANT BUT
   INCOMPLETE
---------------------------------------------------------- Chapter 3:1

Much of the value of inspection activity is not in finding and
listing problems but in resolving the problems effectively, according
to FAA field office managers and supervisors.  They said that
although much of the resolution may hinge on the working relationship
between the FAA inspector or inspectors and the repair station's
personnel, effective documentation of the actions taken is a
necessary part of demonstrating what problems were found, what was
done to resolve them, and whether all parties are in agreement that
deficiencies have been corrected.  FAA officials acknowledged that
effective documentation of inspection and follow-up activity is
needed. 


      TYPES OF INFORMATION NEEDED
      FOR BASIC DOCUMENTATION AND
      MANAGEMENT REPORTS
-------------------------------------------------------- Chapter 3:1.1

FAA's guidance is limited in specifying for inspectors what documents
to include in repair station files.  FAA's files on repair stations
are the agency's official record of inspection-related activity--and
therefore the backbone of any system that uses management information
to help spot trends, identify problems, and target inspection
resources, according to field office managers and supervisors.  The
guidance points out generally that the kinds of documentation of
inspections and surveillance activities include inspection reports
and related correspondence, but the guidance does not specifically
require that any document be included.  The closest thing to a
requirement is a statement in the Airworthiness Inspector's Handbook
that the letter to the repair station describing all deficiencies
should be included in the case file. 

After analyzing FAA's inspection and follow-up program, we determined
that, at a minimum, the files need to contain the following if the
extent to which repair stations are correcting problems in a timely
manner is to be monitored: 

  -- a memo to the file or other documentation showing that an
     inspection was performed, what was inspected, and the results;

  -- a deficiency letter from FAA informing the repair station of the
     problems that needed to be corrected;

  -- a response from the repair station indicating what actions it
     was taking to address the deficiencies; and

  -- a memo to the file or other acknowledgment that the repair
     station's actions were an acceptable response and that the
     deficiencies had been resolved. 

FAA officials agreed that these items are important in developing
complete supporting information about the extent to which
deficiencies were being resolved in a timely fashion. 

We believe--and FAA officials agreed--that beyond effective
documentation in the repair station files, FAA also needs an
effective management information system for capturing this basic
information, combining it with information from other activities, and
synthesizing it in ways that allow management to plan surveillance
activities, schedule manpower resources, evaluate accomplishments,
analyze results for patterns or trends, and modify planned
activities.  FAA's management information tool for its inspection
activity is its Program Tracking and Reporting Subsystem (PTRS).  To
provide data for planning and oversight of FAA's inspection program,
inspectors record inspection results in the computer-based PTRS. 
FAA's PTRS Procedures Manual requires that inspectors record
comprehensive reports demonstrating that inspections were performed,
including inspection results, whether the repair station took any
action, and whether the inspector took any follow-up action to ensure
that deficiencies were corrected. 

Our analysis of the system showed that the key items of information
needed for useful management reporting are the following: 

  -- an indication that a repair station was inspected and the
     results;

  -- an indication that all deficiencies were communicated to the
     repair station in a deficiency letter; and

  -- an indication that the deficiency letter was "closed out" when
     corrective actions by the repair station were determined to be
     acceptable by the inspector. 

FAA officials agreed that PTRS should contain these items of
information if the system's reports are to be of substantial use. 


      EXTENT OF DOCUMENTATION IN
      REPAIR STATION FILES
-------------------------------------------------------- Chapter 3:1.2

We did not find sufficient information in FAA's repair station files
to assemble a clear picture of how quickly and completely
deficiencies found during the inspections of repair stations were
being corrected.  This was particularly true for domestic repair
stations.  In all, we reviewed the files on 331 domestic and 157
foreign repair stations for fiscal years 1993 through 1996.\1
Determining the speed and completeness with which deficiencies were
corrected was not possible for the following reasons: 

  -- When there was evidence that problems had been found, evidence
     of corrective action was usually absent.  Of the 331 domestic
     files reviewed, 96 contained deficiency letters, indicating that
     the facility had been notified that problems existed.  Response
     letters from repair stations were present for 73 percent of the
     deficiency letters.  However, only 22 percent of the deficiency
     letters were accompanied by documentation showing that the
     repair stations' responses about resolving deficiencies were
     acceptable (see fig.  3.1). 

  -- When there was no evidence in a file of a problem at a facility,
     this alone could not be taken as assurance that no problems had
     been found.  Even for the 235 files that did not contain
     deficiency letters, it was not possible to assume that FAA
     inspectors had not identified deficiencies because the files
     contained no documentation showing that an inspection had been
     completed.\2

   Figure 3.1:  Extent of
   Follow-Up Documentation for
   Inspections of Selected
   Domestic Repair Stations,
   Fiscal Years 1993 Through 1996

   (See figure in printed
   edition.)

\a Files did not indicate whether these repair stations received
satisfactory inspections. 

\b Percentages are based on follow-up documentation for 172
deficiency letters (some repair stations had more than one deficiency
letter during the period examined).  Categories are exclusive of each
other and do not add to 100. 

Our review of files on foreign repair stations found more complete
documentation that follow-up had occurred (see fig.  3.2).  We
reviewed 157 files and found deficiency letters in 135.  Response
letters from repair stations were present for nearly 80 percent of
the 356 deficiency letters in these 135 files.  An even higher
percentage--85 percent--contained some form of documentation
indicating that FAA had followed up.  For most repair stations, this
documentation took a form not found in domestic files--a certificate
renewal letter.  Unlike domestic repair stations, foreign repair
station certificates are subject to renewal by FAA at least every 24
months.  In practice, many are renewed every year, according to FAA
personnel.  As part of the renewal, the FAA office issues a new
certificate once it is satisfied that the repair station has taken
appropriate actions to resolve the deficiencies.  While certificate
renewal letters were the most common form of follow-up documentation,
nearly one-fourth of the files with deficiency letters also contained
additional evidence of FAA's analysis of the repair stations'
responses. 

   Figure 3.2:  Extent of
   Follow-Up Documentation for
   Selected Foreign Repair Station
   Inspections, in Fiscal Years
   1993 Through 1996

   (See figure in printed
   edition.)

\a Files did not indicate whether these repair stations received
satisfactory inspections. 

\b Percentages are based on follow-up documentation for 356
deficiency letters (some repair stations had more than one deficiency
letter during the period examined).  Categories are exclusive of each
other and do not add to 100. 

One office has taken a further step to tie the renewal letter more
closely to the resolution of deficiencies.  According to the manager
of the Frankfurt field office, the office recognized in 1996 that
files contained no formal documentation that a repair station had
taken corrective action because the renewal letters did not
specifically mention it.  As a result, the office revised the renewal
letter, adding a statement that reads, "We are pleased to inform you
that the corrective actions and corrective action plan developed
subsequent to the Frankfurt International Field Office repair station
inspection, has been reviewed and accepted by the principal
inspector(s)." The office began using these letters in August 1996. 


--------------------
\1 Our set of 488 files was based on a judgmental sample taken at 11
of the 13 domestic and foreign FAA offices we visited.  The sample
ranged between 44 and 100 percent of those repair stations for which
the office had oversight responsibility and was limited to only
repair stations doing work for air carriers. 

\2 In our review of the files at domestic and foreign offices, when
FAA's documentation did not include copies of deficiency letters, we
did not follow up to determine whether repair stations had actually
received letters. 


      EXTENT OF DOCUMENTATION IN
      DATABASE RECORDS
-------------------------------------------------------- Chapter 3:1.3

Documentation in PTRS is even less complete than documentation in the
individual files on repair stations.  We examined PTRS records to
determine the degree to which they contained inspection and follow-up
information for the deficiency letters we found in our review of
domestic and foreign repair station files.  PTRS generally showed
that an inspection had been conducted, but responses on actions to
correct deficiencies were less frequently recorded than in the files,
as were indications that closure had been reached.  A great deal of
inconsistency was reflected in the data entered into the system. 
Some inspectors entered inspection results in great detail, others
entered only partial data, and still others entered no data at all
about the deficiencies found.  For example, the PTRS entry for one
inspection said, "Discrepancies listed in letter dated 04/16/96," and
provided no indication whether deficiencies had been corrected.  In
another example, the deficiency letter showed the inspector had
documented nine deficiencies, but PTRS showed only three of these
deficiencies and did not show if any had been corrected. 


      LACK OF RELIABLE
      DOCUMENTATION IS A
      LONG-STANDING PROBLEM
-------------------------------------------------------- Chapter 3:1.4

As far back as 1987, we have reported on FAA's shortcomings in having
current and reliable information on key program elements.  In 1991,
we reported that the data in PTRS were unreliable for providing
information on the performance of FAA's inspection program and were
inadequate for ensuring the accomplishment of key elements of the
inspection program.\3

In 1995, we concluded that FAA may be building its future information
management system from a number of databases that contain incomplete,
inconsistent, and inaccurate data.\4 Again in 1996, we reported that
until FAA implements a strategy to improve the quality of its data,
problems with data quality may limit the usefulness of the system and
prevent FAA from realizing its full potential for targeting limited
inspection resources to higher-risk activities.\5 In response to our
reports, FAA has developed and implemented a comprehensive strategy
to improve data quality. 

The Department of Transportation's Inspector General has made similar
observations.  In March 1994, the Inspector General reported that FAA
inspectors do not routinely document items inspected at repair
stations or follow-up actions taken.\6 In 1995, the Inspector General
found that FAA inspectors were not interpreting PTRS reporting
procedures consistently, resulting in inaccurate, inconsistent
reports.\7


--------------------
\3 Aviation Safety:  Problems Persist in FAA's Inspection Program
(GAO/RCED-92-14, Nov.  20, 1991). 

\4 Aviation Safety:  Data Problems Threaten FAA Strides on Safety
Analysis System (GAO/AIMD-95-27, Feb.  8, 1995). 

\5 Aviation Safety:  New Airlines Illustrate Long-Standing Problems
in FAA's Inspection Program (GAO/RCED-97-2, Oct.  17, 1996). 

\6 Audit of the Certification and Surveillance of Domestic and
Foreign Repair Stations:  Federal Aviation Administration, Office of
Inspector General, U.S.  Department of Transportation, R4-FA-4-009
(Mar.  7, 1994). 

\7 Surveillance of Pilot Schools:  Federal Aviation Administration,
Office of Inspector General, U.S.  Department of Transportation,
R9-FA-002 (Nov.  8, 1995). 


      QUALITY OF DATA THREATENS
      EFFECTIVENESS OF NEW
      MANAGEMENT INFORMATION
      INITIATIVE
-------------------------------------------------------- Chapter 3:1.5

The quality of PTRS data is important because PTRS is expected to
provide data for FAA's new information management initiative, the
Safety Performance Analysis System (SPAS).  SPAS is a computer-based
analysis system designed to assist FAA in applying its limited
inspection resources to those entities and areas that pose the
greatest risk to aviation safety.  This system, estimated to cost $32
million to develop and install, is also expected to highlight
particular types of repair stations for increased surveillance or
oversight because they are experiencing problems at rates that exceed
the averages for that group.  However, if the data on which SPAS is
based are not complete and accurate, FAA could be limited in its
ability to identify trends and target inspection resources. 

In the past, we have recommended data improvements as a preliminary
step to implementing SPAS.  Our 1995 report, which concluded that
SPAS will not be effective if the quality of its data is not
improved, recommended that FAA develop and implement a comprehensive
strategy to make such improvements.  FAA agreed with this
recommendation.  Although FAA initially intended to have its approach
in place by the end of 1995, it was October 1996 when FAA issued a
strategy that provides clear and measurable objectives for data
quality, accurate assessments of the quality of the current data in
each database (including an analysis and possible redirection of
FAA's existing initiatives to improve data quality), milestones for
attaining the stated quality objectives, and estimates of the
resources required.  According to headquarters officials, full
deployment of SPAS will be completed in December 1999, as required by
legislation.  Even so, until FAA completes the implementation of its
strategy to improve data quality, problems with data quality will
limit SPAS' usefulness and prevent it from realizing its full
potential. 


   COMPLIANCE MAY COME MORE
   QUICKLY AT FOREIGN REPAIR
   STATIONS
---------------------------------------------------------- Chapter 3:2

While the lack of good documentation precludes a precise comparison
of FAA's follow-up of deficiencies at foreign and domestic repair
stations, some inspectors said that compliance comes more quickly at
foreign repair stations.  We interviewed 34 FAA inspectors who had
conducted inspections of both foreign and domestic repair stations,
and they were unanimous in concluding that compliance came more
quickly at foreign stations.  They said quicker compliance meant
inspectors spent less time on follow-up and had more time for other
work.  The inspectors attributed this quicker compliance to the
renewal requirement for foreign repair stations.  Under FAA
regulations, foreign repair stations must renew their certificates
within 12 months of initial issuance and then at least every 24
months thereafter.  By comparison, domestic repair stations retain
their certificates indefinitely unless their operations are so badly
run that FAA elects to take legal action to suspend or revoke their
certificates.  According to some inspectors, because new certificates
cannot be issued until problems are resolved, foreign repair stations
have an incentive to correct problems more quickly.  Because of the
poor documentation of the inspection results for domestic repair
stations, however, we were unable to validate the inspectors' views
or to verify whether foreign repair stations achieve compliance in a
more timely fashion than domestic repair stations. 


      OPINIONS VARY ON
      ADVISABILITY OF EXTENDING
      RENEWAL REQUIREMENT TO
      DOMESTIC REPAIR STATIONS
-------------------------------------------------------- Chapter 3:2.1

Within FAA, the strongest support for extending the certificate
renewal requirement to domestic repair stations comes from inspectors
who have inspected both foreign and domestic repair stations.  They
solidly supported extending renewal to domestic repair stations to
gain quicker resolution of noncompliance issues.  Of the inspectors
responding to our mail survey who had experience with foreign repair
stations in fiscal year 1996, 89 percent supported extending the
requirement.  Similarly, 31 of the 34 inspectors we interviewed who
had inspected both kinds of repair stations said they favored a
domestic renewal requirement.  In our discussions with inspectors, we
were told that the lack of a renewal requirement makes inspectors
less efficient because they must spend more time following up on
repair stations with deficiencies and less time on much needed
surveillance or other responsibilities.  A specific deadline for
correcting deficiencies to retain certification creates an incentive
or sense of urgency to resolve deficiencies in a timely manner. 

Inspectors with experience only with domestic repair stations were
somewhat less favorable toward certificate renewal.  Our survey
results show that 48 percent of the respondents who had experience
only with domestic repair stations in fiscal year 1996 were not in
favor of renewing domestic repair station certificates on a regular
basis (for example, every 24 months) as a way to improve compliance. 
Our follow-up discussions with 39 inspectors who had experience only
with domestic repair stations identified their reason for opposing
such a requirement was a concern that substantially more work would
be generated.  However, this perception appears to be unfounded.  The
34 inspectors we interviewed who had inspected both kinds of repair
stations indicated that extending the requirement would not place
additional requirements on inspectors.  These inspectors said
inspection requirements for renewal were the same as those for the
annual facility inspection. 

Support for extending the renewal requirement was lowest among FAA
management.  They did not agree with inspectors who said that renewal
would improve safety by obtaining quicker resolution of noncompliance
problems.  The Acting Manager of the Aircraft Maintenance Division
said, for example, "No one has demonstrated that FAA would get one
added ounce of safety if it revised the rule to require
recertification of domestic repair stations." They also raised
several concerns about adopting this approach. 

Additional resources would be needed.  According to the Acting
Manager of the Aircraft Maintenance Division, it would take too many
resources (staff time, etc.) to recertify every repair station.  We
pointed out that according to inspectors who had done both facility
and renewal inspections, the requirements were the same.  For the
most part, he did not provide us with further information about what
additional resources would be needed if the recertification
requirement were extended.  FAA attorneys, however, said they would
need additional resources to process any cases stemming from the
denial of recertification. 

Current procedures already allow certificates to be revoked.  The
current enforcement process utilizes a range of enforcement
actions--from educational and remedial to punitive legal enforcement
remedies, including fines and criminal sanctions in the most serious
cases.  When FAA determines that an immediate need exists to protect
public safety, it can issue an emergency order revoking or suspending
a certificate.  However, although revoking a domestic repair
station's certificate is a possibility if the facility remains out of
compliance, it is a time-consuming process that can often take years. 
In a forthcoming GAO report on FAA enforcement actions, we analyzed
all 2,200 certificate actions (this figure includes airlines, repair
stations, pilots, etc.) taken during fiscal year 1996 and found that
it took an average of 13 months to close an enforcement case.  Our
point is not that a sizeable number of repair stations have such
serious deficiencies that FAA should undertake enforcement actions. 
Rather, it is that certificate renewal appears to operate as a sort
of "gate" that helps ensure that repair stations quickly fix their
problems, big or small, thus helping to bring their operations up to
the quality intended by Federal Aviation Regulations. 

Due process could be a concern.  A headquarters official said that if
FAA allows an inspector to make the decision about whether a repair
station keeps or loses its certificate, it could infringe on the due
process requirements afforded domestic repair station operators. 
However, according to FAA attorneys, due process would not be a
concern.  The manager of the FAA Airworthiness Law Branch explained
that as currently is the case with foreign repair stations, the final
decision not to renew a certificate would rest with the
Administrator.  The same due process rights accorded to foreign
repair stations would apply to domestic repair stations. 


   CONCLUSIONS
---------------------------------------------------------- Chapter 3:3

Our audit work and recent work by the Department of Transportation's
Inspector General have identified continuing problems with the
documentation of inspections and the quality of data entered into the
Program Tracking and Reporting Subsystem, FAA's tracking system. 
FAA's guidance is very limited in specifying what documentation
offices should keep.  As a result, the documentation contained in the
files on domestic repair stations, which acts as the official record
of dealings between FAA and repair stations, did not contain
sufficient data for us to determine how quickly and completely
deficiencies found during inspections were being corrected.  While
FAA's computer-based tracking system gives the agency means for
overseeing the inspection program, problems with the quality of its
data could jeopardize the reliability of FAA's new computerized
system, the Safety Performance Analysis System, in determining when
to target greater inspection resources to repair stations that
warrant more intensive oversight than others.  In previous reports,
we have recommended that FAA develop and implement a comprehensive
strategy to improve the quality of all data used in its databases. 
Until FAA completes the implementation of this strategy, the extent
and the impact of the problems with the quality of the system's data
will remain unclear. 

Data problems notwithstanding, there is some anecdotal evidence that
foreign repair stations may have greater incentive than domestic
repair stations to quickly fix deficiencies found during inspections
because foreign repair stations are faced with a certificate renewal
requirement and domestic repair stations are not.  However, we were
unable to verify this because of FAA's poor documentation,
particularly for domestic repair stations.  Quick correction of all
problems, large or small, helps to ensure better repair station
operations, and having to do less follow-up to determine whether
repair stations have taken corrective action frees FAA inspectors to
conduct other work.  Views within FAA vary widely as to whether a
certificate renewal requirement, which appears to be at the heart of
quicker compliance, should be extended to domestic repair stations. 
Although the evidence is not complete enough to support a
recommendation that FAA take such a step, extending the certificate
renewal requirement remains a potential option for consideration. 


   RECOMMENDATIONS
---------------------------------------------------------- Chapter 3:4

To ensure that FAA inspectors are effectively documenting and
resolving deficiencies found during inspections, we recommend that
the Secretary of Transportation instruct the Administrator of FAA to
take the following actions: 

  -- Specify what documentation should be kept in files on repair
     stations to record complete inspection results and follow-up
     actions.  The documentation should include inspection results,
     deficiency letters, repair station responses to deficiencies,
     and FAA's responses indicating that the deficiencies were
     corrected. 

  -- Monitor the implementation of the strategy to improve data
     quality to ensure it is completed as soon as possible so that
     the data used in SPAS are reliable when the system is fully
     implemented in 1999. 


   AGENCY COMMENTS
---------------------------------------------------------- Chapter 3:5

FAA agreed with these recommendations but did not indicate how or
when it would implement them. 


ACTIONS CURRENTLY UNDER WAY TO
AUGMENT OVERSIGHT OF REPAIR
STATIONS
============================================================ Chapter 4

Following the May 1996 crash of a ValuJet airplane in the Florida
Everglades, FAA announced six initiatives to upgrade the oversight of
repair stations.  These initiatives are not aimed at the inspection
and follow-up activities discussed in the previous chapters. 
Instead, the initiatives are aimed at clarifying and augmenting the
oversight role of air carriers, which, under FAA regulations, share
responsibility for ensuring that repair stations are qualified to do
the work and are performing responsibly.  FAA did not intend that
these initiatives would provide for any significant improvements in
FAA's own inspections of repair stations.  However, other efforts now
under way, coupled with our recommendations in the previous chapters,
could help address problems with current inspections. 

For many years, FAA officials have acknowledged that regulations
governing the inspection of repair stations need to be improved. 
Since 1989, FAA has been in the process of revising these
regulations.  Though progress has been made, FAA officials remain
uncertain about when the proposed regulations will be published for
review and comment.  Inspectors responding to our survey said
overwhelmingly that revised regulations would help the oversight
effort.  FAA is also adding more than 700 inspectors to its ranks who
will, in part, oversee repair stations.  Survey responses from
current inspectors indicated that the success of this effort will
depend in part on the qualifications of new inspectors and on the
training available to all those in the inspector ranks.  Finally, FAA
is revising its regulations to require that repair station mechanics
receive more training. 


   EXISTING INITIATIVES ARE
   TARGETED PRIMARILY AT AIR
   CARRIERS
---------------------------------------------------------- Chapter 4:1

FAA announced the improvements to its inspection policies on June 18,
1996.  These improvements consist of six specific initiatives
designed, according to FAA, to "toughen the FAA's oversight of
airlines that rely on contract maintenance and training." Under
Federal Aviation Regulations, air carriers share with FAA the
responsibility of ensuring that repair stations are conducting work
that meets safety standards.  FAA is responsible for ensuring that
repair stations comply with regulations; air carriers are responsible
for ensuring that repair stations perform maintenance in accordance
with the air carriers' manuals.  The six initiatives were issued
because FAA identified problems in the way some air carriers provided
oversight of repair stations, according to FAA's Deputy Associate
Administrator for Regulation and Certification.  Accordingly, FAA's
initiatives focus on strengthening the oversight role of air
carriers, not on modifying FAA's own approach to inspecting repair
stations and ensuring that corrective action is taken. 

The six initiatives involve actions to be taken by the air carriers
or by FAA inspectors overseeing air carriers (see fig.  4.1). 
Collectively, these initiatives require that (1) air carriers
demonstrate regulatory compliance for each of their contract
facilities doing substantial heavy maintenance or repairs; (2) FAA
ensure that air carriers list all contractors performing substantial
maintenance for them; and (3) air carriers audit repair stations they
want to begin using.  They also call for additional review by FAA
inspectors--mainly those inspectors who oversee air carriers. 

   Figure 4.1:  June 1996
   Initiatives Designed to Improve
   Air Carrier Oversight of Repair
   Stations

   (See figure in printed
   edition.)

Because these initiatives were directed at air carriers, they had
little or no effect on FAA's direct oversight of repair stations.  In
fact, all 72 repair station inspectors who responded specifically to
our question about the impact of FAA's initiatives said that the
initiatives and guidance have had no impact on the extent of their
surveillance activities.  They told us that because the initiatives
were directed at the air carriers and the FAA inspectors responsible
for overseeing the air carriers, rather than at the inspectors
overseeing repair stations, their oversight activities have not
changed. 


      FAA HAS TAKEN STEPS TO
      IMPLEMENT ALL SIX
      INITIATIVES
-------------------------------------------------------- Chapter 4:1.1

FAA implemented these initiatives through two major efforts--issuing
guidelines and issuing a handbook bulletin.  In July 1996, FAA
headquarters issued the National Flight Standards Work Program
Guidelines.  These guidelines stated that air carriers would be
required to demonstrate that programs at each major repair station
complied with regulations.  The guidelines required air carriers to
list all repair stations performing substantial heavy maintenance in
their operations specifications.\1

For the FAA inspectors whose duties involve monitoring the air
carriers (as opposed to monitoring the repair stations themselves),
the guidelines stressed the importance of careful oversight but did
not require specific actions on the inspectors' part.  FAA
headquarters officials said the guidelines left it to inspectors to
decide whether to place more emphasis on the surveillance of repair
stations as part of their oversight of air carriers.  Matters in the
guidance for inspectors to consider in making their decisions
included a particular FAA office's work demands and the complexities
or problem areas of the repair stations involved.  Inspectors
overseeing air carriers told us these initiatives have increased
their awareness of the need to oversee repair stations working for
air carriers, but inspectors overseeing repair stations told us the
initiatives had not changed their oversight activities. 

FAA augmented the guidelines a month later with a handbook bulletin
that provided more specific guidance for the last two initiatives
shown in figure 4.1.  The handbook bulletin defined "substantial
maintenance"\2 for air carriers, thereby clarifying which repair
stations needed to be included on an air carrier's operations
specifications or audited by an air carrier prior to adding them to
the list.  The handbook bulletin's more specific guidance on these
matters was as follows: 

  -- To implement the initiative that all repair stations performing
     significant maintenance be listed, FAA inspectors were to list,
     by October 1, 1996, the repair stations that performed
     substantial maintenance, ensure that each repair station had had
     a current audit, include the repair stations as part of the
     operations specifications, and update FAA's Vital Information
     Subsystem database with the new operation specification
     information. 

  -- To implement the initiative that air carriers conduct audits of
     any repair stations added to the list, FAA inspectors were to
     ensure, effective September 1, 1996, that air carriers audit any
     new maintenance repair station they want to add to their
     operations specifications.  The audits' purpose was to ensure
     that the repair stations are capable of performing the
     contracted work in accordance with the carriers' approved
     programs.  Under the handbook's procedures, FAA must also review
     and accept the audit before an air carrier can use the
     contractor. 

FAA officials told us about 150 air carriers needed to comply with
the bulletin by identifying the repair stations performing
substantial maintenance for them.  The officials said all of the
carriers had complied by late September or early October 1996. 
Subsequent to that, air carriers have added other repair stations to
their operations specifications after having their audits of the
repair stations approved by FAA inspectors.  For example, one air
carrier recently added two repair stations to its operations
specifications after the FAA inspector reviewed and approved both
repair station audits.  In contrast, another FAA inspector
responsible for an air carrier denied use of two new repair stations
when he found deficiencies in the audit reports for both repair
stations. 

FAA officials stated that the review of air carriers' audits of
repair stations is something the inspectors will be doing on an
ongoing basis.  Any time an air carrier wants to add a repair station
that does substantial maintenance, the carrier must audit the repair
station and the principal maintenance inspector for that air carrier
will need to accept the audit before the repair station can be used. 
Moreover, every time a new repair station is added, the air carrier's
operations specifications must be changed. 


--------------------
\1 Operations specifications name the maintenance activities the
repair station is authorized to perform.  FAA issues a set of
operations specifications during certification. 

\2 FAA defined substantial maintenance as any activity involving a
C-check (routine airframe maintenance) or greater maintenance; any
engine maintenance requiring case separation or teardown; and/or
major alterations or repairs performed on airframes, engines, or
propellers.  Under FAA's definition of "substantial maintenance," a
relatively small number of repair stations are likely to be affected
by these requirements.  We reviewed the operations specifications for
10 air carriers that implemented FAA's requirements.  Of the more
than 5,000 total vendors on these air carriers' lists of approved
vendors, 268 were classified as authorized to perform "substantial
maintenance."


   PLANNED UPDATE OF REPAIR
   STATION REGULATIONS IS SLOW IN
   COMING
---------------------------------------------------------- Chapter 4:2

FAA headquarters officials and all of the 86 repair station
inspectors we interviewed told us current regulations governing the
oversight of repair stations are out of date in a number of respects. 
According to FAA, the current repair station regulations are based
primarily on concepts that were developed during the infancy of the
aviation industry.  Aircraft, power plants, maintenance, alteration
concepts, and technology have progressed substantially in the last
three decades.  However, very few substantive changes have been made
to the regulations since 1962.  Portions of the regulations are no
longer appropriate or have become increasingly difficult to
administer, while some other portions no longer make a significant
contribution to aviation safety.  As a result, FAA has had to grant
exemptions and create special administrative procedures to handle
situations not provided for adequately in the regulations. 

In 1975, FAA and industry officials recommended revising substantial
requirements of the repair station regulations.  According to FAA,
minor amendments to the regulations were subsequently adopted, but no
major revision was made.  In 1989, in light of public meetings that
were part of its regulatory review, FAA decided to revise the
regulations completely.  However, it has taken 8 years to prepare the
revisions, FAA officials said.  They attributed the delays to the
project being preempted by other rulemaking and policy projects. 

FAA hopes to begin implementing revised regulations in the coming
months.  It has prepared revised regulations, and headquarters
officials told us the revisions are now being reviewed by the
Department of Transportation and the Office of Management and Budget. 
Officials did not know when the revisions would be published for
comment in the Federal Register.  FAA had established a target of
summer 1997 for publishing these revisions, but this target was not
met.  FAA will consider the comments received before taking action on
the proposed revisions.  The Deputy Associate Administrator for
Regulation and Certification anticipated that FAA would receive
voluminous comments, necessitating considerable time for review and
response. 

FAA headquarters officials outlined several things they hoped to
accomplish with the proposed regulations.  First, they are proposing
that domestic repair stations be required to have a quality control
system that is based on the Joint Aviation Authorities' (JAA)
system.\3 Second, the proposed regulations simplify the repair
station rating system and make the ratings less confusing than the
existing system.  Third, the proposed regulations impose training
requirements for entry-level personnel.  Existing regulations do not
require that entry-level personnel be trained.  They require only
that repair stations use practical tests or employment records to
determine the abilities of uncertified employees.  Finally, the
proposed regulations make repair stations responsible for controlling
and evaluating their vendors.  Existing regulations do not require
that repair stations evaluate their subcontractors or vendors.  They
require only that repair stations have a method of inspecting
incoming material to ensure that it is free from apparent defects or
malfunctions.  FAA attorneys noted that the proposed rule will remove
the distinction between most domestic and foreign repair stations. 

There are indications that some in the repair station industry may
oppose many of these changes.  For example, the National Air
Transportation Association, an industry association, stated that it
expects that the proposed regulations will require new training
programs, additional record-keeping requirements, and the
implementation of quality assurance systems like the air carriers'
quality assurance systems.  This, the association predicts, will
increase repair station costs, causing as many as a third of them to
turn in their repair station certificates.  The association contends
that the anticipated proposed regulations will "cripple the
maintenance industry," and it plans to fight them.  This opposition
indicates that completing the rulemaking process may take a
significant amount of time. 

The importance of completing this project can be seen in inspectors'
responses to our survey.  As figure 4.2 shows, most inspectors
believe that various changes in the regulations would help them carry
out their inspection duties.  Of the inspectors we surveyed, most (88
percent) favored updating the regulations as a way to improve repair
station regulatory compliance.  In particular, most inspectors (77
percent) favored changes to require repair stations to notify FAA of
the names of air carriers for which they do work.  Most inspectors
(78 percent) also favored changing regulations to require air
carriers to provide their manuals or procedures along with the parts
to be repaired by repair stations. 

   Figure 4.2:  FAA Inspectors'
   Responses to Ideas for
   Improving Compliance Through
   Changes Related to Existing
   Regulations

   (See figure in printed
   edition.)

Note:  Percentages may not add to 100 because a few respondents said
they had no basis to make a judgment. 

Inspectors provided examples of why revised regulations are needed. 
One inspector said the regulations do not address new repair
techniques such as nondestructive testing and repair of composite
materials, which means that the inspector must evaluate a repair
station's practices using his or her own judgment.  Two inspectors
noted that regulations require repair stations to have an
FAA-approved inspection procedure manual but do not require repair
stations to follow it.  As a result, an inspector who finds that a
repair station failed to follow its approved manual cannot write a
violation. 


--------------------
\3 A number of European nations have banded together to coordinate
their efforts through JAA.  Like FAA, the national aviation
authorities of JAA member nations have developed their own extensive
inspection, surveillance, evaluation, and certification programs for
repair stations.  Under the provisions of the Bilateral Aviation
Safety Agreement, FAA is negotiating agreements and procedures with
several countries that will eliminate the duplicate oversight of
repair facilities by FAA and such other entities.  Discussions are
still largely in the formative stage. 


   ADDING TO THE INSPECTOR CORPS
   AND IMPROVING TRAINING
---------------------------------------------------------- Chapter 4:3

The Congress has provided FAA with additional resources to hire more
inspectors.  FAA increased the number of inspectors from 2,324 in
fiscal year 1994 to an estimated 3,062 at the end of fiscal year
1997, a 32-percent increase.  FAA's approved budget for fiscal year
1995 authorized 201 additional inspectors; for fiscal year 1996, 237
additional inspectors, and for fiscal year 1997, 300 additional
inspectors.  To fill the additional authorizations and to rehire for
attrition, FAA hired 302 inspectors in fiscal year 1995 and 361 in
fiscal year 1996.  About 63 percent of the inspectors hired were
airworthiness inspectors.  According to the manager of the Human
Resource Programs Branch, most airworthiness inspectors have the
oversight of repair stations as part of their duties.  FAA has
requested 235 additional inspectors in its fiscal year 1998 budget
estimate.  If the request is approved, this would represent a
42-percent increase in inspector staffing since fiscal year 1994. 

Responses to our survey indicate that current FAA inspectors believe
the impact of these new inspectors will depend mainly on how strong
the applicants' qualifications are.  As figure 4.3 shows, current
inspectors believe that aviation industry experience, particularly
supervisory experience, is important.  For example, 81 percent of
inspectors responding to our survey strongly or generally favored
having inspectors with hands-on technical experience in industry as a
way to improve repair stations' compliance.  FAA's current
qualifications for entry-level inspectors require maintenance
experience in a repair station, air carrier facility, or military
repair facility, and 3 years of supervisory experience.  The manager
of the Human Resources Program Branch told us FAA requires that
inspectors have 3 years of supervisory experience because they must
be able to communicate orally and in writing with mechanics,
engineers, and managers.  We did not determine whether FAA's newly
hired inspectors met the agency's qualification standards for new
hires. 

   Figure 4.3:  FAA Inspectors'
   Responses to Ideas for
   Improving Compliance Through
   Inspector Qualifications

   (See figure in printed
   edition.)

Note:  Percentages may not add to 100 because a few respondents said
they had no basis to make a judgment. 

The training of new and existing inspectors is another area that has
been a focus of attention.  We and others have reported for several
years that FAA's aviation safety inspectors are not receiving needed
training.  Most recently, in October 1996 we issued a report
recommending that FAA evaluate the impact of recent budget reductions
on critical safety-related functions, including training, and report
the results to the Congress through the appropriations process.\4 FAA
inspectors' responses to our survey indicate that most inspectors
continue to be concerned about the need for improved training. 
Specifically, 82 percent of the inspectors surveyed said they
strongly or generally favored providing inspectors with maintenance
and avionics training, including hands-on training, as a way to
improve repair stations' compliance with regulations.  Over
three-quarters of the inspectors (80 percent) favored more training
on inspection skills.  Additionally, 45 percent said that the
inability to get needed training is at least a minor reason why
inspectors are not able to ensure repair stations' compliance with
all aspects of the regulations.  These results add support for our
1996 recommendation. 

Inspectors also expressed their concern about inadequate training in
written comments on our survey forms.  For example, one inspector
stated that inspectors need specific training on aircraft and
systems.  Another inspector wrote, "I have completed FAA repair
station certification and surveillance course; however, that course
does not educate in the procedures for overhaul.  To understand the
product, I am relying on personal experience I had before I joined
FAA, with no recurrent training on the actual product." Another
inspector stated he needed more hands-on training on a turbine engine
before he was sent to inspect it. 


--------------------
\4 See Aviation Safety:  New Airlines Illustrate Long-Standing
Problems in FAA's Inspection Program (GAO/RCED-97-2, Oct.  17, 1996). 


   UPGRADING CERTIFICATION AND
   TRAINING OF AVIATION
   MAINTENANCE PERSONNEL
---------------------------------------------------------- Chapter 4:4

Because of significant technological advances in the aviation
industry, current FAA regulations that prescribe the certification
requirements for an estimated 145,000 mechanics and repairmen need to
be updated.  Aviation maintenance is one of the most complex areas of
the industry, and aviation maintenance personnel must possess many
technical skills.  Changes in aircraft technology have also
significantly increased the need for specialized training.  FAA has
been updating, consolidating, and clarifying all its certification,
training, experience, and currency requirements for aviation
maintenance personnel for a new rule (14 C.F.R.  part 66) entitled
"Certification:  Aviation Maintenance Personnel." According to FAA,
some of the key features of this proposed rule include the

  -- creation of additional certificates and ratings for aviation
     maintenance personnel,

  -- expansion of current certification requirements, and

  -- establishment of additional training and recurrent training
     requirements for certified aviation maintenance personnel. 

Initially, on August 17, 1994, the proposed rule was published in the
Federal Register for public comment.  However, the final issuance of
the rule has been delayed because FAA officials decided that to avoid
confusion they need to combine the proposed rule with other rule
revisions.  According to FAA headquarters officials, FAA plans to
reissue the revised proposed rule in the Federal Register for public
comment in December 1997. 


   CONCLUSIONS
---------------------------------------------------------- Chapter 4:5

Although the various activities FAA has under way may help strengthen
the oversight of repair stations, none of them directly addresses the
concerns about inspection and follow-up that we discussed in chapters
2 and 3--namely the limited success in identifying problems through
reviews by individual inspectors of large facilities and the
inadequate documentation of efforts to correct deficiencies found
during inspections.  FAA's initiatives may help the air carriers--and
the FAA inspectors who monitor those air carriers--be more attentive
to the work being performed by repair stations, but they do not
appear to have any direct link to improving the quality of FAA's
inspections of repair stations or the speed and thoroughness with
which problems are resolved.  Also, as FAA has struggled to deal with
a growing workload caused by new airlines and the greater
complexities of a deregulated environment, FAA has received a
32-percent increase in the number of its inspectors since fiscal year
1994.  To use these additional resources as effectively as possible,
FAA needs to overcome its inspection program's weaknesses in
identifying problems at repair stations and in documenting inspection
results that need follow-up. 

The results of our work also underscore the need for progress in
several areas that FAA is addressing by updating repair station
regulations, hiring new inspectors, and improving training programs. 
Progress on initiatives for updating regulations on the oversight of
repair stations and the certification and training requirements for
maintenance personnel has been slow.  These efforts may require
additional management attention. 


   RECOMMENDATION
---------------------------------------------------------- Chapter 4:6

To ensure that outdated regulations governing the oversight of repair
stations and certification and training requirements for maintenance
personnel are updated as soon as possible, we recommend that the
Secretary of Transportation instruct the Administrator of FAA to
expedite the efforts to update the regulations and to establish and
meet schedules for completing the updates. 


   AGENCY COMMENTS
---------------------------------------------------------- Chapter 4:7

FAA agreed with the recommendation but did not indicate how or when
it would be implemented. 


OBJECTIVES, SCOPE, AND METHODOLOGY
=========================================================== Appendix I

In December 1996, the Ranking Minority Member of the Aviation
Subcommittee of the Senate Committee on Commerce, Science, and
Transportation, and Senator Ron Wyden asked us to examine FAA's
oversight of repair stations.  Specifically, we were asked to address
the following questions: 

  -- What is the nature and scope of the oversight of repair
     stations, conducted by FAA personnel? 

  -- How well does FAA follow up on inspections to ensure that
     deficiencies in repair stations' operations are corrected once
     they have been identified? 

  -- What steps has FAA taken to improve the oversight of repair
     stations? 

Our analysis was based in part on agencywide data and in part on a
detailed review involving a cross-section of airlines, repair
stations, FAA offices, and FAA inspectors.  Our industrywide data
included the amount of maintenance costs incurred by airlines.  For a
more in-depth look at how air carriers were using repair stations, we
selected eight air carriers for review, choosing them in part
because, like the industry as a whole, they varied greatly in the
extent to which they used repair stations (see table I.1).  At the
eight airlines, we discussed the type and amount of maintenance
contracted to repair stations.  Also, we discussed the impact of
recent FAA initiatives on the air carrier and the methods each uses
to oversee repair stations. 



                               Table I.1
                
                  Airlines Included in GAO's Detailed
                                 Review

                                            Percentage    Nature of
                                            of            maintenance
                                            maintenance   activity
                                            performed by  done by
                              Nature of     repair        repair
Airline                       operations    stations      stations
----------------------------  ------------  ------------  ------------
Alaska Airlines               Uses 74       10            Airframes,
                              aircraft on   (airframe)    power
                              the Pacific   90 (power     plants,
                              Coast from    plants)       radios,
                              Alaska to     75            instruments
                              Mexico and    (instruments  and
                              the Russian   and           accessories
                              Far East      accessories)

America West Airlines         Uses 102      85            Airframes,
                              aircraft on                 power
                              routes                      plants,
                              throughout                  radios,
                              the U.S. and                instruments
                              to Mexico                   and
                              and Canada                  accessories

American Airlines             Uses 659      26            Power
                              aircraft on                 plants,
                              routes                      radios,
                              throughout                  instruments
                              the world                   and
                                                          accessories,
                                                          but
                                                          primarily
                                                          interior
                                                          modification
                                                          s

Delta Airlines                Uses 542      10            Airframes,
                              aircraft on                 power
                              routes                      plants,
                              throughout                  radios,
                              the world                   instruments
                                                          and
                                                          accessories,
                                                          but
                                                          primarily
                                                          modification
                                                          s and
                                                          predeparture
                                                          checks

Sierra Pacific Airlines       Uses 3        90-95         Airframes,
                              aircraft for                power
                              charter and                 plants,
                              supplemental                radios,
                              services on                 instruments,
                              a                           propellers,
                              contractual                 and
                              basis                       accessories

Simmons Airlines              Uses 93       12            Airframes,
                              aircraft                    power
                              operating as                plants, and
                              American                    accessories
                              Eagle on
                              routes in
                              the
                              Southwest
                              and
                              Midwestern
                              U.S.

Southwest Airlines            Uses 242      85            Airframes,
                              aircraft on                 power
                              routes                      plants,
                              throughout                  radios,
                              the U.S.                    instruments
                                                          and
                                                          accessories

United Airlines               Uses 591      7             Airframes,
                              aircraft on                 power
                              routes                      plants,
                              throughout                  radios,
                              the world                   instruments
                                                          and
                                                          accessories,
                                                          but
                                                          primarily
                                                          modification
                                                          and routine
                                                          maintenance
----------------------------------------------------------------------
We also visited 10 repair stations, choosing them in part because
they represented a variety of locations (both domestic and foreign),
types of repair station activities, and size of operations (see table
I.2).  At these repair stations, we observed maintenance
capabilities, shipping and receiving procedures, and work package
documentation.  We also met with quality assurance officials to talk
about internal controls over parts, suspected unapproved parts, and
oversight by FAA and air carrier representatives. 



                               Table I.2
                
                  Repair Stations Included in Detailed
                                 Review

                                          Size and extent of
Repair station and location               operations
----------------------------------------  ----------------------------
Advanced Material Technologies, Inc.      Employs about 170 people and
Tempe, Arizona                            mainly performs work on
                                          power plants and accessories

AeroControls, Inc.                        Employs about 450 people and
Auburn, Washington                        performs all types of
                                          maintenance work except
                                          power plants

B.F. Goodrich Component Services          Employs about 20 people and
Division                                  works exclusively on wheels
Tempe, Arizona                            and brakes; one of a number
                                          of B.F. Goodrich repair
                                          stations

Chromalloy Los Angeles                    Employs about 205 people and
Gardena, California                       works exclusively on power
                                          plants; one of a number of
                                          Chromalloy repair stations

Evergreen Air Center                      Employs about 590 people and
Marana, Arizona                           performs all types of work
                                          except instruments

Greenwich Air Services, Inc.              Employs about 840 people and
Miami, Florida                            mainly performs work on
                                          power plants and accessories

Lufthansa Technik AG                      Employs about 3,300 people
Frankfurt, Germany                        and performs routine and
                                          contract maintenance for
                                          Lufthansa and other carriers
                                          on airframes, power plants,
                                          and accessories

Precision Avionics and Instruments,       Employs about 35 people and
Inc.                                      works exclusively on
Atlanta, Georgia                          electrical and electronic
                                          instruments, components, and
                                          accessories

Sabena Technic                            Employs about 1,600 people
Brussels National Airport, Belgium        and performs work for Sabena
                                          and other carriers in all
                                          maintenance areas

Tramco, Inc.                              Employs about 2,200 people
Everett, Washington                       and mainly performs work on
                                          airframes and accessories;
                                          one of several B.F. Goodrich
                                          repair stations
----------------------------------------------------------------------
We conducted reviews at FAA headquarters in Washington, D.C., four of
the nine FAA regional offices (Northwest Mountain, Southern,
Southwest, and Western-Pacific), 8 of FAA's 86 Flight Standard
district offices (Atlanta, Dallas, Dallas/Fort Worth, Fort Worth, Los
Angeles, Miami, Scottsdale, and Seattle), and six of the seven
international offices located inside and outside the United States
(Brussels, Dallas/Fort Worth, Frankfurt, London, Miami, and San
Francisco).  We selected the regional and Flight Standards district
offices because of their geographical diversity and because the
locations were responsible for overseeing both domestic and foreign
repair stations.  We reviewed FAA's criteria, procedures, and other
documents used to oversee domestic and foreign repair stations and
discussed them with 86 principal maintenance and avionics inspectors
responsible for overseeing repair stations and 17 inspectors
responsible for air carriers that contract with repair stations.  We
also conducted detailed reviews of a judgmental sample of 488 repair
station files to determine if inspection and follow-up activity was
documented effectively.  In addition, we analyzed data from FAA's
computer-based Program Tracking Reporting Subsystem for fiscal years
1993 through 1996 to determine if FAA effectively captured repair
station inspection results. 

To gather information about the experiences of FAA inspectors
overseeing repair stations and their views on ways to improve the
oversight of repair stations, we conducted a mail survey.  We mailed
our survey to a sample of 275 of the 601 FAA inspectors listed in
FAA's Vital Information Subsystem as being responsible for the
oversight of one or more repair stations doing work for part 121 or
135 carriers during fiscal year 1996.  In total, we received
responses from 247 inspectors, a response rate of 90 percent.  Of
these, 202 completed the questionnaire, while 45 did not because they
did not oversee any repair stations in fiscal year 1996.  (See app. 
II of this report for additional information on the survey
methodology and app.  III for the summary results of that survey.)
The 202 respondents were responsible for overseeing a total of 1,375
repair stations that performed maintenance for part 121 or 135
carriers, with the number of repair stations per inspector ranging
from 1 to 37.  Table I.3 shows the sizes of repair stations overseen
by the inspectors responding to our survey. 



                               Table I.3
                
                Distribution of Repair Stations Overseen
                       by FAA Inspectors, by Size

Size of repair station (number of
employees)                                         Percentage of total
----------------------------------------  ----------------------------
More than 100                                                       17
16-100                                                              35
15 or fewer                                                         48
======================================================================
Total                                                              100
----------------------------------------------------------------------
Note:  Percentages can be generalized to the nearly 2,800 repair
stations doing work for air carriers. 

We also interviewed officials from the government agencies that are
responsible for reviewing FAA's oversight of repair stations and air
carriers:  the Office of the Inspector General, U.S.  Department of
Transportation; the Air Carrier Survey and Analysis Office, Air
Mobility Command Staff, U.S.  Air Force, Department of Defense; and
the National Transportation Safety Board. 

We conducted our review from August 1996 through October 1997, in
accordance with generally accepted government auditing standards. 


SURVEY METHODOLOGY
========================================================== Appendix II

To examine the experiences and opinions of the FAA employees who
inspect repair stations, we surveyed inspectors within FAA's Flight
Standards Service.  We mailed our survey to a random sample of
inspectors listed in FAA's Vital Information Subsystem database as
conducting inspections of repair stations that do work for air
carriers.  The survey asked for such information as the degree of
success inspectors have in identifying all deficiencies, factors that
hinder inspectors' success in ensuring that repair stations comply
with all aspects of the regulations, and ways to improve the
compliance of repair stations.  Our response rate for the survey was
90 percent.  A summary of the responses is in appendix III. 

FAA's database indicated that 601 inspectors were responsible for
repair stations that do work for air carriers.  We drew a random
sample of 275 inspectors.  This sample size was designed to provide
sampling errors of no more than 5 percent at the 95-percent
confidence level. 

Since we used a sample (called a probability sample) of 275 FAA
inspectors to develop our estimates, each estimate has a measurable
precision, or sampling error, that may be expressed as a plus/minus
figure.  A sampling error indicates how closely we can reproduce from
a sample the results that we would obtain if we were to take a
complete count of the universe using the same measurement methods. 
By adding the sampling error to and subtracting it from the estimate,
we can develop upper and lower bounds for each estimate.  This range
is called a confidence interval.  Sampling errors and confidence
intervals are stated at a certain confidence level--in this case, 95
percent.  (See table II.1.) For example, a confidence interval, at
the 95-percent confidence level, means that in 95 out of 100
instances, the sampling procedure we used would produce a confidence
interval containing the universe value we are estimating. 



                               Table II.1
                
                Sampling Errors for Selected Percentages

Percentage                                              Sampling error
----------------------------------------  ----------------------------
5                                                                   ï¿½2
10                                                                  ï¿½3
20                                                                  ï¿½4
30                                                                  ï¿½5
40                                                                  ï¿½5
50                                                                  ï¿½5
60                                                                  ï¿½5
70                                                                  ï¿½5
80                                                                  ï¿½4
90                                                                  ï¿½3
95                                                                  ï¿½2
----------------------------------------------------------------------
Note:  Sampling errors are calculated for the 95-percent confidence
level using the finite population correction factor and 185 cases,
the smallest number of valid cases for questions with finite
categories. 

In addition, table I.3 in appendix I requires ratio estimates in
order to calculate sampling errors.  Table II.2 shows sampling errors
for these estimates. 



                               Table II.2
                
                 Sampling Errors for Repair Stations by
                          Number of Employees

                                                        Sampling error
Size of repair station (number                       (percentage added
of employees)                           Percentage    or subtracted)\a
------------------------------  ------------------  ------------------
More than 100                                 16.6                ï¿½2.7
16-100                                        35.3                ï¿½3.5
15 or fewer                                   48.1                ï¿½4.1
======================================================================
Total                                        100.0                 n/a
----------------------------------------------------------------------
\a Sampling errors calculated at the 95-percent confidence level. 

We conducted 11 pretests of our survey with inspectors in two of
FAA's nine regions, including 3 pretests with inspectors of foreign
repair stations and 8 pretests with inspectors of domestic repair
stations.  Each pretest consisted of a visit with a single FAA
employee by two or three GAO staff.  The pretest attempted to
simulate the actual survey experience by asking the employee to fill
out the questionnaire while the GAO staff observed and unobtrusively
took notes.  Then the employee was interviewed about the
questionnaire items to ensure that (1) the questions were readable
and clear, (2) the terms were precise, (3) the survey did not place
an undue burden on FAA employees that would result in a lack of
cooperation, and (4) the survey appeared independent and unbiased in
its point of view.  We modified the final survey based on our
pretesting results. 

In addition to our pretesting, we had managers in FAA's Flight
Standards Service in Washington, D.C., review our questionnaire, and
we obtained comments from a survey research psychologist at FAA's
Training and Organizational Research Laboratory in Oklahoma City and
from officials of the union representing the FAA inspectors we
surveyed.  We incorporated comments from these reviews as
appropriate. 

During the pretesting phase, it became evident that respondents
considered the survey questions to be sensitive.  Specifically, some
respondents said less experienced inspectors might be afraid of
retribution if their answers were made public.  To address these
concerns, we developed procedures to guarantee the complete anonymity
of all survey responses.  To do this, we did not retain any
identification of the respondent on the survey booklet or return
envelope.  This procedure prevented us from knowing the identity of
the respondent for any of the surveys returned to us.  The use of a
separate return postcard allowed us, nevertheless, to track which
respondents did and did not mail back survey responses so that we
could follow up with those who did not respond.  Pretest respondents
told us these measures would encourage inspectors to return the
survey forms. 

To increase the response to our survey, we mailed a prenotification
letter to respondents 1 week before we mailed the survey on January
31, 1997.  We also used three mailings after the survey mailing:  (1)
a reminder postcard 1 week after the survey, (2) a reminder letter to
nonrespondents 18 days after the survey, and (3) a replacement survey
for recipients not yet responding mailed 4 weeks after the survey. 
We received the last survey included in our analysis on March 20,
1997. 

We received survey responses from 247 inspectors for a response rate
of 90 percent.  Of those responding, 202 inspectors were assigned to
oversee repair stations that did work for air carriers during fiscal
year 1996.  Only these respondents actually filled out our survey and
are included in our survey results in this report.  Table II.3 shows
a summary of the survey returns. 



                               Table II.3
                
                   Summary of Returns to Mail Surveys

                                              Number of FAA inspectors
----------------------------------------  ----------------------------
Population size                                                    601
Total sample size                                                  275
Surveys returned\a                                                 247
Eligible                                                           202
Not eligible                                                        45
Surveys not returned                                                28
Response rate (number returned/number                              90%
 mailed)
----------------------------------------------------------------------
\a Does not include surveys returned that were not filled out. 




(See figure in printed edition.)Appendix III
SURVEY QUESTIONS AND RESPONSES
========================================================== Appendix II



(See figure in printed edition.)



(See figure in printed edition.)



(See figure in printed edition.)



(See figure in printed edition.)



(See figure in printed edition.)



(See figure in printed edition.)



(See figure in printed edition.)



(See figure in printed edition.)



(See figure in printed edition.)


MAJOR CONTRIBUTORS TO THIS REPORT
========================================================== Appendix IV

Robert Jerry Aiken
Leslie Albin
John H.  Anderson, Jr.
Steven N.  Calvo
Fran A.  Featherston
Thomas A.  Kai
Christopher M.  Jones
Julia A.  Rachiele
David A.  Robinson
Stanley G.  Stenerson
Mindi G.  Weisenbloom


*** End of document. ***