the subcommittee will come to order the chair would ask all members and staff everyone in the room to to take their electronic devices and put them on vibrate the subcommittee is meeting today to hear testimony on congressional management in the congestion management i should say in the new york airspace the chair will make a brief opening statement will recognize the ranking member for any statements or comments that he may have and then we will go to our first panel which is two members both senator schumer and our friend congressman shays i welcome everyone in the subcommittee hearing today on congestion management in the new york airspace i'm pleased to welcome our colleague senator chuck schumer who served in the house a number of years before you went over to that other body and congressman chris shays who will be here  momentarily to our hearing today i'm interested in hearing their perspective on this issue over the last year we have seen record delays and congestion in the skies with nearly twenty seven percent of flights delayed according to the bureau of transportation statistics the department of transportation inspector general found that up those delayed eighty eight thousand two hundred thirty four flights were delayed for over an hour seven thousand six hundred fifty nine had ground delays of between two and three hours and almost seventeen hundred flights were delayed over three hours the new york area airports have been hit particularly hard with delays according to the b t s and less than sixty percent of the flights arrived on time at these airports in two thousand and seven the new york airports do not have adequate capacity to meet demand and the department of transportation has kept operations at j f k la guardia  care international airport in chicago for instance for example the short term solution to congestion and delays at the airport was to catch o'hare international airport the long term solution is making additional capacity improvements like the o'hare modernization program on monday the f a a announced that the cap is being lifted as the new runway at o'hare comes online in the fall of this year d o t is not only proposing to cap the new york airports but also to auction a percentage of those slots at each airport many have questioned both the department of transportation's legal it started for such a proposal and the likelihood that slot options would decrease congestion and delays under one of the proposals the auction revenue would revert back to the air carriers with no guarantee that the proceeds would be used to mitigate congestion and delays and the new york airspace in my view auctioning slots is a bad deal for consumers during these tough financial times for carriers consumers are being asked to pay more for less any additional cost to assess these markets or access these markets more than likely will be passed on to the consumers resulting in higher fares and absolutely no guarantee of congestion and one delay reduction further service to small communities has already been affected by carriers pulling down capacity because of the increased fuel prices should optioning be allowed carriers could potentially limit service to small communities in favor of access in the more lucrative markets i'm interested in hearing from our witnesses on how they believe the d o t cap slot auctioning proposal will affect service and pricing in the new york airspace and if there will be any significant reject a reduction in congestion and delays as a real all of these measures and with that i again welcome our witnesses here today i look forward to hearing their testimony and before i recognize mr peet try for his opening statement to our comments i ask unanimous consent to allow two weeks for all members to revise and extend their remarks and ferment the submission of additional statements and materials by members and congestion issues in the new york new jersey metropolitan region airline delays continue to be a problem at our most congested airports according to department of transportation bureau of transportation statistics newark k and la guardia airports had the worst on time performance statistics in our country in the last year also according to the department the new york area airports account for seventy five percent of our chronically delayed flights so the impact is felt across the airspace system so no surprise the delays are a major inconvenience air travelers but they also cost airlines passengers and of course our economy according to the travel industry association statistics air travelers of waited forty one million trips this past year due in part to travel delays according to the group this cost us economy roughly twenty six and a half billion dollars short term caps at the three major new york region airports have been agreed to but given the demand for service in and out of the area it's unlikely that without a long term solution congestion problems will be abated just by  that step for the long term solution the department to propose a cap and auction system to control congestion to cultivate competition that's often stymied by artificial caps alone i'm interested in hearing from our qualified panel of witnesses about this and other possible mechanisms to address congestion associated delays traveling public will not tolerate these kinds of delays the department has offered its solution i look forward to discussing it  but this teen years ago when the telecommunications industry was deciding how to best allocate limited spectrum resources the f c c utilize the auction approach for allocating public spectrum capacity very similar to what the department has proposed so auctions such as these are not unheard of or unprecedented however we must carefully consider all possible consequences of the department's proposal and not rush into any one approach in particular recognizes the senior senator from new york the distinguished senior senator senator chuck schumer well thank you mr chairman it is great to be here back in the house where i spent eighteen very happy years  you notice all of the names here most of them came after i left in one thousand nine hundred eighty and the only two people i was telling chris who would be senior to me had i stayed in the house would be chairman oberstar and mr p try i think gerry you came a couple of years over new york are a huge mess and the sad thing is this could have been avoided the f a a is incompetence has created the problem and the f a a can solve it but they are just focused untested schemes that don't work instead of doing what needs to be done giving us an adequate number of controllers now anyone who's traveled in the last year has felt the pain and frustration that defines air travel in the u delays cancellations of crippled the entire air traffic system leaving passengers stranded across the country and it is nowhere worse than in this in the new york metropolitan area and time and time again we've seen the department of transportation attempt to address new york's congestion problems using ideological market based theory and other untested experiments first it was caps then it was congestion pricing and now we're hearing about  options instead of focusing on real tested solutions to solve this problem like upgrading decades old technology and hiring an adequate number of controllers to staff new york's towers the d o t continues to miss the point to make matters worse the f a s treatment of controllers has led to an unprecedented rash of retirements compounding the problem the bottom line is that at the current pace and under the current plan within the next five years the new york city airspace will be in total gridlock the wave of controller retirements and the f a a is inability and unwillingness to upgrade antiquated technology will simply cause a meltdown in the new york area and across the country last summer's travel season was hampered by some of the worst delays ever recorded nearly thirty percent of all flights were delayed and canceled and in a row port issued last month by the joint economic committee which i chair we found that these flight delays cost passengers airlines and the us economy forty billion dollars a year and sadly it's just the beginning to make matters worse air traffic control towers across the country are dangerously understaffed when you look at the workforce nationally most facilities in the country have staff levels that are more than thirty five percent trainees in two thousand seven developmental trainees composed twenty five percent of the controller workforce up from fifteen percent in two thousand and four and given that the trainees cannot staff a controller position without a fully certified controller supervising these numbers are alarming it's even worse in new york in new york when you fully cancer defied controllers only excluding trainees the j f k tower is only sixty percent staffed having twenty two full time controllers when it should have thirty seven the laguardia tower sixty percent staff having twenty two controllers when it should have thirty six the new york tower sixty seven percent staff having twenty seven controllers when it should have forty the f a a tries to hide these numbers by including the trainees in the overall number but we all know that they can't do a job on their own they have to be with a supervisor at the new york center which manages traffic entering into new york airspace the average training time is more than four years the second highest in the country however most of the seventy one controllers in training haven't even started their official training since september two thousand and six th facility in new york has lost fifty seven fully certified controllers and only hired eighteen to replace them that is shocking and the greatest level of incompetence that we have seen in the early in the new york trade congress sponsible for all arriving and departing traffic we've lost twenty three fully certified controllers and only gained one this month nationally the culture of fear created by the f a a has led thirty three hundred controllers to leave the workforce since two thousand and five and it's going to get worse fifteen thousand five hundred more are expected to leave between two thousand and eight and two thousand and seventeen in the six months from october through march of two thousand and eight nearly one in the six months from october of two thousand and seven through march of two thousand and eight thousand controllers left the workforce half of them to retire and of the f a s eight hundred new hires in fiscal year zero seven only one fifty have been certified as the d o t report pointed out the f a a may be hiring new trainees but they aren't adequately training them to become fully certified professional controllers and the waiver of retirement sets up a vicious cycle where there will be more overtime needed and then quicker and more retirements as workers get burnt out in other words the next  retirements will make this one look like nothing if the d o t and the f a a don't take immediate steps to upgrade the technology and prove capacity with the number of controllers going up at new york's airports if they don't hire and train and retain more full time controllers at new york airports then we can all look forward to even more congestion and more problems instead of solving the problem as we've talked about more controllers better technology the d o t plans to auction takeoff and landing time slots at new york city's three airports this will in no way reduce congestion in new york's airspace instead this plan could limit consumer choices and have a dire impact on sir as to small communities as you have mentioned mr chairman and i will i will act quickly to prevent this plan from being implemented as travelers we feel the burden of an airline industry gasping to catch its breath and the worst possible thing the administration could do to passengers in the industry is deliver one big punch in the gut by auctioning off slots at new york airports this is an ideological untested experiment coming from somebody in an ivory tower there is no proof that the option plan will do anything to reduce congestion and yet d o t insists this market based solution is the only effective proposal the d misguided plan to sell takeoff and landing slots at the highest bidder won't make your plane take off any faster it will just cost you more to fly in and out of la guardia j f k and cannady and it will throw those airports into chaos options have no proven track record of working they've never been tried in any us airport nor have they been tried at any airport in the world in fact the entire plan is modeled after london's road congestion pricing i don't know of one expert who believes this plan will work or believes it's beneficial to the consumer in fact the air transport association which represents the airlines the port authority of new york and new jersey the airports council international all opposed to auctions in fact mr chairman i believe their plan is unconstitutional and will be challenged in court i have introduced legislation to the i will introduce an amendment to the upcoming a authorization to prohibit auctions and i think it will get widespread support and in new york city one of the world's busiest centers new york should not be the guinea pig indeed ots harebrained congestion experiment in conclusion i spoke to an acting administrator to stir jill and i told tim i would oppose any experiment in new york area involving options because he couldn't give me a straightforward answer about the f a s plans so i have placed a hold on his nomination which still exists today options are detrimental to consumer choice small communities low cost airlines will be forced out as the big boys shove them aside the option plan is further flawed by the assumption that all slots are interchangeable we know that a flight from j f k to london is not in through changeable with a flight from j f k to buffalo long distance and international flights need to take off and land at certain times of the day and  specifically designated large gates and terminals so as i said i've introduced legislation supported by both the airlines and the airports including the port authority of new york and new jersey which will protect travelers from prohibiting th from implementing options in new york city or any commercial airport in the country once again the d o t is putting ideology before efficiency my message to d o t an f a a put more controllers in the towers put  forward the new technology that all the countries the rest of the countries of the world have and get off this goofy hair brained scheme to auction off slots it won't solve a thing  chairman i thank you i know i went over the time a little bit but i'm passionate about this issue and i thank the committee's indulgence senator thank you we expected you to go over your time i've let me let me comment before  they do not go down that road lastly is we held a hearing last week in this very room concerning the issue of control or staffing everyone gets it but the f a a everyone understands that there is a crisis developing in the lack of adequate staffing not only in terms of numbers but experienced controllers an issue rightly pointed out in your testimony it is an alarming rate and it is something that should concern all of us all of the stakeholders the airlines the pilots flight attendants everyone involved in the system gets it except the f a a and i'm hoping with our reauthorization bill that we can address that issue and reduce the number of the experienced controllers from from leaving the job and we know we've heard from the inspector general we've heard from the g a o as to why they're leaving morale is at an all time low there are major major problems in the f a a needs to wake up before there are serious consequences good again and senator we thank you for your thoughtful testimony and i think you've made your position very clear to this subcommittee and we realize that you have a full schedule over on the other side of the capitol and if you would like to leave at this time we certainly would understand i just want to thank you and thank you for your leadership on this issue i look forward to working with you because we much i just would i would add one additional facet which wasn't mentioned and that is called next gen which is us basically digital using moving moving air traffic control and the whole  system to the new technology and sort of radar based satellite and that has the promise if it can be made of reorganizing the system and expanding the capacity but there are a lot of steps between where we are and there and it urge you and your colleagues on in another place to to pay attention so we don't end up with a crisis and trying to clean up the mess afterward because this is about changing  slow walk next gen in an effort just to hold back on costs i mean the costs are so little compared to the loss of money by people waiting flights being canceled london paris they're way ahead of us on technology that was developed in america and it was all you know the previous administrator seemed to me to just give up her job and let o m b run the show and o m b said you've got to cut costs no next gen no controllers no overtime and that's helped lead to this problem and my regret is that the new administrator doesn't seem to want to make a clean break from those policies but i know this committee has been out front on next gen and i agree with you completely we thank you for your testimony senator schumer and look forward to working with you the chair now opportunity my staff has written a ten page statement that really is quite excellent i will put most of it in the record just reference a few parts of it under the integrated airspace alternative the f preferred airspace redesign plan significant air airplane traffic would be routed over parts of fairfield county at the expense of the region's quality of life the f a s failed to provide any noise mitigation to our region despite the wide swath of land under the fourth congressional district that will be burst effected by planes flying it out to do it as low as four thousand feet and in southern part of the district the f a a is also continuing to implement its redesign despite d o d s option proposal that could alleviate the need to redesign the airspace altogether the f a a is not required to present noise mitigation strategies even though there is significant impact on the region because there is no mandate for the a to consider quality of life redirecting air traffic over previously unaffected areas as a given the same weight in the agency's decision making process as keeping traffic over areas that already have air traffic even more concerning no attempt has been made to utilize unpopulated or less populated tracts of land industrial or commercial zones major highway systems or large bodies of water from it again ois impact or to set minimum out to toot if the f a a had to consider the quality of life impact of the integrated airspace alternative it would have never concluded that this airspace redesign was the appropriate first attempt at relieving air traffic congestion it is unreasonable to to design airspace without regard to impacts on the ground for this reason the f a a should adopt a no action alternative at this time under until other congestion mitigation strategies such as the option proposal are moving peak flight to off  reauthorization act requiring the g a o to assess the strengths and weaknesses of the f a a its environmental impact study the costs and impacts of redesign and whether the f a a followed the due process in creating their proposal it would be interesting to learn options as effective as redesigning the airspace to mitigate congestion that will not result in any new residents being affected by or noise it seems to me there are other solutions that should be considered before implementing such a radical alternative that negatively impacts so many thousands of residents throughout the northeast the f a a has consistently stated the only way it can reduce congestion travel delays is by redesigning the airspace however the case for the redesign is built on the flawed premise that delays are caused by the design of the airspace this theory neglects to account for inadequate terminal runway and gate to pass the insufficient air traffic controller staffing weather and other schedule inflate it also fails to account for the impact market based strategies could have on congestion what is particularly frustrating about the f a a is action is the department of the transportation implementation of market based solutions for congestion relief while the f refuses to consider the impact of these proposals on air space congestion we believe moving flights out of peak travel times and implementing slots in code is that congested airports would have the same effect as a redesign and must be considered so let me just conclude i've asked the f a a and this committee is is the airspace redesign the best way we can do to mitigate air lines congestion in implementing the redesign is it possible we are overlooking other market based solutions to airline congestion i believe the answer to the those questions are no and yes respectively and let me just conclude by saying i have never dealt in my entire life in congress with a more arrogant agency we understand how it evolves its safety and efficiency and you don't want politicians in the firin with safety but this isn't an issue of politicians wanting to interfere with safety we want the f a a to come to our district to explain what they're doing to have hearings and to respond when i requested that they would come in they wanted to schedule the hearing outside the affected area when we got them to come into the town they said they would take no questions and hear no comments from individuals in the district they just were going to say what they wanted to say and that was that and i just would hope that at the very least we can have an agency that will be more responsive to people listen to their concerns and take account of their concerns thank you mr chairman mr shays we we thank you for your testimony today and let me share with  frustration in dealing with this agency they are not the most responsible agency not only to the members of congress but the public as well and i hope at some point in the future that we will see a change in th attitude and the way they conduct business mr chairman i think you will because i know what you and the ranking member in the members would like to achieve and so i really want to thank you for focusing your attention on this issue we we thank you for your testimony today we understand that you as well have a busy schedule and if you would like to leave at this time we certainly would understand the chair now would recognize the gentleman from new york mr hall for his opening statement and airspace redesign i'd like to call thank you for calling this important hearing today mr chairman as a representative from the new york city area my constituents and i are uniquely affected by the policies that the d o t and f a a implemented at new york's airports however i hope everyone realizes that new yorkers are not the only people to whom this plan matters when it comes to aviation the entire country is affected by what happens in new york currently the airspace congestion over new york is unacceptable travelers in and out of the cities major airports have to expect multiple hour delays as standard practice and circling flights waiting for clearance to land have caused unnecessary noise pollution across my district and neighboring districts i don't envy the task that the o t and f a a have to solve these congestion issues and i have a great deal of sympathy to the difficult choices this decision has left however given the complex complexity of the situation at hand and the current troubles facing the airline industry the decision you have reached seems well short of the ideal solution the need for some limitation on the number of flights at both j f k and newark has become unavoidable the popularity of both airports far outweighs their physical capacity to accept their scheduled flights much less additional ones however implementing an option on previously used slots as part of that cap and especially without the strong support of both the port authority and the airlines involved seems like an unnecessarily difficult and controversial addition the f a a has already made the questionable decision to implement the new york new jersey area redesign which has led directly to an unacceptable increase in air noise for many of rez the residents of my district especially in and around the town around ridge and in parts of rockland county this decision has only and hands my tendency to question the judgment of the s priorities in the new york city area i wonder and i hope that this hearing will help to explain why other congestion reducing policies that their participants who need to be involved have already expressed their support for have not been adopted or even considered for example if the decision had been made to bring in a cap why has the f a a opted not to use the world wide scheduling guidelines why has the f a a failed to increase the number of chronically understaffed air traffic controllers which would clearly result in a reduction in congestion has the f a a fully considered the congestion reducing reducing benefits of adopting any additional policies that would create a more efficient and effective air management a traffic traffic management system is my understanding that during the many meetings held last year the aviation rulemaking committee came up with dozens of recommendations to reduce congestion giving that the plan currently being considered will lead to a prolonged inevitable court battle we would be better off doing everything noncontroversial and cooperative that we can to make sure that the summer travel season goes off with as little difficulty as possible i look forward to the testimony were about to he my chair thanks gentlemen from new york mr hall not only for his comments here today but for his deep interest in this issue he is is one of the reasons why they were holding this hearing today is that his request because counsel office of secretary for the u s department of transportation mr william dakota who is the director of the aviation department port authority of new york and new jersey mr james may who's the c e o of the air transport of so associa mr ed favor meadows executive director of the air carriers association of america and mr douglas slavin who's the regional vice president for martha american international air transport association gentlemen you all i think it's testified here before we will ask you to summarize your statement in five minutes to allow for questions and your entire statement will appear in the record that  and you were recognized for five minutes thank you mr chairman and thank you for having me back again before this committee chairman members of the committee thank you for the op to testify on behalf of apartment transportations consuming efforts to address aviation congestion before going to detail about the duties efforts to address congestion i want to take a moment to talk about the particularly challenging environment currently facing the airlines as my fellow panelists well know record oil prices a slowing economy and increased competition are just a few factors that have created a number of significant challenges for airlines challenges certainly will changed the face of aviation history in the years to come to meet these challenges many carriers are raising fares streamline operations reducing service is possible at some of these measures will result in reduce congestion however so far we have yet to see widespread evidence of kerry's pulling out of the busiest and most congested airports for example the largest carrier at newark continental airlines announced just last week that they are limiting service to fifteen communities but do not plan to not plan on reducing the number of slots they use at newark additionally even some of the busiest airports do see a reduction as they see that reduction history tells us that the aviation industry is very cyclical and the service will return to and exceed the record levels we saw last year that is why we must do something now to fix the problems that caused last summer's horrible delays and not wait for another year of delays before we act as some have incorrectly suggested that expanding capacity is the only appropriate response to congestion the perma believes that expanding capacity is a critical component of the long term solution to relieve congestion and looks to increase capacity both in the air and on the ground whenever possible for example d o t has worked to bring a new runway to o'hare implement airspace redesign in new york implement next gen and free up military airspace for use during peak periods capacity increases must be part of the solution particularly since we expect demand for air travel to resume its robust growth over the coming decade however capacity increases both physical and operational often take a long time to implement and may be limited in scope sometimes physical capacity cannot be expanded such as new york city airports and additional operational permits can help address congestion but sometimes they cannot provide enough capacity to meet the demand when capacity increases cannot create enough supplied to meet demand caps may be necessary this is what has occurred in the new york region congestion at these three new york airports is not a new phenomenon since one thousand nine hundred sixty nine already have been kept and recently newark was kept after becoming one of the most delay prone airports in the country capps solve the problem of congestion because they simply freeze capacity and prohibit new flights from entering the system airlines are often enthusiastic in the support of caps an airport that they already serve because caps limit competition and protecting company airlines from new entrants that might offer competing lower fares unfortunately straight taps without some mechanism to ensure an efficient allocation of scarce slot resources is economically inefficient and stifles competition leading to reduce service and higher fares to consumers so if caps alone are not the long term answer the question arises what is the solution it is clear that caps alone cannot allocate airspace efficiently however solving that problem should not entailed government picking winners and losers and  deciding who would be able to enter the airport market based pricing and ample competition has demonstrated time and time again as the most effective way to allocate a scarce resource that is in high demand space in a movie theater use of cell phones or flights during certain times  to certain locations are all examples that illustrate the pricing works as you all know last month the f a a published a notice of proposed rule making to manage congestion at j f k newark airports like the supplemental recently introduced all airlines operate in newark and j f k would be giving up the twenty slots a day for the ten year life of the rule above that baseline either ten percent or twenty percent of a carrier slots would be withdrawn over the first five years of the rule option as with a little larger proposal under this proposal airlines operate the two airports receive a ten year interest in some of the world most of valuable aviation assets free of charge free of question free of hassle additionally this proposal just like t proposal increases competition by creating a robust secondary market for trading slots and allows a way for new entrants to gain entry into a strict airport the chairman i appreciate the opportunity to explain a proposal to new york airports we are firmly committed the idea that any long term solution to mitigate congestion nations or airports must preserve competition we're really for consumers what we want to do is we want to provide be liable and affordable care service while caps to produce reliability caps if they are allowed to limit competition will make travel an affordable for many americans and we think that's unacceptable thank you again for getting this opportunity to testify the chair thank you mr griffin and now recognizes mr dakota  thank you very much mr chairman prescience the opportunity to be here especially since this hearing is about new york airspace as is this proposal which we believe will provide anything but we're liable in affordable air travel i want to thank you i certainly want to thank senator schumer his remarks certainly are in parallel with ours and congressman hall you also have been a great leader in helping us and buying stewart airport and i am wearing my stuart tartan so i think we have to think about capacity which is with this is about the port authority is very committed to providing safe of fission air travel for people in our region are three major airports handled one hundred ten million pastors two point seven million tons of cargo and have huge economic activity we've taken a number of steps to enhance capacity on the ground we spent fifteen billion dollars in upgrades for airports new terminals air train systems runway improvements we programmed another six billion dollars over the next ten years to do that in november two thousand and seven we bought stewart airport north of newburgh new york we putting five hundred million dollars into that the chairman of the port authority of new york and new jersey convened a flight delay task force before the f a a got involved in the matter and we came up with seventy seven initiatives to improve to do understand about sixteen of those have been implemented by the f a a and while we acknowledge the f a a has made a number of investments in our medical systems made operational procedural changes the fact is they're an able to accommodate today with all that investment the same number of aeronautical operations that they served a decade ago we are absolutely confounded by this the port authorities very much attempted to work with the d o and f a a officials with the problem for the last decade in two thousand congress said the goal of opening up access to this very important popular yet constrained airport system to stimulate competition and opportunity and congress allowed the f a a d o t nearly seven years to try to come up with an appropriate framework to deal with this if they took the challenge they hired professors at the national center of excellence for aviation research next or and no one cannot deny that the f a a didn't spend a lot of time however these became academic exercises we came to fear the professors explained in theory market based solutions but they're never able to demonstrate how it would work in practice as the operator of new york's airports with our proprietary rights our responsibility allocate gates and ground side facility we're tempted to gauge the in the f a a the airlines and the key stakeholders unfortunately after all of this time there's no workable solution the administration is inter decided to impose an approach that we the airport operator think is not only illegal but we also think it's disastrous the vast majority  carriers the people the air travel association consumers groups ultimately think this is going to harm them not to help them the look already order the subsequent orders of j f k and newark are attempting to impose a lot of options despite our collective concerns we regret that we  only given sixty days to comment on it it's incomplete it does not give specifics on how an auction will work its deficient in supporting data analysis and it appears that the priority is to fast track these popular proposals for implementation before the end of the year we're concerned it's fundamentally it's unworkable it's unresponsive it's disruptive and it's really going to be bad for the traveling public so we don't think the f a a has the statutory authority we don't believe congress has given of the statutory authority there's nowhere in the f a a authorization act that allows that we think this is an attack on our proprietary rights but we won't even get into that in any plane the notice the proposal making with guardia fails in its primary objective in reducing congestion delays at la guardia despite increases in airport capacity to describe despite declining airport activity which is true in this industry environment delays have increased by more than fifty percent from two thousand and four to two thousand and eight air space capacity somehow has declined and n p r m really it fails to acknowledge that decline but it also fails to provide any evidence or analysis of what the capacity is it fails to provide an indication of whether the f a a can restore airspace it fails to establish a capital level that seems to be even reasonable and the d o t in this group of academics of obsessed with promoting these auction schemes auctions are not the solutions the fact is when you go through the series of mechanics of how it works where it stumbles in the same place the recognition there's a real world concern of how do airlines get gates out of they get  baggage belt a member of my staff describe this as a fad a moment where supposedly everything just works out there's some kind of a miracle that occurs the proposal is fundamentally flawed and professors around the world have not been able to do this this is almost regional gates new entrant carries can't use multiple terminals we've got a better idea of business arrangements that can't be overcome the professors always assume it away and they are responsibility but they've never figured it out it highlights a fundamental flaw that despite this attempt this this obsession with market based record solutions is an ideological solution options game strongly favors big carriers that doesn't really help the small the ones we're concerned about destinations the impact on small carriers and there's so many cities that are vulnerable like they're in our testimony and this is not just a new york phenomenon it's been proven elsewhere let me just close by saying the bottom line is it's capacity we need to focus on capacity it's clear that if capacity is not added in the short term there needs to be something like a cap there needs to be something like i add a scheduling there needs to be a robust buy sell rule but in the long term it has to be capacity that's what it's all about we are advancing many initiatives to improve capacity in new york region building new facilities really trying to guarantee passengers accessible and service and we remain very committed to work with the f a a with the d o t the key stakeholders to come up with the right approach for new york thank you chair thank you mr dakota now recognizes mr m before i begin remote my remarks mr chairman i'd like to note as a proud member of clan donald we've had a longstanding relationship with the stewards and so i am glad to associate with my friend mr dakota here and  also with congressman hall mr chairman members of the committee thanks for allowing me to appear here today i'd like to report good news about new york and the state of the nation's industry i'm fortunately i can do neither yesterday we announced a revised two thousand and eight forecast our airlines expect to lose in the range of ten billion dollars this year a loss on par with the worst year on record soaring fuel prices are the sole reason for those losses we face a sixty two billion dollars fuel bill this year that number is greater than the combined fuel expenses for the first four years of this decade for the airlines and that grim news more clearly demonstrates why the airlines are so focused on improving efficiency in the new york airspace redesign of the bad airspace structure combined with improved operational measures and technologies will significantly increase system agility smarter more efficient aircraft departures routing and landing sequences mean reduced fuel burn and cost savings thus upgrading that outdated air traffic control management system is an absolute key priority right alongside safety for the airlines as we start the busy summer travel period meaning for relief in new york is going to glue if you will the rest of the country even further reducing fuel burn in wasted time why because although new york has twelve percent of the operations system wide it creates forty five percent of the system delays there is no question that the ripple effect from relief in new york will be significant throughout the country candidly new york passengers especially those coming from small communities will not  pe current capacity cuts service may be pared back as fuel prices further row the carrier's bottom line that means access will be constrained hitting the business and leisure travelers and the entire travel and tourism industry hard its chairman i know this committee is deeply concerned about what's mean done to reduce congestion and flight delays in new york the financial and cultural center of this country a magnet for visitors from all over the world along with the grim news about the airline industry i have to bring you some grim news about new york based on what we've seen since the first of the year we're not encouraged so you might ask yourself what the department is doing about the ever growing congestion in new york to make sure that passengers and shippers and airlines and others can get where they want to go on time and the answer is not much and the lack of relief is despite the fact the airlines have accepted caps at all three airports reduce flights at peak hours readjusted schedules and selectively upgrade gauged aircraft throughput at the airports the number of planes that move in and out each day is down the lowest in a decade although we're meeting with the newly appointed new yorkers are later this week by all accounts only a very small percentage of the seventy seven capacity enhancements identified by the new york arcade been fully implemented there's no real sense of urgency to get these things done today and not tomorrow the three year implementation timeline frankly is not acceptable new york and the rest of the country need relief now and instead of moving forward with the capacity an airspace design with every available resource with all deliberate speed the deity is pushing congestion pricing and slot options completely unproven textbook experiments that every graduate student would love to pursue but no one in the aviation world has ever used successfully in the next few months d o t seems intent on leaving a legacy of failed but extremely costly experiments that do nothing to reduce congestion nothing to reduce congestion and flight delays in new york or for that matter anywhere else in addition to limiting the public's access to new york our actions and congestion pricing rob the airlines have years of investment in planning as we make clear in our written statements congestion pricing and slot auctions are lawful unfair incredibly costly to passengers airlines in the economy these proposals have been tried and failed elsewhere and they're not going to work here our prescription for new york is simple stop talking ideology and experiment and start leaving a legacy that will help not hurt the country devote all the resources necessary right now to implement new  ce redesign and related initiatives work with the port authority and air traffic controllers to implement the near term capacity enhancements identified last year by the arc work with the department of defense as well as congress if necessary to open up new airways on a more permanent basis excel or eight development and implementation of technologies that will bring as next gen we talked about it earlier and deploy worldwide scheduling guidelines as to chairman e eighty a and its members are committed to getting the job done with the right solutions we commend senator schumer congressman meeks and others who have introduced legislation to pr and members of the committee i'm pleased to be here today to talk about issues that are critical to the nation's air carriers communities and to the traveling public our member airlines are dedicated to providing affordable airfare options to all american travelers who receive significant benefits when low fares are available we thank this committee for holding this hearing for your dedication to enhancing the nation's air traffic system and for supporting the growth of air commerce and airline competition are at a point in time that up steps are not taken to ensure the dream of deregulation will remain an essential part of u s airline service we may see the disappearance of travel options for millions of travelers unfortunately these are not issues let me read a statement for out the year there was strong indications that the airport an airway system was on the verge of saturation the airports serving chicago new york and washington and the airways system connecting them were simply congested during too many hours today that statement was made in one thousand nine hundred sixty eight we absolutely fully support expanding capacity system changes and what's necessary to help the system run smoothly and to expand however other things must also be done to keep options available particularly supporting deregulation and competition were at a defining point in history we have seen several key areas including low cost carriers file for bankruptcy at the same time as jim a noted costs are out of control and continue to rise while we are supposed to have open markets in a deregulated system as a result of the significant increase in operations at the new york airports these airports are again close to competition the current slot system that has allowed the sale of slots has not promoting competition nor has it improved operations airports that are slot controlled have less low fare service and competition than most other airports when intra addressing closed airports department has correctly stated that it's important to preserve competition as part of the solution to address congestion the department has proposed a market approach that includes an option while there are legitimate questions about the authority to impose auction approaches we applaud the department for exploring options to promote competition it's been a long time since steps were taken to make sure that would happen while an option approach may not happen and may not be completely possible steps must first be taken to make sure competitive options survive the current situation faced by the industry as well as many carriers announce reductions in operations at major airports the elimination of aircraft from their fle and possible mergers now is the time to start with for some slots and facilities and make them available to care as well as small numbers of slots as competition is address we do not object to exploring market mechanisms and considering all options if specific steps are taken for new entrants and limit incumbents any mechanism should must be a blind's sale transfer allocation system as that department of justice has said if not then those that control will continue to control and we have to address the significant increase in operations of regional air jets at major airports although we fully agree with comments made here this morning that small community service must be preserved this committee has played an active role in improving the nation's aviation system and opening doors to competition some of the actions being taken to address to laze and congestion could forever closed the door on competition and prevent the growth of small carriers and maybe see some more of them disappear our dream of deregulation is to create a high tech safe delay free and secure a system that maximizes consumer choices and ensures that low fares are available to all consumers and all communities let's in that not make that dream just a memory instead let's continue to work together to make sure that this becomes a reality we look forward to continue to work with you on this and all of the matters thank you chair thank you mr favor men and recognizes mr levin thank you mr chairman and distinguished members of the subcommittee for the opportunity to represent i out of two hundred thirty member airlines at this important hearing today over the past nine months i have spent much of my professional time representing ayyad as members interest before t on the issue of new york congestion i'd like to share my thoughts and what has been an extremely frustrating and counterproductive d o t process first iota believes that the one significant step d o t has taken over the past nine months to address congestion in new york was to designate j f k newark as a level three congested airports under the principles of the worldwide scheduling guidelines or w s g in doing t employed an international standard utilize that one hundred forty airports around the world to manage congestion iota supported these temporary get caps under the w s j principles as long as they were accompanied by a renewed f commitment to a quick increase capacity at the region's airports the f a a deserves credit for taking up this challenge in today we estimate that by the end of this year they will have completed sixty percent of the seventy seven technology in perceived or improvements recommended by the aviation rulemaking committee to increase capacity in the region while much work needs more work needs to be done we are pleased with the efforts to date and urge this subcommittee to support the f a a in this important initiative while the f a a has been addressing congestion duty is spent the last nine months pursuing quixotic mission of a quick quixotic mission to use a new york challenge as an opportunity to impose their free market pricing views on the industry after three months of arc meetings d o t was apparently surprised to find that it was not able to convince the airline serving new york as well as the port authority that peak pricing and sought auctions where the best way to manage congestion at the airports knowing that congress would not granted the authority to impose congestion pricing directly duty instead moved to change their internal rules to authorize airports implement their own peaky pricing schemes in contradiction of i k o policies and international law not resting their duty is now seeking to bush the airport slots are the property of the u s government and that supposedly rich airlines should not receive them without compensation in return t is now proposing the lease their so called property and at the same time confiscate significant numbers of slots from carriers that have invested millions in these airports to support their operations to be clear do you tease option proposal has nothing to do with curbing congestion and is a necessary to protect competition at these airports if d o t wanted to protect competition one would expect them to implement the w s j as similarly congested airports in london paris  frankfurt and one hundred thirty seven other airports around the world have done before them while some of challenge the w s j is anti competitive the facts indicate otherwise london heathrow has been operating under the ws g since  three and has seen twenty five new entrants over the past five years including continental northwest us airways and delta in the past six months j f k newark and la guardia has either been kept or constrained for a long time following allocation and congested airports and indeed adopts many of the key w s g principles however at the same time d o t argues that a cap under the w s g without so called market mechanisms will not allow for not enough competition one must question what competition danger d o t sees that the other one hundred forty airport it's use in utilizing the w s g have missed ayyad is very concerned about the dangerous precedent d o t is set in internationally  pursuing these economics experiments u s and international law i care policies and several court cases have served strict government's ability to pursue congestion pricing in the past however since d o t embarked on this mission we've already seen an aggressive congestion pricing scheme being proposed by brazil and i understand that other countries are now considering the same we are particularly concerned that foreign governments will see market mechanisms as an opportunity to raise new revenues from the airline industry to adjust to address general budget shortfalls mr chairman i do not need to tell you that this industry is facing an economic crisis beyond that which we experience post nine eleven that currently predicted fuel prices iota members could fac additional financial burden of ninety nine billion dollars over the next twelve months compared to two thousand and seven twenty four airlines have ceased operations or entered bankruptcy over the past five months to put it bluntly there could not be a worse time for d pursuing market experiments that would impose hundreds of millions of dollars of new costs on an industry in crisis an industry that today supports seven percent of global g d p and thirty two million jobs the board seven percent of