No more ATC “privatisation” for the FAA?

The main advocate for the commercialisation of the Federal Aviation Administration’s air traffic control responsibilities, House T&I Committee chairman Bill Shuster, has confirmed the controversial 21st Century Aviation Innovation, Reform, and Reauthorization Act will no longer be tabled for adoption.

Met with a lack of support among congressional Republicans, Mr Shuster’s bill promised to corporatise only the traffic control business of the FAA – while the regulator would have retained its role in safety oversight and administration.

The new entity would have operated in an independent, not-for-profit structure outside of the government, but would only provide a service. The FAA, US Department of Transportation and Congress would still have authority of air traffic control.

So why the delay in implementation?

The bill was deemed a “privatisation” attempt which would place control of the US ATC system in the hands of airlines, in a soap opera of political ‘back and forth’ between general aviation associations, airlines and regulators.

Compared to the first version of the bill introduced in 2016, the “21st Century” variant encompassed an assortment of amendments. Mr Shuster emphasises “not one” of the general aviation community’s requests were excluded from the amended bill, including no user fees, no airspace restrictions and parity on the new company’s board of directors to alleviate concerns of the entity being orchestrated by airlines.

Among other supporters, IATA and the USA’s National Air Traffic Controllers Association endorsed the commercialisation effort, with the bill later becoming a proposition of interest to President Donald Trump.

Ignoring the divisive arguments on either side of the ownership debate, what was really sought by Mr Shuster was a steady, predictable funding stream for the US FAA. All sides agree: The FAA needs to be financed sufficiently to properly conduct its many roles, but instead has been subject to a number of shut downs and inconsistencies in the past decade.

The FAA functioning while bound as a government entity has steered ‘NextGen’, the FAA-led modernisation of America’s air transportation system, to become more cumbersome and complicated than first expected. While the FAA expected to complete roll out of all NextGen platforms by 2025, IATA imagines a delay in deployment until at least 2035.

This means NextGen would be delivered 31 years after it was launched, while costing two to three times more than the initially estimated USD40 billion public/private investment.

Nonetheless, the FAA’s website argues NextGen “remains on target to have all major components in place by 2025”, adding the programme has delivered USD2.2 billion in benefits from 2002 to 2016 and will have delivered USD161 billion by 2030.

Which claims are more accurate?

It is unclear which claims are accurate, however the US Government Accountability Office (GAO) offers some insight in a pair of separate reports. In its ‘Air Traffic Control Modernization: Progress And Challenges In Implementing Nextgen’ report, GAO said the FAA is taking actions to address challenges within its control by, for example, prioritising NextGen improvements and segmenting them into smaller pieces that each require less funding.

GAO notes while it was not possible to eliminate all uncertainties, the FAA has adopted an enterprise risk management approach to help it identify and mitigate current and future risks that could affect NextGen implementation. GAO also found while specific NextGen initiatives and programmes have changed over time, the FAA’s 2016 NextGen cost estimates were within range of 2007 cost estimates.

Does this mean the FAA doesn’t actually require commercialisation? Or, as Mr Shuster suggests, does the GAO report simply repeat an overly optimistic and unrealistic assessment of NextGen deployment by the FAA? With so many conflicting arguments and true delivery of the scheme a matter of perspective – time alone will tell.