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THE STATE OF AMERICAN AVIATION 

(113–46) 

HEARING 

BEFORE THE

SUBCOMMITTEE ON 

AVIATION 

OF THE

COMMITTEE ON 

TRANSPORTATION AND 

INFRASTRUCTURE 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED THIRTEENTH CONGRESS 

FIRST SESSION 

DECEMBER 12, 2013 

Printed for the use of the 

Committee on Transportation and Infrastructure 

( 

Available online at: http://www.gpo.gov/fdsys/browse/ 

committee.action?chamber=house&committee=transportation 

(II) 

COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE 

BILL SHUSTER, Pennsylvania, Chairman 

DON YOUNG, Alaska 

THOMAS E. PETRI, Wisconsin 

HOWARD COBLE, North Carolina 

JOHN J. DUNCAN, JR., Tennessee, 

Vice Chair 

JOHN L. MICA, Florida 

FRANK A. LOBIONDO, New Jersey 

GARY G. MILLER, California 

SAM GRAVES, Missouri 

SHELLEY MOORE CAPITO, West Virginia 

CANDICE S. MILLER, Michigan 

DUNCAN HUNTER, California 

ERIC A. ‘‘RICK’’ CRAWFORD, Arkansas 

LOU BARLETTA, Pennsylvania 

BLAKE FARENTHOLD, Texas 

LARRY BUCSHON, Indiana 

BOB GIBBS, Ohio 

PATRICK MEEHAN, Pennsylvania 

RICHARD L. HANNA, New York 

DANIEL WEBSTER, Florida 

STEVE SOUTHERLAND, II, Florida 

JEFF DENHAM, California 

REID J. RIBBLE, Wisconsin 

THOMAS MASSIE, Kentucky 

STEVE DAINES, Montana 

TOM RICE, South Carolina 

MARKWAYNE MULLIN, Oklahoma 

ROGER WILLIAMS, Texas 

TREY RADEL, Florida 

MARK MEADOWS, North Carolina 

SCOTT PERRY, Pennsylvania 

RODNEY DAVIS, Illinois 

MARK SANFORD, South Carolina 

NICK J. RAHALL, II, West Virginia 

PETER A. DEFAZIO, Oregon 

ELEANOR HOLMES NORTON, District of 

Columbia 

JERROLD NADLER, New York 

CORRINE BROWN, Florida 

EDDIE BERNICE JOHNSON, Texas 

ELIJAH E. CUMMINGS, Maryland 

RICK LARSEN, Washington 

MICHAEL E. CAPUANO, Massachusetts 

TIMOTHY H. BISHOP, New York 

MICHAEL H. MICHAUD, Maine 

GRACE F. NAPOLITANO, California 

DANIEL LIPINSKI, Illinois 

TIMOTHY J. WALZ, Minnesota 

STEVE COHEN, Tennessee 

ALBIO SIRES, New Jersey 

DONNA F. EDWARDS, Maryland 

JOHN GARAMENDI, California 

ANDRE ́ CARSON, Indiana 

JANICE HAHN, California 

RICHARD M. NOLAN, Minnesota 

ANN KIRKPATRICK, Arizona 

DINA TITUS, Nevada 

SEAN PATRICK MALONEY, New York 

ELIZABETH H. ESTY, Connecticut 

LOIS FRANKEL, Florida 

CHERI BUSTOS, Illinois 

SUBCOMMITTEE ON AVIATION

FRANK A. LOBIONDO, New Jersey, Chairman 

THOMAS E. PETRI, Wisconsin 

HOWARD COBLE, North Carolina 

JOHN J. DUNCAN, JR., Tennessee 

SAM GRAVES, Missouri 

BLAKE FARENTHOLD, Texas 

LARRY BUCSHON, Indiana 

PATRICK MEEHAN, Pennsylvania 

DANIEL WEBSTER, Florida 

JEFF DENHAM, California 

REID J. RIBBLE, Wisconsin 

THOMAS MASSIE, Kentucky 

STEVE DAINES, Montana 

ROGER WILLIAMS, Texas 

TREY RADEL, Florida 

MARK MEADOWS, North Carolina 

RODNEY DAVIS, Illinois, Vice Chair 

BILL SHUSTER, Pennsylvania (Ex Officio) 

RICK LARSEN, Washington 

PETER A. DEFAZIO, Oregon 

EDDIE BERNICE JOHNSON, Texas 

MICHAEL E. CAPUANO, Massachusetts 

DANIEL LIPINSKI, Illinois 

STEVE COHEN, Tennessee 

ANDRE ́ CARSON, Indiana 

RICHARD M. NOLAN, Minnesota 

DINA TITUS, Nevada 

SEAN PATRICK MALONEY, New York 

CHERI BUSTOS, Illinois 

CORRINE BROWN, Florida 

ELIZABETH H. ESTY, Connecticut 

NICK J. RAHALL, II, West Virginia 

(Ex Officio) 

(III) 

CONTENTS Page 

Summary of Subject Matter .................................................................................... iv 

TESTIMONY 

Hon. Susan L. Kurland, Assistant Secretary for Aviation and International 

Affairs, Department of Transportation .............................................................. 6 

Nicholas E. Calio, President and CEO, Airlines for America .............................. 6 

Mark Brewer, A.A.E., Airport Director, Manchester-Boston Regional Airport, 

and Chair, American Association of Airport Executives ................................... 6 

Peter J. Bunce, President and CEO, General Aviation Manufacturers Association ........................................................................................................................ 6 

Edward M. Bolen, President and CEO, National Business Aviation Association ........................................................................................................................ 6 

Edward Wytkind, President, Transportation Trades Department, AFL–CIO .... 6 

PREPARED STATEMENTS AND ANSWERS TO QUESTIONS FOR THE 

RECORD SUBMITTED BY WITNESSES 

Hon. Susan L. Kurland: 

Prepared statement .......................................................................................... 48 

Answers to questions from the following Representatives: 

Hon. Bill Shuster, of Pennsylvania .......................................................... 54 

Hon. Frank A. LoBiondo, of New Jersey ................................................. 55 

Hon. Mark Meadows, of North Carolina ................................................. 61 

Hon. Rick Larsen, of Washington ............................................................ 57 

Hon. Daniel Lipinski, of Illinois ............................................................... 58 

Hon. Peter A. DeFazio, of Oregon ............................................................ 61 

Hon. Steve Cohen, of Tennessee .............................................................. 63 

Hon. Michael E. Capuano, of Massachusetts .......................................... 64 

Nicholas E. Calio: 

Prepared statement .......................................................................................... 65 

Answer to question from Hon. Bill Shuster, of Pennsylvania ...................... 83 

Mark Brewer, A.A.E.: 

Prepared statement .......................................................................................... 86 

Answers to questions from Hon. Frank A. LoBiondo, of New Jersey .......... 97 

Peter J. Bunce: 

Prepared statement .......................................................................................... 98 

Answers to questions from Hon. Frank A. LoBiondo, of New Jersey .......... 107 

Edward M. Bolen, prepared statement .................................................................. 109 

Edward Wytkind: 

Prepared statement .......................................................................................... 120 

Answers to questions from Hon. Frank A. LoBiondo, of New Jersey .......... 135 

SUBMISSION FOR THE RECORD 

Louie Key, National Director, Aircraft Mechanics Fraternal Association, written statement ....................................................................................................... 136 

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(1) 

THE STATE OF AMERICAN AVIATION 

THURSDAY, DECEMBER 12, 2013 

HOUSE OF REPRESENTATIVES, 

SUBCOMMITTEE ON AVIATION, 

COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE, 

Washington, DC. 

The subcommittee met, pursuant to notice, at 10:02 a.m. in Room 

2167, Rayburn House Office Building, Hon. Frank A. LoBiondo 

(Chairman of the subcommittee) presiding. 

Mr. LOBIONDO. Good morning. The subcommittee will come to 

order. Today we are going to hear from representatives of the Department of Transportation and the various segments of the U.S. 

aviation industry—airports, airlines, labor, manufacturers, and 

general aviation—on the state of American aviation. This hearing 

is a good way to wind down the subcommittee’s 2013 activities and 

begin to shift focus to the 2014 and the next FAA reauthorization 

bill. 

The existing Federal aviation law, the FAA Modernization and 

Reform Act, was enacted after 5 years and 23 short-term extensions: a very painful period that many of us remember all too vividly. It created a stable-four framework for the FAA and industry 

stakeholders. The Reform Act also made important reforms to the 

aviation system and to the FAA, in order to increase efficiency and 

modernize the air traffic system. The goal was to maintain a safe, 

modern, and efficient civil aviation system now and into the future. 

And, as I have said before, ensuring implementation of the Reform Act remains a top priority of the subcommittee. This includes 

all of the ongoing work at the FAA’s technical center, the premier 

facility in the Nation, in my district, on important programs such 

as NextGen, unmanned aircraft systems, and critical FAA safety 

initiatives. 

But along with ensuring implementation of the Reform Act, we 

must also begin to look ahead to the next one. It is an understatement to say that aviation is a key sector of the U.S. economy. Commercial aviation represents 5 percent of our gross domestic product, 

and roughly 10 million American jobs. General aviation contributes 

about $150 billion to the economy, and supports roughly 1.2 million 

jobs. Commercial airports support over 10 million jobs and create 

annual payrolls of $365 billion. 

Clearly, a healthy and safe aviation industry is good for the economy. It is good for job creation. It is good for passengers, and it is 

good for all of the stakeholders. The FAA forecasts long-term aviation growth, resulting in increased air traffic. These forecasts highlight the need to modernize the air traffic control system, streamVerDate Aug 31 2005 12:06 Oct 28, 2014 Jkt 000000 PO 00000 Frm 00009 Fmt 6633 Sfmt 6633 P:\HEARINGS\113\AV\2013\12-12-~1\85900.TXT JEAN
2 

line certification and rulemaking processes, and ensure that the 

FAA is properly organized to oversee the NextGen program. 

Additionally, foreign competition and ongoing funding challenges 

must also be addressed. We want to create an environment that allows for a healthy aviation industry, while making sure that the 

United States remains the gold standard of aviation, innovation, 

and safety in the world. 

As Chairman Shuster indicated in his speech yesterday, in preparing for the NextGen FAA reauthorization bill we want to think 

big and hear from everyone. All ideas are welcome. All stakeholders should be coming to the table. 

We are all working towards the same goals, a healthy and innovative aviation industry that remains the world’s gold standard, a 

modern and efficient air traffic control system, and a productive 

and effectively organized Federal Aviation Administration. Therefore, we look forward to hearing from each of the witnesses today 

regarding how they believe American aviation is doing right now, 

as well as any impediments to growth and ideas for the next reauthorization bill. 

Before we turn to our panel of witnesses, I ask unanimous consent that Members have 5 legislative days to revise and extend 

their remarks, including extraneous material for the record of this 

hearing. 

[No response.] 

Mr. LOBIONDO. Without objection, so ordered. 

And now I would like to turn to Mr. Larsen for any remarks you 

may have. Rick? 

Mr. LARSEN. Thank you, Chairman LoBiondo, and thank you for 

calling today’s hearing on the state of American aviation. This 

hearing provides us with an opportunity to look back on 2013 and 

the challenges and successes that we have had in our first year as 

chair and ranking member of this subcommittee. 

Without a doubt, it has been a tough year for aviation here, in 

Washington, DC. We started the year at odds over sequestration 

with our aviation system caught in the middle. In April, air traffic 

controller furloughs caused by sequestration led to flight delays, 

and Congress, in my view, raided the Airport Capital Improvement 

Grant program to put controllers back to work. 

Then again, in October, the FAA was partially shut down for 16 

days, and 12,000 FAA employees were furloughed. We have wasted 

countless hours planning the—we have forced FAA to waste countless hours planning the 2013 furloughs, planning for the sequester 

budget, and planning for shutdown. 

So, we called this hearing to explore today’s state of American 

aviation. Simply put, American aviation cannot afford the American Government to keep doing the business as we did it in 2013. 

We need a balanced and responsible solution for fiscal and budgetary issues that allows our aviation system to move forward. 

Yet, Mr. Chairman, while we started this year under difficult circumstances, you and I have continued to work in a bipartisan way, 

as we have always worked. And we are ending this year with bipartisan accomplishments that I think that we ought to be proud 

of, and bode well for the work that we will be doing together over 

the next year-and-a-half on FAA reauthorization. 

3 

Now, looking forward, I think it is important to note that the 

force of globalization, and the growth of emerging international 

markets present both opportunities and challenges for American 

aviation. And we simply can’t write a reauthorization bill for 2015 

without taking a look at what is happening elsewhere in the world. 

According to the IMF, GDP in emerging economies is growing at 

approximately 6 percent a year, while in advanced economies GDP 

is growing at approximately only 2 percent. 

Now, earlier this year, our own State’s—my own State’s Governor, Jay Inslee, asked me to attend the Paris Air Show in his 

stead. That event made something very crystal clear to me: the 

aviation industry is global, it is competitive, and there are new entrants in the market every day. What happens in Shanghai, Dubai, 

New Delhi, Moscow, and Buenos Aires, matters here, in the U.S. 

As an example, the Chinese National Aviation Authority has indicated that traffic to, from, and within China increased 10.6 percent in 2012 alone. And over the next 20 years, the Boeing Company predicts China will need nearly 6,000 new airplanes. The 

emergence of new international markets is already having an impact on U.S. aviation. Manufacturers have to adjust their strategies 

to target new customers. In my own State, the aerospace industry 

is the largest exporting sector, by value, accounting for $27 billion 

of the State’s $64 billion in exports in 2011. 

U.S. airlines are drawing an increasing amount of the revenue 

from international flights. In 2000, U.S. airlines earned an average 

of 25 percent of their systemwide revenue from international services, and today it’s about 40 percent. Congress and the administration must ensure that American aviation can compete effectively in 

a global marketplace while protecting and preserving a strong middle-class aviation workforce here at home. 

And, together, we have taken important steps this year to enhance the global competitiveness of the industry. We passed H.R. 

1848, the Small Airplane Revitalization Act of 2013, requiring the 

FAA to update its small airplane certification regulations. We have 

conducted important oversight hearings this year, examining the 

FAA certification process. And, based on these hearings, Mr. Chairman, you and I requested yesterday that the GAO undertake a 

comparative study of U.S. certification processes relative to our 

international trading partners. And if we can glean lessons from 

these international efforts, perhaps it will lead to a more efficient 

U.S. certification process, and we could apply these lessons. 

But we also must maintain the highest level of safety in our 

process. We have asked the GAO to examine challenges faced by 

manufacturers when navigating foreign certification processes. We 

have a lot of work to do, Mr. Chairman, and I appreciate your focus 

on safety. Safety is a top priority of FAA, it is a top priority of 

mine. We need to maintain our focus on aviation safety, as was 

made clear in July, with the crash of Asiana flight 214. We have 

to learn from that tragedy, and do what we can to prevent something like that in the future. 

One way to move forward on safety is with the finalization of 

rules for pilot training and experience. These represent significant 

safety improvements from lessons we learned from the fatal Colgan 

4 

Air crash. I am proud that we worked together with the families 

from that tragedy to put together stronger safety rules. 

But, as always, there will continue to be work to be done to make 

sure our skies are safe. Where the aviation faces global challenges 

like climate change, these challenges should be addressed through 

international cooperation. That is why, last month, the bipartisan 

leadership of this committee sent a letter urging Secretary Foxx to 

hold U.S. carriers harmless from a proposed unilateral European 

Union Emissions Trading Scheme. 

The United Nations International Civil Aviation Organization 

has set forth a multilateral process for developing a global approach to aviation emissions. The international community has 

spoken on this issue through the U.N., and the EU should be discouraged from going it alone. 

Additionally, while the American aviation industry must benefit 

from the growth of global markets, it must also ensure that 

globalization doesn’t harm the American aviation workforce. Earlier this year, the administration announced that the U.S. Trade 

Rep’s office will attempt to negotiate a comprehensive Trans-Atlantic trade and investment partnership with the EU. 

Now, historically, international air transport service agreements 

have been negotiated bilaterally by the State Department and by 

DOT, under the oversight of this subcommittee. And issues such as 

foreign ownership and control of U.S. airlines have implications 

that we need to consider. And the Departments of State and Transportation possess the necessary expertise to negotiate on behalf of 

the U.S. aviation industry and its employees on a bilateral basis. 

Therefore, I don’t believe that an air transport service agreement 

should be considered in the context of a comprehensive trade agreement negotiated by the USTR, but that we maintain the existing 

process. 

So, we have a lot of challenges ahead of us for the aviation industry. We have a lot of opportunities ahead for the aviation industry, 

and I look forward to hearing from our witnesses today. And I 

thank you, Mr. Chairman, for the opportunity to offer an opening 

statement, and for this panel that we have today. Thank you. 

Mr. LOBIONDO. Thank you, Mr. Larsen. Before we get to our 

panel, I just want to take a moment of personal privilege. 

If you have not noticed, you should have noticed, and you should 

realize that the working relationship that has been established by 

Mr. Shuster and Mr. Rahall is certainly evident in this committee. 

And what Rick Larsen is talking about is something that we have 

lived by for a number of years together. 

Rick is a close working partner. But, more importantly, he is a 

good friend. And we have been focused on results. And we hope, 

while there is a great deal of dysfunction here in Washington in 

this particular arena, that we can demonstrate that we can be focused on results. And, again, we are taking our cue from our chairman, Mr. Shuster. 

And, with that, we are pleased that you are here, Mr. Chairman. 

Mr. SHUSTER. Well, thank you, Mr. Chairman. And, Mr. Larsen, 

thank you for working together, and that is a great message to 

send out. And not only in this committee, but on Water Resources 

5 

and Development we have also been able to work together. And 

hopefully we are moving forward to getting a bill out of conference. 

But, again, I thank everybody for being here. Thank you, Mr. 

Chairman, for holding this hearing. 

Yesterday I had the opportunity to speak to the International 

Aviation Club in Washington. And my message was pretty simple, 

I think, that aviation is extremely important to the United States 

of America. It is the industry we invented, and it provides millions 

of jobs to Americans, it provides a trillion dollars to our economy. 

It is a system that is the best in the world. But there is no guarantee that we will continue that way, unless we make some 

changes to the system. 

You look at our history, whether we were the leaders in textile 

manufacturing, steel, automobiles, electronics, today we are not a 

leader in any of those fields. And we have to make sure that in this 

particular industry, we continue to be the world leaders. And I 

think that the status quo is unacceptable. And, as I said yesterday, 

I think we need to come up with bold, innovative ideas to improve 

the system. And it starts with the industry and Congress listening. 

And, as I mentioned, WRRDA, I think that will be the model as 

we move forward to the next FAA reauthorization, is having 

roundtables, having the stakeholders in, listening to their concerns, 

talking to Members of Congress. And it is important that you are 

talking to Members of Congress, because I can assure you there are 

Members of Congress that don’t understand the aviation system in 

this country. 

So, it is really important for stakeholders to sit down with Members of Congress and educate them. I think that went a long way 

in us being able to assemble a very large bipartisan vote on the 

water resources bill that we passed. But it is about listening to the 

ideas, taking them in, figuring out how we can work together. 

And I do recognize that our system is unique in the world. We 

are the largest system in the world. We have more airports, we 

have more commercial and general aviation activity than anywhere 

in the world. But the ultimate goal, I think, is to look at the industry leaders around the world, whether it is what Canada is doing 

with their air traffic control system, or what the Europeans are 

doing with airports, what other countries are doing with certification programs for manufacturing of aircraft, how the Europeans 

do it much faster than we do. Compare ourselves to them, and take 

the best of what they offer, and put it into our system, all the while 

maintaining the safety that we have today, because we do have the 

safest system in the world. 

And the next reauthorization bill shouldn’t be my vision, it 

shouldn’t be the Congress’ vision. It needs to be the industry, it 

needs to be all of us working together to come up with the bold vision that benefits everybody. 

Our ingenuity in America is second to none. I think we can do 

this, continue to have a more efficient, safe, and modern aviation 

system. But working together is, I think, the way we need to do 

it. 

So, we have about 12 to 18 months to do this. And, as I said, 

this is going to be an educational first dialogue to identify the problems, come up with solutions, and then educate the American peoVerDate Aug 31 2005 12:06 Oct 28, 2014 Jkt 000000 PO 00000 Frm 00013 Fmt 6633 Sfmt 6633 P:\HEARINGS\113\AV\2013\12-12-~1\85900.TXT JEAN
6 

ple and educate Members of Congress. And I can’t stress enough 

to you how important it is to educate Members of Congress. Because those of us that serve—especially these gentlemen that serve 

on this subcommittee, they really have an indepth knowledge of the 

aviation system. But, you know, I learned some things the other 

day, when I was talking to some airline folks, that I didn’t even 

realize were going on out there in the world. 

So, if I don’t realize it, I can guarantee you there is 435—or 535, 

I guess I should include the Senate—that don’t have a deep understanding of what we are doing. And for us to continue to overregulate and overtax the industries that are in this room is something 

that I think is harmful, and we need to make sure we step back 

and take a hard look at that, as we move forward. 

So, with that, I appreciate you having this hearing today, and I 

yield back. 

Mr. LOBIONDO. Thank you, Mr. Shuster. We will now turn to our 

panel. 

We are pleased today to welcome the Honorable Susan Kurland, 

the Assistant Secretary for Aviation and International Affairs for 

the Department of Transportation; Mr. Nicholas Calio, president 

and CEO of Airlines for America; Mr. Mark Brewer, airport director of the Manchester-Boston Regional Airport, and chair of the 

American Association of Airport Executives; Mr. Peter Bunce, who 

is president and CEO of General Aviation Manufacturers Association; Mr. Ed Bolen, who is president and CEO of the National Business Aviation Association; and Mr. Edward Wytkind, president of 

the Transportation Trades Department of the AFL–CIO. 

Welcome to all our panelists. And Ms. Kurland, you are up. I 

don’t think your mic is on. 

TESTIMONY OF HON. SUSAN L. KURLAND, ASSISTANT SECRETARY FOR AVIATION AND INTERNATIONAL AFFAIRS, DEPARTMENT OF TRANSPORTATION; NICHOLAS E. CALIO, 

PRESIDENT AND CEO, AIRLINES FOR AMERICA; MARK 

BREWER, A.A.E., AIRPORT DIRECTOR, MANCHESTER-BOSTON 

REGIONAL AIRPORT, AND CHAIR, AMERICAN ASSOCIATION 

OF AIRPORT EXECUTIVES; PETER J. BUNCE, PRESIDENT 

AND CEO, GENERAL AVIATION MANUFACTURERS ASSOCIATION; EDWARD M. BOLEN, PRESIDENT AND CEO, NATIONAL 

BUSINESS AVIATION ASSOCIATION; AND EDWARD WYTKIND, 

PRESIDENT, TRANSPORTATION TRADES DEPARTMENT, AFL– 

CIO 

Ms. KURLAND. Thank you. Chairman Shuster, Chairman 

LoBiondo, Ranking Member Larsen, and members of the subcommittee, I appreciate the opportunity to appear before you today 

to discuss the state of American aviation as you begin to consider 

reauthorization, and to highlight ways in which the Department of 

Transportation works to create opportunities for the U.S. aviation 

industry to compete effectively in the global marketplace. 

After a long period of restructuring, the U.S. airline industry has 

become profitable, despite long-term increases in fuel prices. For 

many airlines, a significant component of their formula to profitability has been to expand their international footprint. And we are 

7 

also seeing low-cost carriers expand into international markets, as 

well. 

International flights connect travelers, shippers, and U.S. businesses to the global economy, and they create jobs. Moreover, air 

travel brings foreign tourists and business travelers who spend 

money and carry U.S. products back home. This also benefits our 

airports, and contributes to the economic development in our communities. 

The future competitiveness of the U.S. aviation industry will depend upon the availability of a safe, modern, and reliable infrastructure. FAA’s NextGen program is a critical ongoing initiative to 

help enhance safety and efficiency by transforming our aviation infrastructure. NextGen technologies and procedures guide aircraft 

on more direct routes, improve communication, save fuel, and decrease delays. 

The FAA also places a strong emphasis on preserving and expanding airport infrastructure. In fiscal year 2013, FAA provided 

more than $3 billion to airports of all sizes throughout the country. 

The Department also works to foster an environment that enables U.S. companies to compete successfully in the rapidly changing global economy. Since President Obama launched the National 

Export Initiative in 2010, the U.S. has seen an increase of 1.3 million export-supported jobs. Secretary Foxx’s appointment to the export promotion cabinet is an affirmation of the critical role that 

transportation plays as both a generator and facilitator of exports. In 2012, the U.S. exported $39.5 billion in air travel services. 

And this includes airline seats and cargo holds in U.S.-registered 

aircraft, which constitute exports when foreign customers purchase 

international transportation. These exports could not happen without the ability to readily access international markets. The Obama 

administration, working together with the aviation industry, has 

achieved much success in removing barriers to market access. 

Through the Open Skies Initiative, we have expanded commercial opportunities for U.S. airlines in international markets. The 

economic activity enabled by liberal air service agreements has produced tremendous benefits for U.S. travelers and shippers. We now 

have 111 Open Skies partners. Communities of all sizes benefit, either through new nonstop international services of their own, or 

through access to international markets via efficient domestic connections. 

We also work to resolve issues that our industry faces doing business abroad, and to address unfair and discriminatory practices 

that interfere with our carriers’ ability to take advantages of opportunities afforded by the Open Skies agreements. This work is an 

essential part of our mission, since the rights that we negotiate in 

our agreements are only as valuable as the industry’s practical 

ability to exercise them. 

GA and business aviation sectors are also seeking to aggressive 

expand in international markets. And to address this growing demand, we have worked closely with NBAA and GAMA, and have 

led an initiative to develop best practices in the economic treatment of business aviation operations in the APEC region. 

A difficult challenge facing U.S. aviation is the need to develop 

a future workforce with the technical training and creative ability 

8 

to carry this industry well into the 21st century. We are working 

as part of the Obama administration’s larger efforts to support 

STEM education, but we are working with industry, labor, and 

educators on this very important matter. 

Expansion in international markets will remain a focus of the 

U.S. aviation industry, and DOT is committed to working with 

members of this committee and all of our aviation stakeholders. 

This concludes my testimony, and I would be happy to answer 

any questions you may have. 

Mr. LOBIONDO. Thank you. 

Mr. Calio? 

Mr. CALIO. Chairman LoBiondo, Chairman Shuster, Ranking 

Member Larsen, members of the committee, thank you for the opportunity to be here today. 

I also want to take just a second to thank you for your ongoing 

work to fight off the European Union Emissions Trading Scheme, 

the EU ETS, which is really nothing more than a money grab so 

the EU could spend money however it wanted to. This committee 

and the administration were indispensable in putting a stop to 

that, and we are deeply appreciative of your continuing work on 

that issue. 

The U.S. airline industry is indispensable to our society and 

economy. It enables our diverse and far-flung Nation be linked domestically and internationally, as Assistant Secretary Kurland 

points out. No other country can match the tightly knit fabric of 

air commerce that so conspicuously contributes to our Nation’s 

well-being. This exceptional accomplishment did not occur by happenstance, and it won’t be maintained by happenstance, which 

makes this committee’s examination of the state of the U.S. aviation industry today and Chairman Shuster’s speech before the 

International Aviation Club yesterday particularly timely. 

U.S. airlines, however large or small they may be, are successful 

because of their diligence, innovation, and commitment. They are 

in the game, and they are ready to step up. 

Unfortunately, all too often they confront indifferent, disjointed, 

or hostile Government policies. We operate in a public policy setting that sometimes seems to veer from listless to antagonistic. The 

current budget negotiations are an abject example of an antagonistic public policy setting that impedes the ability of the industry 

to lead and compete effectively. The industry, the administration, 

and the Congress sometimes operate, as Chairman Shuster has repeatedly noted, as if the industry is a piggy bank that is bottomless 

and can fund whatever comes to mind. In this case, increasing the 

TSA fee, not to do better at TSA, but to fund the deficit. More than 

doubling that fee is bad for the airlines, bad for consumers, and 

bad for the economy and job growth. 

It is also bad for the airports and the communities that we serve. 

The way our Government acts is in sharp contrast to the way many 

of our foreign carrier competitors’ governments act. As the global 

economy shifts, we are increasingly facing global competition from 

carriers that enjoy the benefits of their governments’ cohesive national aviation policies that not only purposefully accelerate their 

expansion, they are treated as strategic assets to develop the economies, to grow the economy, and to increase passenger flows. Our 

9 

Government needs a like-minded understanding of the role the airlines can play, unfettered from the hugely burdensome tax and regulatory scheme. 

In a speech to the IAC yesterday, Chairman Shuster called for 

all elements of the industry to work together, and with him, in this 

committee and the Congress, to take a holistic view of the industry, 

and what was necessary to maintain our leadership. We are willing 

to do that. 

He also called for the development of a bold and innovative vision to achieve that goal. If nothing else, I think the current budget 

exercise can serve to underscore the need for a broad, cohesive, national aviation policy like the governments of many of our foreign 

competitors are currently executing. It is why Airlines for America 

has been trying to educate the Congress, the administration, and 

the public about the need for a national airline policy. 

As many or all of you know, that policy would have five pillars: 

rationalize the industry’s tax and regulatory burden; modernize our 

ATC infrastructure; try to eliminate or at least reduce fuel price 

volatility; and those four pillars all lead to make us more competitive on a global basis, which we need to do in order to keep growing 

our economy. We would be happy to share specifics about any of 

our ideas in any of those regards as we move forward. 

But by undertaking this policy, this committee and the Congress 

could do what previous Congresses did for the railroad industry in 

the 1970s and early 1980s, and what it failed to do for the maritime industry. On the one hand, you have got a thriving rail industry now in this country that invests billions of dollars in its own 

infrastructure. We have no maritime industry any more. 

So, we would encourage you to undertake a look at what could 

be done with a national airline policy that benefits all elements of 

all parties at this table. And, frankly, I have to say that the way 

this committee operates gives me some faith that this budget exercise can lead to that kind of examination and that kind of success. 

Thank you very much. 

Mr. LOBIONDO. OK, thank you. 

Mr. Brewer, please. 

Mr. BREWER. Mr. Chairman LoBiondo, Chairman Shuster, Ranking Member Larsen, members of the Aviation Subcommittee, thank 

you for inviting me to participate in today’s hearing. It truly is an 

honor for me to be here with you today. 

On behalf of airports around the country, I would like to begin 

by thanking members of this committee and your staff, who helped 

pass the long-delayed FAA reauthorization bill last year. We realize it was a difficult process, but we appreciate your persistence. 

Since the FAA bill was enacted into law, airports and our colleagues in the aviation industry have been dealing with the uncertainty of sequestration. The first round of cuts threatened to furlough tens of thousands of controllers, and close a large number of 

contract towers at airports around the county. Congress wisely intervened and prevented those massive disruptions and tower closings from happening. But, at the end of the day, airports were 

forced to give up $253 million that had been set aside for important 

infrastructure projects. This quarter-of-a-billion-dollar cut came at 

a time when airports faced significant capital needs, and are reVerDate Aug 31 2005 12:06 Oct 28, 2014 Jkt 000000 PO 00000 Frm 00017 Fmt 6633 Sfmt 6633 P:\HEARINGS\113\AV\2013\12-12-~1\85900.TXT JEAN
10 

stricted from generating more local revenue from higher passenger 

facility charges. 

Unfortunately, further sequestration cuts loom on the horizon. 

There are, however, fiscally responsible ways we could work together to pay for critical infrastructure, and ensure that people in 

small communities have access to safe and reliable air service. 

With that in mind, we have a few recommendations for you to consider in dealing with the sequestration debate, as it continues, and 

in preparing for the next FAA bill. 

First, we encourage you to prevent AIP funding from continuing 

to be diverted for FAA operations. Airport operators understand 

the downward pressure on Federal spending and the difficult 

choices that need to be made, but we firmly believe that keeping 

the FAA running smoothly should not be done at the expense of 

our Nation’s infrastructure. 

Additionally, AIP cuts could jeopardize needed safety and capacity projects. In Manchester, for instance, AIP cuts would—could 

delay our runway and taxiway projects, and our plans to relocate 

a roadway to improve safety and comply with current FAA standards. 

Second, AAAE, ACI North America, and a group of large gateway 

airports are calling on Congress to raise the Federal cap on local 

passenger facility charges from $4.50 to $8.50, and to periodically 

adjust the cap for inflation. Considering the enormous constraints 

on Federal spending, it is time to give airports the self-help they 

need to finance a larger share of their infrastructure projects with 

local revenue. 

The FAA is predicting that passenger levels will increase from 

737 million passengers this year to almost 1.1 billion by 2029. That 

is another 320 million passengers, which is the equivalent of adding the entire population of the United States to an already-constrained system. 

Sixteen years may seem like a long time, but runways often take 

10, 15, and sometimes 20 years to complete. 

Airports need to come up with more local revenue to build infrastructure projects, and to prepare for the influx of passengers to 

come. ACI North America estimates that the airports’ capital needs 

now exceed $14 billion a year, but airports received only about $6 

billion from AIP and PFC revenues combined in fiscal year 2013. 

Other groups have also highlighted the economic repercussions associated with the gap between capital needs and available resources. Our proposal to raise PFC cap to 850 and to adjust it for 

inflation periodically will help fill that funding gap. 

Finally, I would like to thank you and all of the committee members for keeping the contract towers open earlier this year, and ask 

for your continued support during the ongoing sequestration process. We look forward to continuing to work with you in keeping 

those towers open, explore ways to improve the aviation program, 

and consider the next FAA bill. 

Mr. Chairman, thank you again for inviting me to participate 

today. I would be happy to answer any questions. 

Mr. LOBIONDO. Thank you. Hold on a minute. 

[Disturbance outside of hearing room.] 

11 

Mr. LOBIONDO. If we have to, Shuster, Larsen, and I will go over 

and straighten this out. OK, we will try. 

Pete, go ahead. 

Mr. BUNCE. Chairman LoBiondo, Chairman Shuster, Ranking 

Member Larsen, members of the committee, thank you for letting 

me be here today. And I really want to start by commending you 

all. For us, in the industry, to have an opportunity a year out from 

the next reauthorization, to have an opportunity to come and talk 

to you about the issues involved with the next reauthorization and 

doing what we have to do with our entire system here in the U.S. 

is—I couldn’t ask for anything more from industry. 

So that, coupled with what we were able to do all together with 

the Small Airplane Revitalization Act and the bipartisan way that 

that went forward and was eventually signed into law by the President, really shows what this committee can do, working together 

with industry. 

So, maintaining this competitiveness is absolutely vital. We are 

5 days away from the 110th anniversary of the Wright Brothers’ 

flight at Kitty Hawk, and we have been leaders in aviation for that 

entire period of time. And to be able to keep that, this Committee 

has recognized and actually set the stage in the last reauthorization to ask the right questions. Your emphasis on certification, to 

be able to improve the processes for certification, to have consistency in regulatory interpretation, started a process that we very 

much appreciate. And we have got to keep the pressure on the FAA 

to be able to fulfill what—some of the promises that they have 

made in the reports to actually make that—strengthen that and 

streamline that process. 

Last year, the International Trade Commission did a study, and 

they actually looked at general aviation manufacturing and said, 

how is this competitive in the world marketplace. They looked at 

factors and found out that financing—things like the Ex-Im Bank 

became very important. Research and development, obviously. 

Taxes and fees, to include the depreciation schedule and the incentive for manufacturing that is included in there have an impact. 

But, most importantly, it is certification. 

You have given me an opportunity to come before this committee 

recently and talk to you about certification. We are making strides 

there. But to have the FAA really take a look at what works in 

other parts of the world, and take the best practices from those, we 

absolutely welcome. So thank you for asking for that study, because I think that we are able to pick some things out from other 

states of design that will actually help us. 

In development programs, the burn rate for the actual original 

equipment manufacture is significant. One company, in their programs right now, has a burn rate of $10 million a month. Now, if 

you compound that throughout the supply chain, you are talking 

about big money. And any delay that we get in the certification 

project, because of overburdensome regulations or a lack of consistent interpretation, really hurts that process. That becomes important. 

Also, in the last reauthorization, you called on the FAA to give 

a report on restructuring and how do we right-size the National 

Airspace System. We understand the FAA is starting to come and 

12 

brief you all on what their program is. I cannot applaud that 

enough, because that really sets the foundation of our ability to 

lean the system out there. It is a very safe system, but we all know 

that it has got antiquated equipment, and it has got infrastructure 

that either has to be brought back up to speed, or divested from 

and consolidated, and modern technology allows us to do that. 

So, I hope that we are bold in that process. We wouldn’t have actually had this debate, I think, about the contract tower issue if, 

actually, the FAA had looked several years ago and said, ‘‘Hey, can 

we remote towers out there? Can we look at the capability that 

they already are putting forward in Scandinavia? In low activity 

can we remote towers like Reagan between 2:00 and 5:00 in the 

morning, and send the feed over to Dulles, and let them control?’’ 

Smart things like, we have propagated these GPS-based approaches all over the country. 

Do we need to continue the expensive infrastructure of instrument landing systems that cost a lot to refresh? Can we back off 

on the number of radars that are out there now that we have the 

ADS–B ground infrastructure complete, and we know when the 

mandate is for equipage for aircraft. Can we back off on the number of VORs that are out there? All of those elements should be in 

the FAA’s plan. And, with us working together as stakeholders, to 

be able to provide you inputs, if we can hold the FAA’s feet to the 

fire to be able to do that, I think we will have achieved success. 

And the last thing I want to emphasize is, back in 1996 the mandate was taken away from the FAA, because of some high-profile 

accidents, to actually advocate for the aviation industry. We understand the FAA should be the safety regulator out there, and there 

is no question about that. But it would be very useful, I think, for 

us as an industry all together, to piggy-back on what my colleague, 

Mr. Calio was talking about, for the DOT to pick up that assignment from Congress. They should be the advocates for the aviation 

industry. 

We know the Department of Commerce has a lot of industry that 

they have to advocate for, but DOT knows the transportation system. And Assistant Secretary Kurland talked about what she was 

able to accomplish with the APEC initiative, working with industry, and we think we could expand that greatly through the next 

reauthorization. 

I look forward to your questions. 

Mr. LOBIONDO. Thank you. 

Mr. Bolen? 

Mr. BOLEN. Well, thank you. I very much appreciate the opportunity to be able to testify today at this important hearing. And I 

would like to just quickly begin my comments where Mr. Calio 

began his, with the EU ETS. Clearly, from our perspective, that is 

a fatally flawed program. It is very bad for all of aviation, particularly bad for business aviation. So I just wanted to associate myself 

with his remarks. 

I am really excited about the hearing today, because it is so important that we set the stage for the future of air transportation 

in the United States. Several of you have already said aviation 

plays an enormous role in our Nation’s transportation system and 

our Nation’s economy. And business aviation, in particular, is imVerDate Aug 31 2005 12:06 Oct 28, 2014 Jkt 000000 PO 00000 Frm 00020 Fmt 6633 Sfmt 6633 P:\HEARINGS\113\AV\2013\12-12-~1\85900.TXT JEAN
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portant for a lot of small towns and communities that have no 

other access, really, to our air transportation system. And it really 

provides an opportunity for a lot of U.S. companies to compete effectively in a global marketplace, and respond in times of humanitarian crisis. This is an industry that generates a lot of jobs. 

So, it is an important industry, it is one that the U.S. has always 

been the world leader. It is also an industry that is very heavily 

regulated by the Federal Government. And that means when we 

have situations where there are challenges with our Government 

and our Government spending, it has a significant impact on us. 

Sequestration has been talked about today. The shut-down has 

been talked about today. That is a period when we were not able 

to buy or sell any aircraft in the United States for the period of 

the shut-down. And we are grateful to this subcommittee for the 

efforts that you made to try to articulate the essential nature of the 

registry, and the importance to keep it open in times of crisis. 

But as an industry that is heavily federally regulated, and 

hypersensitive to challenges in our Government operations, I think 

it is important for us to articulate that we recognize that continuing to do things the way we always have is not going to work. 

We simply don’t have the revenues. We are going to have to work 

together to find efficiencies, moving forward. And that is why the 

MBAA, the general aviation community, has tried to be proactive, 

suggesting changes like streamlining certification and—again, commending, as Pete Bunce did, this committee for its efforts on the 

Small Airplane Revitalization Act, congratulate this committee for 

Section 804 of the past FAA reauthorization bill, which gives us an 

opportunity to look at facilities, going forward. 

And certainly, as a community, we are trying to prioritize 

NextGen, so that we can get the benefits of a modern air transportation system within the constraints that we have with the current 

economy. 

But I also want to make sure, as we begin to talk about the next 

reauthorization, begin to talk about the future, we understand that 

while we have got to move forward, we have got to change, we have 

got to adapt and evolve, we also want to take an opportunity to not 

just look at what is wrong with our current system, but also make 

sure we understand what is right, what does work. Because, at the 

end of the day, the U.S. today has the largest, the safest, the most 

diverse, and the most efficient air transportation system anywhere 

in the world. We have been the world leader since the inception of 

flight, and we don’t want to lose those aspects that help make us 

great. 

We also want to recognize that our national airspace is a public 

treasure. It benefits all Americans, not just the traveling public, all 

Americans. And that is underscored by those economic benefits we 

have talked about earlier. You know, I have heard Chairman Shuster talk about Adam Smith and the wealth of nations, and what 

are appropriate roles of the Government, going forward. 

Transportation seems to be one where there is clearly a national 

interest, a public interest, and we believe that Congress is an appropriate place for us to oversee that public treasure. We think 

there is a role for Congress, going forward, and we have seen how 

Congress has been so vital in righting wrongs that have been takVerDate Aug 31 2005 12:06 Oct 28, 2014 Jkt 000000 PO 00000 Frm 00021 Fmt 6633 Sfmt 6633 P:\HEARINGS\113\AV\2013\12-12-~1\85900.TXT JEAN
14 

ing place elsewhere, so I don’t want to lose that fact, going forward, 

that this is a public treasure, there is a role for Congress. All 

Americans benefit. Historically, this Congress has recognized that 

the general taxpayer revenues ought to help fund a portion of that. 

We think that is appropriate, going forward. 

I also want to underscore that, from a general aviation perspective, the fuel taxes are an appropriate way to contribute to the system. I know a lot of other parts of the world use user fees. We believe that anything a user fee can do, the fuel tax can do better. 

So, as we begin to talk about how we move forward, how we 

evolve, how we adapt, how we keep America number one in aviation, we want to make sure we understand not just what is wrong 

with the current system, but what is right, so that, as we move forward, we take the best, and keep it, and build on it, and make sure 

that we are prepared to compete in the future. 

Mr. LOBIONDO. Thank you. 

Mr. Wytkind? 

Mr. WYTKIND. Thank you, Chairman LoBiondo, Ranking Member 

Larsen, and members of the committee, for inviting transportation 

unions to provide their views on the state of the airline industry. 

I appear today on behalf of not only our 32 member unions generally, but specifically our airline unions. I represent most workers 

in the aviation sector. 

In today’s global aviation marketplace, our Government must be 

proactive in developing an aggressive—and enforcing policies that 

help keep our industry competitive on the international level. At 

the same time, our Government must commit to maintaining a 

fully functioning and efficient FAA with stable and robust financing for our aviation industry. 

We must also do more to ensure that important safety reforms 

are implemented, and current rules are not needlessly reformed or 

revisited, based simply on a broad antiregulatory agenda. The expansion of international air transportation can offer lucrative business opportunities for U.S. airlines, for sure. And, if done the right 

way, can create middle-class aviation jobs. 

But our Government must embrace smart policies. Specifically, 

the administration must understand the land mines and pitfalls of 

unscrupulous liberalization, protect against the outsourcing of critical safety and security work, oppose regulatory overreaches by foreign states, and provide stable and robust financing for our aviation infrastructure and its workforce. 

The most pressing trade issue facing our industry revolves 

around the Trans-Atlantic Trade and Investment Partnership, or 

TTIP. Negotiation is currently being held between the U.S. and the 

European Union. Despite historical precedent for excluding air 

services from broad trade negotiations, the EU is seeking to include 

them among the complex issues being discussed in TTIP. 

The EU’s aim? Pretty clear. To force changes to U.S. rules that 

limit foreign ownership and control of U.S. airlines, and reserve domestic point-to-point service, or cabotage, to U.S.-controlled carriers. These laws have helped ensure a viable U.S. airline industry, 

and have protected employees against unfair competition, preserved workers’ rights, and ensured America’s status as a world 

leader in air transportation. 

15 

Decades of unfair trade policy have ravaged jobs in many U.S. 

industries, and those experiences inform our unyielding commitment to ensuring that it does not have the same result for airline 

workers in this country. The administration must categorically reject these efforts by the EU. I am pleased that there is broad support for this position in the House, including a majority of this committee that recently signed a letter to the U.S. Trade Representative expressing those views. 

In the EU we are currently seeing the negative impacts of aviation liberalization when labor protections are ignored, or fail to 

work as intended. Norwegian Air Shuttle, which is incorporated in 

Norway and holds an air operator’s certificate in that country, has 

developed a suspect business model designed to exploit European 

aviation and labor law, and undermine the rights of employees. 

NAS is registering its aircraft in Ireland—by the way, you can’t 

make this stuff up—and contracting or, more accurately, renting 

pilots and flight attendants that are based in Thailand, yes, and 

covered by labor laws in Singapore. The airlines is using a flag-ofconvenience policy, one very familiar to our maritime unions: to 

shop around and scour the globe for the cheapest labor and the 

most compliant regulations for their bottom line. 

Why does this matter to us? Because NAS has announced its intention to serve the United States: New York, Orlando, Fort Lauderdale, and possibly L.A., and they are clearly trying to undercut 

the U.S. airline industry by about 50 percent. An affiliate of NAS 

is now seeking an Irish operating certificate. And just this week it 

applied for a DOT permit. 

The U.S. also must adopt and enforce policies that curb unsafe 

outsourcing of U.S. aircraft repair and maintenance, and provide 

adequate safety and security safeguards. The FAA has yet to issue 

a congressionally mandated rule, now 9 months overdue, to apply 

drug and alcohol testing to foreign mechanics working on U.S. aircraft. It is a simple mandate, one based on the premise that if you 

are going to repair aircraft overseas under FAA regulations, then 

the same rules will apply to those workers that apply here, in the 

United States. We urge the administration to adopt this rule without further delay. 

In order to remain competitive in the global market, the U.S. 

must invest in the FAA’s workforce and aging infrastructure and 

ensure enhanced oversight of the industry and airspace, and continue modernizing the National Airspace System through NextGen. 

We have already witnessed the impacts that Government shutdowns and budget uncertainty have on these programs. And each 

time Washington has another knock-down, drag-out budget battle, 

these initiatives designed to make air travel safer and more efficient, and to expand capacity, are grounded or idled. This stuff 

must end. 

Under current budgetary constraints, we have concerns regarding the FAA’s ability to fully function and operate without sufficient and predictable funding, particularly for its operating budget. 

Compounding the problem, the FAA has a staffing crisis. It is operating under a hiring freeze, and one-third of its workforce, including controllers, aviation safety inspectors, and system specialVerDate Aug 31 2005 12:06 Oct 28, 2014 Jkt 000000 PO 00000 Frm 00023 Fmt 6633 Sfmt 6633 P:\HEARINGS\113\AV\2013\12-12-~1\85900.TXT JEAN
16 

ists, will be eligible to retire in 2014. This is unsustainable, and 

must be addressed before it impacts operations and safety. 

How we handle these issues and others included in my formal 

testimony will help shape this industry and its place in the world 

as it relates to aviation travel. I believe that, with strong leadership and sound policy, we can retain our standing as the world 

leader in aviation. We look forward to working with the committee 

to accomplish that. Thank you. 

Mr. LOBIONDO. Thank you, Ed. My first question is for anybody 

on the panel who would want to take a swing at this. Where, in 

your view, has the FAA been most successful in moving forward 

with NextGen, and where has FAA fallen short in implementing 

NextGen? Any takers? 

Mr. BUNCE. Mr. Chairman, I think if you look at the ground infrastructure for ADS–B, I think it is a true success story. They 

have a great program manager at the FAA that has put that infrastructure almost all out there, and these are—if you think of the 

ADS–B ground station as about the size of a refrigerator—they can 

put them up on cell phone towers, so it doesn’t take a lot of land. 

It allows them to divest from other infrastructure that is out there. 

So I think the FAA needs to be commended on that. 

When we look at performance-based navigation and going into 

airports, we have approaches that have now been put out there. A 

lot of them are overlays of existing approaches, so they don’t take 

full advantage of the capability that satellite navigation gives you. 

But one of the problems is that pilots aren’t able to use them. And 

that is because there are delays in getting the controllers the guidance, even though we have had years and years to get ready for 

the deployment of this system, we still aren’t able to use those approaches. 

Denver is a great example. So you had industry and Government 

working together, a great cooperative relationship between pilots 

and controllers and the FAA, all these—the airspace was redesigned, the approaches were put in, but then you talk to my airline 

pilot colleagues, and they can’t use the approaches because the controllers won’t issue them, because their handbook doesn’t give them 

the guidance to allow them to do so. 

So, there is good and bad throughout this deployment. And the 

more that we can focus on trying to utilize systems that have already been put in place, and then prioritize the NextGen workflow 

plan for other systems, I think really would help us in that quest. 

Mr. BOLEN. Yes, and I will just build on those remarks. I mean 

I think we are in a period where we are making some significant 

progress as we are getting to better granularity about what 

NextGen is, and what are the hurdles to its implementation. 

Definitionally, I think we have made a lot of progress. I think we 

have seen the FAA bring in a very strong NextGen manager. We 

have had some NextGen successes, probably most notably the 

Greener Skies Initiative in Seattle, where we have had an opportunity to see where NextGen works. But we have also identified 

the problems, including the controller’s handbook. And now efforts 

are being made to understand and remove those impediments, 

going forward. 

17 

So, I think, as it evolves, we are finally getting a level of clarity 

and a level of understanding that will help us get to where we need 

to go. But I think what we are finding is this is a much more challenging project than we may have anticipated. And we are finding 

things like controller handbook issues that weren’t really anticipated. 

So, I think we are at a point where the community is beginning 

to all get on the same page. There is better dialogue with the FAA, 

particularly through the NextGen Advisory Council. But there is a 

lot of work to do, particularly in a constrained Federal budget. And 

that is why prioritizing those NextGen projects, to get the right 

ones done at the right time so that we are truly making a difference, become so important. 

Ms. KURLAND. Mr. Chairman, thank you. And I am very pleased 

to hear my colleagues’ comments. 

NextGen, as we all know, is critically important to the continued 

stable and world-class aviation system that we have, and a stable 

funding source is critical for us to be able to continue moving forward, so we are not doing it in fits and starts. It is a rolling program with many different components. And I am, you know, delighted to tell you that at this point the FAA is getting close to having the completed critical foundation, in terms of the software and 

the hardware. As, you know, both Ed and Pete mentioned, there 

are specific instances where we have got certain programs that 

have really been doing well: the Greener Skies program. We are 

seeing, for example also, JetBlue in New York, because of the approaches there, is able to save 18 gallons per flight. And, you know, 

that adds up. 

So, it is critically important that we continue NextGen. We are 

very happy to have, you know, industry working with us. The National Advisory—the NextGen Advisory Committee has been critically important, and we look forward to working with the committee, as well. 

Mr. LOBIONDO. OK, thank you. Mr. Larsen? 

Mr. LARSEN. Thanks, Mr. Chairman. I want to just explore a few 

issues in the time I have, the first round. 

The first issue has to do with ancillary fees, as they continue to 

grow as a revenue source for airlines. The majority of those fees 

are not taxed. So, for—to start with, Assistant Secretary Kurland, 

has this administration looked at that general issue at all, and 

have you made any determinations about that? 

And then I want Mr. Calio and Mr. Brewer, then, to have a 

chance to respond. 

Ms. KURLAND. Yes. They, as you rightly point out, have not been 

taxed. It is my understanding I thought this is something the committee might be looking at. But, if I could provide you some information for the record on that, I don’t have that information at my 

fingertips. 

Mr. LARSEN. I imagine it might be something we end up debating 

in the next year-and-a-half. 

Ms. KURLAND. I would think so. 

Mr. LARSEN. Yes. Mr. Calio? 

Mr. CALIO. Thank you. In terms of taxing ancillary fees, we oppose it. You know, too often airlines are treated like they are some 

18 

other kind of business. Under the Internal Revenue Code, ancillary 

fees or optional services are not taxed as part of the ticket tax, 

based on an excise tax, and they are taxed as income tax. 

And I point out, also, that optional services accounted for about 

6 percent of the total revenue. In 2012, airlines made 37 cents per 

enplaned passenger. Without the optional service fees, we would 

have lost $8.12 a passenger. When it comes to being bold and innovative, I hope that the bold and innovative vision for the future of 

the airline industry is not figuring out ways to further increase the 

tax and regulatory burden. 

Mr. LARSEN. Yes. Mr. Brewer? 

Mr. BREWER. I appreciate the question, and I appreciate the opportunity to respond. 

Let me take it from a broader perspective, from an airport operator’s perspective. One of the ways that we generate revenue at an 

airport to maintain and operate our infrastructure is through rates 

and charges to our retail concessions and to our food and beverage 

concessions. And we do it based on a percentage of gross. And I believe that when this excise tax was imposed on the ticket, at the 

time it was imposed, all of those ancillary fee—bag fees and so 

on—were all considered part of the gross. 

I think what we are seeing now is that the airlines have found 

a way to take a lot of things that used to be part of the gross number, and make it so now the excise tax is taxed on the net, not on 

the gross. If the 7.5 percent was on the gross number, it would be 

an additional $260 million into the AIP fund, or into the Aviation 

Trust Fund, which could help build the infrastructure that is needed to maintain the systems that the airlines use. I think it would 

be a broad-based and very fair opportunity for the airlines to contribute through this tax system into the aviation system. 

Mr. LARSEN. Thank you all for answering that set of questions. 

I appreciate it. And I imagine we will continue to have discussions 

about the infrastructure financing as we go forward. That is just 

going to, I think, be part of it. 

Mr. Calio, I had a question regarding TTIP. And does A4A have 

a position on the issue of air transport services being in or out of 

TTIP? 

Mr. CALIO. Our position is that we have concerns about it being 

in. I would note, though, in terms of the issue of foreign ownership, 

we are with our labor partners on that, that that should not be 

part of it. And the EU is pushing very hard on that. 

Mr. LARSEN. Yes, that is great. Thanks. And then, Mr. Wytkind, 

on the—that point of TTIP, can you talk a little bit more about 

your position with regards to State and Transportation handling 

the issue of air service agreements versus having it part of a broader TTIP negotiation? 

Mr. WYTKIND. Yes, thank you. And I—we have been very clear 

on this. We think that, in the trade arena, the aviation trade area 

is one where you are seeing a lot of progress in opening markets. 

Over 100 open skies agreements have been negotiated by the Departments of Transportation and State. We have worked very closely with those agencies to make sure that those agreements, as they 

are made, impact workers in a good way, and create and support 

middle-class aviation jobs. 

19 

We are very, very concerned and strongly opposed to seeing aviation in the TTIP negotiations, which are very broad, very complex, 

and there are going to be a lot of trade-offs at the bargaining table. 

We are not really interested in being part of a trade-off. This is too 

vital an industry to the Nation and to the economy. And we think 

it has worked quite well. We think it is a solution in search of a 

problem. 

We are opening markets. We are growing international service. 

It is very lucrative, it supports good jobs. We support that. But we 

do not think it is a good idea to jam aviation into a very complex 

negotiation over TTIP. We have been very aggressive with the 

Obama administration, we have been very aggressive with the European governments, to let them know what our views are, and we 

are hopeful that this committee will continue to work with us to 

make sure that that doesn’t happen, because I think it would really 

harm the airline industry and its employees. 

Mr. LARSEN. Yes. And you have noted in your testimony the majority of this subcommittee has signed the broad letter opposing 

having these open skies agreements negotiated within TTIP. 

Mr. WYTKIND. Indeed. And I am very heartened to hear Mr. 

Calio’s comments, too, because one of the core issues involved in 

those discussions are the European Union’s continued bully tactics 

to try to change our foreign ownership and control laws. They have 

tried in various venues. They have tried to—they tried to force it 

upon the U.S. Government when they had their last open skies 

agreement that they negotiated not long ago. And this is just another attempt to change our foreign ownership and control rules, 

which we are very much against, and we are very heartened to 

hear that our air carrier partners are in the same position. 

Mr. LARSEN. Thanks. Finally, before I yield back, back to Mr. 

Calio. Could you maybe give three examples? You noted in your 

testimony other governments treat their airlines as strategic assets 

to the national economy. Could you give three examples of—name 

names, if you want, but three examples of tools other governments 

are using to treat their airlines as national assets, as strategic assets? 

Mr. CALIO. Look to the Middle East to start. There is more you 

can see there. 

For one, the level of taxation is very low. The level of passenger 

charges and fees are very low, which encourages people to fly and 

grow capacity. The level of regulation, particularly on the economic 

side—at A4A—we put regulation in two buckets. There is safety 

regulation, which is in one bucket. We work very closely with DOT 

and FAA on those. 

The other side is economic regulation. We are supposed to be deregulated, as an industry. We are not. And if you look at the way 

these other countries are regulating their industries, they give 

them the freedom to operate as businesses to maximize their sustainability and profitability. And, unfortunately, also, in some 

cases, because they are almost starting from scratch, their air traffic control infrastructure is much, much better than ours. 

And we could provide more examples, and we will, to your staff, 

going forward. 

20 

Mr. LARSEN. That would be an excellent help, I think, moving 

forward. 

Thank you, Mr. Chairman. 

Mr. LOBIONDO. Mr. Shuster. 

Mr. SHUSTER. Thank you, Mr. Chairman. Broad question to the 

entire panel. What types of policy initiatives would you recommend? And don’t give me a laundry list—I am sure you will 

have a laundry list—but just sort of the highlights in the next FAA 

reauthorization. And those we deal with specifically in this committee, because I know we are talking tax policy and things like 

that, which, at this point doesn’t come out of this committee. But 

can you give us sort of a couple of high-priority items in the next 

FAA reauthorization you would like to see passed? 

Start at the—— 

Ms. KURLAND. Mr. Chairman, the FAA has started the rampup 

process for considering what we would recommend for reauthorization. And after the first of the year, we will really be ramping that 

up. And we will look forward to working closely with you and the 

committee, as you move forward on reauthorization. 

You know, many—a number of items have been mentioned, in 

terms of the cooperation, in terms of—with the committee and with 

my colleagues around the table, in terms of promoting our interests, internationally, and also to—in protecting and taking a look 

at small communities and how they fare in aviation and services. 

So, on these and many other issues, especially in the FAA realm, 

we will look forward to working with you. 

Mr. SHUSTER. Mr. Calio? 

Mr. CALIO. First of all, we would like to provide more metrics 

and measurement to the FAA in terms of NextGen, so it can keep 

the program moving in the leadership at the FAA, which is working very hard on the issues and has the tools to get done what it 

needs to get done, in terms of advancing NextGen. Measurements 

will provide a business case for continuing on down the line. 

We would like to see some parameters put around the regulatory 

process that require that it be based on sound science and data, 

and that there be cost benefit analysis done. And we would like no 

increase in the passenger facility charge. You know, it is interesting. In the last year, in 2013, a record amount—$12.3 billion— 

was paid into the Aviation Trust Fund. And that funds 80 percent 

of the FAA’s budget. For a variety of other reasons which I think 

are listed in our testimony, but we would also be happy to provide, 

in terms of the airports. We don’t think any change is justified. 

Mr. SHUSTER. And NextGen would have a huge positive impact 

across the system. So that really should be a number-one priority, 

to move that forward as fast as—or faster than we are now? 

Mr. CALIO. It has to be moved fast-forward. We had our board 

meeting yesterday, and Bill Ayer, who is the chairman of the 

NextGen Advisory Committee, and Margaret Jenny, who is the 

president and CEO of RTCA, came in—and Ed Bolen was referring 

to it earlier, I sit on the board of RTCA with him—the NextGen 

Advisory Committee was trying to provide advice and counsel and 

practical ways for the FAA to move forward on NextGen in measurable bites. Again, prioritizing, even within budget constraints. Get 

done what you can to make the business case. 

21 

You know, when we talk about 2020, 2025, it needs to move faster than that. 

Mr. SHUSTER. Right. Mr. Brewer? 

Mr. BREWER. Thank you, Mr. Chairman. I think I mentioned in 

my earlier testimony—and, as you might suspect, I have a different 

opinion on the PFCs. And we believe raising the PFCs will help 

with airport infrastructure, will help with the National Air Transportation System, and make local decisions and help airports fund 

projects locally. 

We understand the pressures that are on all of you in this room, 

and Congress in general, to try and reduce Federal spending. We 

believe that this gives the flexibility. 

Just a reminder that PFCs, at least in my experience at the airports that I have worked at, I have never done a PFC project unless it was suggested by the airlines, or approved by the airlines 

in our Airline and Airport Affairs Committee. So it is not an unusual request for the airlines to actually suggest the use of PFCs. 

And we think giving the additional flexibility for the airport operators to gain additional revenue for that purpose is appropriate and 

important. 

Maintaining the contract control tower system is essential. It is 

very efficient, it is very effective, and I think it meets every parameter. The GAO has looked at it and said it is a great program. And 

maintaining the EAS program for smaller communities to gain access into the National Air Transportation System. 

Mr. SHUSTER. One of the concerns I have is that I look around 

the country with airports—Airport X wants to build two 11,000 

dual runways, where we have got other airports in the country that 

are vastly underutilized that are not far away. And so I want to 

make sure that Airport X, whatever airport that is—and I don’t 

want to name names—but, you know, the airlines are saying, 

‘‘Well, we don’t necessarily need that extra runway,’’ so I want to 

make sure that we are being prudent with those dollars, and that 

airports, again, that exist out there, can be utilized, and not just 

continue to build on one or two airports on either coast. So that is 

a concern of mine. 

Mr. BREWER. We appreciate that thought. And, as you know, 

PFC programs have to be AIP-eligible. And so it would be something that would have to be consistent with an airport’s master 

plan. 

Mr. SHUSTER. Right. 

Mr. BREWER. And an 11,000-foot runway that may not be necessary or justified most likely wouldn’t get past that test. 

Mr. SHUSTER. OK, thank you. Mr. Bunce? 

Mr. BUNCE. Mr. Chairman, obviously, from the manufacturer’s 

perspective, the emphasis on certification is welcome. And continuing to ask the FAA to provide metrics back to Congress to say, 

OK, are they really making an impact, as far as streamlining the 

process, allowing industry to use the delegation authorities, which 

then frees up other resources for companies that haven’t had the 

long expertise. 

So, a new startup company that wants to produce a jet, or has 

gone from piston production and now wants to produce a jet, can 

get the resources from the FAA, because other companies that have 

22 

been able to do that for a long time are allowed to use their delegated authorities to the maximum extent possible to be able to get 

product out the door. Because we have to go through the FAA to 

be able to deliver anything. 

I think, also, what I mentioned earlier about giving DOT the 

mandate to promote this industry could be very helpful to all of us 

together. As the FAA presents its plan to you for right-sizing the 

NAS, to be able to find a mechanism to make sure they deliver on 

that. And if we really can find a way where, if it is incremental 

and it is rolling over a period of years, that they come to you with 

a certain amount of integration or consolidation, and then the Congress has to approve it, and then they go to the next tranche, if 

we can keep them on schedule, that would benefit us all. Because 

if we right-size the NAS, those savings could easily be plowed back 

into important programs, like NextGen. 

Mr. SHUSTER. Mr. Bolen? 

Mr. BOLEN. Chairman Shuster, in terms of guiding principles, we 

would first recommend we establish the goal to ensure that the 

U.S. remains the largest, the safest, the most efficient, and the 

most diverse air transportation system in the world. I believe that 

translates into advancing NextGen, and making NextGen a priority. 

I also would urge you to recognize that our National Airspace 

System is a public good that is worthy of public support. And I 

think that translates into a general fund contribution. 

I also believe, because it is a public good, it demands and deserves congressional oversight, as we move forward. 

And, finally, I would like to establish that the general aviation 

community should contribute to our air transportation system. We 

believe that the fuel taxes are the best and most efficient way for 

us to contribute, and we would urge you to keep that as a funding 

mechanism for general aviation. 

Mr. SHUSTER. I have been in discussion with some of the business groups, and they believe that the time is now—with low interest rates, to figure out how to bond this thing. And they believe it 

can be built in 3 to 5 years, if we really focus on it, put the money 

behind it—whatever it is, $40 billion. 

Do you believe that it can be built in that timeframe, if we put 

the effort on it? Or is it technologically, in your view, impossible? 

Mr. BOLEN. Well, bonding has been suggested as a way to advance NextGen. I think it is worth understanding, however, that a 

lot of NextGen is software programs. It is technology, not brick and 

mortar. 

Typically, we have done a lot of bonding to build roads, build infrastructure that is concrete, bricks, and mortar. This is a little 

something different. And so, if we are going to borrow money 

against a funding stream, I think we want to understand what is 

it we are borrowing money to purchase, and how is that going to 

pay for itself over time. 

Mr. SHUSTER. Right. 

Mr. BOLEN. We are working, as Mr. Calio suggested, we, as an 

industry, are working very hard to understand the benefits of 

NextGen, the business case for NextGen, and to figure out how we 

23 

can implement it as quickly as possible, and as cost-effectively as 

possible. 

Mr. SHUSTER. Thank you. 

Mr. WYTKIND. Mr. Shuster, thank you for that question, and I 

am happy to try to offer a few observations. 

First of all, this long-term funding issue is a challenge that you 

are facing, as a chairman, in every mode of transport. I congratulate you for the work you did on the WRRDA bill, because it did 

free up more resources, and brought—will eventually bring more 

investments into our ports and harbors. 

I think the model that you used there to keep the committee together on a bipartisan basis needs to be used to figure out a longterm funding system for the FAA, and our air traffic control system, and the overall aviation sector. So that is issue one which we 

want to be at the table to discuss. 

I think safety reforms are going to have to be on the table here. 

One is if the administration does not act on foreign repair station 

regulations, as this committee has already directed it to do, I think 

it is going to have to be revisited, to make sure we don’t have unsafe conditions around the world in the way that we maintain our 

aircraft that you and I fly in. 

And separately, I think that cargo pilot carve-out that occurred 

in the administration’s pilot fatigue rules can’t be ignored by this 

committee. Cargo pilots share the same airspace as commercial jets 

that fly passengers around, and there is no reason why we should 

have tired cargo pilots, simply because they don’t carry people inside their aircraft. 

Third, I would strongly recommend that the committee take a 

look at some of these international issues. While we can’t come up 

with a legislative remedy today, we will in the future, if indeed 

some of these schemes that we saw with the Norwegian Air Shuttle 

continue to emerge in the context of our trade relationships with 

the Europeans and other parts of the world. We don’t think we 

should be supporting policies, trade policies, that allow foreign carriers to come in, cook up new schemes that are designed to undercut U.S. airlines and their employees. 

And lastly, I think these workforce challenges in the FAA, I urge 

you strongly to partner, as you have before, with the air traffic controllers, and PASS, the union that represents inspectors and technicians, to make sure that the FAA has the resources it needs to 

have the best workforce that is trained, that deals with its staffing 

crisis, and that makes sure that the workers of the FAA are at the 

table when you implement NextGen and other initiatives. I think 

that is going to be a priority we will bring to the committee in the 

next few months. Thank you. 

Mr. SHUSTER. Well, I thank everybody for their input, and I 

thank the vice chairman for indulging. Good to see you. 

And I am going to submit this question for the record to Mr. 

Calio. I am interested to know the impact of the recent consolidation in the industry, how it has impacted the small and mediumsized communities. Because, as you know—and we have talked before—I care very much about rural America. I am from rural America. And I want to make sure that there is some semblance of air 

service that continues to go out there, as we move forward, espeVerDate Aug 31 2005 12:06 Oct 28, 2014 Jkt 000000 PO 00000 Frm 00031 Fmt 6633 Sfmt 6633 P:\HEARINGS\113\AV\2013\12-12-~1\85900.TXT JEAN
24 

cially. We have just gone through another consolidation, which I 

think in the long run is going to be positive for the industry. I just 

want to make sure it is positive for the small and medium-sized 

markets in America. So I will submit that for the record. Thank 

you. Yield back. 

Mr. DAVIS [presiding]. Thank you, Chairman Shuster. The Chair 

now recognizes the gentleman from Massachusetts, Mr. Capuano, 

for 5 minutes. 

Mr. CAPUANO. Thank you, Mr. Chairman. Mr. Calio, I really like 

the concept of trying to come up with a national airline policy. It 

is not as easy as the title might presume. We will have some significant differences of opinion amongst all of us, tax policy being 

one of them. 

For me, I am less interested in what is taxed, as much as does 

the tax raise enough money to do what we need to do. Can we 

build runways? Can we address safety? Can we do all those things? 

Where it comes from? Let’s be serious; it all comes from the passenger. It all does. Taxes always pass through, from every company, and that is fine. So, for me, it is more of a level playing field 

than the absolute amount of what is precisely taxed. 

You know, regulatory burden? I have yet to see any industry ever 

come to any committee I have ever served on that says they are 

not overly regulated. Exactly what—again, it is a competition thing 

to me. I am looking for level playing fields. 

The air traffic control system we talked about. Stabilizing energy 

prices. Well, if we could figure out how to do that, we would all 

be—I don’t know what we would be, but a lot better than we are. 

But I do want to talk about the one item that I think would 

bring everybody together in a general way, and that is to support 

our efforts to compete globally. For me, I have watched the shipping industry go from a position during my lifetime where, for all 

intents and purposes, there are no American flag ships. I mean 

that is an overstatement, but not much of an overstatement. In the 

Port of Boston, I can’t remember the last time I saw a significant 

sized U.S. flag ship. And I don’t want to get to that situation in 

the airline industry. 

And again, I don’t mean to pick on Boston, I actually think they 

are doing a pretty good job, but we have the same thing, we have 

an international airport, and we have international business interests that we are interested in, and we want international flights. 

But just recently, I learned we are attracting—we are actually supporting a foreign-flagged airline to bring a flight in to Boston. And 

to me, it is like, well, if we really want that flight—which sounds 

fine, it is to the Middle East, I think that is great—why isn’t one 

of our U.S. carriers doing that? 

We had a big thing a couple of months ago; we brought our first 

direct flight from Beijing to Boston, a long flight. Again, Chinese 

company. And again, I am not against that, that is fine by me. But 

I guess what I really want to get at is I would really like to get 

people to the table to try to figure out what are the things that are 

truly putting us at a disadvantage. Not necessarily to give any significant advantage, but just to level the playing field. If they can 

do it, if the Emirates airlines can do it, if China Air can do it, why 

can’t any one of the U.S. carriers do it? Why won’t they do it? 

25 

And what are we doing wrong to not do that? And I think that 

goes to—and I want to stay away a little bit from the repair basis, 

because I think that will get us into some disagreements as to how 

we do it. And I am not interested in hearing things about, you 

know, we need to lower labor costs or we have to hire everybody 

from low-cost countries. That is, again, part of the problem with 

the station repair. 

But I am interested in finding out and maybe talking a little bit 

about some of the things that you might see. And I am going to 

ask some of the other people on the panel to tell me some of the 

things you might see that might be able to, again, level the playing 

field, so that U.S. carriers are not at a disadvantage, so that my 

kids will actually see U.S.-based airlines operating in this world, 

and not all foreign operators. 

Mr. CALIO. Thank you, Mr. Capuano. I appreciate your interest 

in the national airline policy. And that is what the national airline 

policy, or the concept of a national airline policy, is all about. It is 

all those elements that you mentioned. It is the taxation—the taxation does matter, because the taxation has an impact on capacity 

and demand, in terms of how much people are willing to fly. And 

we would be happy to sit down and talk to you at a roundtable, 

in your office, anywhere with any group, and talk about that. 

It is the same on the regulatory side. It is just a rationalization— 

there are some ancient regulations that really don’t do much to 

help anything. There is information that we are required to report 

that no other industry is required to report that doesn’t impact 

safety, and it costs money to do so. There are all sorts of other 

things, like global distribution systems and potential rules on that. 

So, the regulatory burden is something to look at, because these 

other airlines, as I pointed out earlier, these foreign competitors, 

are subject to different regimes. And you are correct; some things 

we can’t ever compete on. We are not going to compete with labor— 

on labor costs, and shouldn’t, with China and the Middle Eastern 

carriers. They can do things that we would not be permitted to do. 

And, you know, we value our workforce. But we don’t want to be 

undercut by them, either, on that basis. So there are other things 

to look at. 

We think we have to look at and applaud DOT here, because 

Open Skies are great, but you have to look at what happens down 

the line after the Open Skies comes. If people can keep flying here, 

and it is free for a new Beijing-to-Boston route, a new Middle Eastto-Boston route, or New York route, but then we are having trouble 

getting in other countries with whom we are dealing, you know, on 

a practical basis, that makes a difference. There is a lot of different 

things. 

Mr. CAPUANO. Are you aware of any of your members ever being 

subsidized by a foreign government to bring a plane into their 

space? I mean I just learned about the air services incentive program. To be perfectly honest, I am a little bit surprised and 

shocked that it even exists. Why are we paying foreign carriers to 

come to an airport that is already congested, and providing a service that certainly we could provide? 

Were you offered, or any of your members offered that subsidy 

to be able to fly the same route, or do we just give it away? 

26 

Mr. CALIO. Not to my knowledge. 

Mr. CAPUANO. Ms. Kurland, could you tell me what the—I mean, 

again, I am not asking about the specific issue, I wouldn’t, that 

would be unfair. But, generally, the policy strikes me as crazy as 

to why are we paying somebody to come in to an already international airport to provide a service that any one of our U.S. carriers could have provided easily? 

Ms. KURLAND. Congressman, I will get you the specifics of this. 

But, generally speaking, airports—and I think Mr. Brewer will be 

able to also talk a little bit about this—airports are allowed to have 

incentive programs if they are offered to all. If they want to attract 

a new service, one that is not being offered at the airport—— 

Mr. CAPUANO. Oh, I understand. That is why I am not mad at 

Massport. They are doing what they have to do to be competitive. 

I am kind of surprised that our policy—why we have allowed such 

a policy, why we would encourage such a policy. Why wouldn’t we 

prohibit just that, to disadvantage a U.S. carrier? 

Ms. KURLAND. The purpose would not be to disadvantage carriers. It would be a community, an airport, taking a look at the 

service that they are getting, and perhaps—and I can’t speak to 

Boston—perhaps—I would assume that they have approached U.S. 

carriers saying, you know, ‘‘We have got a lot of business interests 

that are interested in going to and from Beijing. Are you interested 

in providing the service?’’ 

And sometimes, in order to incentivize and get carriers to be 

more interested in providing the service, they may come up with 

an incentive program, as long as it meets FAA criteria. And, again, 

I would have to get those for you. You know, there would—as long 

as it is open to all comers, there could be that ability. 

Mr. CAPUANO. I understand. But that doesn’t get—— 

Mr. DAVIS. The gentleman’s time has expired. 

Mr. CAPUANO. My time is up, and I appreciate the chairman’s indulgence. 

Mr. DAVIS. The Chair now recognizes the gentleman from Pennsylvania, Mr. Meehan, for 5 minutes. 

Mr. MEEHAN. Well, thank you, Mr. Chairman. I am appreciative 

of the opportunity to participate in this projection, which is so important, I think, and the time that you are taking to help us better 

understand where we need to go. And I am clearly struck by the 

emerging possibilities that we face in the international area. It certainly leads to the growth—I represent an area in which my own 

Chamber of Commerce has identified that the key to growth and 

our capacity to attract commerce from around the world is a viable 

international airport. 

So, we know that these are vital, but it also means a level playing field competing globally. And I am trying to explore and understand a little bit better where some of the impediments to global 

competition may take place. 

Ms. Kurland, I took time to read Mr. Calio’s written testimony. 

And one of the things that concerns me is, as we are trying to expand opportunities to reach into certain markets, one of the markets, the Asian market, Middle Eastern, Chinese airlines, they are 

investing a great deal in more wide-bodied airplanes. We have a 

statutory mandate to try to strengthen the competitive positions of 

27 

our air carriers so that we can compete with those foreign air carriers. 

Can you give me a sense as to what you are doing to try to ensure that our airlines are able to compete on a level playing field, 

and particularly what your level of understanding is with regard 

to the kind of not just incentives, but some of the foreign countries 

seem to underwrite expenses that our independent airlines have to 

be able to sustain themselves on the open market? What are your 

observations with regard to that? What is DOT doing to help keep 

us competitive? 

Ms. KURLAND. Thank you, Congressman, for that question. A few 

things. 

Number one, as we talked about today, is the negotiation of Open 

Skies agreements. In order to make sure that we have, with as 

many countries as possible, liberalized air service agreements, so 

that the U.S. carriers can make the business decisions themselves 

for where they want to serve. 

Number two, the U.S. Government and, working through the Department of Transportation, has the authority, which we have done 

on behalf of a number of our carriers in the global alliances, to 

award antitrust immunity to global alliances where it is warranted. 

And what that has allowed companies and the alliances to do is to 

create greater synergies, to create neutrality, to provide greater 

reach, where a particular carrier may say, ‘‘You know what? It 

doesn’t make any sense for me to fly to that particular country,’’ 

but by able to work or codeshare or have an alliance relationship 

with a foreign carrier, they have greater reach and greater opportunities for—— 

Mr. MEEHAN. Have we been promoting these opportunities to 

work—— 

Ms. KURLAND. Oh, yes. 

Mr. MEEHAN. We just went through a situation in which the Department of Justice seemed to be a little bit involved in antitrust, 

with regard to where the airlines themselves believed that they 

had the competitive opportunity. 

Ms. KURLAND. Let me just draw a distinction there. When it 

comes to mergers and consolidation, Justice makes those decisions 

and decides what divestitures or what remedies are appropriate. 

And when it comes to granting antitrust immunity for the global 

alliances, that decision rests with the Department of Transportation. 

Mr. MEEHAN. OK. You made a point, though, and I appreciate 

it. And I think you were talking about the Open Skies agreements—— 

Ms. KURLAND. Yes. 

Mr. MEEHAN [continuing]. And other kinds of things. And so I 

am asking what you are doing. But with regard to those—— 

Ms. KURLAND. Yes. 

Mr. MEEHAN [continuing]. When you are engaged in those kinds 

of negotiations, are there kinds of either legal tools, or other kinds 

of things that you need to be able to more effectively negotiate with 

foreign governments? 

Ms. KURLAND. Yes, sir. In all of our Open Skies agreements we 

do have fair competition provisions. That is number one. 

28 

Number two, on a regular basis, when it comes to specific doing 

business issues in different countries on behalf of our carriers, we 

are regularly engaged. For example, if a carrier is having a problem in a country using its own ground handling facilities, we weigh 

in and we are able to help resolve those issues. 

When it comes to certain circumstances where a carrier wants a 

different time slot, we will work with communities—we will work 

with other countries to do that. Just recently we worked with a 

country in order—on behalf of one of our carriers in terms of the 

types of leasing arrangements that they had. 

The point that you—the other point that you are raising, in 

terms of unfair competition, we have a statute that was passed by 

Congress—and I cannot pronounce the acronym, it is IATFCPA— 

and what it does is when carriers are able to provide us with the— 

with circumstances, with evidence, we are able to file a proceeding 

with another country, and take actions. And we recently did this 

in Italy, where the Italians were charging our carriers and other 

carriers different fees than they were charging their own in the 

EU. And what we did is we filed a—this proceeding. We said we 

were going to take retaliatory actions against Alitalia. And the EU 

and the Italians have said that they are going to rectify that. 

So, we do have tools. They are fact-based, in order to be able to 

move forward. And, as Mr. Calio, you know, will also—— 

Mr. MEEHAN. Well, can I—my time is expiring, I thank you. 

Ms. KURLAND. I am sorry. 

Mr. MEEHAN. It probably has expired. But, Mr. Calio, do you 

have a reaction, as—with regard to just the issue of incentives that 

foreign airlines and others—countries may be giving to create a 

noncompetitive environment for our airlines, internationally? 

Mr. CALIO. We work very closely with DOT on many of the issues 

that Assistant Secretary Kurland mentioned, and have had success 

on those. The partnership is very good in other areas, and I am 

going to take the opportunity to thank you and Congressman 

DeFazio here, and many members of this committee and subcommittee who have joined you. 

One area where the Government is not working with us, but is 

actually working against us, is the creation of pre-customs and border protection—pre-clearance facilities, particularly in Abu Dhabi, 

where the Congress has well noted that this should not happen. It 

is going to open January 5th. It is a country to which no U.S. airline flies. It has low passenger flows. The State-owned Etihad airline, however, is currently marketing it publicly as an incentive to 

fly through Abu Dhabi. And the CBP and Department of Homeland 

Security have indicated publicly that they plan to litter the Middle 

East with pre-clearance facilities. 

That is all well and good. You know, there are pre-clearance facilities in some places where there is a lot of benefit to the United 

States, where it actually lowers the lines. But right now we have 

wait times of 1 to 4 hours in some places when people try to fly 

into this country. It is kind of a slap in the face to U.S. citizens 

flying back from overseas. It is a disincentive for foreign travelers 

to come into this country. And we shouldn’t spend a dime on a preclearance facility somewhere else, until we can get our own system 

straightened out. So, thank you again for your support. 

29 

Mr. MEEHAN. Thank you, Mr. Chairman. I yield back. 

Mr. DAVIS. The gentleman’s time has expired. The Chair now 

recognizes the gentleman from Oregon, Mr. DeFazio, for 5 minutes. 

Mr. DEFAZIO. Thank you, Mr. Chairman. I was very concerned, 

and follow up on Mr. Capuano’s question about—I was not aware 

of this flag of convenience. I have spent many years on this issue 

on the Maritime subcommittee, working through the international 

organizations. 

Assistant Secretary Kurland, has the Department begun or taken 

a position, taken this to ICAO or anywhere else? I mean this flag 

of convenience thing is total BS, and we got to stop it now. 

Ms. KURLAND. Well, sir, Congressman, we have talked—our door 

is always open. And we—— 

Mr. DEFAZIO. But the question—have you taken—do you support 

flags of convenience? Does the Department support that, that idea? 

Yes or no. 

Ms. KURLAND. We support a liberalized aviation—— 

Mr. DEFAZIO. So you are not going to say you are against this 

scheme where we are going to find the least labor standards, the 

least regulated environment for a company to be based—— 

Ms. KURLAND. Oh, no, I am—— 

Mr. DEFAZIO [continuing]. And then they are going to fly into the 

United States to—— 

Ms. KURLAND. I am sorry, I misunderstood your question. 

Mr. DEFAZIO. Yes. 

Ms. KURLAND. Oh, you were talking about Mr. Wytkind’s question. 

Mr. DEFAZIO. Yes, yes. 

Ms. KURLAND. I can weigh in on that, in terms of that specific 

situation. We have raised our concerns and labor’s concerns with 

the EU at the last joint committee meeting in June. We have continued to raise them with the EU. 

Just yesterday, Deputy Secretary Porcari spoke with the DG for 

transportation, Matthias Ruete, and the EU is looking into this and 

will be getting back to us. 

Mr. DEFAZIO. OK, good. I would hope that our position—— 

Ms. KURLAND. Oh, yes. 

Mr. DEFAZIO [continuing]. Would be we are not going to let these 

people land in the United States of America. Plain and simple, we 

are not going to let them land. 

Ms. KURLAND. Sir, we are exploring this, and we have made our 

concerns known—— 

Mr. DEFAZIO. OK. 

Ms. KURLAND [continuing]. To the EU. 

Mr. DEFAZIO. I know, but I always hear that, and I want to see 

it go a little further than making our concerns known. You know, 

we have lost maritime industry. I have dealt with this consensusbased process. We have to take a strong stand—— 

Ms. KURLAND. And we do have, in our—— 

Mr. DEFAZIO. OK, I got to get through some other questions, I 

have very little time. 

Was the FAA—have you been consulted on this TTIP, the foreign 

ownership? Are you involved in that? 

30 

Ms. KURLAND. The TTIP is—negotiations are ongoing under the 

purview of the USTR, and I can’t comment. But what I can tell 

you, sir, is that when we have had our bilateral discussions on 

aviation with the EU, we have made it very clear that the issues 

of cabotage, ownership and control, are matters that Congress has 

statutes on, and any changes would have to come from Congress. 

Mr. DEFAZIO. OK, good. When are we going to get a regulation 

on foreign repair stations? It has only been 12 years since I first 

began raising concerns about security there. We did finally mandate that you come up with new regulations. You are 9 months 

late. When are we going to have them? 

Ms. KURLAND. I will take that back to Administrator Huerta, and 

I will get you an answer for the record. 

Mr. DEFAZIO. That would be great. OK. Then we have talked a 

lot here about transparency and competitiveness and all this. And 

I don’t understand why the FAA is prohibiting the airlines from 

breaking out what goes into the cost of a ticket. Now, why would 

we want to prohibit consumers from having that information? I 

don’t quite get it. 

I mean I—you know, I make—you know, I voted for some of 

these fees and taxes and that. I am not ashamed. But I think that, 

you know, the airlines, like any other—you know, I mean, you go 

to the gas station, they tell you how much tax you are paying if 

you—you know, so—— 

Ms. KURLAND. That is actually a DOT rule. 

Mr. DEFAZIO. Yes. Well, you are part of the DOT. 

Ms. KURLAND. Part of the DOT. 

Mr. DEFAZIO. I would assume the FAA was consulted, since you 

regulate the airlines. 

Ms. KURLAND. Yes. No, but it is something that comes out of our 

consumer affairs office. 

We are trying to be responsive to the—you know, we—to the 

needs of consumers as they fly, in making sure that when they purchase their tickets they are aware of what goes into it. And I can 

provide you additional information on—— 

Mr. DEFAZIO. OK, I am just very puzzled, why we have that rule. 

I mean it is beyond me. 

Ms. KURLAND. Well, it is a question of making sure that our— 

that the consumers are—understand what they are purchasing. 

Mr. DEFAZIO. Right, which would mean I am purchasing a ticket, 

and I would like to have specificity. I would go so far as to say I 

like the specificity when the airline imposes a surcharge for fuel 

costs. I want to see all that stuff. I want to know why—— 

Ms. KURLAND. Well, no. There can be a—I believe that there can 

be a break-out. It is just—it is how it is done. 

Mr. DEFAZIO. Yes. 

Ms. KURLAND. And I would be happy to get you that information. 

Mr. DEFAZIO. OK. Well, thank you. And my time is about to expire, but I—you know, I just—the concerns about the Abu Dhabi 

have already been stated. But, I mean, was FAA—are you working 

with Homeland? I mean you are supposed to help promote our domestic industry. You know, they are proposing a bunch more of 

these at places that are—where we have very little traffic for U.S. 

airlines. 

31 

Are you being consulted in this, or are you intervening or commenting to Homeland? I mean Homeland came into—I got the 

whole song and dance, served on that committee 10 years, I know 

it. But I have a concern here that we are going to lose this industry. We got this issue with these, you know, flags of convenience, 

and we got these problems where we are creating pathways for totally subsidized foreign-owned airlines into the U.S. with special 

privileges. 

Ms. KURLAND. As you mentioned, it is in the Department of 

Homeland Security’s wheelhouse. But we did intervene, and we 

did, at high levels, bring the industry’s concerns to DHS. 

Mr. DEFAZIO. OK. Well, please keep doing that, because they got 

more plans. 

Mr. DAVIS. The gentleman’s time has—— 

Mr. DEFAZIO. Thank the chairman. 

Mr. DAVIS. Thank you. The Chair would like to now recognize 

the gentleman from Texas, Mr. Farenthold, for 5 minutes. 

Mr. FARENTHOLD. Thank you very much. And I am going to have 

to echo the gentleman from Oregon’s concern about some of the 

taxes, fees, and potential lack of transparency with the regulations 

requiring complete disclosure of the cost of a ticket. We are losing 

transparency as to the fact sometimes over 20 percent of a ticket 

is actually taxes and fees. I do think we are in a position in this 

committee—I am surprised that, of all the committees I sit on, we 

all seem very much concerned about the same issues. And I do remain concerned about that, and would like to remain posted on 

that. 

Further, Chairman Shuster visited with Mr. Calio a little bit 

about the small and medium-sized airports, and how they are affected by the consolidation in the airline industry. The district I 

represent, our big commercial airports are Corpus Christi—we 

have got—you know, we are fortunate to have Southwest, United, 

and American in, but we do not have a SkyTeam carrier. And we 

are the smallest market Southwest covers. If we lose them, there 

is a real concern. 

The other major metropolitan area we have is Victoria. It is an 

essential air service. And all it has got is a small prop plane to 

Houston, an independent carrier, which—I would like to get copies 

of the information you provide to Chairman Shuster, as well, 

please. 

I would also like to ask you—Virgin America is probably the first 

new airline that has come about, and that has been quite some 

time. Can you talk about some of the impediments to entry of new 

carriers? 

Mr. CALIO. I would have to say that, in terms of entry of new 

carriers, I am not a particular expert on that. We could provide you 

information on that. 

Historically, however, the industry has had low impediments to 

entry, if you have the money and can handle the capital costs. 

Mr. FARENTHOLD. Money is always an impediment, I would 

guess. 

Mr. CALIO. I am sorry? 

Mr. FARENTHOLD. Money is always an impediment to what you 

want to do. 

32 

Mr. CALIO. Right. But, you know, again, historically, many organizations—people have started airlines, not quite at the drop of a 

hat, but you can get an airline up and running relatively easily, I 

think. I would prefer to get back to you on that. 

Mr. FARENTHOLD. All right, and let me go to Mr. Brewer now and 

talk a little bit about access to airports. You know, with the American Airlines and U.S. Air merger, there was some emphasis on access to airports here in Washington, LaGuardia, and Dallas Love 

Field. To what extent does this create a problem for—again, I am 

going to stick with new carriers or the, you know, up-and-coming 

folks. I mean how do we address this problem? Is NextGen going 

to solve it by creating more capacity, more slots? I mean in Washington there is no real estate to park the airplanes. Is there a solution to this problem? 

Mr. BREWER. No, I think—I believe that the real issue is access 

to the—to DCA, in particular. 

I will give you our example in Manchester. Four flights a day 

into DCA. With the merger of American Airlines and U.S. Airways, 

those slots are in jeopardy. There are 74 slots a day into DCA that 

are allocated to our commuter aircraft. The definition of commuter 

aircraft are those with 76 seats or less. But there are now more 

than those 74 commuter flights coming in to DCA. 

So now, with the merger, U.S. Airways and American need to get 

mainline service in to protect the market share that they currently 

have. 

Mr. FARENTHOLD. So, are you suggesting that there ought to be— 

that the carriers need to be bringing in—these capacity-controlled 

airports need to be bringing the bigger jets in so they have more 

people? Or—— 

Mr. BREWER. I am suggesting—there are two issues that—my little understanding it is of the airline industry, there is are words 

that we need to always remember. One is yield and one is demand. 

Yield is what keeps your existing flights flying. The airlines need 

to make a certain percentage of profit on every flight, or it is gone. 

And demand is what creates the need for additional flights. 

Mr. FARENTHOLD. OK. I appreciate it. I have one other question 

I want to address to Mr. Wytkind and Mr. Calio, and that is the 

FCC has recently talked about allowing cell phone usage on airplanes. I got in a big argument with my family. Forget safety. 

There is an annoyance factor there. But do the folks you represent 

in your union and do the airlines have a particular take on that? 

It is my take the Government needs to stay out of it, the market 

will decide that. But I would like to hear both of you gentlemen’s 

take on that. 

Mr. WYTKIND. We—thank you for the question. We have publicly 

said that we support any legislation to not allow it. It is one thing 

to allow the use of smartphones on aircraft for other purposes, including being on the Internet, et cetera. But we are against cell 

phone use. We think it is disruptive, not only to passengers, but 

to the employees on the flight that need to service that plane. We 

think it creates a potentially very chaotic environment. 

And since things happen on air flights that we don’t want to see 

happen, when they do, I think if you have got a cabin full of passengers that are using their phones for calls, we think it is very 

33 

disruptive and not consistent with what we think is a good, safe, 

and consumer-friendly environment. 

And, lastly, I think it is important to note that when you allow 

this to happen, the front-line employees, the flight attendants, are 

going to be the ones that are going to be forced to arbitrate disputes inside that cabin when it is determined that there should not 

be cell phone use. It is going to be the front-line employees. 

Mr. FARENTHOLD. And I am out of time. If the Chair will indulge 

me in letting Mr. Calio answer, I will yield back at the conclusion 

of his answer. 

Mr. CALIO. Congressman, I am busy on a call. 

[Laughter.] 

Mr. CALIO. Seriously, we think that the FCC and the FAA have 

to resolve, first and foremost, whether they determine it is safe for 

cell phones to be used on an airplane. 

If they do so, we believe the decision should be left up to individual carriers as to whether they want to institute a policy or not. 

And that policy will be instituted by individual carriers on the 

basis of whether it is safe to do so. And, in considering that, they 

will consider the safety of their passengers and their crews, and 

customer input on it. 

Mr. GRAVES [presiding]. Ms. Titus? 

Ms. TITUS. Thank you. I agree with you, I don’t want to sit next 

to you talking on your cell phone, so I appreciate that. 

We are just a little under 2 years away from the expiration of 

the FAA authorization. And given the recent history of the bill, it 

is not too early to start talking about it now, I don’t believe. 

I represent Las Vegas, and tourism is the life blood of our economy. Nearly 45 percent of the people who come to Las Vegas come 

through McCarran, which is the ninth busiest airport in the country. So we have got to have the infrastructure in place there to welcome them, speed them along, serve them effectively, efficiently, 

and in a friendly manner. 

When this legislation was considered before, issued capital investments and reforms to the passenger facility charges and the 

airport improvement program were the top of the list of things that 

were concerned. I know this will come up again for 2014. 

I wonder if, maybe starting with the Assistant Secretary and 

some of the rest of you weighing in, if you could tell us how those 

reforms are working, and if you are thinking about continuing 

them in the next bill, or if we might want to relook at that whole 

issue. 

Ms. KURLAND. In terms of passenger facility charges, in the 

President’s budget we have a proposed increase to $8. We—you 

know, also, the Federal Aviation Administration, through its airport office, is always very mindful, and always taking a look at how 

its—the capital improvement programs are working through AIP 

and PFCs, and I will be happy to work with the committee on this, 

going forward. 

Ms. TITUS. And some of the larger airports don’t feel like they 

benefit so much from that program and those charges, and would 

like to look at it from a different perspective. Is that—can somebody comment on that? 

34 

Ms. KURLAND. Yes. As part of the—getting a larger PFC, the 

larger airports would have already foregone a great deal of what 

they would have normally received under the AIP program. And if 

they were to receive a larger PFC, would forgo even more under 

the AIP program. They would like to have more autonomy and 

more control as to how to spend the funds. But perhaps Mr. Brewer—— 

Ms. TITUS. Thank you. 

Mr. BREWER. For the first time in many years, you have three 

airport—the AAAE, American Association of Airport Executives, 

Airports Council International North America, and there is a new 

organization called Gateway Airports. For the first time, all are in 

alignment on the PFC issue, of $8.50 per passenger, and periodically an escalation. 

Right now, the $4.50 PFC has the purchasing power of about 

$2.50, compared to what it was when it was initially implemented. 

The pressure on all of you to reduce costs on a national basis on 

the Federal budget is continuing. This gives local airports such as 

McCarran the ability to raise the funds that they need for PFC-approved—meaning AIP-eligible—projects, and implement them directly with local funds and local issue. 

Ms. TITUS. Yes, sir? 

Mr. CALIO. Prior to your arrival I addressed the PFC issue. Airlines for America’s members oppose any increase in the fee. Airlines and their passengers are already taxed too much. It is occurring again right now, probably today, as we speak. 

There are two Government studies that show if you increase the 

price by $1 of a ticket, demand goes down by 2 percent. These are 

GAO studies, they are not our studies. A $4 increase would be 

huge. You know, Las Vegas has suffered some diminution of service 

because of lack of demand. And particularly for flyers to your airport, very price-sensitive, and there is very little price elasticity. 

In terms of increasing the PFC, again, near-record amounts were 

contributed through PFCs to the Aviation Trust Fund in 2012. Airport revenues outside of PFCs are $23.9 billion. That is a record 

level. We don’t think there is a demonstrated need for the increase. 

And I think, if you are going to consider an increase, you have 

to look at the impact on airlines and on airline passengers. Airlines 

and our passengers are already paying 17 separate taxes and fees. 

It is over 20 percent of the cost of the ticket. That could be going 

up as soon as Saturday or Sunday, whenever the President signs 

the budget agreement, if it passes. And at some point you have got 

to look to other sources, not just the airlines and their passengers. 

Thank you. 

Mr. WYTKIND. May I offer a couple observations? We have looked 

at the financing issues. And one of the reforms that didn’t get 

adopted in the last bill was a long-term vision for how you fund 

what is largely a looming insolvency in our Aviation Trust Fund, 

in terms of really being able to deal with their needs. 

We haven’t endorsed a PFC increase yet. We think it is part of 

a larger conversation. We think we should make sure we understand the impacts that fees and taxes, whatever form they take, 

will have on airline travel, on revenues, on profits, and, by extenVerDate Aug 31 2005 12:06 Oct 28, 2014 Jkt 000000 PO 00000 Frm 00042 Fmt 6633 Sfmt 6633 P:\HEARINGS\113\AV\2013\12-12-~1\85900.TXT JEAN
35 

sion, on the jobs that we support and represent in the airline industry. 

And so, we think some of the compelling arguments made by our 

air carriers need to be very carefully considered as to what happens to demand, what happens to the pricing capability of the airlines, primarily because of what Mr. DeFazio said. I wish he was 

here. Because the lack of transparency means that a average consumer doesn’t even know why he or she is paying the price they 

pay because of the pile-on of various fees and taxes. 

And so, I think these need to be carefully looked at. Because our 

job is to represent the interests of our members. And so, what I do 

is I look at these things and figure out at what point are you harming air carriers? And, by extension, are you harming our workforce 

that we are duly, you know, elected to represent? And I think that 

is where the rub is, for us, to try to analyze this and understand 

it. 

Ms. TITUS. Thank you, Mr. Chairman. 

Mr. DAVIS [presiding]. The gentlelady’s time has expired. The 

Chair now recognizes the gentleman from Missouri, Mr. Graves, for 

5 minutes. 

Mr. GRAVES. Thank you, Mr. Chairman. And I just have two 

statements, and then I have to follow up with a question. But one 

statement was made earlier—and this is for—just a statement for 

the Deputy Director. Advocacy. When we removed advocacy, or 

when you all removed advocacy from the mission statement at the 

Department of Transportation, specifically the FAA, I think we 

took a giant leap backwards in terms of promoting aviation in this 

country, one of the greatest industries and one of the best aviation 

systems in the world. And I think that needs to be fixed. I think 

you are, obviously, a regulatory agency, but you are—also should 

be advocating for and promoting aviation, and I hope that you take 

that back. 

The second statement I want to make, too, because we have 

talked a little bit about PFC increases and the lack of money or 

stuff for AIP funds, and I tend to agree with Mr. Calio on the simple fact that, you know, we raided—we did keep the contract towers open, as Mr. Brewer pointed out. But we raided the AIP, or the 

Aviation Trust Fund. We raided it to keep those, and that was the 

worst thing we could have done, or Congress could have done. We 

took money away from capital improvement projects and put it into 

operating, and that was a bad mistake. It really, really was. 

Now, having said that, my question is for Mr. Bunce. And you 

kind of touched on it briefly in your opening statement, on some 

of the changes we could be making in particularly remote towers 

and all. And I am just curious, you know, how our airspace operating environment compares to other countries, in terms of size 

and complexity. 

And I also am going to give you a followup question with that, 

too, in how is UAVs going to play into this in the future. I mean 

I heard on the news the other day that Amazon wants to start 

making deliveries, you know, using UAVs straight to the home. 

And those things are flying in my airspace, which is a bit of a concern to me. 

36 

But, regardless, I am very curious, your thoughts on that, compared to other countries, and then how we integrate this in the future. 

Mr. BUNCE. Thanks, Chairman Graves. If we look north of the 

border, a lot of people have used Transport Canada as a model. So 

if you look at their fleet, about 33,000 airplanes, compared to about 

225,000 here. When you take movements, well less than about 5 

percent of movements up north of the border. 

If you look at their military, the last I checked they had four 

fighter squadrons operational out in Alberta and over in Quebec. 

You know, their military is one-fifth the size. So the need for airspace is not there. 

They are using remotely piloted vehicles up in the Arctic up 

there, but nowhere near the scale that we are talking about down 

here. That has actually now been mandated by Congress. 

And the other thing that I think we need to think about in our 

airspace is commercial space. What a great opportunity. I mean 

when could we have ever thought that we are actually delivering 

things to the Space Station using commercial vehicles now? But 

when we do a launch out of either the west coast or the east coast 

right now, the amount of airline traffic that Mr. Calio’s folks are 

forced to change their routing, how it affects general aviation, too, 

is very significant. And these launch windows are long. And then 

you talk re-entry time. That is significant. 

So, as we look at our system and compare it, let’s say, to Europe, 

they have tried to get single European skies together for many 

years now. It keeps getting slid to the right, because there is no 

political agreement to align the airspace, it is just a patchwork of 

each small country that in a jet you pass through within, you 

know, just a few minutes. I think we welcome the opportunity to 

compare ourselves with other countries, but there is no place like 

the United States and the amount of traffic and what potential we 

have to increase with that. Because if we actually do UAVs in the 

airspace, the biggest concern for all of us is that we keep it all safe, 

and we keep it deconflicted. 

So now you add to all those movements—now we have a manned 

aircraft, and try to put unmanned vehicles up there, we have got 

to be able to have somebody be able to see them. And for you and 

I flying in the airspace, seeing a small, little vehicle is almost impossible, when you are traveling at those speeds. We have to do 

that electronically. So NextGen has to bring that into play. 

So our system is—there is no comparison to anyplace else in the 

world. We have got to be very careful when we talk about making 

radical change. 

Ms. KURLAND. Congressman, may I just add one point? And this 

goes to the advocacy points that have been made. The FAA cannot 

do advocacy. But in the Secretary’s office, as long as we get clearance from the Commerce Department, we do do advocacy, and we 

have done a great deal of advocacy on behalf of our aviation companies. I would be happy to provide you some of that information, as 

well. 

Mr. GRAVES. I would love to have that information. But I got to 

tell you there is an attitude out there that a lot of—and I know 

the FAA has a regulatory job. I mean that is what they do. But 

37 

I have got to tell you out there, there is a strong sense by the pilot 

community, aviation community, all the businesses out there that 

surround aviation, that, you know, while there may be, you know, 

some advocacy going on, or should be some going on, there isn’t. 

It is all about regulatory issues, regulatory authority. And, you 

know, and the unfortunate part is there is a lot of people in the 

FAA that don’t understand aviation, or don’t know the first thing 

about aircraft or—you know, or what it takes to run an airline, or 

what it takes to run a business, or to fly an airplane. 

And that is probably the biggest problem that you have out 

there, particularly as we lose people within the FAA that have a 

knowledge or a background in aviation and replace them with people that have no background in aviation, whatsoever. It is getting 

worse and worse and worse. And as our pilot community tends to 

dwindle, you know, that is going to hurt the FAA, too, the Department of Transportation, because you are going to put yourselves 

out of business, as well. 

But that is a neutral comment. I have got a lot of issues with 

that. But I would very much appreciate you letting me know or my 

office know what you are doing, in terms of promoting aviation and 

advocacy. Thank you, Mr. Chairman. 

Mr. DAVIS. The gentleman’s time has expired. The Chair now 

recognizes the gentleman from Texas, Mr. Williams, for 5 minutes. 

Mr. WILLIAMS. Thank you, Mr. Chairman. And I want to thank 

all of you for being here today for this testimony. 

I am from Texas. We got a lot of airports in Texas. I am a business guy, a small business owner, and I have always been concerned with Government’s aggressive involvement with the private 

sector, often with negative results. 

My question would be to you, Ms. Kurland. It is clear, from your 

testimony, that DOT believes it has been a strong advocate for the 

U.S. airline industry. Indeed, one of Secretary LaHood’s—when he 

first came here, his first airline initiative was to establish the future of Aviation Advisory Committee to provide policy recommendations to ensure that we have an economically viable and globally 

competitive industry. 

Now, one of the recommendations, as I know you are probably 

aware, of the committee was for DOT to conduct an independent 

evaluation of the airline industry’s Federal tax burden. 

Now, as you may know, the aviation tax burden—we have talked 

about it today—has doubled since 1992, and now constitutes 21 

percent, or $61, of a typical $300 domestic round-trip ticket. Ironically, the administration included $5.5 billion in new and higher 

aviation taxes and fees in fiscal year 2014 in its budget proposal. 

And I can tell you that high taxes eventually will strangle a business. 

So, my question would be, has the assessment been conducted? 

And, if not, when do you plan to do so? 

And then, can you also explain how increasing the aviation tax 

burden on passengers and airlines by 25 percent makes the administration a champion of the industry? 

Ms. KURLAND. Thank you, Congressman. That was a very important recommendation from the Future of Aviation Advisory Committee. The recommendation recommended that we get an indeVerDate Aug 31 2005 12:06 Oct 28, 2014 Jkt 000000 PO 00000 Frm 00045 Fmt 6633 Sfmt 6633 P:\HEARINGS\113\AV\2013\12-12-~1\85900.TXT JEAN
38 

pendent source to conduct the inquiry. And we have been looking 

for one. And we think that the GAO would be a very good candidate to do such a study. And if perhaps, through your good offices, you could gauge their interest in performing such a study, we 

would be very appreciative of that, because we do think it is an important study, and the GAO would be a good entity to perform 

that. 

With respect to aviation taxes, no one likes taxes. It is. But the 

system is an expensive system. It is a system that needs to have 

a stable funding source. And the airlines and the passengers who 

are the primary beneficiaries are—you know, we want to balance 

the—this burden. 

As also has been mentioned, there is a certain portion of the 

funding of the aviation system that does come from the general 

fund. So it—the—excuse me—the approach of the administration is 

to be—to try and come up with a balanced approach to the taxation. 

Mr. WILLIAMS. Well, I appreciate the administration’s view on 

that. I, as a small business owner, sometimes realize—sometimes 

fewer regulations and fewer taxes kind of creates competition. And 

competition, in the end, benefits not only the business, but also 

the—in this case, the passenger. I would like for you to take that 

message back to the administration, have them start taking a look 

at fewer regulations, fewer taxes, to create competition and better 

service for the consumer. 

Ms. KURLAND. I will. Thank you, sir. 

Mr. WILLIAMS. We will try to help you with the GAO. 

Ms. KURLAND. Thank you very much, sir. 

Mr. WILLIAMS. Thank you. Yield back. 

Mr. DAVIS. Thank you. The Chair now recognizes Mr. Coble from 

North Carolina for 5 minutes. 

Mr. COBLE. I thank the chairman. Mr. Chairman, I apologize. I 

was tied up in Judiciary. So, hence, my belated arrival. But it is 

good to be with all of you. Good to have the witnesses before us. 

Mr. Bunce, let me start with you with what I regard as a feelgood question, which I hope will elicit a feel-good answer. How do 

you view the contributions of aviation to the economy and communities across our country, A. 

And is there a broader public benefit to aviation that policymakers in the administration and the Congress need to recognize 

in our respective funding and policy decisions? 

Mr. Bunce, first, and anyone else who wants to put their oars 

into these waters are welcome to do so. 

Mr. BUNCE. Well, thank you, Mr. Coble. And, as you said, aviation is just a crown jewel for this country. We are an aviation Nation. And the vitality of the entire aviation system—myself, as a 

general aviation pilot, represent general aviation manufacturers, 

we are all inner-related. So I want to see a very healthy airlines. 

I want to see a very healthy network of airports. 

And our tax policy is integral to be able to keep that healthy. But 

also, we need to recognize that, as we look at employment in this 

country in this aviation industry, it is truly significant. Just in general aviation alone, it is 1.2 million jobs. We have been hit hard 

during the down-turn. We haven’t asked for a bail-out. We have 

39 

been proceeding on board, and we rely on this committee—and I 

really think you all have done a very commendable job of trying to 

help us look at smart policy that can not only preserve the jobs 

that we have, but actually expand it, because we do have that capability. 

And this airspace system that we have in this Nation is one of 

those incubators for that. We talked about unmanned aerial vehicles just shortly a little while ago, a commercial space launch. But 

also, you look at the new technology that we are pumping into 

cockpits to be able to facilitate NextGen. 

As my colleague, Ed Bolen, pointed out earlier, it is not just 

ground infrastructure. We are providing amazing technology that is 

making people safer in the skies. And also, we are reducing our 

footprint environmentally. The new technology that we are putting 

up there just with engines alone, let alone the composite structures 

that we are putting for airframes, is significantly lowering our carbon footprint. 

And then you add that to these approaches that we have designed, we are really making significant gains. That is why our 

leadership is so vital. Ground infrastructure for ADS–B can allow 

us to do some things with separation that we never could do before 

with radars. That is why it was so important for us to try to 

prioritize and keep this on track. And we rely so much on you all 

to help the FAA along in that process. 

Mr. COBLE. Thank you, Mr. Bunce. And I hope that my next 

statement is inaccurate, but I fear that the average American citizen does not fully appreciate the contributions submitted by the 

aviation community. And I am appreciative to you for it. 

Anybody else want to be heard? 

Mr. BOLEN. Well, I would just say, Mr. Coble, it is clearly, internationally, that there are a lot of parts of the world that want to 

move to the center of the world’s aerospace stage, and they are investing heavily in their infrastructure, in their airlines, in their 

manufacturing base, because they recognize aerospace is a remarkable industry with a lot of high-tech, well-paying jobs that connects 

communities, it connects people, facilitates trade and commerce 

and jobs. 

And so, the rest of the world wants aerospace. We are currently 

wearing the crown. And I think that we, as a aviation community, 

and Congress, and the public ought to be aware of what we have 

and how we can preserve and enhance that so we retain that mantle of the world leader in every aspect of aerospace. Because the 

rest of the world wants what we have got. 

Mr. WYTKIND. Mr. Coble, may I? I just have one observation. 

The airline sector has been sort of an island for middle-class jobs 

in this country for the entire history of flight. And if you look at 

the quality of the jobs on the operating side, on the maintenance 

side, on the manufacturing side, and everything else in between, 

those jobs are jobs that elected officials and the private sector 

ought to be fighting to keep. 

And I am worried that if we do not rationalize our policies, if we 

do not look at the way in which, for example, we deal with taxes 

and fees, if we do not look at the way in which we regulate commerce, if we do not look at our trade policies to make sure we are 

40 

not creating a sort of a runaway flag of convenience model that is 

going to guide the future of the airline industry, then we find ourselves stuck in a situation where we will ravage yet another American industry that is an island for middle-class jobs, the way we 

have across most sectors of the economy, which is why we have 

been with many elements of the industry on issues involving tax 

and fee burdens. It is because we see that at some point the piggy 

bank doesn’t work any more, and you need to go somewhere else 

to find revenue to deal with the problems we have. 

And that is why we have been trying to cooperate with our employers, because of that island of middle-class jobs that we are trying to protect. 

Mr. DAVIS. The gentleman’s time has expired. 

Mr. COBLE. Yield back, thank you. 

Mr. DAVIS. The Chair now recognizes another gentleman from 

North Carolina, Mr. Meadows, for 5 minutes. 

Mr. MEADOWS. Thank you, Mr. Chairman. And I wanted to use 

just the first opening to thank the gentleman from North Carolina 

that just spoke. He is the dean of our delegation. When you use the 

term ‘‘gentleman,’’ Mr. Coble is really the epitome of that word. 

And we are going to really miss him when he retires at the end 

of this term. And I just wanted to go on record as thanking the 

gentleman from North Carolina. 

Mr. COBLE. If I may, Mr. Chairman, thank you for your generous 

comments. This may end up costing me. 

[Laughter.] 

Mr. DAVIS. The Chair agrees. 

Mr. MEADOWS. I am going to just close with just two points and 

two questions. Mr. Bunce, I would like to come to you and, the Assistant Secretary, if you would weigh in on this, as well. 

In 2003, Vision 100 was passed. In there it had a deadline for 

TSA to approve the repair station—the security rules for repair 

stations abroad. They missed that deadline. 

Then again, in 2007, as part of recommendations from the 9/11 

Commission, we passed it again. And that particular rule gave 

them a new deadline, of which they have missed again. The problem with that second issue is that it prohibited the FAA from certifying, if that was missed. 

And so now we are here some 10 years later without the TSA essentially making a ruling on that particular thing. And, Mr. Bunce, 

is that lack of issuing the security rule affecting manufacturing of 

some of our U.S. companies? 

Mr. BUNCE. Yes, sir. It is impacting us significantly. And if you 

really look at a situation where when DHS did not respond to the 

Congress, then the FAA was put in a position where they couldn’t 

authorize any new repair stations. So then we, as industry, were 

kind of made the lunchmeat in the middle of this argument of one 

agency not responding to the Congress appropriately. And, as you 

say, 10 years is just unacceptable. 

What we have seen in the process is if you cannot get your aircraft repaired throughout the places where this global industry 

flies, what happens? People don’t want to buy an aircraft that has 

an FAA certification on it. So, effectively, you are negatively impacting jobs here. And, actually, the rule is very simple. We work 

41 

very closely with our colleagues on the labor side of the House. It 

has been debated back and forth. And the rule, just to provide 

basic security mechanisms over there to make sure something nefarious isn’t put on an aircraft should be fairly simple. And we just 

cannot get it out of the administration. 

Mr. MEADOWS. So what you are saying is the lack of the TSA to 

make a rule in 10 years is affecting jobs. 

Mr. BUNCE. Absolutely. 

Mr. MEADOWS. OK. So can either of you, under any circumstance, 

figure out what is so complicated that, for the last 10 years, there 

wouldn’t have been this—because it sounds like it is even undermining our certification process, where other people look to have it 

certified in another country or without that, it sounds like it is undermining that. But at worst case, it is affecting manufacturing. Is 

there any possible scenario why that would be accepted? 

Ms. KURLAND. I can’t speak on behalf of DHS. I am sure that 

they are taking a careful look at it. But as you—— 

Mr. MEADOWS. I would say very careful, if it took 10 years. They 

are taking a very careful look at it. 

Ms. KURLAND. But as you noted, the FAA, without that, cannot 

issue any new certifications for foreign repair stations. And, from 

the FAA’s perspective, we will—you know, once that happens, we 

will only certify those stations where we know that we have the 

ability—— 

Mr. MEADOWS. OK. Can you put some pressure on the TSA? I 

know that is a different agency, but it is all under the executive 

branch. Can you put some pressure on them to make that, or 

should we have them in here for a hearing? 

Ms. KURLAND. Well, Congressman, we will go back and we will 

talk to them—— 

Mr. MEADOWS. So you will personally call—— 

Ms. KURLAND. I will personally call over to the TSA. But—and 

convey your comments. 

Mr. WYTKIND. Mr. Meadows, is it possible to offer an observation? Because we have been involved with this issue, too. We agree 

with you, that 9-plus years to get that regulation completed is completely unacceptable. What I want to caution, though, is that rule 

was put in—that legislation was put into effect with bipartisan 

support. We supported it, because we were concerned about the security risk of this massive outsourcing of foreign—of aircraft maintenance overseas. 

And, yes, they should have it done. It should have been done 

years ago. We are concerned, though, that the rule needs to meet 

high security standards, so that we don’t run into a situation where 

we are sending so much maintenance overseas, and it is being done 

under substandard security rules. 

But we completely join you in calling on the DHS to get this rule 

done. It is absurd that we are about to hit a decade—I was a much 

younger man when that legislation was passed, and we fought for 

it. But we didn’t fight for it so then the regulation sits for 10 years. 

So we agree that it needs to be finished. 

Mr. MEADOWS. Well, and I think at this point, if we don’t address 

is, Congress needs to act to go back the other way. And TSA needs 

to understand that. You know, I will close with this quote. There 

42 

is a quote out there that—I love the quote. No matter how beautiful the strategy, we must occasionally look at the results. And the 

results of this have not been effective. 

I yield back. 

Mr. DAVIS. The gentleman yields back. The Chair would now like 

to recognize for 5 minutes the gentlelady from Nevada, Ms. Titus. 

Ms. TITUS. Thank you, Mr. Chairman. As I listen to you, it seems 

that a theme which is emerging is kind of a lack of coordination. 

The Secretary at one point said, ‘‘Oh, that is the public relations 

division of FAA,’’ or, ‘‘That is DOT,’’ or, ‘‘You have got—that is 

Homeland Security,’’ or ‘‘That is TSA,’’ or ‘‘That is Commerce doing 

trade.’’ 

I wonder if you would start, Madam Secretary, addressing how 

you coordinate efforts within your agency, and then we might talk 

about how to improve them overall, so we can hope to some day 

get to an overall plan, like Mr. Wytkind said we need for aviation 

in this country. 

Ms. KURLAND. Well, thank you very much, Congresswoman. We 

do coordinate. There are two types of coordination that go out. We 

coordinate within DOT across our modes. And if I don’t particularly 

have a certain piece of information today, I will get it to you for 

the record. 

We also coordinate, on an interagency basis, on various activities. 

For example, in terms of exports. The idea of—we work closely 

with the Commerce Department, in terms of being able to advocate 

on behalf of U.S. transportation and U.S. aviation companies, 

where they are seeking to do business and get contracts in other 

countries. We work closely with the State Department in negotiating Open Skies agreements and in helping to resolve doing business issues on behalf of our carriers. So we do have ways of communicating with each other. I am sure they can always be improved, we would take back any suggestions or thoughts or ideas 

that you have. 

Ms. TITUS. Anybody else want to weigh in of what we can do to 

improve it, or what we, as Members of Congress, might do to help 

make that better? 

Mr. BUNCE. Congresswoman, I would just add that when this 

committee worked during the last Congress on, like, consistency of 

regulatory interpretation, all of us are affected, day in and day out, 

by regulators that come in and perhaps in one region of the country 

have a totally different interpretation of how this regulation should 

be applied than another. And to be able to have the FAA look at 

this holistically, try to make sense of the millions of pieces of guidance that are out there that—we have to repair aircraft, we have 

to operate them, we have to manufacture them and try to get a 

handle on that. This committee has been very helpful in trying to 

put pressure in that regard. 

When we go and even work in the stovepipes that exist within 

the bureaucracies, and let’s say we manufacture an aircraft that 

can work up at the high-altitude airspace, and we manufacture to 

a standard that the FAA says, ‘‘Yeah, it is good to go,’’ they bless 

it, but then it goes over to the other part of the FAA that deals 

with the operators—and this is actually within the same directorate within the FAA—and we have to reprove again that the 

43 

plane can do what one part of the FAA already blessed it to do— 

that is inefficiencies in the system. 

And so, with your help, we try to emphasize this, put pressure 

on it. And then, as Mr. Calio said earlier today, metrics become 

very important. The more metrics that we are able to produce, 

agree on, and then be able to report back to you, we can actually 

establish whether we are making progress. 

Mr. WYTKIND. I have one observation I want to make. The 

Obama administration has been incredibly proactive in working 

with the labor movement in the aviation trade arena, which is an 

important issue that has been raised in this hearing today. And the 

amount of input we have to make sure that aviation workers are 

at the table, and that their concerns and their rights and their jobs 

are being considered by those that negotiate trade policy in the 

aviation sector, has been incredibly good. 

And that is why we are worried about TTIP and jamming aviation into those broad trade talks, because we have a lot of faith 

that the State Department and the Transportation Department understands what is at stake when you open markets abroad, and understands that the needs and the rights and the jobs of middleclass workers in this country have to be at the table, and we are 

worried that they won’t be. 

So, I want to say, for the record, there has been a lot of backand-forth about some of the problems with DHS and with the DOT 

and other agencies. But I have to tell you. On the aviation trade 

issues, they have worked very, very closely, and have made it very 

clear that the rights and the jobs of middle-class workers in this 

country are at the table, and we are there to protect them. 

Ms. TITUS. OK. I guess it is not as bad as I thought it was. 

Mr. DAVIS. The gentlelady yields back. First off, thank you to the 

panel. As a freshman who is sitting here, I learned early that I 

would rather give time to everyone else to ask their questions instead of jumping in mid-term, so you have got one more to put up 

with me. 

And I want to start by asking Assistant Secretary Kurland for 

a response. I am hearing that reports are—I am seeing in some reports that—we all know that the FCC has a very important meeting this afternoon regarding passenger usage of cell phones in 

flight. But I am seeing reports that DOT may actually preempt 

that decision. Can you confirm or deny that that may be taking 

place? And what might that decision be? 

Ms. KURLAND. It is my understanding, Congressman, that the 

FCC is, in fact, having a public meeting today, in which they may 

be taking a vote in order to go—whether or not to go forward with 

a rulemaking on the use of certain types of equipment. 

The only thing that I can comment on from the FAA perspective 

would be that the FAA would take a very careful look at any safety 

implications, whether it is from avionics interference or from cabin 

safety. So—but, like, this—the first step right now is for the FCC 

to be having—they are having this meeting today. 

Mr. DAVIS. So the FCC is having the meeting, yes. But the reports are that DOT is going to preempt them with a decision. Is 

that—— 

44 

Ms. KURLAND. I am going to have to look into that, and I will 

provide you an answer for the record. I don’t have that information. 

Mr. DAVIS. How long will it take? 

Ms. KURLAND. As quickly as I can. 

Mr. DAVIS. OK. 

Ms. KURLAND. As soon as I get back to the office, I will—— 

Mr. DAVIS. I will ask a few more questions. If your staff could 

kind of text their folks over at DOT and maybe get a response, that 

would be great. We would very much appreciate it. I mean we are 

on the—we are very concerned about what is going to happen with 

the FCC decision today. And seeing reports that DOT may actually 

already have a decision made, I guess the question that I need answered is, is it inevitable that you are going to actually make a decision that would or could affect whatever comes out of the FCC? 

Ms. KURLAND. As I say, I will have to check that. You may have 

more information right now than I do. 

Mr. DAVIS. OK. We will come back. Mr. Bunce, first off, thank 

you for being here. I think this committee has been a model for bipartisanship and working together to find solutions. An example of 

this, obviously, is the Small Airplane Revitalization Act, which was 

signed into law this year, and focuses on streamlining the small 

aircraft certification standards. The sooner these new Part 23 

standards are in place, the better it will be for all of our aviation 

community, especially general aviation community, and our economy. 

I guess my question is, from your perspective, what can be done 

to facilitate the FAA’s development and implementation of this 

Act? 

Mr. BUNCE. Well, thank you, Mr. Davis, and thank you very 

much for your cosponsorship of that important legislation. That 

was substantive for us. 

And I just want to let you know the impact. I was in Cologne 

at EASA, which is roughly FAA equivalent over there. And because 

of the effort of the Congress that started here, in this committee, 

actually, EASA has said that is one of their number-one rulemaking programs, going forward. So they call it CS–23, we call it 

Part 23 over here, but this is truly global rulemaking. 

We had eight different countries participate in that rulemaking 

process, but we were very worried during that that certain elements within the bureaucracy would start to parse it up and break 

it up, and we wouldn’t have the game changing effect that it will 

have now, because of your help. How do we make this actually happen over the next 2 years to try to get the FAA to deliver it is actually just, we think, having this committee very engaged in saying, 

‘‘OK, what is the progress to date.’’ 

If we get this right, now we can expand this to rotocraft and then 

Part 25 transport category aircraft. So it is just not stand-alone. 

We are not just talking about aircraft below 12,500 pounds. In 

rotocraft right now, we have to modernize the regulations. Because, 

to keep them safe, we are having too many accidents, because we 

are not properly able to use new technology to keep pilots safe. So 

we can extend this if we do it right. But this is fundamental. 

45 

Mr. DAVIS. Well, thank you. And, I mean, obviously, keeping the 

committee engaged is a priority. But do you foresee any other problems in meeting the December deadline in 2015? 

Mr. BUNCE. Having worked with the FAA, there could always be 

problems, sir. But we are going to report back to you if we see any 

problems in the process. 

Mr. DAVIS. Well, thank you. Mr. Brewer, thank you for being 

here today. I appreciated your testimony with respect to protecting 

our contract towers. These cost-effective partnerships, they promote 

safety and are absolutely critical to small communities and many 

of the small airports that I represent. 

There are a number of great contract towers in my district. We 

have Bloomington, Decatur, and, actually, Bethalto, St. Louis Regional Airport. And, in fact, Carl Olson, who is the executive director at the Bloomington Airport, just contacted us the other day and 

let us know they received another perfect score from the FAA on 

their safety inspection. 

The question I have for you—I am confident Congress is going 

to keep working together on this, but what can be done in the near 

and the long term to promote and protect the contract tower program? 

Mr. BREWER. I just want to say thank you for bringing this up 

again, because it is such an important and cost-effective way to 

maintain safety throughout the system. And, as you indicated some 

of the contract towers in your own district, there is 252 of these 

contract towers in 46 States and 4 territories around the country; 

28 percent of all of the tower operations go through the contract 

tower program. 

I think the funding of it needs to be maintained. And, as we look 

forward to the new FAA reauthorization bill, ensuring that that 

program is protected, I think, is key. 

Mr. DAVIS. Well, thank you, and I couldn’t agree more. Mr. Calio, 

you knew I wouldn’t forget you. 

Hey, I have got a great workforce training facility at one of my 

community colleges in Springfield, Illinois, Lincoln Land Community College, where they are training aviation mechanics for the future. And by 2016, reports are that one-third of the aviation workforce is going to be eligible to retire. 

Besides the facilities like Lincoln Land Community College’s program, what can this committee do, in your opinion, to help prepare 

for that future, and bring more individuals into the workforce in 

aviation? 

Mr. CALIO. Well, Congressman, you identify a significant problem. Mr. Wytkind referenced it before, I think, and it is not just 

machinists and other airline workers, it is the air traffic controllers, as well. 

And, candidly, I think the best thing that this committee could 

do would be to take today’s hearing and use it as a springboard to 

look holistically at the entire industry and what needs to be done 

to let us maintain our world leadership and make us more competitive. Because we do have problems, we do have challenges. Particularly on a global basis across the board, we all are challenged. 

46 

And so, if you can continue your work and make it serious, and 

produce the kind of results you had previously on WRRDA, on the 

certification bill, that would be it. 

Mr. DAVIS. Thank you. Mr. Wytkind? 

Mr. WYTKIND. Thank you for that question. The only thing I 

would offer is that, first of all, the machinists union has a partnership with at least one, if not more, high schools that train future 

mechanics. I will send more formally to the committee information 

about that program. It might be one that the committee might look 

at as a way to expand training. 

But I do think this outsourcing problem, where we now have onethird of—excuse me, 70 percent of all maintenance is outsourced in 

the airline industry, more than a third goes overseas, we are creating disincentives for people to even want to become airline mechanics in this country, because the jobs are going overseas. 

So I think, if we connect the dots, you have got a public policy 

challenge of making sure we keep the level playing field, that we 

don’t incentivize outsourcing abroad, but at the same time we have 

the shortage looming. Well, you can’t ignore—those two points are 

related. 

And so, I think, as we go forward, we are going to be offering 

some suggestions about workforce training issues that apply to not 

only mechanics, but to pilots, to air traffic controllers, to other FAA 

workers. And I am looking forward to working with you on that. 

I think it is an area where we can find some bipartisan support 

and agreement. 

Mr. DAVIS. I agree. Thank you. Assistant Secretary Kurland, any 

new news? 

Ms. KURLAND. I understand that the press is making statements, 

but I will have to go back to the Department and we will have to 

get back to you and report back to you on that, sir. 

Mr. DAVIS. OK, because I am told that another committee—at a 

committee hearing today the FCC chairman said the DOT was 

working on a rule to regulate voice calls. And I guess it perplexes 

me—— 

Ms. KURLAND. I don’t know. 

Mr. DAVIS [continuing]. To know that something is going on with 

DOT and this committee can’t get the same answers that another 

committee can. 

Ms. KURLAND. And I apologize, but I don’t have that information 

at my fingertips. But I will get back to you. Maybe I do. 

Mr. DAVIS. You want to say something? 

Ms. TITUS. Thank you, Mr. Chairman. I just—— 

Ms. KURLAND. We will be making a statement later today, and 

we will make sure that we get it to you. Thank you. 

Ms. TITUS. Well, Mr. Chairman, I am just reading here, it came 

out 6 minutes ago. ‘‘U.S. Carriers, FCC Reach Accord on Unlocking 

Cell Phones. FCC chairman, Tom Wheeler, said before Members of 

Congress that an agreement was reached between the carriers and 

the agency, and details will be presented at the FCC meeting later 

on. The agreement would ensure that providers notify,’’ et cetera, 

et cetera. So apparently, you are right, Mr. Chairman. 

Mr. DAVIS. Thank you. 

47 

Mr. CALIO. If I could just clarify, I believe—in terms of carriers, 

so nobody misunderstands—that would be the cell phone carriers, 

not the airline carriers. 

Mr. DAVIS. Thank you for that clarification, Mr. Calio, and thank 

you. And, Ms. Kurland, if you could have your staff get back to my 

office with a—as soon as this is made public, so that we can be 

aware, and let our constituents know, and also let the rest of this 

committee know, I would sincerely appreciate it. 

Ms. KURLAND. We will certainly do that, sir. And thank you for 

your patience. 

Mr. DAVIS. Well, thank you. And I guess I will end by saying 

does anyone have any comments on this cell service issue? I am 

happy to take them now. Otherwise, we will adjourn the hearing. 

[No response.] 

Mr. DAVIS. Seeing none, this hearing is adjourned. 

[Whereupon, at 12:28 p.m., the subcommittee was adjourned.] 

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