Says Budget Continues To Grow Despite Drop In Air Traffic

The DOT's Inspector General Calvin Scovel III offered a less-than-flattering assessment of the FAA during a hearing last week before the House Transportation Committee, which will write the agency's next reauthorization bill.

In his prepared remarks for the hearing "Status of FAA’s Efforts to Operate and Modernize the National Airspace System," Scovel (pictured) said the agency " has taken steps to implement the provisions of reform legislation, including introducing new employee compensation systems and establishing the Air Traffic Organization (ATO).

"However, the Agency has not taken full advantage of its personnel reform authorities, or implemented changes that could significantly enhance air traffic operations. In general, FAA is not using business-like practices to improve its operational efficiency and cost effectiveness. As a result, FAA has experienced significant increases in its costs without appreciable increases in controller productivity."

Over the past 2 decades, Scovel said, Congress has granted FAA unique authorities to implement acquisition practices, expedite delivery of new technologies, and reduce the Agency’s costs reforms that would result in increased operational efficiency, improve the Agency’s acquisition practices, expedite delivery of new technologies, and reduce the Agency’s costs. Those areas included reforms in personnel, acquisition, and overall organization.

But the IG said that "these reforms have not slowed the Agency’s cost growth or improved operational productivity. Between fiscal years 1996 and 2012, FAA’s total budget grew by 95 percent, from $8.1 billion to $15.9 billion,8 with its operations account increasing by 108 percent, from $4.6 billion to $9.7 billion (see figure 1). Also, during this timeframe FAA’s total personnel compensation and benefits (PC&B) costs increased by 98 percent, from $3.7 billion to $7.3 billion."

The IG cited the delays in implementing NextGen and issues surrounding the requirements for ADS-B Out capability by 2020 that he says "provides little benefit to large commercial airlines, while the requirements for the more beneficial ADS-B In continue to evolve. Furthermore, the costs of the current portion of the program (ADS-B Out and current broadcast services) now outweigh projected program benefits for FAA and airspace users by $588 million."

"Our work continues to demonstrate that while FAA has taken some action to implement the reform authorities Congress granted almost 2 decades ago, it has not achieved the large-scale efficiencies, productivity enhancements, and cost savings envisioned by these reforms," Scovel said at the end of his remarks. "The Agency’s inability to transcend ongoing problems is largely due to its failure to fully adopt sound management practices, make knowledge-based decisions, and assign clear accountability for productivity and results. With new and complex challenges on the horizon, FAA’s effective and timely use of its reform authorities will be critical to meeting the Nation’s current and future aviation needs."

FMI: Full Written Testimony