Wingman: Reaching NextGen's Goals

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Wingman: Reaching NextGen's Goals

We are approaching the end of 2007, and the U.S. still doesn't have a FAA funding bill necessary to sustain its normal operations, much less finance the initial stages of NextGen, the much heralded roadmap to America's necessary airspace modernization.

The problem isn't the absence of ideas; it's not a lack of talented people; nor is it a dearth of motivation. Many creative and industrious persons and organizations throughout the aviation community - including some in government - are advancing novel ideas, and making important innovations and breakthroughs. The problem is organizational. Our present structure of using the FAA and its so-called board of directors, the U.S. Congress, to manage and fund airspace modernization is fatally flawed.

A primary reason for this is that government entities respond to political pressures, not market-based economics. And political maneuvering, where one side tries to seek some advantage at the expense of another, creates perverse incentives and hinders our progress. It's time to take this critical enterprise out of the political arena.

An Alternative Approach

Recently a group of nine prominent aviation leaders, brought together by the Reason Foundation, including a former U.S. Secretary of Transportation, a former FAA Administrator, and the architect of airline deregulation, called for significant changes in America's air traffic control system, and declared that the FAA's Air Traffic Organization (ATO) "is not up to the task of making the kind of paradigm shift" needed to modernize the nation's air traffic system.

This ensemble of experts, consists of Langhorne Bond, a former FAA administrator (1977-1981), Jim Burnley, a former U.S. Secretary of Transportation (1987-1989), Aaron Gellman, the founder of GRA, Inc., Jim Haynes, a former chairman of the National Air Transportation Association, Jonathan Howe, a former president of the National Business Aircraft Association, and former director general of Airports Council International, Alfred Kahn, a former chairman of the U.S. Civil Aeronautics Board (1977-1978), Clint Oster, a former research director of the Aviation Safety Commission (1987-1988), David Plavin, a former president of the Airports Council International-North America, and James Wilding, a former president and CEO, Metropolitan Washington Airports Authority.

The group made these overarching points about a restructured ATO:

It should be separated from the FAA and run like a business, with a chief executive officer who has the normal powers and duties of a CEO, including the power to hire and fire staff and hold them accountable for results. It should also have a board of directors that represents its customers and other stakeholders, not political special interests.
It should be funded by a steady, reliable revenue stream that isn't subject to politics. As such, the ATO should be funded directly by aviation customers – airlines, business jets and private pilots – with federal general fund support limited to public-service functions such as paying for military use of the civilian air traffic control system.
It should be allowed to consolidate, reorganize and improve its facilities and equipment, in the interests of its customers, as well as reconfiguring airspace consistent with NextGen capabilities.

Such a change is no longer revolutionary. Since New Zealand converted its government operated ATC system to a government corporation in 1987, more than 40 countries have decided to take a similar course. Furthermore, the empirical evidence shows these transformations have shown positive results. A U.S. Government Accounting Office (GAO) study in 2005 of five major commercialized ANSPs (air navigation service providers), concluded that all five have seen improvements in cost control, and have invested in new technologies and equipment that has increased "productivity" and produced operating efficiencies, such as fewer or shorter delays.

Importantly, at the same time, the safety of the ANSP's services "remained the same or improved," according to the GAO.

These ANSPs are not located in small, isolated countries either. They include Germany, France, Switzerland, the Benelux countries, and the U.K., which together manage some of the world's busiest and complex airspace. And the commercialized ANSPs of Australia, New Zealand and Canada, control air traffic over three of the world's largest geographic areas.

Funding Impasse

Regardless of how the U.S. might proceed on reforming its air traffic structural problems, a new method of funding that is more equitable and effective is also imperative.

Besides paying for current operations, the ATO - or for that matter its potential replacement - will need to make major investments over the next two decades to install new NextGen technologies, which the FAA's Research, Engineering, and Development Advisory Committee determined will require an extra $1 billion per year over this period.

But the FAA's current capital spending budget is focused on patching up the existing system, and replacing its the host computer system, not the forward-thinking enabling technologies envisioned by NextGen. This effort will require a substantial, reliable revenue stream that is not subject to political vagaries.

The vigorous, and sometimes distasteful debate over user fees this past year, is symptomatic of the problem of addressing the issue of airspace modernization politically rather than economically. The obvious facts are that everyone in aviation should and will gain by upgrading airspace infrastructure and methods, and everyone loses when it is delayed. It should be equally apparent that who benefits from these services in terms of convenience and comfort should pay according to what they receive.

For one possible way this might be achieved, see the Wingman piece posted on this site earlier this year: "How About Rallying around Fuel Taxes?"

Need for Urgency

Finally, we need to get on with modernization prudently but nevertheless, quickly. The nine prominent experts referred to above, said, "America needs a 21st-century air traffic management system, and we need it as soon as possible."

How is it that we seem to have a broad general agreement that our present system is dysfunctional, a drag on our economy, losing billions annually, and then say, with a straight face, that we intend to fix it by 2025, nearly two decades from now? Even if we take into account the incremental steps toward modernization planned between now and 2025, there seems to be more bureaucratic caution than urgency.

And ambitious plans have not always been realized. More than one has expressed dismay about the past progress of ATC modernization, at least privately. But Rockwell Collins Chairman and CEO Clayton M. Jones publically told a RTCA symposium last March that he is frustrated with the pace of America's transition to a more efficient air traffic management system. Jones noted that the U.S. is only slightly closer to a more flexible and capable ATM system since the now-retired Free Flight concept was advanced in the mid-1990s.

Wingman believes many others would agree. 11-27-2007.

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