Air Traffic Control Newsletter #143

Air Traffic Control Reform Newsletter

Air Traffic Control Newsletter #143

Inspector General indicts ATC status quo

In this issue:

Inspector General Summarizes Case Against ATC Status Quo

Defenders of the ATC status quo have been very busy in recent months. Their mantra is that despite a legacy of problems, FAA is making significant progress on NextGen, and it would be disruptive to this progress if the Air Traffic Organization were to be separated from FAA and reorganized as a service business, paid directly by its customers. That was essentially the message of FAA Administrator Michael Huerta at the U.S. Chamber’s Aviation Summit several months ago, which reflected a letter he’d sent to Sen. John Thune (R, SD), Chair of the Senate Committee on Commerce, Science, & Transportation. This was also the point of former AOPA president Craig Fuller’s piece in The Hill March 3rd, “Privatizing Air Traffic Control is a Solution Searching for a Problem.”

An eloquent answer was provided by the testimony of DOT Inspector General Calvin Scovel at the May 17th hearing of the House Transportation & Infrastructure Committee on ATC reform, “Observations on FAA’s Efforts to Implement Reforms and Modernize the National Airspace System.” It’s a summary of a decade or so of OIG audits, in a digestible 17-page document.

Scovel’s first major point was that the reforms Congress enacted in 1995 and 1996—personnel, acquisition, and organizational (creating the ATO)—for the most part “have not achieved the expected outcomes,” though he cites some small successes (such as saving over $2 billion over 13 years by outsourcing Flight Service Stations). FAA’s procurement process is still a nightmare, the FAA budget has grown by 95% between 1996 and 2015, and there has been no overall gain in ATC productivity—in fact, the unit cost of ATC services has increased 71% since 1997.

Second, “management problems continue to hinder FAA’s efforts to deliver new technologies and major acquisitions.” Far from being idiosyncratic, the schedule delays and cost overruns stem from systemic issues, built into the organizational culture. Moreover, “these weaknesses are not limited to FAA’s transformational programs,” which Scovel illustrated with examples.

Scovel agreed that FAA is making progress with some high-priority NextGen investments, especially the priorities recommended by the NextGen Advisory Committee (NAC). Yet even on those four priorities, “full implementation of [their] capabilities—and realization of benefits—remains years away. And, “significant risks remain that could impact implementation and slow delivery of benefits” in those four priority areas (which include both Performance Based Navigation and Data Comm).

Also singled out for attention is FAA’s long-delayed introduction of electronic flight strips (which Nav Canada has had in use for 15 years). In typical FAA fashion, last year it awarded a contract for Terminal Flight Data Manager, under which the contractor has three years to finalize the design and then eight years to deliver the product to just 89 of the busiest airport control towers. So 11 years from now, just 89 of FAA’s hundreds of ATC facilities will finally have a capability that all Nav Canada facilities had more than a decade ago.

Many more details on these and related problems are provided in a lengthy letter to Chairman Thune from Airlines for America, dated May 16th. It appears to be intended as a corrective to the rosy picture painted by Administrator Huerta in his letter to Thune last winter. It argues that FAA:

  • Underestimates the cost of NextGen, which artificially inflates the benefit/cost ratio;
  • Redefines NextGen to include a number of projects that have never been part of it;
  • Masks the small portion of benefits that accrue to airlines by not breaking down benefits by sector;
  • Asserts that $2.7 billion in direct benefits have been delivered, when these are only the results from modeling, not measurement; and,
  • Counts fuel savings as benefits, but not system-wide traffic flow management benefits or dis-benefits, where delays have resulted from some of the changes.

The 15-page letter also includes case histories of a number of NextGen capabilities, raising questions about each. These include ADS-B, Data Comm, PBN, and Wake RECAT. And it also faults FAA for chronic controller under-staffing in recent years, and for basically ignoring much-needed airspace redesign in the New York/New Jersey/Philadelphia region, the location of a very large fraction of U.S. aviation congestion and delays. (To be sure, there are runway constraints at this region’s airports, but airspace redesign could permit more intensive use of the existing runways.)

The A4A letter is useful as a supplement to Inspector General Scovil’s testimony, providing greater detail from the customer’s perspective.

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A Tale of Two Towers

During the week of May 15th, two news articles crossed my screen within days of each other. The first announced that Philadelphia International Airport is in line to get a new FAA control tower. The second announced that London City Airport will replace its control tower with the first remote tower in the United Kingdom.

One of the advances included in the original NextGen vision (back when it was called NGATS) was the “Virtual Tower.” Just as TRACONs and Centers are located on the ground, with no windows, and rely on surveillance data and communications links, so would the virtual tower. In the March 2008 edition of this newsletter, I outlined some of the expected benefits of shifting to this new kind of tower. They include:

  • Eliminating the need to build second and third towers at airports (such as DFW and ORD) where all the runways cannot be seen out-the-window from a single tower;
  • Replacing obsolete towers at significantly lower capital and likely operating cost;
  • Enabling small-airport tower services to continue at night (when many are currently not staffed) by controlling several such small airports from a single center.

That article also summarized the findings of operational simulations of virtual versus conventional towers, carried out in 2007 at the FAA Tech Center in Atlantic City. The project used tower simulators to run side-by-side comparisons of conventional and virtual tower operations, using experienced controllers. Performance was similar during daytime good-weather conditions, but at night and in reduced-visibility conditions, the virtual tower did much better. And the controllers preferred the virtual tower operation, for its increased productivity and perceived lower workload.

Alas, somewhere along the line, what we now call Remote Towers has disappeared from NextGen, along with other paradigm changers such ground-based (GPS) augmentation systems (GBAS) to replace ancient Instrument Landing System technology. While remote towers are certified and in operation in Sweden, and will soon be certified in Germany, Hungary, Ireland, and Norway—and soon also the U.K.—the only two pilot projects in the United States are not FAA projects. The Leesburg project is funded by the State of Virginia and Saab Sensis Corp. and the Loveland project is being funded by the Colorado DOT. The FAA is cooperating with both projects, but it has no budget for developing remote towers.

Therefore, it is gearing up to commit itself to a $200 million traditional control tower replacement for Philadelphia International. The FAA Tech Center is already doing a siting study for the replacement tower, which is expected to be five years away from actual construction.

Meanwhile, NATS, the U.K.’s ATC corporation, will develop and implement a remote tower for fast-growing London City Airport. On the airport will be a mast with 14 high-definition video cameras and two pan-tilt-zoom cameras providing a 360-degree view of the airport. Video feeds will be sent to a remote tower center to be added to the NATS control center at Swanwick, about 70 miles away. Redundant high-speed fiber networks will provide the video feeds; controllers will also have the usual audio and radar data. The technology will be provided by Saab Digital Air Traffic Solutions, whose equipment powers the world’s first certified remote towers in Sweden.

As the National Research Council reported in 2015, what FAA now defines as NextGen is not the transformational vision with which this effort was launched and sold to Congress and the aviation industry. Instead, it has become largely a replacement of old facilities and equipment with newer versions—the same old same old. It will require organizational transformation to bring about anything resembling the original NextGen vision.

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Defense Secretary OK with ATC Corporatization

On May 17th, Chairman Bill Shuster of the House Transportation & Infrastructure Committee made public a letter from Secretary of Defense James Mattis, in response to Senator John McCain’s March 13th question about DoD’s position on possible corporatization of the ATC system. The answer was straightforward: “The DoD is supportive of possible privatization of ATC services.” Mattis explained that the agency has created an ad-hoc committee “to assess the current ATC relationship between DoD and the FAA, within 120 days, in order to delineate the linkages that would be necessary with a privatized ATC entity.” Shuster reassured those taking part in the May 17 hearing that this year’s corporatization bill would include all needed provisions to maintain the current civil/military ATC relationship.

This welcome news was not unexpected. The FAA Management Advisory Council that issued a unanimous final report endorsing corporatization in January 2014 included DoD liaison Steve Pennington (as a non-voting member), with whom I discussed this subject last summer, so I was hardly surprised by Secretary Mattis’s letter. It reflects the state-of-the-practice worldwide between military aviation and ATC corporations.

Former FAA executive Mike Cirillo recently told me of the year he spent at German ATC corporation DFS headquarters in Frankfurt, on an international exchange program. “DFS employees were proud of the excellent relationship they had forged with their Bundeswehr (German military) colleagues. . . . They characterized the relationship as much better than in the days when [government] was the ATC service provider.” Mike was incredulous at claims by congressional opponents of corporatization that DoD would never go along with corporatization.

Civil/military cooperation has been addressed in all 60 countries that have created ATC corporations. As reported previously in this newsletter, Australia is under way with a joint effort to develop a single civil/military ATC software system to replace the AAATS developed by Airservices Australia in the 1990s. Defence and Airservices are jointly funding and managing procurement of the new system. NATS in the UK has a close working relationship with Defence Airspace and Air Traffic Management. At NATS’s Swanwick London Area and Terminal Control Center, military controllers are embedded throughout the operation. And 20 years ago, Eurocontrol implemented a Civil-Military Interface Standing Committee, to facilitate civil/military cooperation across Europe. And our own Air Traffic Control Association runs a civil/military ATC conference in parallel with its big annual ATC conference.

In short, civil/military cooperation in air traffic control is standard practice worldwide, whether the ANSP is an ATC corporation or a government agency.

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Aviation Policy Experts Support Corporatization

Having participated in several congressional hearings on ATC corporatization last year and again on May 17th this year, I’m flabbergasted at opponents’ portrayal of this successful reform that is almost ubiquitous among developed countries. For the benefit of those still learning about this subject, I have compiled information on statements by people knowledgeable about air traffic control who have decided this is a sensible and much-needed U.S. reform.

Five groups of aviation experts have signed or issued statements on the need for fundamental reform that are best described as corporatizing the existing ATC system. Prior to the actual reorganization that stood up the ATO in 2003, a dozen former FAA officials signed a statement endorsing a “not-for-profit air traffic control corporation” along the lines proposed in Reason Foundation’s 2001 policy study, “How to Commercialize Air Traffic Control.” They included four previous Administrators (John McLucas, Langhorne Bond, Allan McArtor, and David Hinson) plus eight other retired senior FAA officials. You can read their statement at: http://reason.org:8080/news/show/a-statement-concerning-the-fut.

Six years later, when interest in ATC reform had resumed following the recovery of air traffic from the 9/11 attacks, nine distinguished aviation leaders, signing as individuals, called for fundamental reform of the governance, funding, and management of the Air Traffic Organization, including separation of safety regulation from operations and financial self-support. Organized in large part by former Administrator Langhorne Bond, signers included former Civil Aeronautics Board chairman Alfred Kahn, former DOT Secretary Jim Burnley, GRA, Inc. founder Aaron Gellman, former National Air Transportation Association chairman Jim Haynes, former president of the National Business Aviation Association Jonathan Howe, former president of Airports Council International-North America David Plavin, former CEO of the Metropolitan Washington Airports Authority James Wilding, and the former research director of the Aviation Safety Commission Clint Oster. Their statement is online at: http://reason.org/files/air_traffic_control_experts_statement_2007.pdf.

In January 2014 the 2011-2013 FAA Management Advisory Council released its final report, “FAA and Aviation Policy Reform: Now Is the Time.” It identified policy failures during those years and made the case for fundamental governance and funding reform. The four basic reform principles it set forth were a dedicated user-based revenue stream, separating a commercialized ATO from FAA, simplifying ATC regulatory procedures, and elimination of the current aviation excise taxes so as to fund both the commercialized ATO and FAA’s remaining function from cost-based fees. The report had unanimous support from all industry members, including David Bronczek of FedEx Express, Jack Pelton of Cessna, Gina Marie Lindsay of LAX, Steve Van Beek of LeighFisher, and Chip Childs of Skywest. This report was not released by FAA, but is posted online at http://reason.org/files/faa_mac_joint_report.pdf.

As debate heated up over the House bill last February, a group of former congressional, DOT, and FAA leaders sent a letter to House Transportation Committee Chair Bill Shuster urging fundamental reform that would take the ATO out of FAA and convert it into a federally chartered, self-supporting nonprofit corporation. Signers included former DOT Secretaries Jim Burnley, Norm Mineta, and Mary Peters; all three former Chief Operating Officers of the ATO (Russ Chew, Hank Krakowski, and David Grizzle); former FAA Administrator Randy Babbitt, former Clinton White House infrastructure expert Dorothy Robyn; and former Senators Byron Dorgan (D, ND) and Trent Lott (R, MS).

Finally, as debate continued last spring, veterans of the Clinton Administration in April 2016 sent a letter to all members of the U.S. Senate, reminding them that ATC corporatization has a bipartisan history, specifically the Clinton Administration’s detailed proposal to spin off ATC as the self-supporting U.S. Air Traffic Services corporation (USATS), and citing the support for corporatization from controllers’ union NATCA. Signers included former DOT Secretaries Federico Pena and Norm Mineta, former OMB Director Peter Orszag, senior Treasury and OMB official Joshua Gotbaum, former chairman of the National Airline Commission Gerald Baliles, former National Performance Review Director Elaine Kamarck, and former White House infrastructure expert Dorothy Robyn. They were not supporting a specific piece of legislation but rather the importance of structural reform of ATC. (https://www.enotrans.org/etl-material/2016-letter-clinton-admin-alumni-senate-atc-corporatization)

By my count, that constitutes four former DOT Secretaries, five former FAA Administrators, all three former ATO Chief Operating Officers, and former heads of several major airport and general aviation organizations. They would not be publicly supporting a risky or untried idea.

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FAA Managers Oppose Corporatization

Two days before the May 17th House Transportation & Infrastructure Committee hearing on ATC reform, the FAA Managers Association (FAAMA) issued a public statement attacking ATC corporatization in inflammatory terms. As if reading from the NBAA playbook, they attacked it as a “transfer of this national treasure to a corporation dominated by the airlines.” The statement stressed that the emergency grounding of planes after the 9/11 attacks was handled by “government controllers, government managers, government employees who were on duty that fateful day . . .”—totally ignoring that most of the flights headed to or from Europe were safely and efficiently brought to safe landings in Canada by the dedicated employees of private, nonprofit Nav Canada. The give-away comes further into the piece, which says FAAMA opposes “privatization” because it is a bad deal for the flying public [no reason given], a bad deal for national security [no explanation], a bad deal for the taxpayer [no explanation], “and it is a bad deal for our members.” Now we’re getting somewhere.

FAAMA represents several thousand “front-line supervisors” within FAA, not senior managers. They constitute a significant portion of what NATCA president Paul Rinaldi (at the May 17 hearing) called “the clay” within FAA—the bureaucratic mass that prevents timely decision-making and implementation. They staff the enormous proliferation of silos and fiefs within the ATO, creating the organizational culture whose end results appear in reports of the Government Accountability Office and the DOT Office of Inspector General.

FAAMA is right to see corporatization as a threat to at least some of its members. One of the most important goals of ATC reform is to replace the existing bureaucratic organizational culture with an innovation-friendly, can-do culture more like that of telecommunications firms and the smaller and more-innovative aerospace companies. There are some first-rate people within FAA who would feel liberated by graduating from a civil-service bureaucracy into a results-oriented technology company. Others, however, would find that kind of culture impossible to cope with. Fortunately, there is a large subset of FAA supervisors and managers within a few years of retirement age, so the needed reinvention of ATO’s corporate culture might be do-able largely by attrition (and to some extent, by lateral transfers to the now-much-smaller FAA). But make no mistake: that organizational culture must change, if airspace users are to have any hope of the ATO turning into a cost-effective service business.

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ICAO Guidance on ATC Corporations

The International Civil Aviation Organization is the recognized international authority on aviation safety, air traffic control, and airports. Back in 2001, when there were fewer than two dozen ATC corporations in the world, I quoted relevant ICAO language on the subject in a Reason Foundation corporatization study. The document in which this excerpt appears was produced by the Civil Air Navigation Services Organization (CANSO), the international organization for air navigation service providers—ANSPs. (www.canso.org)

ICAO refers to ANSPs as “autonomous authorities.” Here are some of its guidelines on the organizational and financial aspects of these entities:

“By autonomous, ICAO means that the organization should have greater freedom from the government in conducting its financial affairs, infrastructure funding, etc., and it should be self-financing, subject to the usual business taxes [if for-profit], and be required to seek a return on capital. Importantly, it should still be regulated by the government, and encouraged to be as competitive, efficient, and cost-effective as any other commercial business. Based on the empirical evidence so far [as of 1999], ICAO believes that such autonomous air navigation service providers are likely to be more efficient, more dynamic, and more business-like than their government-run counterparts, and more attractive to banks and other lenders.

“ICAO specifies that an autonomous authority should have financial and managerial autonomy from the government. This means that it should finance its operations through user charges and any other revenues it may generate from its operations, be free to access national and international money markets to fund major infrastructure investment, and have the authority and flexibility to respond to market forces when it comes to manpower and general management policies. . . . To that end, ICAO pledges its support and encouragement for any government contemplating this significant leap forward.”

That was then. Today, CANSO has grown to 87 full members (providers of ATC services), of which 60 meet the ICAO definition of an autonomous authority. Their ranks will be increased quite meaningfully when our Air Traffic Organization is converted into a self-supporting air traffic corporation.

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News Notes

Aireon Completes Initial Space-Based ADS-B Flight Tests. On May 3rd, Aireon announced the completion of three sets of flight tests, validating the ability of ADS-B signal transmission from aircraft in flight to the initial set of 10 IridiumNext satellites and from the satellites to ATC providers on the ground. The first flight tests involved Nav Canada and a specially equipped Bombardier aircraft. The second used the FAA’s “flying laboratory” Bombardier aircraft, and the third used a Polaris Flight Systems Beechcraft Bonanza. According to Vinny Capezzuto, VP of engineering at Aireon, the tests were able to “thoroughly validate the capabilities of the system.” The complete constellation of satellites will be in place by 2018 and will then begin providing global surveillance and flight tracking to ANSPs that sign up for the service. (So far, the FAA is not among them.)

NATS Invests in Remote Tower Company. The UK’s air navigation service provider, NATS, on May 5th announced a partnership with Nav Canada, in which the two ANSPs will be equal shareholders in Searidge Technologies, a Canadian company with expertise and experience in developing and implementing remote tower solutions in a number of countries. The company now operates at more than 30 sites in 16 countries, and the investment by NATS will support further growth. (Nav Canada was an early investor in Searidge.)

Avinor to Spin Off ATC Company. On April 6th, Norway’s combined airports and ATC company Avinor announced that it will spin off the ATC portion of its business as an independent company. The reason is the Norwegian Transport Ministry’s desire to open the airport control tower business to competition. Having the ATC provider also be the owner of most of Norway’s airports was seen as casting doubt on the fairness of control-tower competitions.

FAA Gets an Underwhelming Budget Increase. Congress approved an omnibus spending bill early in May, which was quickly signed into law by President Trump. FAA’s budget for FY 2018 will be $16.5 billion, an increase of $127 million. That works out to an increase of 0.8%, not even enough to provide inflation-based increases in compensation to the agency’s workforce, let alone making meaningful increases in technology modernization or facility replacement. Strangely, this is what status-quo people call “fully funding” FAA.

Malaysia Airlines Opts for 100% Global Flight Tracking. SITAONAIR, Aireon, and FlightAware announced last month that Malaysia Airlines is the first customer for global flight tracking and alerting, based on the capabilities of Aireon’s global space-based ADS-B service. Once the full Aireon satellite constellation is operational, in 2018, Malaysia Airlines’ aircraft operations center will get real-time position updates of its entire fleet, worldwide. Since the fleet is already equipped for ADS-B, no additional avionics or modifications are required.

Inspector General to Audit Security of FAA Data Comm. The U.S. DOT’s Office of Inspector General last month announced the launch of an audit into possible security risks involved with FAA’s fledgling Data Comm service, which thus far permits digital information exchange between ATC and cockpit crews for pre-flight functions. In coming years, Data Comm is to be expanded to permit digital messaging in en-route and TRACON airspace, so if there are security problems, now is a good time to identify them.

DFS Opting for GPS-Based Landing Systems. Germany’s ATC corporation, DFS, was a European pioneer in introducing a ground-based augmentation system (GBAS) to provide precision landings at Frankfurt airport in 2014. This system is now in regular use, offering a steeper 3.2-degree glide slope (for reduced noise exposure). In a recent article in Avionics, DFS’s CEO said the company sees GBAS as the future replacement for traditional Instrument Landing Systems (ILS) at other German airports. GBAS, he explained, requires only a single installation to provide precision approaches for all of an airport’s runways, rather than a separate ILS for each and every runway end. For unexplained reasons, GBAS is not part of FAA’s NextGen modernization program.

Electronic Flight Strips at Dublin Airport. IAA, the ATC corporation of Ireland, has implemented electronic flight strips in its control tower at Dublin. The system is E-STRIPS, produced by Saab. The electronic flight strips will serve as an enabler for collaborative decision-making (CDM) at the airport.

Poole Testimony Online. As noted previously, I testified at the House T&I Committee hearing on ATC reform on May 17th. The focus of my testimony was adapting the stakeholder governance concept pioneered by Nav Canada to a nonprofit U.S. ATC corporation. I also gave reasons for my assessment that small airports will be better off under an ATC corporation than they are under the FAA status quo. (https://transportation.house.gov/uploadedfiles/2017-05-17_-_poole_testimony.pdf)

Correction on NATS Post-9-11. In last month’s issue I wrote that in response to the financial squeeze that hit UK aviation corporation NATS after the 9-11 attacks, its two principal shareholders—the Airline Group and the UK government—each made a capital contribution. Barry Humphreys emailed to inform me that since the struggling airlines did not have the ready cash to provide their share, the Airline Group sold a 4% shareholding to BAA Ltd (now Heathrow Airport Ltd), reducing the airlines’ stake to 42%.

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Quotable Quotes

“First, air traffic control is not an inherently governmental function. Although keeping planes safely separated is a complex and critical task, it is a purely operational process that follows well-established rules. Like running an airline or manufacturing a Boeing 787, air traffic control can be performed effectively by a non-governmental entity as long as it is subject to oversight by FAA safety regulators, whose job of setting and enforcing the rules is inherently governmental. Second, precisely because air traffic control is commercial in nature, the federal government is poorly suited to running it. Blue-ribbon commissions have studied the FAA in depth for decades, and there is broad consensus on the problem. Air traffic management is a 24/7 technology-intensive service business trapped in a regulatory agency that is constrained by federal budget rules, burdened with a flawed funding mechanism, and micromanaged by Congress and the Office of Management and Budget.”
—Dorothy Robyn, Special Assistant to the President for Economic Policy [Clinton Administration], “The Need to Reform FAA and Air Traffic Control to Build a 21st Century Aviation System for America,” testimony before the House Transportation & Infrastructure Committee, May 17, 2017

“I believe there is no good reason to build a physical control tower anywhere in the world. We’ve been following Searidge for a while, looking very carefully at what they are doing in Budapest, and the future potential—digital towers, artificial intelligence, and all the things that Searidge are into—seems absolutely square in fitting into where we want to be and what we want to offer our customers.”
—Martin Rolfe, CEO of NATS, in John Croft, “Remote-Tower Outlook Drives NATS’ First Acquisition,” Aviation Daily, May 8, 2007

“Outside of government, the only opponents [of ATC corporatization] are the National Business Aviation Association (NBAA), who represent the interests of the people who soar around the country in private jets (i.e., not you and me). The Gulfstream and Learjet cabal love the status quo because they get a huge bargain. Private jets consume a relatively large chunk of US ATC services, but pay a tiny share of the cost of running the system. The U.S. is the only nation in the world that does not levy weight-and-distance user fees on the wealthy and big corporations that own bizjets. The Eno Center for Transportation . . . recently did some compelling ‘corporate welfare’ math to compare who pays what on a flight from Dallas to Washington, DC requiring essentially the same ATC services. [The table shows the AA Airbus A321 paying $3,381 in aviation user taxes and the Gulfstream V paying $327.]
—Rob Britton, “Fixing U.S. Air Traffic Control,” Huffington Post.com, April 25, 2017

“[German ANSP] DFS has been able to reduce its running costs by introducing a strict efficiency program. By 2019, our aim is to reduce costs by 10% compared with 2013. Our workforce has been reduced by almost 7% in 2015 by natural fluctuation alone. Our high levels of safety, service quality, punctuality, and environment have been maintained and in some cases improved. We were also able to lower en-route charges for airspace users by 8.4% and terminal service fees by 12.3% in 2016.”
—Klaus-Dieter Scheurle, CEO, DFS Deutsche Flugsicherung, “European Air Traffic Management: The German View of Current and Future Trends,” The Journal of Air Traffic Control, Fall 2016

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Robert Poole is director of transportation policy and Searle Freedom Trust Transportation Fellow at Reason Foundation.