Air Traffic Control Newsletter #109
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Air Traffic Control Reform Newsletter

Air Traffic Control Newsletter #109

New study on FAAâ??s risk-averse culture, More work on ATC corporation ideas, and Inspector General on controller training

In this issue:

Addressing FAA’s Risk-Aversion Problem

For decades the FAA expressed pride in operating not only the world’s largest ATC system but also the best. And for many years the latter was true. But regular readers of this newsletter (or of DOT Inspector General studies or GAO audits) know there are long-standing problems with how the agency deals with change and modernization. And the rest of the world has noticed. With the reform of ATC systems in nearly all developed countries over the past two decades, non-US air navigation services providers have been implementing new technologies and procedures more rapidly and with fewer problems than the FAA. And the latest World Economic Forum Global Competitiveness Report ranks the United States not first but 18th in the quality of its aviation infrastructure (ATC and airports). That’s a decline from 12th place in 2008.

Last spring I was invited to research this issue by the Hudson Institute’s Chris DeMuth (former president of American Enterprise Institute and a former senior official at OMB). He’s managing an ongoing project on innovation and competitiveness in the US economy, and turned to me for a position paper on “organization and innovation in air traffic control.” In the course of writing this newsletter over the past 12 years I have reported on many examples of resistance to change at FAA-such as declining to become an investor and launch customer in the Aireon space-based ADS-B endeavor, researching but not implementing remote towers, developing mostly non-productive (overlay) RNP approaches, etc. But for this research, I needed to go deeper, seeking to tease out why the agency acts in risk-averse ways.

The research plan focused on seven case studies-the above three plus controller-pilot data link, ground-based augmentation systems (GBAS), real-time aviation weather, and facilities consolidation. In each case I read or re-read relevant GAO and IG reports, as well as interviewing many technology providers as well as former FAA and DOT officials. The research confirmed the existence of what I call “status-quo bias” in how FAA deals with the ATC system and developed five possible causal factors:

  1. FAA’s self-identity as a safety agency creates an organizational culture that is overly conservative, compared with that of airframe and engine producers, avionics providers, and the rest of aviation, all of which are regulated by FAA.
  2. FAA has experienced a brain drain of many of its best and brightest engineers, which leads to inadequately specified system requirements and the phenomenon known as “requirements creep,” in which all kinds of wonderful but costly things get added to the project, increasing its cost and complexity.
  3. Likewise, FAA has less than top-flight program management expertise, making it overly reliant on contractors and leading to cost overruns and schedule slippage.
  4. FAA has too many overseers-understandable given its problem-filled history but with serious consequences for diverting management attention away from the job of operating and improving the ATC system.
  5. FAA therefore focuses far more than other ANSPs on pleasing its political overseers rather than its aviation customers.

Hudson Institute then organized an extensive peer review process, getting feedback from about 20 outside experts, culminating in a half-day workshop to discuss the draft of the study. This process led to sharpening many of the points in the paper. And it also led to changing the above five points from hypotheses to findings.

The final version of the paper outlines key reform principles to address the shortcomings.

  • To change the overly cautious ATC culture, separate the Air Traffic Organization from FAA, putting FAA safety regulation at arm’s length from operating and modernizing the ATC system. The idea is to foster the kind of innovative thinking and acting that we see in aviation’s private sector, all of which is subject to FAA safety regulation but for which innovation is its stock in trade.
  • To bring about efficient and on-time modernization, shift the ATO’s funding from annual appropriations to direct revenue from its customers, which would be a bondable revenue stream well-suited to financing NextGen’s major capital improvements.
  • To refocus management attention on serving its aviation customers, change the governance of the ATC system from a plethora of government bodies (multiple congressional committees, OMB, GAO, Inspector General, and Office of the Secretary of Transportation) to a board of directors representing a cross-section of aviation stakeholders.

None of these changes is that radical. Divesting a portion of FAA to a self-funded nonprofit entity is what happened in 1987 when Washington National and Dulles International were divested from FAA to the newly created Metropolitan Washington Airports Authority. User funding and revenue bonding is the well-proven model that US airports have used for over 50 years. And the idea that the numerous “alphabet groups” of aviation stakeholders could work together on key ATC policy issues has been demonstrated by the work of RTCA’s NextGen Advisory Committee in recent years. A stakeholder board for the ATO corporation would build on that experience of working together.

The report was released on January 6th and will be discussed at a workshop at Hudson on January 16th, moderated by Chris DeMuth and featuring me, former AOPA president Craig Fuller, and former FAA Management Advisory Council member Steve Van Beek. (Details below under “Upcoming Event”) The report will also be posted on the website.

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More Studies Underway on ATC Corporatization

Last issue I reported that the FAA Management Advisory Council recently endorsed separating the ATO from the FAA and making it self-supporting from fees and charges. FAA Administrator Michael Huerta opened the door for serious discussion of alternatives for ATC in an October speech, and House Transportation & Infrastructure Chair Rep. Bill Shuster (R, PA) echoed those thoughts in a December speech. Others who have cited Nav Canada and other ANSPs as possible models include NATCA President Paul Rinaldi and former AOPA president Craig Fuller.

And there is a lot more going on than just talk. Both the DOT Inspector General’s Office and the GAO have launched formal studies of organizational and funding reform of US air traffic control, drawing on the international experience with various forms of corporatization. The University of Virginia’s Miller Center last month issued “A Blueprint for Presidential Leadership” that identified as a bipartisan opportunity “transitioning air traffic responsibilities to a privatized or publicly corporatized entity.” And the DC-based Eno Center for Transportation has created a NextGen Working Group whose charge is to:

  • Assess the most significant barriers to implementing NextGen, including “an analysis of the existing institutional structure governing ATC and safety in the US through the FAA”;
  • Analyze lessons learned from previous attempts at both ATC modernization and separating ATC entities from government;
  • Develop three to five case studies of successful ATC modernization in other countries; and,
  • Devise policy recommendations for US ATC reform.

The report from that project is scheduled for the May-July 2014 time frame.

In addition, it is something of an open secret in Washington that the Business Roundtable has a project on ATC reform, the details of which have not been made public. I know more about this project than I am at liberty to discuss at this time, but can confirm that a very high-powered team has been working on a detailed ATC reform proposal for about two years, and that it will be unveiled later this year.

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Inspector General Slams FAA Training Contract

The FAA’s $859 million contract to purchase all controller training services, the 2008 Air Traffic Control Optimum Training Solution (ATCOTS), appears to be neither optimum nor the solution to the need to hire and train nearly 12,000 controllers through FY 2021. That’s according to an audit report from the DOT Office of Inspector General released December 18, 2013 (Report No. ZA-2014-18). The charge from the chairman of the Senate Homeland Security & Government Affairs Committee’s subcommittee on financial and contracting oversight was to determine (1) whether FAA has improved its oversight of the contract since the IG’s highly critical 2010 report on ATCOTS, (2) whether FAA can achieve ATCOTS training goals under the current contract, and (3) whether FAA has established effective performance goals for training via the contract. Alas, FAA basically flunked on all three.

FAA did take some actions in response to the IG’s 2010 recommendations, but amazingly it extended the ATCOTS contract for a year without first assessing and quantifying its training needs (as the 2010 report had called for). It took this action because cost overruns in the first four years had exhausted the contract’s five-year base funding. And that was partly due to poor oversight of the contract and partly due to flawed incentive provisions that gave the contractor extra funds despite poor performance.

How poor? Half of the FAA’s training goals for the contract have not been achieved, including two big ones. One was to reduce the average training time. But between 2009 and 2012, the average time to certify a controller increased an average of 41%, taking nine months longer than before the contract. Another was to reduce the cost of controller training, which was the basis of the contract award to Raytheon (whose price was $358 million lower than the FAA’s estimated cost for doing all the training in-house). Yet as noted above, the contract exhausted five years of funding in its first four years.

There is also a kind of catch-22 involving the premise that ATCOTS would lead to innovations in training, especially in connection with equipping new controllers to use such newer technologies as ERAM, STARS, and ADS-B. Training innovations were also supposed to lead to cost savings in training. But the way the contract was written, training innovations could only be implemented if FAA provided money to cover additional costs. But the budget provided only $16.7 million for such costs, less than 2% of the total contract amount. Of the 11 training innovations proposed by the contractor, FAA rejected the majority as either too costly or technically deficient. So the IG team was unable to document any significant training innovations.

There is a great deal more detail in the IG report about poor contract oversight and management, which reinforces one of my findings in the Hudson report about less-than-top-notch program management competency at FAA. But I was also amazed to learn that “FAA does not know its total training costs,” despite the premise of cost savings that drove the contract selection. Lower cost than what, if actual internal costs are unknown?

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Aireon Adds Three New Investor/Customers

The joint venture of Iridium and Nav Canada to provide global ADS-B service via satellite has added three new ANSPs to its ranks. In a late-December news release, Aireon announced that Danish ANSP Naviair, Italian ATC provider ENAV, and Ireland’s IAA will each make equity investments in Aireon as well as becoming customers of its services.

The three will invest a total of $120 million, which adds to the $150 million already committed to the venture by Nav Canada. Their funding will be provided in four tranches from 2014 through 2017, based on Aireon achieving various milestones. In 2018 Aireon will redeem a portion of Iridium’s initial investment ($120 million), after which the ownership shares of the parties will be:

Nav Canada 51.0%
Iridium 24.5%
ENav 12.5%
IAA 6.0%
Naviair 6.0%.

The ANSPs involved in Aireon represent various forms of corporatization or commercialization:

  • Nav Canada is a not-for-profit private company, governed by a stakeholder board.
  • ENAV is a joint-stock company that was created out of the former National Agency for Flight Assistance. It is controlled by Italy’s Ministry of Economy and Finance.
  • IAA is a commercial, semi-state company that provides all ATC services within Irish airspace (451,000 sq. km.).
  • Naviair is an independent company owned by the Danish state.

All four are self-supporting from fees and charges for their ATC services.

As I reported in 2012, Aireon initially approached the FAA ATO about becoming both an investor and the launch customer for the venture. But for several reasons stemming from its institutional and funding structure, FAA was unable to commit to do either. The agency’s ongoing budget uncertainty was one factor, another was its convoluted decision-making process, and a third factor was a competitive bidding requirement, which might have required the agency to invite comparable proposals from other providers of space-based ADS-B, one of which was already in operation in Alaska. So the agency missed out on this opportunity, which four self-supporting ANSPs were able to treat as a simple business decision.

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Private Sector Providing Real-Time Turbulence Data

I have reported previously on the real-time high-altitude aviation weather information being provided to subscribing airlines and business jet operators by Air-Dat, a start-up company acquired last year by Panasonic. Recent reports have identified a similar commercial service called TAPS (Turbulence Automated PIREPS System) now being provided by Weather Services International (WSI), the professional division of The Weather Company, owner of the Weather Channel and other services.

TAPS is an algorithm installed in the plane’s condition monitoring system. It gets inputs from accelerometers and the navigation systems to quantify turbulence being experienced in real time at a particular location. During non-turbulent flight, reports are sent to the company’s operations center every 20 minutes, using the existing ACARS data communications system. But when turbulence above a specified threshold is encountered, reports are sent every 30 seconds. Meteorologists at WSI analyze the data and provide additional weather context to the airline’s flight operations center, which notifies pilots of following aircraft in time to request changes in course or altitude.

Early last month, American Airlines was unveiled as the largest customer for TAPS thus far, having completed installation on about 360 Boeing 737, 757, and 767 aircraft. A not-yet announced US carrier is also outfitting its fleet, and WSI says 500 US-based aircraft are now in operation with TAPS.

While the FAA keeps talking about a still-to-come NextGen Weather Processing (NWP) system, aimed at replacing legacy aviation weather systems, airlines and innovative private companies are making real-time aviation weather data a reality. Perhaps that explains why the NextGen Advisory Committee ranked a proposed NextGen “common weather information database” as 35th out of 36 NextGen priorities.

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Upcoming Event

“Organization and Innovation in Air Traffic Control,” January 16, 2014, Hudson Institute, Washington, DC. Details at: . (Robert Poole speaking)

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News Notes

ATC Problems Top Inspector General List of 2014 Management Challenges. In a report released Dec. 16th, DOT Inspector General Calvin Scovel discusses seven top management challenges facing the U.S. DOT this year. Two of the seven concern the ATC system: operating the national airspace system (including controller selection and training) and dealing with the root causes of problems with the NextGen modernization effort and setting investment priorities. The report is PT-2014-009, “Top Management Challenges for Fiscal Year 2014.”

UAV Tests “See And Avoid” System. General Atomics reported last month that a specially equipped Predator B UAV had carried out a successful test flight of a prototype system allowing it to see and avoid other air traffic. The test flight, near Edwards Air Force Base, involved 40 pre-planned encounters with other, variously-equipped, aircraft. The Predator’s SAA package included radar, a transponder, and the same type of TCAS collision-avoidance system that is required on airliners and business jets. The inputs were provided to the UAV’s ground-based pilot who successfully avoided close encounters all 40 times.

Italian ANSP to Manage Air Traffic at New Dubai Airport. ENAV, the commercialized air navigation service provider in Italy, has been selected to manage air traffic for the new Al Maktoum Airport in Dubai, as well as optimizing air traffic flows in Dubai airspace. The airport has five runways and is designed to accommodate 160 million annual passengers. (Wouldn’t it be great if a commercialized ATO could have bid on such a job?)

Cyprus to Commercialize Its ANSP. The government of Cyprus is reorganizing its civil aviation department, with the aim of separating the provision of ATC services from the department and making it self-funded from air navigation charges in the Nicosia Flight Information Region (FIR). The new entity will be “independent, state-owned and operated as a private company.” Eurocontrol is providing advice and assistance in the transition.

Inspector General Targets FAA Regulatory Problems. Testifying before the House Aviation Subcommittee on October 30th, DOT Assistant Inspector General Jeffrey Guzzetti told Members about several FAA air safety regulatory problems: over 1,000 applications pending for air operator and repair station certification (some delayed more than three years), difficulties keeping up with certification of NextGen technologies such as ADS-B equipage, use of the delegation system, and lack of consistency in regulation and certification.

Far North Atlantic ADS-B Service Coming This Year. Aviation Daily reported last month that the ANSPs of Iceland and Denmark are nearing completion of projects that are installing ground systems to provide high-altitude ADS-B service on northerly flight tracks over the North Atlantic. All of Isavia’s ground stations are complete and awaiting certification, while Denmark’s Naviair is still working on stations in the Faroe Islands. ADS-B service is expected to be phased in during this year.

GPS Backup for Arctic Shipping. The General Lighthouse Authorities of the UK and Ireland are working together to implement eLORAN navigation for new Arctic ocean shipping routes, Reuters reported in late November. The two agencies are having discussions with Russia about a similar system the latter operates in this region, eChayka, in hopes of making the two interoperable.

Dumont Is New President of Aero Club of Washington. Peter F. Dumont was elected as the 2014 president of the Aero Club of Washington, and took office effective January 1st. Dumont is also President and CEO of the Air Traffic Control Association. Congratulations, Pete!

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Quotable Quotes

“There are examples of other nations’ aviation systems that are more successful, innovative, and efficient than ours. What can we learn from others that could help propel US aviation toward the future? For example, what can we learn from Canada’s air navigation service provider? Nav Canada is privately owned and operated. It is governed by representatives from air carriers, business and general aviation, the Canadian government, and employee unions. And industry and labor have a direct say in how revenue is invested and what level of service is provided. Nav Canada has been able to quickly and nimbly modernize and realign its air traffic control system. . . . What can we learn from France, Germany, and other Western countries that have commercialized their air traffic control service providers? Or the United Kingdom’s air navigation service provider, which is a public-private partnership? Or Australia’s government-owned corporation that provides air traffic control services? Or New Zealand’s air traffic control services, provided by a fully-owned subsidiary of the government and operated as a commercial business?”
-Rep. Bill Shuster (R, PA), Chairman, House Transportation & Infrastructure Committee, speech at the International Aviation Club, Washington, DC, Dec. 11, 2013

“We have been restricting-not denying-access to airports and airspace for years as part of a traffic flow management initiative. With the introduction of Category II (CAT II) Instrument Landing System (ILS) approaches capable of lowering landing minimums, it is not uncommon to see initiatives put in the system such as ‘CAT II certified and capable [aircraft] are exempt from this ground delay process.’ I raise the issue to suggest that under controlled tactical traffic management initiatives, our most capable aircraft have and should gain an advantage over less capable or equipped aircraft.”
-Rick Ducharme (Metron Aviation), “Coming First,” Air Traffic Management, Issue 3, 2013

“Say what you like about the FABs [Functional Airspace Blocks in Europe], they have been an engine for procrastination. There are a number of issues with the original FAB design. FABs bring States into the first line of the discussion-allowing sovereignty to raise its ugly head on day one. That in turn stops ANSPs thinking commercially. Secondly, FABs do not allow like-minded ANSPs to form alliances; they require like-bordered ANSPs to sit together.”
-Andrew Charlton, “European ANSPs Are Revolting,” Aviation Intelligence Reporter, December 2013

“Up until now, the [ATO]’s budget had to be approved annually by the Congress, which is tough for a company with a 20-year horizon. Any [ATO] project, even as small as $5 million, needed approval from the government Treasury. But now [ATO] gains autonomy and will be able to act more like a company than a branch of the civil service.”
-Daniel Yergin, “Behind Mexico’s Oil Revolution,” Wall Street Journal, Dec. 19, 2013[edited to substitute “ATO” for “Pemex.”]

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