Possible FAA Relaunch Sets Stakeholder Tapdance
April 27, 2015
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  • The Aero Club of Washington was acutely interested in the words of National Air Traffic Controllers Association President Paul Rinaldi, delivered last week at the club’s annual luncheon in Washington. NATCA will likely be a deciding factor in whether or not the Federal Aviation Administration gets a total makeover. Almost everyone agrees the agency is overdue for some serious change, but it’s unclear whether lawmakers will be able to pull it off.

    At issue is whether to dismantle the FAA such that the air-traffic-control system is a separate entity—perhaps a nongovernment entity—from the certification and standard-setting operation. House Transportation and Infrastructure Committee Chairman Bill Shuster wants air-traffic control to become its own nonprofit, and he is working hard to convince ranking member Peter DeFazio that he can write a bill that won’t hurt the FAA’s funding or governmental abilities. DeFazio has yet to be convinced.

    (I wrote about the FAA debate between DeFazio and Shuster in a special report on the committee that published last week. Shuster and I will discuss the topic further at a National Journal LIVE event on Tuesday.)

    Shuster’s plan for the FAA reorganization is definitely bold, but it shouldn’t be a surprise to anybody. “This is nothing new. The Clinton administration tried to do it,” he told me recently. “Everybody’s now to the point of, ‘We all have the same frustrations, the same complaints.’ Now you have labor talking about it. You have general aviation. You have the airlines, the major airlines, manufacturers, everybody, Republicans, Democrats.”

    Not so fast, Mr. Shuster. Yes, there is broad agreement that air-traffic control needs to be sheltered from sequestration and the annual government funding cycle. Beyond that, there are many concerns and a whole lot more questions about actually making it a nongovernment entity. For example, the Alliance for Aviation Across America, which represents small airports, farmers (think crop dusters), and individuals who own airplanes, is worried that the new nonprofit would charge “user fees” based on take-off and landing that would hurt small aviation.

    “The imposition of any user-fee tax would hurt businesses and farms that rely on general-aviation aircraft and add an immense bureaucratic burden to these businesses and groups,” said Selena Shilad, the group’s executive director.

    Ed Bolen, president and CEO of the National Business Aviation Association, which represents people who use small aircraft for business purposes, added another caveat at a recent congressional hearing. “A dialogue about finding a new governance structure is appropriate, but the composition and scope of its authority matters. Congress must retain authority over taxes, fees, and charges. This is not a responsibility that can be transferred, delegated, or outsourced.”

    These are just two examples of the types of complaints that will be voiced as Shuster and DeFazio work their way through a bill. There will be competing arguments. The airlines, for example, will want to keep their costs down—already chafing at the passenger and fuel taxes imposed on them. The airports—big and small—will want to protect the funds that allow them to build more runways and hangars. The math won’t favor everyone all the time.

    Here’s where Rinaldi comes in. NATCA could wind up casting the deciding vote in fights about who pays for what and how the system will work. Any FAA overhaul would most directly impact his members, so they are paying close attention. At the Aero Club, Rinaldi was blunt about these internal squabbles. “We all have our parochial positions. I can name them all if you want me to,” he said. “We must set aside parochial issues.”

    Well aware of his delicate position in the stakeholder realm, Rinaldi didn’t venture further into his own recommendations other than to repeat that the status quo is unacceptable and that the new agency should have a robust and predictable funding stream. After suffering sequestration and furloughs, NATCA is clearly open to a new way of doing things. So are others in the aviation community. It’s now up to Shuster and DeFazio to come up with something that will balance everyone’s interests, parochial or not.

    For our insiders: What are the advantages of a nonprofit air-traffic-control system? What are the potential problems? What can we learn from other countries who have adopted this model? Why is U.S. airspace different? What other options are there? Would it be better if the FAA became an independent government agency like the U.S. Postal Service? What “parochial” interests could get in the way of an FAA deal? How can they be overcome?