```

[House Hearing, 114 Congress]
[From the U.S. Government Publishing Office]

    FEDERAL AVIATION ADMINISTRATION REAUTHORIZATION: REFORMING AND 
       STREAMLINING THE FAA'S REGULATORY CERTIFICATION PROCESSES

=======================================================================

                                (114-1)

                                HEARING

                               BEFORE THE

                              COMMITTEE ON
                   TRANSPORTATION AND INFRASTRUCTURE
                        HOUSE OF REPRESENTATIVES

                    ONE HUNDRED FOURTEENTH CONGRESS

                             FIRST SESSION

                               __________

                            JANUARY 21, 2015

                               __________

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             COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE

                  BILL SHUSTER, Pennsylvania, Chairman
DON YOUNG, Alaska                    PETER A. DeFAZIO, Oregon
JOHN J. DUNCAN, Jr., Tennessee,      ELEANOR HOLMES NORTON, District of 
  Vice Chair                             Columbia
JOHN L. MICA, Florida                JERROLD NADLER, New York
FRANK A. LoBIONDO, New Jersey        CORRINE BROWN, Florida
SAM GRAVES, Missouri                 EDDIE BERNICE JOHNSON, Texas
CANDICE S. MILLER, Michigan          ELIJAH E. CUMMINGS, Maryland
DUNCAN HUNTER, California            RICK LARSEN, Washington
ERIC A. ``RICK'' CRAWFORD, Arkansas  MICHAEL E. CAPUANO, Massachusetts
LOU BARLETTA, Pennsylvania           GRACE F. NAPOLITANO, California
BLAKE FARENTHOLD, Texas              DANIEL LIPINSKI, Illinois
BOB GIBBS, Ohio                      STEVE COHEN, Tennessee
RICHARD L. HANNA, New York           ALBIO SIRES, New Jersey
DANIEL WEBSTER, Florida              DONNA F. EDWARDS, Maryland
JEFF DENHAM, California              JOHN GARAMENDI, California
REID J. RIBBLE, Wisconsin            ANDRE CARSON, Indiana
THOMAS MASSIE, Kentucky              JANICE HAHN, California
TOM RICE, South Carolina             RICHARD M. NOLAN, Minnesota
MARK MEADOWS, North Carolina         ANN KIRKPATRICK, Arizona
SCOTT PERRY, Pennsylvania            DINA TITUS, Nevada
RODNEY DAVIS, Illinois               SEAN PATRICK MALONEY, New York
MARK SANFORD, South Carolina         ELIZABETH H. ESTY, Connecticut
ROB WOODALL, Georgia                 LOIS FRANKEL, Florida
TODD ROKITA, Indiana                 CHERI BUSTOS, Illinois
JOHN KATKO, New York                 JARED HUFFMAN, California
BRIAN BABIN, Texas                   JULIA BROWNLEY, California
CRESENT HARDY, Nevada
RYAN A. COSTELLO, Pennsylvania
GARRET GRAVES, Louisiana
MIMI WALTERS, California
BARBARA COMSTOCK, Virginia
CARLOS CURBELO, Florida
DAVID ROUZER, North Carolina
LEE M. ZELDIN, New York

                                CONTENTS

                                                                   Page

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

                               WITNESSES
                                Panel 1

Ray Conner, President and Chief Executive Officer, Boeing 
  Commercial Airplanes, The Boeing Company:

    Testimony....................................................     5
    Prepared statement...........................................    51
    Responses to questions for the record from Hon. Bill Shuster, 
      a Representative in Congress from the State of Pennsylvania    56
Aaron Hilkemann, President and Chief Executive Officer, Duncan 
  Aviation:

    Testimony....................................................     5
    Prepared statement...........................................    60

                                Panel 2

Gerald L. Dillingham, Ph.D., Director, Physical Infrastructure 
  Issues, U.S. Government Accountability Office:

    Testimony....................................................    30
    Prepared statement...........................................    66
    Responses to questions for the record from the following 
      Representatives:

        Hon. Bill Shuster of Pennsylvania........................   102
        Hon. Daniel Lipinski of Illinois.........................   104
        Hon. Richard L. Hanna of New York........................   107
        Hon. Todd Rokita of Indiana..............................   109
Hon. Christopher A. Hart, Acting Chairman, National 
  Transportation Safety Board:

    Testimony....................................................    30
    Prepared statement...........................................   110
    Responses to questions for the record from Hon. Daniel 
      Lipinski, a Representative in Congress from the State of 
      Illinois...................................................   122
Dorenda Baker, Director, Aircraft Certification Service, Federal 
  Aviation Administration:

    Testimony....................................................    30
    Prepared statement...........................................   123
    Responses to questions for the record from the following 
      Representatives:

        Hon. Todd Rokita of Indiana..............................   131
        Hon. Elizabeth H. Esty of Connecticut....................   134

                       SUBMISSIONS FOR THE RECORD

Hon. Peter A. DeFazio, a Representative in Congress from the 
  State of Oregon, request to submit to the record the written 
  testimony of the Professional Aviation Safety Specialists 
  (PASS).........................................................   135

                        ADDITIONS TO THE RECORD

Aeronautical Repair Station Association, statement for the record   143

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

 
    FEDERAL AVIATION ADMINISTRATION REAUTHORIZATION: REFORMING AND 
     STREAMLINING THE FEDERAL AVIATION ADMINISTRATION'S REGULATORY 
                        CERTIFICATION PROCESSES

                              ----------                              

                      WEDNESDAY, JANUARY 21, 2015

                  House of Representatives,
    Committee on Transportation and Infrastructure,
                                            Washington, DC.
    The committee met, pursuant to call, at 10:05 a.m., in Room 
2167, Rayburn House Office Building, Hon. Bill Shuster 
(Chairman of the committee) presiding.
    Mr. Shuster. The committee will come to order. Good 
morning. Happy New Year to everybody. The committee has not 
formally organized, so we have to start off in asking for 
unanimous consent to conduct today's hearing under the rules of 
the committee under the 113th Congress, and without objection, 
so ordered. Hopefully our colleagues, Mr. DeFazio and others 
will in the next week or so, be ready to come together and----
    Mr. DeFazio. Better organized on the day.
    Mr. Shuster. OK. Great. And I know we have some new members 
on the committee, and you know what, I need a list of our 
members because we have got quite a few. I see many of them 
here today. Do you have your----
    Mr. DeFazio. We have one new member here today. That will 
be it. You would like me to----
    Mr. Shuster. Yeah, please.
    Mr. DeFazio. OK.
    Mr. Nolan. Jared.
    Mr. DeFazio. Well, Jared is not here.
    Mr. Nolan. He is new on the committee.
    Mr. DeFazio. I know, but he is not here, so we aren't going 
to recognize him. Those who show up get rewarded, and those who 
don't.
    Mr. Chairman, we have actually two new members, at the 
insistence of Mr. Nolan. Jared Huffman who is not here, so I 
won't go on about him, but I served with him on the Resources 
Committee, and he is very solid and will be a great contributor 
to the committee, and Julia Brownley who represents the smaller 
port of southern California, but yet a very important area and 
represents Ventura and that area around there and was also 
formally in the State assembly for was it----
    Ms. Brownley. Six years.
    Mr. DeFazio. Six years. And so we are looking forward to 
her contribution, and a major focus for her will be intermodal 
and port activities.
    Mr. Shuster. Well, thank you, and welcome to the committee. 
Also, I will introduce our new members to the committee 
starting with the gentleman from North Carolina, Mr. Rouzer, 
who has been on Capitol Hill before, so he has seen a couple of 
tours of duty here and other jobs on the Hill in other 
capacities, so I would like to welcome him. Mrs. Walters is not 
here today. She is from southern California. Mrs. Comstock, 
Barbara Comstock is from northern Virginia. Mr. Curbelo, and 
you know I know his first name but go and refresh me. What is 
his first name?
    Carlos. Yes, I knew it began with a ``C,'' but--Carlos 
Curbelo from the Miami area. Our senior new member is Mr. 
Woodall, Rob Woodall from Georgia, suburbs of Atlanta and the 
hinterlands of Georgia who have got some water issues. Mr. 
Rokita from Indiana, Mr. Katko from New York, upstate New York, 
I believe the Syracuse area. Mr. Babin, Brian Babin----
    Dr. Babin. Babin.
    Mr. Shuster. Babin, I am sorry. Doc is easier. From Texas, 
what part of Texas exactly?
    Dr. Babin. Woodville, Texas.
    Mr. Shuster. Woodville, Texas.
    Dr. Babin. Just northeast of Houston.
    Mr. Shuster. OK. Cresent Hardy, who is from the entire 
State, I think, of Nevada, or 80 percent of it. That is 
correct, isn't it, Mr. Hardy?
    Mr. Hardy. About 70 percent, yeah.
    Mr. Shuster. Who is next to you? I can't see the name.
    Mr. Hardy. Costello.
    Mr. Shuster. I should know that, Ryan Costello. He is from 
the Philadelphia Eagles part of the fan base of Pennsylvania. I 
am from the Pittsburgh side, so hopefully we can come together 
on the committee here.
    Mr. Garret Graves from Louisiana. What part of Louisiana?
    Mr. Graves of Louisiana. Baton Rouge.
    Mr. Shuster. Baton Rouge, that is what I thought. And I 
believe that is it. So we got a big new lineup here. I am 
looking forward to working with all of you.
    And today again, I want to welcome our witnesses for being 
here today. Mr. Conner, Mr.--how do you pronounce that, 
Hilkemann? Did I get it right?
    Mr. Hilkemann. Hilkemann.
    Mr. Shuster. Hilkemann. OK. I can see the ``L'' there. I 
don't have my glasses on, so.
    Again, welcome today. I am glad you are here with us today, 
and today's hearing is on ``Federal Aviation Administration 
Reauthorization: Reforming and Streamlining the FAA's 
Regulatory Certification Processes,'' which I know you two have 
a lot to say about that.
    The current FAA authorization is set to expire at the end 
of September, and passing a new bill that helps lay the 
groundwork for the future of U.S. aviation is a top priority 
for this committee.
    I look forward to hearing about the progress the FAA has 
made to streamline the certification process since the last FAA 
bill was signed into law as well as areas that witnesses 
believe are in need of additional reform.
    I think everyone here today understands the important role 
that aviation plays in our Nation's economy. Aviation 
manufacturing is at the heart of American leadership in 
aviation and high technology. This vital industry contributes 
billions of dollars and supports millions of jobs in our 
country's economy and is our leading export sector.
    Today we are discussing FAA regulation, regulatory 
certification processes which have significant impacts on our 
Nation's ability to innovate, manufacture, export, operate, and 
maintain the very safest products in an increasingly 
competitive global market. The FAA is responsible for ensuring 
every aircraft in our skies is safe, and that those that 
maintain and fly those aircraft are well-qualified and well-
trained.
    Besides assuring the safety of aircraft, our certification 
system must be efficient, rational, and must be applied in a 
consistent and fair and transparent manner. Too often we are 
seeing unnecessary regulatory burdens that do not serve to 
improve actual aircraft safety. It seems to be a process simply 
for the sake of process.
    We are seeing inconsistent interpretations of applications 
for a number of FAA policies and regulations. In fact, I have 
heard cases where from region to region it is different, from 
office to office it is different, and within even offices, 
inspectors see things in a different way. We have got to make 
sure that doesn't happen.
    Products and technology that can actually enhance aircraft 
safety are often caught in a bureaucratic maze substantially 
delaying their implementation and the realization of safety 
benefits. I have heard concerns that our certification 
processes are much slower than in other countries, resulting in 
American companies being placed at a disadvantage to their 
foreign competitors who have a more streamlined process to get 
their products certified in the market.
    While U.S. commercial aviation is the safest in the world, 
we must also ensure that our safety regulations and the 
processes they go through are effective, consistent, and keep 
pace with the modern marketplace. The FAA is the gold standard 
for aviation safety. It is a big part of what makes this 
country the global leader in aviation. We cannot let American 
leadership slip away or be squandered away because of 
regulatory processes that are overly burdensome, unnecessarily 
cumbersome, and inconsistently applied and out of sync with a 
changing world.
    As aviation stakeholders innovate and seek to compete in a 
fast-paced marketplace, it is important that the FAA's 
standards keep pace. Instead of being the unquestioned global 
leader in bringing innovative products to market, the United 
States sometimes lags behind the rest of the world in the 
introduction of new technology. Given the concerns we have 
heard about the FAA's certification processes, we are looking 
to our witnesses to hear if there are additional reforms and 
streamlining efforts needed in the next FAA reauthorization and 
to ensure that our certification processes guarantee the safety 
of our system while not inhibiting aviation growth.
    With that, I now yield to the ranking member, Mr. DeFazio.
    Mr. DeFazio. Thank you, Mr. Chairman. Mr. Chairman, I am 
pleased to be here today and begin the focus of this committee 
for FAA reauthorization on the certification process. Twenty-
eight years on this committee and I have seen a lot of changes. 
One, I just like to recall, because it points to the balance in 
the certification process, and that is, when I was early on the 
committee, I always thought that the old rule is basically 
going back to the CAB days where the FAA was charged with both 
promoting and regulating the industry in the interest of public 
safety were in conflict, and I was assured time and time again 
they weren't. In fact, in the 1996 FAA reauthorization, my 
amendment to strip them of the promotional authority was 
defeated.
    A little later that year, a ValuJet went down, and we found 
that because this was essentially a lack of oversight and 
accountability with a contractor to a subcontractor, that 
people had died, and oddly enough, in those days we followed 
the rules, but somehow they found, even though my amendment had 
been defeated and was in neither the Senate nor the House bill, 
I got a call saying where can we put it in the bill. And we put 
it in the bill, and we stripped virtually all of the 
promotional, you know, rules and regulations pertaining to the 
FAA from the bill to make it clear that they are an agency that 
regulates in the interest of the public and public safety, and 
that brings us here today.
    Certification. It is critical. We have been, as the 
chairman said, and should and hope to continue to be the gold 
standard in terms of the safety in the industry. We have been 
the world leader in terms of innovation, and we need to balance 
these things as well and as best as we can. You know, I have 
very little patience for repetitive work, bureaucracy. We need 
a system that is risk-based, that sets proper prioritization, 
but it has to also be robust and faultless, and I don't think 
we are quite at that point on either side.
    You know, I am going to ask unanimous consent to put in the 
record, and I would actually recommend it to members because of 
the testimony, I read all of it today, it is the most 
meaningful, it is from PASS [Professional Aviation Safety 
Specialists], and they talk about problems with staffing. We 
can't pretend that we don't need to oversee the process even 
when we delegate, but more and more that is becoming the 
virtual reality. On the other hand, we can certainly do better 
on the agency level in terms of not going through repetitive 
processes.
    Again, just ancient history, and I am sure this doesn't go 
on anymore, but many years ago I was visiting a manufacturer 
who made the film that goes inside the hull, essentially of the 
wallpaper in the airplane, and it had passed the flammability 
standards, and I said that is great, and they said, yeah, but, 
you know, we have to do it for every type. And I said, what do 
you mean for every type, and they said, well, you know, like 
737-200, 737-300, 737-400. I said it is all the same hull, it 
is all the same interior, it is all the same flammability 
standard. They said, yeah, I know, but that is not the way the 
FAA does it.
    I hope that doesn't go on today. That is nonsensical. We 
need to focus on new technologies. We need to focus on things 
that aren't repetitive, things that are risk-based, that, you 
know, that promote real, you know, potential threats to the 
integrity and the airworthiness of our aircraft.
    I also note in the testimony, and I will get into it with 
GAO, that I believe that there are some barriers being 
artificially created by our friends in the EU and elsewhere 
where they use their processes to disadvantage American 
manufacturers and advantage their own, or in the case of the 
Chinese, where they basically ask you to give them every single 
technical detail and proprietary bit of information on how 
something was produced but don't worry, they won't copy it 
before they will certify it, and I don't believe that the FAA 
has pushed back hard enough against some of these other, you 
know, foreign civil aviation authorities in the EU and 
elsewhere to give us a level playing field, and that is 
something else that warrants examining.
    Thank you, Mr. Chairman.
    Mr. Shuster. Thank you, Mr. DeFazio. And with that, I want 
to introduce our two witnesses today: Mr. Ray Conner, who is 
the president and CEO of Boeing Commercial Airplanes, The 
Boeing Company; and Mr. Aaron Hilkemann, I got it right that 
time, who is the president and CEO of Duncan Aviation. With 
that, Mr. Conner, I want you to go ahead and start off with 
your testimony.

TESTIMONY OF RAY CONNER, PRESIDENT AND CHIEF EXECUTIVE OFFICER, 
  BOEING COMMERCIAL AIRPLANES, THE BOEING COMPANY; AND AARON 
   HILKEMANN, PRESIDENT AND CHIEF EXECUTIVE OFFICER, DUNCAN 
                            AVIATION

    Mr. Conner. Thank you, Chairman Shuster. Chairman Shuster, 
Ranking Member DeFazio, members of the committee, thank you for 
this opportunity to provide Boeing's perspective as you begin 
the process of developing legislation to reauthorize the 
Federal Aviation Administration. I am Ray Conner, president and 
chief executive officer of Boeing Commercial Airplanes. It is 
an honor to be here to represent 80,000 Boeing Commercial 
Airplane employees and the world's largest commercial airplane 
manufacturer.
    Mr. Chairman, I have longer remarks that, with your 
permission, I would like to submit for the record. My remarks 
this morning focus on the FAA's ongoing effort with the support 
of Congress to modernize the airplane certification process. 
They also address the importance of continuing this effort to 
both aviation safety and American aerospace competitiveness. 
Before I address that important topic, I want to make a couple 
general observations about the industry's shared commitment to 
safety.
    Any discussion of U.S. aviation regulation should begin 
with this very important fact: Travel on a large commercial jet 
is the safest form of transportation in human history. More 
than 8 million people board airplanes daily and arrive safely 
at their destinations. While there have been some high-profile 
air tragedies of late, flying today is several orders of 
magnitude safer than it was 50 years ago.
    In the U.S.A. today, a fatal accident occurs less than 1 
out of every 45 million flights. This is an extraordinary 
safety record. It is a great accomplishment for the aviation 
industry and its regulators, and we have a shared commitment, 
one that is deeply embedded in the culture of our company to 
continue to improve. The FAA's regulatory system and oversight 
efforts have, of course, been critical pillars of modern 
aviation's extraordinary safety record. The FAA certifies all 
Boeing's airplane designs, our production system, and each 
airplane that comes off our production lines in Washington 
State and South Carolina.
    The FAA's regulatory approach has necessarily adapted over 
time in an effort to ensure that its resources are deployed 
where they can most effectively contribute to safety in a 
rapidly growing and technologically complex industry. The FAA 
will need to draw upon this tradition of robust and efficient 
risk-based oversight in the decades ahead as air travel 
continues to grow.
    The last 5 years have been a great example of how Boeing 
and our industry are expanding. Since 2010, we have increased 
our production in our factories by 56 percent to meet the 
strong demand for our products. In 2014, we delivered 723 
airplanes to our customers, and we have announced further rate 
increases in our production, and we expect growth in our 
industry will continue due to rising demand here and abroad.
    To stay ahead of the competition, Boeing will bring several 
new products to market in the next few years. They include the 
787-10, the 737 MAX family, and the 777X. Each of these new 
airplanes will further improve fuel efficiency and provide 
other benefits to our customers and the flying public.
    The introduction of each airplane will also improve 
aviation safety as newer and safer airplanes, with enhanced 
safety technologies, replace older airplanes in the fleet. Of 
course, each airplane will have to be certified by the FAA, and 
the large volume of this work poses a significant challenge for 
the agency. To meet the challenge, the FAA will need to 
continue its work to modernize its certification process. This 
will ensure it is making optimal risk-based decisions to deploy 
its resources in a way that maximize safety benefit and that 
simultaneously enable industry to efficiently introduce new, 
safe, and compliant products.
    One of the important tools that the FAA has at its disposal 
is Organization Designation Authorization, or ODA. My written 
statement includes detailed information about ODA. The point I 
want to stress here is that ODA has served the FAA, our 
industry, and most importantly, the flying public very well.
    Mr. Chairman, it was gratifying to see the committee 
recognize the value and the importance of ODA in section 312 in 
the last FAA reauthorization bill. As you know, this provision 
directed the FAA to consult with the industry to determine ways 
to enhance the effective use of delegation, and to consider 
process reforms and improvements to the certification process. 
The FAA has made progress since the last reauthorization, and I 
am grateful for the agency's leadership in driving those 
improvements.
    As I mentioned in my written testimony, there are three 
areas where Congress could continue to support these efforts: 
Accelerating the full use of ODA authority, developing and 
training the FAA workforce, and increasing international 
harmonization and certification standards.
    Mr. Chairman, I really appreciate the committee's support 
of the FAA's efforts to modernize the certification activities, 
and with the leadership of Administrator Huerta and the Members 
of Congress, I am confident that together we will tackle the 
challenges I have described, and I want to just thank everyone 
for the opportunity to be here today, and I am glad to answer 
any questions that you might have.
    Mr. Shuster. Well, thank you very much, Mr. Conner.
    And with that, we will turn to Mr. Hilkemann so you can 
proceed with your testimony.
    Mr. Hilkemann. Chairman Shuster, Ranking Member DeFazio, 
Aviation Subcommittee Ranking Member LoBiondo--excuse me, 
Larsen is the ranking member. Aviation Subcommittee Chairman 
LoBiondo, distinguished members of the committee, I would like 
to just talk a little bit about Duncan Aviation. We are a 
family-owned business. We began in 1956. We are based in 
Lincoln, Nebraska.
    Mr. Shuster. Can you pull your mic closer to you?
    Mr. Hilkemann. Sure. We have over 2,000 employees, 
including over 500 veterans. We have three major facilities, 
Lincoln, Nebraska, Battle Creek, Michigan, and Provo, Utah. We 
have 18 satellite facilities around the country. Approximately 
25 percent of our business is from the international foreign 
registered aircraft. I am currently vice chairman of the 
General Aviation Manufacturers Association's board of 
directors, and I also chair our Airworthiness and Maintenance 
Policy Committee.
    I want to begin by commending the FAA for selecting, 
conducting, and coordinating the Aviation Rulemaking Committee, 
ARC. This panel was established under the FAA Modernization and 
Reform Act of 2012. The ARC developed six recommendations that 
Duncan Aviation supports. I would like to highlight two which I 
believe are key to assist both the FAA and industry.
    The primary recommendation of the ARC was to establish a 
master electronic database for the agency and industry use. By 
including internal directives, policy memos, legal 
interpretations, the FAA and industry could consistently 
interpret regulations. The second key recommendation of the ARC 
that I believe is significant is the establishment of the RCCB, 
the Regulatory Consistency Communication Board. This would 
enable the FAA and industry to have an arbiter to settle 
different interpretations of the rules, both within each party 
and between the parties.
    These two initiatives could significantly impact issues 
that Duncan Aviation and others in our industry encounter. 
These issues currently involve inconsistent interpretation and 
application of the regulation, and a lack of effective 
communication and dialogue during dispute resolution.
    Duncan has encountered these issues for our mobile 
maintenance units in the past 2\1/2\ years. It was a process 
that directly impacted our ability to open additional units on 
a timely basis while also costing time and resources to 
resolve. Establishing the RCCB could have resolved this issue 
in a much more timely fashion. I want to point out that the FAA 
has recognized the need for more guidance on mobile maintenance 
units and is drafting additional guidance at this time.
    Other improvements in oversight, including reducing 
redundant audits and moving to a more centralized risk-based 
approach to safety, the FAA is in agreement and recently issued 
a paper to ICAO. The upcoming FAA reauthorization offers the 
FAA policymakers and industry the opportunity to work together 
to promote safety and do so in an effective and efficient 
manner.
    Chairman Shuster, Ranking Member DeFazio, Aviation 
Subcommittee Chairman LoBiondo, and Aviation Subcommittee 
Ranking Member Larsen, on behalf of Duncan Aviation, I want to 
thank you for your leadership and the opportunity to provide 
this perspective. I will be glad to answer any questions that 
you have.
    Mr. Shuster. Well, thank you very much, Mr. Hilkemann, and 
I will begin the questioning.
    Again, it is my concern and if anybody has been in the room 
with me over the last 2 years you have heard me say this over 
and over, I am very concerned that if we don't do something in 
this reauthorization to streamline, to make this work for us, 
we will lose leadership in the world, whether it is 
manufacturing aircraft parts, technology or--with the airline 
industry, I think we are already under attack from our 
opponents out there in the industry.
    The Chinese have said they are going to want to build a 
commercial aircraft here in the next decade or so, so I think 
now is the time to really move forward.
    Mr. Conner, you mentioned the ODA. Can you talk a little 
bit more in depth? I know it is in your testimony, but can you 
talk a little bit more about that and what is going on, and 
what you see as things we can do to change it?
    Mr. Conner. Yeah. Well, delegation has been around for 
quite some time, as you know; we have been granted full 
delegation authority, and what we are trying to do now is just 
to continue to use it to the largest extent possible. I think, 
for the most part, we have made great strides in that respect. 
We have a tremendous number of people that are qualified now by 
the FAA to do this. We are making strides, but still there are 
places where we should be moving to more of the risk-based, 
systems-type approach to these kinds of things where we are 
focusing our efforts on those areas of true safety concern and 
technology improvements where the FAA can use those resources 
and those talents to be able to do that. A little bit too often 
we are spending more time on areas where we could be the ones 
that are doing that kind of work.
    Mr. Shuster. For some of our newer members here, can you 
explain exactly who works for you and how you train them and 
the FAA certifies them?
    Mr. Conner. Yeah, we have a--we have an organization that 
is--a delegated organization that really is, in essence, the 
arm of the FAA within The Boeing Company. They are----
    Mr. Shuster. They work for you?
    Mr. Conner. They work for us.
    Mr. Shuster. But they are certified, and----
    Mr. Conner. They are certified.
    Mr. Shuster [continuing]. They are responsible for 
everything?
    Mr. Conner. They are certified and they are approved by the 
FAA to basically take on that effort, and they take that job 
very, very seriously, and so we have a large organization that 
does that already today on areas that are maybe of lesser, you 
know, safety issues, and you know, interiors and those kinds of 
things, we spend a lot of time with that.
    What we would like to do is move more to the risk-based 
systems approach, or systems engineering is really the larger 
piece of this where the FAA spends its time so we can then 
spend our time with our resources that are highly technically 
capable and are approved by the FAA. Each individual is 
approved by the FAA to do that kind of work.
    Mr. Shuster. And you pay those folks? It is on your dime? 
You are training them----
    Mr. Conner. It is completely----
    Mr. Shuster. By Boeing?
    Mr. Conner. It is completely under The Boeing Company's 
responsibility----
    Mr. Shuster. Right.
    Mr. Conner [continuing]. In terms of pay and those kinds of 
things, but they are viewed as----
    Mr. Shuster. Right.
    Mr. Conner [continuing]. Essentially within our company, as 
an arm of the FAA.
    Mr. Shuster. Thank you. And Mr. Hilkemann, can you talk 
some about the inconsistencies that you have seen out there, 
actual cases that help to highlight what we are talking about 
here, because I travel around the country, hear a lot of 
different things--so if you can give us some concrete examples 
that will be very helpful.
    Mr. Hilkemann. You know, on the mobile repair station unit 
we had been--there is a couple of different ways----
    Mr. Shuster. And mobile repair station is something that 
goes out to the airplane and actually----
    Mr. Hilkemann. Right.
    Mr. Shuster [continuing]. Fixes it, rebuilds it?
    Mr. Hilkemann. Exactly. They may have a truck or a van that 
they use to take the equipment out to. We had approximately 20 
of those in place that we had been authorized as a work-away 
for, oh, probably a 10- or 15-year period. There was a change. 
They requested us to make a change to that. We wanted to 
discuss it. We asked for an extension, and normally you have 10 
days to respond. We asked for an extension. The net of the 
story is we ultimately put in the applications at their 
request. About 6 months later we did start to receive letters 
of fines for operating in the interim period under that old 
way. Ultimately, it has been resolved, and today, after 2\1/2\ 
years of a process, we are putting the application back into--
change them back to the original process.
    So there was clearly a--you know, an indecision on what the 
correct manner. Neither changed what we were doing. It was 
really simply a matter of how they would be--under what 
compliance we were under and what rule.
    Mr. Shuster. So after 2\1/2\ years, you were virtually 
doing the same thing as you were doing before?
    Mr. Hilkemann. Right.
    Mr. Shuster. And that is why the RCCB is--is that in place 
now?
    Mr. Hilkemann. No. No, it is not in place now, but I do 
think, I feel strongly if that would have been in place and we 
could have brought that to that committee, it could have been 
resolved. I think what happens, and I understand the process, 
once it becomes a legal matter, then it eliminates our ability 
to have further discussions, whether it is in Washington or in 
the region. It makes it a difficult process to get resolved.
    Mr. Shuster. Well, thank you very much. Yield to Mr. 
DeFazio for questions.
    Mr. DeFazio. Thank you, Mr. Chairman.
    Mr. Conner, you referred to international harmonization, 
and I would probably kind of like to have you expand on that, 
although I know there are oftentimes sensitivities since you do 
have to deal with some of these foreign entities on an ongoing 
basis, but you know, the FAA is, you know, say they are working 
with the European agency on a so-called mutual acceptance 
model. Do you have any thoughts on that, whether--you know, 
what sort of a priority that should be, what sorts of problems 
that could solve?
    Mr. Conner. Yes. Thank you. I think from the standpoint of 
harmonization with respect to the regulations, I think that 
there has been a lot of work, really solid work that has been 
done, where the tendency to be a little bit different is maybe 
in interpretation of those, of those regulations. And clearly, 
the Europeans and EASA have taken a far greater approach to 
delegation than maybe what we have been able to do here with 
the--in the United States.
    But I do believe that the FAA has done a very solid job of 
harmonizing, particularly with Europeans, around harmonization. 
Now, as the Chinese start to come into this world, then that is 
going to be another area that we have got to continue to focus 
on and are continuing around the entire world as we move 
forward.
    Mr. DeFazio. OK. Well, I won't ask you here but perhaps you 
might opine to me privately on how you see sometimes the 
regulatory structure being used on competitive or 
anticompetitive basis, and I would be interested in thoughts on 
that, but I won't ask you to do that publicly.
    Mr. Conner. OK. I would love to spend some time with you on 
that.
    Mr. DeFazio. Yeah, I would love that.
    And to follow up on your statements, Mr. Hilkemann, is, you 
know, one of the parts of the PASS testimony, since I know you 
are not here representing GAMA, but you know, you do--you are 
involved with them, and they are saying because--and you know, 
part of this is, you know, part of this is sometimes a 
bureaucratic problem, but sometimes it is a resource problem in 
terms of expertise or actual just people to staff these issues, 
and they are saying that what is happening is because of the 
demands on the oversight in other areas and new problems that 
are having to be dealt with such as unmanned aerial vehicles, 
that, you know, smaller businesses, manufacturers in avionics 
and other areas who can't afford to, you know, go to an ODA are 
getting into a longer and longer and longer line for 
certification, and do you have any thoughts on that? How we can 
address that?
    Mr. Hilkemann. Duncan Aviation has an ODA. We have for a 
number of years.
    Mr. DeFazio. Get a little closer to the mic.
    Mr. Hilkemann. I am sorry. Duncan Aviation does have an 
ODA, and we have for a number of years.
    Mr. DeFazio. Right.
    Mr. Hilkemann. It has been very successful for us as well. 
There is a lot of work. We had a lot of staff.
    In our case, what we are able to do is also hire unit 
members that we don't have on staff full-time. Because of the 
variety of the airplanes that we work on, we don't have 
dedicated unit members for each of the applications that we 
use, so we hire them as we do--as we need. So that is how some 
of the smaller companies go about doing it.
    I would say there are members on my committee of GAMA, the 
Airworthiness and Maintenance Policy Committee, that do not 
have ODAs. And I think it depends on the region on how quickly, 
you know, they--they could be sequenced or they could not be. 
You know, I would say in our region, that has never been an 
issue to my knowledge, but I can't comment about all the other 
regions, but clearly it can be a challenge in certain smaller 
companies who don't have or can afford to invest in the ODA.
    Mr. DeFazio. All right. Do you think prioritization is an 
issue? I mean, you know, I mean, they pretty much work, at 
least in my experience in dealing with problems with 
certification, pretty good as it relates to fire fighting has 
been a perennial issue in my part of the country. There doesn't 
seem to be a prioritization process like, OK, fire season is 
coming, we really need to certify it. Well, there are 15 people 
who applied for this, this, and this which are not so time 
sensitive. I mean, do you think the process needs to set some 
levels of prioritization better or it sounds like your region 
works pretty well, but----
    Mr. Hilkemann. Yeah, it is difficult for me to answer that 
question since I am not part of that process at this point.
    Mr. DeFazio. Yeah. OK. And just from the perspective of 
Boeing, you know, to me, I mean, part of the solution here is a 
risk-based system which, you know, where we are looking, you 
know, not spending much time on routine things, but we are 
spending time on critical components, do you think the FAA is 
doing a good job of that or could they do a better job of that?
    Mr. Conner. Well, excuse me. Obviously, I think that we 
are--we are moving in the right direction. Are we moving fast 
enough? I think we could do a better the job on some of the 
things that we are currently involved with. You know, we have 
1,000 people that are part of our ODA organization, and we have 
a tremendous amount of capability. I think it is time that we 
move to really risk-based approach to this systems engineering, 
allow us to do the detail engineering and those kinds of 
things.
    Where we sometimes come apart is a little bit on the 
interpretation of some of the requirements, and we should have 
a vehicle in which we can deal with that, but, you know, we 
are--we are working towards it. Are we working fast enough? It 
is about speed. It is about efficiency and those kinds of 
things. And with the level of certification that we are going 
to have coming towards us, in addition to the amount of work 
that we are having with delivering 723 airplanes, we are going 
to be doing 4 million hours of engineering over the course of 
the next few years just on existing programs. That is not to 
say on these new development programs.
    So there is a tremendous amount of work in order for us to 
continue to deliver airplanes that I think that we could do 
more of the--of the work that maybe that the FAA is doing 
today.
    Mr. DeFazio. All right. Thank you. Thank you, Mr. Chairman.
    Mr. Shuster. Thank you. And Mr. DeFazio, you asked for a 
UC. I didn't respond to the UC request to submit a PASS 
statement into the record. And without objection, so ordered.
    [The information appears on pages 135-142.]
    Mr. Shuster. And now go to Mr. LoBiondo.
    Mr. LoBiondo. Thank you, Mr. Chairman. And I would like to 
thank the chairman for elevating this issue to the full 
committee level because of its critical importance. And Mr. 
Conner, Mr. Hilkemann, thank you for being here. This 
certification process is critically important on our country's 
aviation sector, and I know you have touched on this, but for 
the new members, could you each elaborate on the impact of the 
FAA's certification process that that has on your company's 
ability to compete and to innovate, Mr. Conner?
    Mr. Conner. Well, the certification process is one of the 
key pieces of what we do in terms of getting a new--
particularly new products to market. The 787 went through the 
most extensive certification and approval process in the 
history of aviation. Tremendous amount of work there. Where I 
think that we can spend and be better equipped to compete is 
again around this delegation piece of this thing.
    The EASA is more--is working more towards delegation, 
allowing the manufacturer to do some more of the nonrisk type 
of items. Going towards a risk-based approach where the FAA is 
truly involved in the oversight of those highly critical 
systems, going to a systems engineering approach, maybe 
changing the workforce in little ways in terms of the--having 
systems engineering as part of that is, I think, more of the 
critical pieces here so we can--we can take on some of the more 
standard things that are common to every one of our airplanes, 
and they can be focused on those new technologies where--where 
the risk-based approach can be really utilized to the high--its 
fullest extent.
    Mr. LoBiondo. Yes. Mr. Hilkemann.
    Mr. Hilkemann. Sure. You know, the two areas that we 
interface with the FAA is on the repair station and then on the 
design and modification system, part 21. In both of those 
areas, you know, I would say we had--our interface with the FAA 
has been very positive. I think on the ODA side, for what we 
do, with a lot of insulation, they can range all the way from a 
complete new cockpit to a cabin management system to a WiFi 
system to just additional item in the cockpit. Most of those we 
are able to do under the ODA, almost all those. At some times, 
the FAA picks and choose to have oversight on some of those, 
but I would say the majority are done by the--through our ODA, 
and we approve those in the same manner that Boeing does on 
their authority. So in our case, I would say the ODA is working 
and it allows us to innovate and install a lot of new 
equipment.
    Mr. LoBiondo. Mr. Conner, do you feel that in any way, the 
FAA's certification process is hampering you with global 
competition that is under--dealing with some different 
standards than you may be?
    Mr. Conner. Well, I think it is dealing with--not 
standards. It is dealing with different interpretations at 
times. I think that, we need to be clear. I think the FAA has 
done a very good job of harmonizing those requirements with the 
international regulatory authorities.
    The area where I think that we can be more effective is in 
terms of utilizing the delegation that has already been 
approved to the extent possible. We spend a lot of time in an 
effort in some of these areas where I think that our delegation 
could be utilized to a greater extent, and then the utilization 
of the FAA resources on those more critical areas.
    So does it inhibit our ability? It makes things more 
complicated sometimes. At the very last minute when we are 
trying to deliver an aircraft, that can become an issue for us. 
It becomes an issue for us with our customer, can become an 
issue with us in terms of having to churn our production system 
a bit to make that happen. I just--I think that this is a place 
where we can move to the more risk-based approach, and I think 
that would be in the best interest of the industry, it is in 
the best interest of the utilization of the resources that the 
FAA has in their arsenal there.
    Mr. LoBiondo. Thank you, Mr. Chairman.
    Mr. Shuster. Thank you, Mr. LoBiondo. With that, recognize 
Mr. Nolan. No questions for Mr. Nolan.
    Mrs. Kirkpatrick is recognized for 5 minutes.
    Mrs. Kirkpatrick. I live in Arizona, and I spend about 10 
hours a week in the air, so I thank you, Mr. Chairman, for 
having this hearing because I think a lot about airplane 
safety. But I have a really practical question. I mean, I am 
really concerned about certification, but you know, 
oftentimes--well, not too frequently, but sometimes I am on a 
plane and the pilot announces there is a mechanical problem and 
we sit on a tarmac for a couple of hours. What kind of 
oversight is there over that repair at that moment when we are 
sitting in the plane? What kind of oversight standards is 
there--does these certification standards apply to that?
    Mr. Conner. Yeah, but typically the mechanics in the 
airlines have an authority of which to go fix those kinds of 
issues. They are not necessarily--I mean, that is within the 
framework of the airlines, and I probably am not in the best 
position to be able to answer that, but that is more of an 
airline maintenance-type of approach to things, and these are 
things that typically come up every time. They have their own 
certification process, too, for their mechanics and those kinds 
of things.
    Mrs. Kirkpatrick. So how may certification processes are we 
talking about here?
    Mr. Conner. It is hard for me to say. I would----
    Mrs. Kirkpatrick. But you acknowledge there are different 
certification standards for different----
    Mr. Conner. Well, the airlines----
    Mrs. Kirkpatrick [continuing]. Areas?
    Mr. Conner. The airlines have theirs and then we have 
ours----
    Mrs. Kirkpatrick. Right.
    Mr. Conner [continuing]. As the manufacturer, yeah.
    Mrs. Kirkpatrick. So suppose we go to the risk-based 
certification process, how long does it take someone to get to 
that standard where they can do that?
    Mr. Conner. Well, I mean, that would be something that the 
FAA would probably be in a better position to be able to--but 
they have the people today that are able to do that. We are--we 
have people today that are delegated, trained, approved, like I 
said, 1,000 people are delegated and approved within The Boeing 
Company's ODA organization that can do--can approve design, 
approve installation on behalf of the FAA.
    Mrs. Kirkpatrick. Here is my concern. We have data that 
shows that there is about 1,000 people shortage in the 
certification process, so you have 1,000 at the FAA.
    Mr. Conner. At the FAA, yeah.
    Mrs. Kirkpatrick. Right. What I am trying to get to is how 
can we streamline--what can this committee do----
    Mr. Conner. Yeah.
    Mrs. Kirkpatrick [continuing]. To streamline that hiring 
process? That is a lot of people. We still have a lot of people 
who need jobs.
    Mr. Conner. Yeah. Well, we have ours. I think utilizing it 
to the fullest extent we possibly can in the right areas where 
there is not the highest risk areas with respect to the 
airplane itself, that is where we can become--be utilized so 
they don't have to use their resources unnecessarily. They can 
retrain or hire new people that are more systems engineering 
based that can be--provide oversight to those high-risk, you 
know, flight critical areas as opposed to maybe in some of the 
areas that we are more capable of and have more detail 
capabilities around.
    Mrs. Kirkpatrick. Thank you. And Mr. Hilkemann, I 
appreciate that you are hiring veterans. You know, we have very 
highly qualified veterans now who are back from Afghanistan and 
Iraq. Do you find that there could be a streamlining of the 
certification for veterans who may be already trained to do 
this kind of work but have to go through the whole 
recertification process?
    Mr. Hilkemann. What we find, you know, we hire people from 
all walks of the services. In other words, if they were working 
on tanks, they were working on aircraft, or if they were 
working on helicopters, they have a certain amount of 
mechanical skills that they have learned, and so we are able to 
hire them directly into our facility. And then, depending on 
the experience that they receive and their own abilities, they 
are able to move up very quickly in our organization.
    So we don't have a lot of transition. A lot of the bases 
have their own transition training back into the public sector, 
so they are coming directly to us. I would say half of those 
are referrals from existing veterans that have been in our 
company in the last year, the last few years. So I get to meet 
every individual we hire through an orientation process, and I 
always ask them how did you find out about us and why did you 
decide to join us. And I would say of 50 percent of those are 
referrals from existing individuals, and in the case of 
veterans, it is from other veterans.
    Mrs. Kirkpatrick. Well, I appreciate that, and thank you 
for that. I yield back my time.
    Mr. Shuster. Thank you very much. And Mr. Hanna is now 
recognized for 5 minutes. And also, I want to apologize, Mr. 
Larsen. You were at the top of the list, Mr. Larsen. I 
overlooked your name. I apologize for that.
    With that, Mr. Hanna is recognized.
    Mr. Hanna. Thank you, Chairman.
    Mr. Conner, maybe you could elaborate on exactly what a 
risk-based approach is, because it sounds as though there is 
some margin there that is different than absolute perfection.
    Mr. Conner. Well, OK. First of all, I want to just drop 
back. You know, we talk about workforce training and 
development, and it is very important that we have the right 
skills not only within the FAA, but also within The Boeing 
Company to do these types of things. Systems engineering is 
very critical in this approach. Risk-based is about those 
flight critical pieces of the airplane, elements of the 
airplanes. Where maybe----
    Mr. Shuster. Excuse me, Mr. Conner. Can you pull those mics 
closer to you? It is better the closer you get. We can hear you 
better.
    Mr. Conner. All right. Thank you. I didn't want to shout.
    Mr. Shuster. I want to hear everything you have to say.
    Mr. Conner. OK. Where we can probably spend more of our 
time is on interiors' certifications, seats, lavatories, 
galleys, those kinds of things. We spend an awful lot of time 
in these areas, and this is where our customers, our airline 
customers want to differentiate themselves against their 
competition, and that is where we can spend more of our efforts 
whereby allowing us to take that----
    Mr. Hanna. You want more responsibility over----
    Mr. Conner. Well, I want more responsibility----
    Mr. Hanna [continuing]. Certain items?
    Mr. Conner [continuing]. In the right areas. This is where 
I want to make sure that I make myself very clear. We are not 
looking to eliminate. We are looking to make sure that we are 
working with the FAA on the right things and we are taking the 
right approach to these things.
    Mr. Hanna. Let me ask you about Airbus for a minute.
    Mr. Conner. Yeah.
    Mr. Hanna. They have a different system over there. How do 
you feel that you have--do you have a competitive advantage or 
disadvantage, and how does the FAA play into that for your 
whole company?
    Mr. Conner. Well, the FAA works with EASA, and then they 
come back and they validate the certification of which EASA has 
done on their--on the Airbus aircraft. What we do know is that 
the Airbus utilizes delegation to a further extent than 
probably we do. To what extent exactly, I couldn't speak to 
that. I think maybe the FAA could have a better feel for that, 
but we do know that their delegation, they have taken advantage 
of a greater portion of the delegation in areas such as 
interiors, in areas such as the things I just spoke about.
    Mr. Hanna. So safe to say that you are at somewhat of a 
competitive disadvantage?
    Mr. Conner. Well, if we have to spend a lot of time in 
redoing or if the FAA is coming back and redoing some of the 
things that we have already done, then that--I think it is just 
not a great utilization of either one of our resources.
    Mr. Hanna. I understand.
    Mr. Conner. That is probably better--it is not nearly as 
efficient as it could be, and that then causes disruption 
within our production system, it causes disruption into the 
value stream of our suppliers, and it causes disruption to our 
customers as well.
    Mr. Hanna. Uh-huh. Thank you, Chairman. I yield back.
    Mr. Shuster. Thank you. With that, Mr. Larsen.
    Mr. Larsen. Thanks. So just to get some perspective here. I 
visited a small manufacturer up in Anacortes in my district, 
and they make a variety of components for smaller airplanes, 
including things called vortex generators, which I am sure Mr. 
Hanna knows all about since he flies smaller airplanes, but you 
know, the smallest one no longer than probably my thumbnail, 
and that has to get certified, it goes on the airplane.
    For some perspective, except for the--except for the 
airplane itself on delivery, how many usual parts and 
components in a 737 approximately have to have an FAA stamp, 
metaphorical stamp?
    Mr. Conner. I mean, I don't know. Well, that is--I mean, 
every one----
    Mr. Larsen. Every single piece.
    Mr. Conner. Look, we go through a certification process of 
not only the production system, which includes the supply 
chain, but every part ultimately that is part of a design 
because the FAA certifies our design, and every single part 
then has to be certified.
    Mr. Larsen. So when you talk about the existing plans as 
well as future plans you are going to be designing and 
building----
    Mr. Conner. Yeah.
    Mr. Larsen. Each of those come with the same or different 
production process?
    Mr. Conner. It could, depending on what we do with 
technology.
    Mr. Larsen. And so the process itself as well needs to be--
--
    Mr. Conner. Yes.
    Mr. Larsen. If it is a new process, needs to go through a 
certification as well?
    Mr. Conner. Yes, yes.
    Mr. Larsen. So we are not just talking about parts and 
components?
    Mr. Conner. No.
    Mr. Larsen. We are talking about not what you make only, 
but how you make it?
    Mr. Conner. What type of system have you--when I talk about 
the production system: Are the quality inspections appropriate? 
Have you followed the intent of the planning documents and the 
engineering intent of what we put into the design? Those are 
all the same things that are a part of this certification 
process.
    Mr. Larsen. Yeah. So in all--again, it is not just the what 
you make, but it is how you make process as well.
    Mr. Conner. Yes.
    Mr. Larsen. So in terms of the how you make side of the 
production process, how much of that is currently ODA-related 
and how much of that is----
    Mr. Conner. We do an awful lot of that work ourselves, and 
then the FAA comes in and certifies our production system, and 
they do audits to verify those types of things, and we do 
audits ourselves, and we are--and it is a constant--it is kind 
of a--the production system is constantly being evaluated and 
audited.
    Mr. Larsen. Yeah. And in terms of the FAA inspectors that 
come in and do the auditing, you discuss, as your second point, 
the necessity of training----
    Mr. Conner. Uh-huh.
    Mr. Larsen [continuing]. An FAA workforce. I mean, do you 
have an estimate of what numbers of people? Do you have an 
estimate of how to train? What FAA ought to be training in?
    Mr. Conner. Well, I think the one place I would want to 
emphasize is the systems engineering piece of this thing as 
being a critical part to start to move towards as opposed to 
detailed design type of activity. That is where we--that is 
where we can be very helpful in that respect because we have 
the detail design capability and analysis and those kinds of 
things. Where they can become at a higher level and be looking 
at it more from a systems approach to that.
    Systems engineering, I think, is one of the areas that will 
be an important piece of the workforce training for the FAA.
    Mr. Larsen. Yeah. And it talks about the supply chain as 
well, which is extensive for you and your main competitor----
    Mr. Conner. Correct.
    Mr. Larsen [continuing]. Throughout the country, around the 
world.
    Mr. Conner. Uh-huh.
    Mr. Larsen. How do you--how is that managed through ODA, 
and are there any changes that need to take place, or is that 
all--you don't deal, or you don't deal with that part?
    Mr. Conner. No, no, we deal with that part as well. We go 
in and we establish the production system. The FAA comes in 
and--which includes our supply base, and they come in and 
validate that as well through their audit process.
    Mr. Larsen. Yeah. Yeah. Thanks. Thanks for that.
    Mr. Hilkemann, you mentioned that at least it has been your 
experience, I guess, that the ODA that you have, that you 
haven't had many--how you described it, many problems with 
inconsistent interpretation, perhaps, at least in your region; 
is that right? Is that what I heard you say?
    Mr. Hilkemann. Implementation and use of the ODA has worked 
well for us in our region.
    Mr. Larsen. OK. Have you had--do you have concerns or how 
should we address concerns that we hear about inconsistencies 
region by region?
    Mr. Hilkemann. Well, the inconsistencies have been more on 
the repair station interpretations as you get new inspectors 
and additional inspectors. I think if you look at the ODA, the 
more responsibilities, the more things that the ODA can do, 
because some ODAs are very limited.
    Mr. Larsen. Yeah.
    Mr. Hilkemann. The more things that the ODAs can train 
themselves, add staff to, and develop, in effect, you are 
decreasing that thousand, you know, requirement jobs that you 
talked about that the FAA would need, or you make the resources 
available for those small companies that was suggested--you 
know, suggested is out there or concern for the smaller 
company.
    So I think, you know, if we can get all the ODAs operating 
at the highest level possible and additional delegation, in 
effect, that reduces the need for additional inspectors and 
creates capacity for the rest of the system.
    Mr. Larsen. All right. Good. Thanks. Thank you, Mr. 
Chairman.
    Mr. Shuster. Thank you. Mr. Rice is recognized for 5 
minutes.
    Mr. Rice. Thank you, Mr. Chairman, and thank you, 
gentlemen, for being here today. And Mr. Conner, particularly 
thank you for American excellence in aviation, and for 
employing so many thousands of the people in South Carolina. I 
appreciate that very much.
    Aviation is certainly a shining light of American 
manufacturing and one area in which we maintain our leadership 
role in the world. I am focused very much on American 
competitiveness, and I have seen over and over and over again 
in my 2 years here in Congress how Government regulation too 
often, in the name of protecting the public, makes us less 
competitive and actually does very little to protect the 
public. That being said, if we sacrifice safety in American 
aviation, then we won't be competitive in that area very long, 
so I am sure you guys have a vested interest in that and that 
you need to make sure that that record of safety is maintained, 
and you don't want to do anything to compromise that.
    Now, from what I understand, Mr. Conner, you are saying 
that the FAA is now looking at areas that don't necessarily 
deal with flight safety but more things within the plane that 
don't deal with its flight, like the interior of the plane, the 
lavatories, and the kitchens.
    Mr. Conner. Those are just examples, yes, yeah, correct.
    Mr. Rice. Do they spend a significant amount of time 
dealing with these things that have nothing to do with the 
flight of the plane?
    Mr. Conner. We spend a lot of time in these areas to 
certify the airplanes, particularly the airplanes that we are 
delivering today. Maybe not nearly--not as much on the new 
development projects, but particularly in the areas that we are 
delivering today, yes, we do spend a lot of time in that.
    Mr. Rice. Now, and you have certified FAA inspectors on 
your payroll?
    Mr. Conner. And engineers, yes.
    Mr. Rice. Have you people or airplane manufacturers gone to 
the FAA and said, look, maybe you should be focused on areas 
that deal solely with the flight safety of the plane and not 
with what color the interior of the seats are and that kind of 
thing?
    Mr. Conner. Yeah. Well, yes, we have.
    Mr. Rice. And they still want to focus on these collateral 
matters?
    Mr. Conner. Look, I think that--I want to make this clear 
is that we are working very closely with the FAA to move in 
this direction. What we would like to do is take advantage of 
the--or utilize the level of authorization that we do have from 
an ODA perspective so we can better utilize the resources that 
we have and better utilize the resources that the FAA has.
    Mr. Rice. Have you run any estimates of the cost in money 
and/or time to deal with these collateral issues with the FAA? 
Not with flight safety but interiors and lavatories and----
    Mr. Conner. Well, I mean, we--for now, it is more 
anecdotal, but I can tell you that we spend an awful lot of 
time, so like we haven't necessarily--I don't have the data 
right in front of me, but it is something that we could 
probably compile over the course of time here, but I would just 
say that it is an inordinate amount of time spent sometimes on 
seat certifications, on interior certifications, on lavatory, 
galleys, these kinds of things, so I think that we have the 
capability to do a very good job.
    We are highly trained in these areas. These are things we 
deal with every single day, and we have a full ongoing 
commitment. Our reputation as a company, as an industry, is 
built on safety, and I can tell you it is the top priority of 
every single individual within our company, and we are 
constantly working to improve the safety of our products, and 
we get that feedback every day from operations, from our 
customers, from our suppliers, and we work to enhance that 
constantly.
    Mr. Rice. I don't want you to disclose any trade secrets 
here, but it would be safe to say with commercial aircraft 
being a relatively expensive item, that the markup is probably 
pretty low on these things, isn't it? The profit margin is not 
real high.
    Mr. Conner. No, it is not, and it is getting more difficult 
all the time. Our competitor is extremely aggressive in the 
marketplace, and they are very much focused on being the number 
one manufacturer in the world, and that would be Airbus and 
then with the advent of the Chinese, they are going to be 
coming as well.
    Mr. Rice. And so with the ever expanding U.S. Government 
bureaucracy eating into that profit margin, it makes you a 
little less competitive in the world?
    Mr. Conner. Well, I think the most important thing here----
    Mr. Rice. I know I am using terms that you wouldn't use.
    Mr. Conner. Yeah. Well, the most important thing is to 
continue to drive efficiency, speed, in the areas that are 
appropriate without compromising safety at any single level. 
Sometimes I think we are duplicating efforts, and that is where 
we want to move away from and allow the FAA to really focus on 
those things that are most critical to the safety of flight of 
our aircraft.
    Mr. Rice. Thank you very much, sir, for being here, and 
again, thank you, both you gentlemen, for excellence in 
American aviation.
    Mr. Conner. Thank you.
    Mr. Shuster. Thank you, Mr. Rice. And with that, Mr. 
Huffman from California is recognized. Do you have a question? 
OK. And I just want to take this opportunity to welcome you to 
the committee, and I understand you are going to be joining us 
this Congress, so again, look forward to working with you.
    Mr. Huffman. OK.
    Mr. Shuster. Ms. Norton. Ms. Norton is recognized for 5 
minutes.
    Ms. Norton. Thank you very much, Mr. Chairman. This is an 
important hearing.
    Mr. Conner, I note--your pages aren't numbered like my 
students in my law class, but it is under ``Delegated 
Authority.''
    Mr. Conner. Yes.
    Ms. Norton. You go to great lengths to commend FAA's 
delegated authority.
    Mr. Conner. Yeah.
    Ms. Norton. You say there are stringent FAA requirements. 
You say you are held to very high standards.
    Mr. Conner. Correct.
    Ms. Norton. You talk about rigorous and closely overseen 
ODA systems. I wonder how you reconcile this glowing report 
with what the DOT and IG and the GAO have said and how they 
have criticized.
    Mr. Conner. Yeah.
    Ms. Norton. It seems to me it is fair to say sharply 
criticized both of them. These are independent overseers. 
Sharply criticized FAA oversight of certification programs. How 
do you reconcile your glowing report with these criticisms?
    Mr. Conner. OK. Thank you. I appreciate the question. I can 
tell you, it is a very stringent process in which we go through 
to achieve delegated authority, both on a companywide basis and 
on an individual basis, and it is constantly evaluated over 
again and over again.
    Ms. Norton. Well, let me just ask you about being 
constantly evaluated. There has been sequestration. There have 
been cuts. There have been furloughs. How often are you 
audited?
    Mr. Conner. I would have to ask for help on that, but----
    Ms. Norton. Well, I wish you----
    Mr. Conner. I can tell you, we are audited on a production 
system and on a design basis at least once a year, and it goes 
to our supply base--it goes not only to us. It goes to the 
supply base. It goes to all our facilities. The FAA is--in 
terms of auditing, they are quite often.
    Ms. Norton. So you see no shortage of personnel that had an 
effect or the cuts or the sequestration. You see none of that 
reflected?
    Mr. Conner. No. We were impacted by sequestration. We were 
not able to deliver airplanes on time because we were not able 
to get appropriate FAA inspectors to come in at certain times. 
They were limited in terms of their overtime capabilities. They 
were limited in terms of their ability to support in terms of 
certain critical inspection processes that come with the 
delivery of an airplane. So there were impacts from the 
standpoint of being able to deliver airplanes. Now----
    Ms. Norton. I think it is fair to put it on the record 
because if there are deficiencies, the question is going to 
come forward, are the deficiencies on your part or were those 
charged with oversight not doing their job? And I think it is 
important to note that you have testified that sequestration 
and cuts have had an effect on the ability of FAA to do its 
audits.
    Could I ask you something about----
    Mr. Conner. Well, the audits take place, detailed, formal 
audits take place every 2 years. And then we do constant 
informal audits as the years--as time----
    Ms. Norton. So they are meeting the minimum requirements?
    Mr. Conner. Yeah. Well, that is the requirement.
    Ms. Norton. Could I ask you something about Boeing and 
noise or airplanes and noise?
    Mr. Conner. Noise.
    Ms. Norton. We are in a region--and this is typical of the 
United States, large cities, quiet suburbs--there have been 
real complaints about noise, and we find that what happens is 
that airplanes get rerouted. Well, if they get rerouted, for 
example, from the Nation's Capital, they are going over 
suburban Virginia, so then they complain.
    Mr. Conner. Uh-huh.
    Ms. Norton. Are you able to improve the noise levels of 
aircraft today at a rate that would satisfy these issues and 
what is going to be a situation where everybody's going to live 
in an impacted environment, even those who live in the suburbs?
    Mr. Conner. With each new airplane we bring to market, we 
are required to satisfy certain noise levels. And those noise 
levels get more stringent with each new airplane we introduce. 
And so, yes, I would say that we are complying to those strict 
standards.
    Ms. Norton. So those are part of the standards that you 
have to comply with?
    Mr. Conner. Yes, absolutely.
    Ms. Norton. So I will save that question for the FAA.
    Mr. Conner. Yeah.
    Ms. Norton. Finally, could I ask you, concerning 
international flights, your honest view, whether you have any 
compunctions, any fear, any sense that you should bring to our 
attention about these disastrous international accidents that 
have happened recently on international airlines? I want to 
know if you believe their counterpart oversight equals ours. I, 
of course, refer to the Malaysia Airlines, the most recent one, 
and, of course, to AirAsia.
    Mr. Conner. You know, I think it would be inappropriate for 
me to comment on those because they are still under 
investigation. We really don't know at this particular point in 
time. Once we do know, then we will be able to make----
    Ms. Norton. But on a peer basis, in dealing with these 
airlines, do you have confidence in airlines on an 
international basis that they are being held to the same kind 
of standards that you regard as rigorous that you are being 
held to?
    Mr. Conner. If they are certified, yes, they are.
    Ms. Norton. Thank you, Mr. Chairman.
    Mr. Shuster. The gentlelady's time has expired.
    Mr. Davis is recognized for 5 minutes.
    Mr. Davis. Thank you, Mr. Chairman.
    Thank you to both the witnesses.
    Mr. Conner, I want to echo what my colleague Mr. Rice said 
about Boeing being an employer in his State. And thank you for 
what you do in the passenger side but also on the defense side 
to my constituents who work just across the river in Illinois 
from St. Louis. Anytime you would like to bring any South 
Carolina jobs over to Illinois, we would be happy to work with 
Mr. Rice on a good compromise.
    Mr. Conner. OK. I will keep that in mind.
    Mr. Davis. Thanks. Thanks.
    Mr. Conner, in your testimony, you stress the importance of 
FAA delegating authority so it can shift its focus from low-
risk items to higher level safety opportunities. Can you 
provide an example where the FAA still retained a low-risk 
item, and what reason did the FAA cite for retaining that low-
risk item, and what kind of impact kid it have on your 
certification process?
    Mr. Conner. Well, you know, I want to stress here too that 
we have worked very well with the FAA on moving towards this 
delegation, and I think the leadership of Administrator Huerta, 
his staff, I think we are moving in a positive direction. The 
degree of which we move and the speed of which we move are 
areas where I think that we could improve on.
    As I said, the areas of interior certification, whereby our 
customers want to have more control over how they differentiate 
themselves, but still staying within the requirements of the 
engineering design and the intent of the design and those kind 
of things, we have a lot of capability in these areas. These 
are areas where I think that the FAA could move a little bit 
more toward us doing more of the delegation--areas of galleys, 
areas of laboratories, areas of seats, areas of side walls, 
overall interior certification.
    These are things that we do all the time, and I think that 
we spend--there is duplication of effort, and that is where we 
could then utilize their resources to work on some of the more 
critical items and use our resources to work on those because 
what we have today is both working in the same direction. But I 
do want to emphasize that we have worked very well in moving 
towards this. It is now--we are just getting to these points of 
the speed at which we move and the degree of which we move.
    Mr. Davis. You outline a number of steps the FAA and this 
committee can take when crafting our new FAA reauthorization. 
What is, in your view, the most critical step?
    Mr. Conner. Utilization of the ODA. And one of the critical 
things is getting the workforce trained in a different way, in 
more of the systems engineering type approach. Now, this will 
take time. It is a cultural change, moving away from maybe some 
of the more detailed design effort, which we do and which we 
are approved to do and which we have an ODA delegation that 
would allow us to approve those things, but moving, again, 
toward more of that risk-based oversight, utilizing systems 
engineering type approach. So this will require some transition 
on the FAA's part from the standpoint of training and some of 
those other things.
    Mr. Davis. OK. I have a little bit of time left. I am going 
to ask you one more question. The NTSB recommends that the FAA 
and manufacturers utilize outside experts when certificating 
new technology.
    Mr. Conner. Yes.
    Mr. Davis. They believe it could be the most efficient way 
to ensure operations safety.
    Mr. Conner. Yes.
    Mr. Davis. Do you use independent outside experts when 
certifying new technology, and can you give me an example?
    Mr. Conner. Yeah. I think that is a very good point. There 
was one, you know, we had the battery incident a couple years 
ago, and this is one where we complied with all the 
requirements that were known at the time. Everything was 
certificated. Most extensive certification ever. When we had 
the incidents, we drew on that outside expertise, from the 
automobile manufacturers, from different places. I think where 
we move, as we move to new technologies that are maybe being 
utilized in other areas, this is where we, as a community, FAA 
and ourselves, can draw on some of that industry knowledge to 
help us in terms of how we move forward and apply those to the 
aircraft.
    Mr. Davis. OK. Mr. Chairman, I will yield back the balance 
of my time.
    I thank you both.
    Mr. Shuster. Thank you, Mr. Davis.
    And Ms. Frankel is recognized for 5 minutes.
    Ms. Frankel. Thank you, Mr. Chair.
    Thank you to the witnesses.
    Well, I can say this about most of us probably here is that 
we are experienced amateurs at flying; we do a lot of flying.
    Mr. Conner. We all are.
    Ms. Frankel. Yes. And I actually feel rather safe when I 
fly, but I think the scariest thing for me and for probably 
most people is--for the customer, talking about the customer--
is that when you get on the plane, you feel you have completely 
lost control of your life. Unlike a car, where if you hear a 
rattle or something, you can pull over. When you are in an 
airplane, it is like you are depending on somebody else. I 
mean, there is really not much you can do. You put your seat 
belt on, hold somebody's hand.
    So I am not so sure I actually understand or maybe agree 
with, if you are saying that there are certain elements of the 
design of the plane that should not have an inspection by an 
independent party--is that what you are saying?
    Mr. Conner. No.
    Ms. Frankel. I mean, for example, a bathroom.
    Mr. Conner. No.
    Ms. Frankel. OK. So how would that work?
    Mr. Conner. Well, we are authorized. We have delegated 
people. These people are essentially the arm of the FAA. 
Although they are paid by us, they are within our organization, 
they are approved individually by the FAA. They carry the FAA 
authority, in essence. And we take that very, very seriously. 
Each individual takes that very, very seriously.
    And I would say, when you get on an airplane, just know 
that the safety of that aircraft is the number one priority not 
only for everyone in our organization, but it is the priority 
of the FAA, and any other people involved in building or 
certifying the airplane.
    But I can tell you, I am not saying our people have those 
capabilities as well. We are just saying in those areas where 
we have that capability, we have that strength, that are less 
flight-critical, that is where we could be utilizing those 
capabilities to a greater extent.
    Ms. Frankel. But there would be circumstances where an 
uncomfortable passenger could lead to a dangerous situation in 
a cabin, correct?
    Mr. Conner. But that is not going to--I mean, sure. That 
happens, yes.
    Ms. Frankel. So getting back to, I think, the focus of what 
you are trying to say is you are looking for safe ways to speed 
up getting the aircraft out into the marketplace.
    Mr. Conner. More efficient ways.
    Ms. Frankel. More efficient ways. The problem right now, 
would you say, is it not enough inspectors? Not enough 
competent inspectors? Or a lack of focus of what is important?
    Mr. Conner. No, I think we have enough resources. Between 
the FAA and ourselves, we have enough resources to make this 
happen. It is how we utilize those resources in the most 
effective way possible so we can ensure that we maintain a safe 
and compliant product while still being efficient enough to be 
able to compete in the highly competitive aerospace industry.
    Ms. Frankel. I still do think there is some power and 
influence when you are signing the paycheck. Is there any other 
independent person who could----
    Mr. Conner. Well, the FAA comes back in and--at any moment, 
they could come back in and evaluate that to make sure that we 
are doing exactly what we said we would do. And we are required 
through the ODA process on the individual basis to make sure 
that they are. Every 2 years, they come in and they audit our 
entire production system, which includes that.
    Ms. Frankel. So could you just give some more concrete 
examples of what you would take off the list?
    Mr. Conner. Take off the list in terms of their----
    Ms. Frankel. Yeah.
    Mr. Conner. Well, I would certainly, as I said, the 
interior aspect of the airplane, these are places where we 
could do more of the work, OK. These are things. Systems, how 
the systems interact with each other, how they interact in 
terms of flight, those kinds of things. When I say ``systems,'' 
you know, it is about engines, it is about the flight controls. 
Those are the areas where I think that the FAA, from a risk-
based--those are high-risk or risk areas in terms of flight 
that they could spend more of that energy in those areas and do 
them on a systems risk-based oversight basis.
    Ms. Frankel. Thank you.
    And, you know, Mr. Chair, I would just request, I don't 
know if there is anybody who could give us the other point of 
view or the view of the FAA, that would be of interest to me.
    Mr. Conner. I think they are.
    Mr. Shuster. Stick around for the next panel.
    Ms. Frankel. All right. Thank you. Thank you.
    Mr. Shuster. And I think it is important, sometimes I think 
this goes without saying, but it needs to be said, Boeing and 
Mr. Hilkemann, they want those planes to work. They can't 
afford to put a plane out--I mean, that is your business.
    Mr. Conner. Chairman Shuster, our entire representation, 
our ability to sell, our ability to operate is built----
    Mr. Shuster. Absolutely.
    Mr. Conner. We are a 100-year-old company, and for us to 
maintain that reputation that we built over the course of time 
is completely dependent on the ability to deliver and operate 
safe airplanes.
    Mr. Shuster. Absolutely.
    Mr. Conner. That is the number one priority of every 
individual within the company, and if we ever find anyone 
deviating from that, they are immediately dismissed.
    Mr. Shuster. Mr. Hilkemann, you echo those same sentiments 
for what you do?
    Mr. Hilkemann. One hundred percent. It is the most 
important thing for us. You know, our reputation is only as 
good as the last aircraft we delivered, so every aircraft has 
to go out.
    Mr. Shuster. Absolutely. Thank you.
    And next is Mr. Hardy.
    Mr. Hardy. Thank you, Mr. Chairman.
    First, I would just like to thank the chairman for the 
opportunity to be on this committee. Being involved in the 
construction industry, being involved in the regional 
transportation commission for many years in my State, I feel 
like I am well versed in many of the issues on this committee 
and appreciate that opportunity to be here.
    Mr. Shuster. Mr. Hardy, I think you have got a bad mic. Do 
you want to scoot over?
    Mr. Hardy. How about that?
    Mr. Shuster. It is breaking up somewhere. Move over one 
chair and try to use someone else's mic. Thanks.
    Mr. Hardy. Thanks. Can you hear me in now?
    Anyway, being a new member on this committee, I would like 
to ask a question, a little out of line here, but in the past, 
on these reauthorization regulations that are set up, is there 
collaboration between the private sector and the public sector 
on the efficiency of this? And the reason I bring this up is, 
the State and local levels all over the country, because of 
this recession, have got together and been in the construction 
industry. We have worked together with those State and local 
entities to create a program to where we can build bridges and 
tunnels and dams more efficiently, cost-effectively, and still 
maintain a high standard of safety. So is that done in this 
process with the FAA?
    Mr. Hilkemann. From Duncan Aviation's standpoint, I guess I 
would look at it from GAMA, the Airworthiness and Maintenance 
Policy Committee. We have been in existence now for I think 
around 3 years, and I think almost at every meeting we have 
had, we have had an FAA representative there who can discuss 
issues and concerns and things that we are seeing in the 
industry. And so that was probably the genesis of the 
additional guidance on the mobile maintenance unit.
    So, from our standpoint, it is very positive to have that 
interface. Everyone that is on that committee walks away 
saying, we are glad we came to that last meeting. And, you 
know, the feedback I have received from the FAA has been the 
same. So it is a great resource, and anyone who is not on the 
committees, they are losing out on a lot of opportunity to 
interface and have feedback back and forth.
    Mr. Hardy. Thank you.
    Another question I have. Mr. Conner and Mr. Hilkemann, you 
both have a vast amount of experience. You know your companies 
and industries very well. Instead of us telling you how to run 
your company and how we should restrict you, could you maybe 
elaborate a little bit on--tell us how regulations should be 
structured if you were in charge of the bases? And also please 
share with the committee the regulations that are hindering 
your company that pertains to your industry.
    Mr. Conner. Well, I think the regulations as they stand 
are, you know, I think it would be out of my experience to talk 
about, you know, what we should do with reform and such. But we 
have a good set of regulations. How we apply those regulations, 
how we manage those regulations, those are the things I think 
that we, as the company in working with the regulator, can 
spend more time.
    I mean, beyond interiors, there is a number of different 
places where compliance is well known, well understood. We have 
done these things over and over again as an industry where we 
could take some of that, you know, relieve some of that burden 
from the FAA as well. I think this is more about taking what is 
there and applying it in a most efficient way so that both the 
FAA and industry can work in the most efficient way possible.
    Mr. Hardy. Thank you, Mr. Chairman. I yield back.
    Mr. Shuster. Thank you, Mr. Hardy.
    And seeing no one on the Democrat side, Mr. Rouzer--who is 
on the Democrat side, actually.
    Mr. Rouzer. Looks can be deceiving.
    Mr. Conner, Mr. Hilkemann, I appreciate you all coming 
forward today. And, by the way, it is good to be up close and 
personal here.
    I have just one quick question for you. I come from a 
policy background but also a business background as well, and 
anybody who has been in business understands that time is 
money. My question is, and we have been all around it, and I am 
just wondering if there is a concrete answer: How long does it 
take you to manufacture a plane from start to finish under the 
regulatory apparatus that we have today?
    And then the followup question to that is: If we 
implement--or FAA is able to implement this risk-based approach 
that you have outlined several different times, how much does 
that save you on a time front, or is it more of an efficiency 
in terms of lower costs so, therefore, you can be competitive 
as well?
    Mr. Conner. It is a little bit of both, actually. I think 
that we can move a little quicker in the development aspect of 
things. That is typically, you know, developments in 5, 4 years 
type from start to finish with a new airplane. On an existing 
airplane, that varies depending on the airplane type in terms 
of start to finish, but where we could be more efficient, it is 
just about efficient and how we bring those airplanes actually 
into the hands of our customers. That is really where I think 
that things could be much better for us.
    Mr. Rouzer. Mr. Hilkemann, do you have any comment, follow 
up?
    Mr. Hilkemann. No, I don't think so.
    Mr. Rouzer. Thank you, Mr. Chairman.
    Mr. Shuster. Thank you, Mr. Rouzer.
    Mr. Gibbs is recognized.
    Mr. Gibbs. Thank you, Mr. Chairman.
    Mr. Conner, Boeing--I am over here--I want to commend you 
for--it is really exciting to hear about the increase of 
employment and planes you are building and new orders. That is 
exciting. And I want to kind of follow through a little bit on 
Mr. Hanna's questions about foreign competition and the 
regulatory structure. And I realize we have agreements with 
them and the FAA, and I am sure the airlines get involved.
    And then, also, Mr. Hilkemann, on your written testimony, 
it kind of comes together a little bit. In your written 
testimony, you say there is frequent and redundant surveillance 
activities, many of which are conducted by foreign aviation 
authorities, duplicate similar efforts while producing low, 
additional value. And some of it is done by foreign 
authorities.
    So I am trying to--you know, I think, Mr. Conner, you said 
that the bureaucracy sometimes, you know, takes longer, than 
what maybe it takes some of your foreign competitors.
    And, Mr. Hilkemann, having run the largest maintenance, 
repair, and overhaul business in the United States, in this 
regard, you know, how level is the playing field? Or would you 
say the foreigners come in and cause the most problems? And see 
where I am going here. Can you kind of expound on what our 
challenges are to get our efficiencies in place so Mr. Conner 
can be competitive selling airplanes?
    Mr. Hilkemann. Sure. To give you an idea of what we see in 
terms of redundancy, each week, we get about four or five 
paperwork audits a week that are sent into us. It is a 
requirement for most of the charter operators to conduct that 
and to send that to us. But we also have customers that follow 
those same standards. So that is happening on a weekly basis.
    On a monthly basis, we are audited by the FAA at one or 
multiple sites of our facilities.
    And then, on an international basis, we have six to eight 
international entities coming in for approximately a week 
throughout the year. And those are the audits that we pay for, 
either through license fees and additional audits. Some may 
stay for 2 or 3 days. Some may stay up to a week. So those are 
happening on a bimonthly basis.
    Mr. Gibbs. Just to follow through with Mr. Conner then, 
would our American Airlines customers have the ability to go do 
that on foreign competition, airplane manufacturers like Mr. 
Hilkemann just kind of described?
    Mr. Conner. Well, when they go to pick up an airplane, then 
they typically would walk the airplane. They will buy off on 
the airplane, saying it meets their requirements. They will fly 
it and make sure that everything is to what they expect it to 
be. They will walk the interior to make sure that it is 
everything they expect it to be. A lot of situations, we have 
airline inspectors within our factories watching the airplane 
as it is built and approving in different stages of the build 
process.
    Mr. Gibbs. I think you also mentioned the Chinese are 
getting into the airplane export.
    Mr. Conner. Yes. Well, they are beginning the process and 
starting to manufacture, yes. They haven't delivered yet, but--
--
    Mr. Gibbs. They haven't delivered, but the process is being 
started, just from a safety aspect, since their planes, you 
know, would theoretically be flying over our skies----
    Mr. Conner. Sure.
    Mr. Gibbs. We will have to have--the FAA, United States 
Government--will have an agreement with them?
    Mr. Conner. Yes.
    Mr. Gibbs. It would be similar to what you have, I assume, 
with the French Government.
    Mr. Conner. And the FAA goes, with our airplanes, to be 
able to get certified in China or any other country, we work 
with their regulatory agency to get our airplanes certified as 
well.
    Mr. Gibbs. OK. So I guess, you know, since we are looking 
at another FAA reauthorization, obviously, this is an issue 
that you are concerned about for the efficiency, so I assume 
you have probably got some more information you might want to 
share or----
    Mr. Conner. Well, I think one of the things that we want 
to--as part of this process, it is very important that we 
maintain the FAA as the gold standard in the world. And, 
therefore, having a presence in the international arena is very 
important. Supporting them, being in countries, working with 
the other countries, having people there, for instance, in 
China, some of these other places, where they can create 
influence, where they can actually do some things, working more 
closely and supporting them, being in different places around 
the world so they can make those kinds of things; that is very 
important as a world leader to be visible and active. And we 
support that fully.
    We believe that the FAA should be the leading regulatory 
agency in the world. And there are agencies around the world, 
EASA and I would imagine that the Chinese would want to move in 
this direction too--they want to be the leader, and they are 
going to push the envelope to make sure that they are. So, from 
a regulatory standpoint, we are in a competition too.
    Mr. Gibbs. OK. Thank you, Mr. Chairman.
    Mr. Shuster. Thank you, Mr. Gibbs.
    Mr. Duncan.
    Mr. Duncan. Well, thank you, Mr. Chairman.
    Mr. Conner, you mentioned that your company had had a 56-
percent increase in business over the last 5 years, and some of 
those years weren't the best years.
    And Mr. Hilkemann, I was wondering if you have had a 
similar increase in business.
    And the first question I have is, what do both of you 
gentlemen see over the next 2 or 3 years? Do you see that 
business increasing even faster, or what do you see in that 
regard?
    And then I have a second question: I chaired the Aviation 
Subcommittee for 6 years, from January of 1995 to January of 
2001, and I was hearing these same complaints back then. Mr. 
Hilkemann mentions inconsistent interpretation and application 
of regulations, lack of effective communications in dispute 
resolutions. I am wondering, both of you have had ODAs now.
    Mr. Conner, you said for 6 years, I think.
    And, Mr. Hilkemann, you said for several years.
    And then you have this section 313 advisory panel that put 
out a report in July of 2013, a year and a half ago.
    Are we making some progress? Big progress? I mean, what do 
you see on those things, since we were hearing these same 
things years ago? So those two questions from both of you.
    Mr. Hilkemann. All right. In terms of growth, our business 
is heavy maintenance. And it is usually done 6 to 12 years 
after the aircraft are manufactured. So that is the bulk of our 
business. So we benefit from deliveries that occurred in the 
last 10 to 15 years. And even before the recession, we had 
record levels of deliveries in our industry. So because of that 
inaction in our industry, the large and ultra large aircraft 
continued to be sold during the recession--worldwide, more 
outside the U.S. than in the U.S.
    But because of that, our business is still projected to 
grow. We have recovered the volume that we lost during the 
recession. We probably have grown--I think the numbers, if I 
look at it, from about $300 million to about $500 million today 
since 2009. So we have recovered the portion that we lost 
during that first year in the recession, and we have increased 
that. So that is on a positive standpoint.
    As far as what progress have we made, you know, I think, on 
the ODA side, we have made progress because we have had more 
authorities and we can do more things. On the repair station 
side, we currently have 56 auditors that audit our facilities. 
And when you do that, you have 56 opinions. Now, those are 
managed through Lincoln--it is called ICAO--our managing office 
in Lincoln. But, clearly, when we have changed back to having 
that number of inspectors, you are going to have differences of 
opinion.
    So, for about 12 years, we were in a certificate management 
unit where we had dedicated inspectors. We had five in Lincoln. 
We had three or four remote inspectors that were full time with 
us. I think the positive thing from that is it showed us that 
there were a lot of things over the years prior that created 
inconsistencies. We were able to fix those. We do have some 
concern. It is too early to tell you that it is going to be 
better or worse, but we do have some concerns when you have the 
quantity of the inspectors that we have today under this new 
system.
    Mr. Duncan. All right. Mr. Conner.
    Mr. Conner. Yes. Well, do I see our business growing? Yes. 
We have committed to higher production rates in the next few 
years. There are 36,000 airplanes in demand over the next 20 
years. About a third of those are already in the backlogs 
between ourselves and our competitors. But I do believe the 
next few years will determine market leadership for many years 
to come, so we are in a very highly competitive market as we 
stand today. One of the reasons why we are bringing these new 
airplanes to market is so they can compete better.
    With respect to ODA, we are making progress in terms of the 
extent at which we utilize it. Are we moving with the speed 
that we would like? I think we are working very diligently to 
work with the FAA to make that a reality. What we would like to 
see happen is just continue to push forward and make it a 
reality and utilize what has already been approved in terms of 
the authorization for delegation.
    Mr. Duncan. All right. Thank you.
    Mr. Shuster. Gentleman, Mr. Young.
    Mr. Young. Mr. Chairman, I just want to thank Mr. Conners. 
You build a great aircraft.
    Mr. Conner. Thank you.
    Mr. Young. I fly with them all the time and every time I 
get in an Airbus, I shudder, so your competitor can forget 
them.
    Mr. Conner. I do too, but that is OK. For other reasons.
    Mr. Shuster. Thank you, Mr. Young.
    And, with that, we thank the panel for being here today, 
appreciate your input and look forward to working with you for 
the next FAA reauthorization. We will take a few-moment recess 
so we can switch out the panels. Thank you very much.
    [Recess.]
    Mr. Shuster. The committee will come to order. We are 
joined by our next panel. I want to welcome our next panel. I 
guess everybody went to get coffee or a restroom break.
    While we are waiting for our panel to rejoin, I know that a 
few of us are going to have to leave here close to 12 o'clock. 
Mr. LoBiondo and myself are serving on Armed Services.
    Mr. Larsen, you are not in our meeting. We are picking 
subcommittees on the Republican side. You guys have already 
done that? OK.
    So Mr. LoBiondo and I will have to excuse ourselves. I 
believe Mr. Davis is going to take over the chair at that time.
    Mr. Young. Well----
    Mr. Shuster. Well, there is nothing wrong with you, Mr. 
Young. I just figured you had other things to do. You had other 
places to go.
    Have we lost our two other panel members?
    Mr. DeFazio. Bathroom break.
    Mr. Shuster. Thank you, Mr. DeFazio.
    Mr. DeFazio. Too much information.
    Mr. Shuster. Right.
    Why don't we go ahead? We have another appearance by Dr. 
Dillingham. He is the Director of Physical Infrastructure 
Issues for the Government Accountability Office. So on the 
guidance of Chairman Young, we will start with Dr. Dillingham, 
who has, again, been a frequent visitor to us.
    So Dr. Dillingham, why don't you go ahead and proceed?

 TESTIMONY OF GERALD L. DILLINGHAM, PH.D., DIRECTOR, PHYSICAL 
 INFRASTRUCTURE ISSUES, U.S. GOVERNMENT ACCOUNTABILITY OFFICE; 
      HON. CHRISTOPHER A. HART, ACTING CHAIRMAN, NATIONAL 
   TRANSPORTATION SAFETY BOARD; AND DORENDA BAKER, DIRECTOR, 
AIRCRAFT CERTIFICATION SERVICE, FEDERAL AVIATION ADMINISTRATION

    Dr. Dillingham. Thank you, Mr. Chairman, Ranking Member 
DeFazio, members of the committee. FAA has taken some important 
steps to address the challenges stakeholders face in getting 
U.S. aviation products certified for use at home and abroad. At 
the same time, we found that these steps are not sufficient and 
many key challenges remain regarding domestic certification and 
the consistency of regulatory interpretation.
    At the time we concluded our work, FAA indicated it had 
completed 8 of 14 initiatives established to address the 
Certification Process Committee's recommendations, and 2 were 
on track to be completed within 3 years. I understand from Ms. 
Baker's testimony that FAA has now completed 10 of the 
initiatives. When we completed our work of the remaining 
initiatives, one was at risk for not meeting planned 
milestones, and three initiatives would not meet planned 
milestones, including updating the regulations under which 
large and small aircraft are certified. Missing these 
milestones increases the risk of delays in improving the 
certification processes for a rapidly changing and expanding 
industry.
    Regarding regulatory certification--regulatory consistency, 
FAA has drafted a plan to address the Regulatory Consistency 
Committee's six recommendations, which are targeted at 
improving the consistency of how regulations are interpreted by 
FAA and the industry. While the plan is expected to be released 
sometime this month, it is being released over a year beyond 
its original target date of December 2013.
    Moreover, some key industry stakeholders told us that 
although FAA briefed them on its draft implementation plan, 
they were disappointed that they were not asked to participate 
in the development of the plan, as was suggested in the 2012 
FAA Reauthorization Act. Stakeholders also expressed concerns 
about FAA's decision to close two of the committee's 
recommendations before the plan is finalized, including the 
recommendation on improving the clarity of FAA's final rules.
    Turning to foreign approval of U.S. aviation products. The 
U.S. has historically been viewed as the gold standard for the 
approval of aviation products, with some countries accepting 
FAA's approval as sufficient evidence that the product is safe 
for use in their country. Other countries, however, do not 
accept FAA's certification, and more often, these countries are 
conducting their own approval processes for U.S. products. 
Stakeholders told us that such practices result in U.S. 
companies facing uncertainty and costly delays in delivering 
their products to foreign markets.
    Additionally, these companies noted that some of FAA's 
internal processes, such as the prioritization of foreign 
approval applications and insufficient staff resources and 
expertise, also contributed to delays and increased cost in 
getting their products to foreign markets. Working within the 
limitations of national sovereignty and other factors, FAA has 
several initiatives underway aimed at alleviating current as 
well as heading off future challenges related to foreign 
approval.
    GAO will continue to assist this committee by providing 
information and analysis on the certification process 
challenges and support committee efforts in considering these 
issues as part of the 2015 FAA Reauthorization Act.
    Thank you, Mr. Chairman. This concludes my statement.
    Mr. Shuster. Thank you, Dr. Dillingham.
    Next, the Honorable Chris Hart, who is the Acting Chairman 
of the National Transportation Safety Board.
    Mr. Hart, you may proceed.
    Mr. Hart. Good morning, Chairman Shuster, Ranking Member 
DeFazio, and members of the committee. Thank you for inviting 
me to testify on behalf of the National Transportation Safety 
Board today.
    For many years, the NTSB has investigated accidents and 
incidents that have identified issues regarding the FAA 
certification process. Most recently, we investigated smoke and 
flames coming from a lithium ion battery on board a Boeing 787 
at Boston's Logan International Airport. From this 
investigation, we recommended to the FAA actions that will 
address issues that they will continue to see in the 
certification process, especially as new technologies are 
introduced at an accelerating pace.
    The recommendations included: Identifying new technologies 
and the need to consult with outside experts regarding those 
technologies; ensuring an FAA workforce that has up-to-date 
training regarding the new technologies; and evaluating 
certification from a systems perspective, as you have already 
heard this morning.
    In the U.S. certification process, delegation of the 
certification has been in practice for many years and is 
necessary to improve efficiency of the FAA in the certification 
process.
    In its current form, Organization Designation Authority, or 
ODA, usually works well. It is a risk-based approach that many 
DOT modal agencies have adopted to use their resources more 
effectively and to focus their oversight on the riskiest areas. 
But as the NTSB has said, in many investigations, risk-based 
systems only work well when the regulator exercises effective 
oversight.
    In other investigations, the NTSB has recognized the need 
for the FAA to improve the certification process in the 
following areas: Ensuring no single-point failure modes; 
accounting for wear-related failures; and including structural 
failures and human machine system interaction failures in the 
assessment of safety critical systems.
    We are pleased with the action taken by the FAA last year 
regarding icing based on our investigation of two accidents in 
1994 and 1997, outlined in my full testimony, but it is 
unfortunate that needed changes that we identified in both 
incidents and accidents have taken so long to implement.
    Additionally, the NTSB has investigated events that 
illustrate shortcomings with flight standards. In the 
investigation of a January 2003 accident, the NTSB identified 
improper maintenance at a repair station where the owner had 
been previously employed as a chief inspector at a repair 
station that had its license revoked. We identified that the 
FAA did not have any regulations that enabled them to deny 
applications for part 145 repair stations of applicants that 
are associated with repair stations that previously had their 
license revoked. And we recommended that the FAA promulgate a 
regulation to implement this authority.
    The FAA published a notice of proposed rulemaking in May of 
2012, but more than 10 years after the accident, it has not yet 
issued a final rule on the subject.
    As you prepare to reauthorize the FAA, the certification 
process is a very important component to consider. Also, the 
NTSB has several other safety recommendations that could 
improve safety of our aerospace system, including strengthening 
procedural compliance for pilots, expanding the use of 
recorders in general aviation aircraft and enhanced recorders 
in commercial aircraft, and oversight of public aircraft 
operations.
    I would be happy to talk with you further about these 
topics as well. Thank you for inviting me to testify today. I 
would be happy to answer any questions you may have.
    Mr. Shuster. Thank you, Mr. Hart.
    And next, Ms. Baker, who is the Director of the Aircraft 
Certification Service at the Federal Aviation Administration.
    Ms. Baker, please proceed.
    Ms. Baker. Chairman Shuster, Ranking Member DeFazio, 
members of the committee, thank you for the opportunity to 
speak with you today. As the Director of FAA's Aircraft 
Certification Service, I am responsible for the oversight of 
design, production, and continued operational safety of 
aircraft, engines, propellers, and articles. Overseeing the 
safety of the world's largest fleet of aircraft while 
simultaneously certifying innovative new products and 
technology is a challenge, but one that we recognize as 
critical to ensuring U.S. economic growth. As such, we 
continuously strive to improve the process.
    The globalization of aviation, advances in technology, a 
high velocity of change, and heightened expectations from our 
stakeholders are all external forces driving us to reexamine 
how we conduct business. Since the 1920s, the FAA has relied on 
delegation to safely leverage the Government workforce. We 
apply safety management principles and use risk-based 
decisionmaking to leverage delegation and international 
partnerships and focus limited FAA resources. Today, we 
delegate 90 percent of certification activity. We are working 
to streamline the remainder.
    My written statement includes an update on FAA's 
implementation of initiatives responsive to section 312 of the 
FAA Modernization and Reform Act of 2012. During 
implementation, it became clear that not all of industry's 
concerns can be addressed through national policy changes. 
Therefore, today, I would like to focus on how we are 
addressing certification reform at the local, national, and 
international level.
    At the local level, we are reinvigorating concepts from the 
Certification Process Improvement Guide. This guide was 
developed in collaboration with industry over 10 years ago to 
improve cooperation and communication. Each company worked with 
their local office to define operating norms, develop an issue 
resolution process, and identify individual certification 
priorities.
    Utilizing the same philosophy, the FAA will work with 
individual companies to establish short- and long-term goals to 
help them reach their vision of full utilization of the 
Organization Designation Authorization, or ODA. The FAA has 
also created an ODA scorecard to collect qualitative and 
quantitative data related to safety, FAA involvement, and ODA-
holder compliance. On a local level, the scorecard will support 
constructive dialogue between the FAA management and ODA 
holders about compliance, timeliness, and performance 
improvements that may be needed.
    At the national level, the roll up of the scorecard metrics 
will allow us to monitor the effectiveness and efficiency of 
all ODAs, help differentiate between national and local issues, 
and point to areas where policy improvements are necessary. 
Globally, the FAA has been the leading model for safety and 
efficiency around the world. Yet the aviation industry is made 
up of an international web of networks and complex business 
arrangements that are challenging our traditional regulatory 
model.
    We are working with our global partners to leverage our 
bilateral agreements to facilitate the needs of industry. In 
2013, we formed a Certification Management Team between the 
FAA, the European Aviation Safety Agency, and the authorities 
of Canada and Brazil. This team discusses means to standardize 
and streamline certification of aviation products by reducing 
duplicative processes.
    I know the committee is also interested in the progress the 
FAA has made in response to section 312 of the act, which 
focused on the consistency and standardization of the 
regulatory interpretation. While the implementation plan for 
section 313 was formally posted on the FAA Web site yesterday, 
we have already taken steps to implement the recommendations. 
In fact, we have closed two of the six initiatives and the plan 
was supported by industry.
    The highest priority initiative is to develop a single 
master source for guidance organized by regulations. We are 
making progress and reviewing our existing databases to ensure 
the information is up to date. A challenge we face is that 
Enterprise Architecture Assessment identified 21 separate FAA 
document repositories.
    Last week, I participated in a demonstration of the proof 
of concept for the tool that will link the documents from 
multiple sources. This week, it will be presented to the 
Associate Administrator for Aviation Safety for approval of 
funding to proceed to field beta testing. I was impressed with 
the system's capability. It will link regulatory material not 
only by regulation, as requested by industry, but also by 
concept, in case the user doesn't know the regulatory citation.
    In conclusion, the FAA has made progress on sections 312 
and 313 of the act. We are conscious of the fact that 
certification reform is essential for economic growth of the 
United States, and we are working continuously to improve. The 
FAA is tracking the progress of implementing the initiatives, 
the performance outcomes, and the global return on investment 
for the FAA and industry.
    The FAA will continue efforts to develop meaningful metrics 
that promote open, constructive dialogue, facilitate positive 
change, and hold industry accountable to compliance with the 
regulations and FAA accountable to increasing efficiency of 
certification.
    Mr. Chairman, I am happy to answer any questions you may 
have.
    Mr. Shuster. Thank you very much, Ms. Baker.
    As I said, I have to excuse myself, but I wanted to ask a 
question before I left.
    Ms. Baker, your testimony said that you completed 10 of 14 
of streamlining the FAA's aircraft certification process. Can 
you explain to us, does that mean it is fully implemented, or 
does that just mean a milestone?
    Ms. Baker. The 10 that are completed have been completely 
finished and implemented. There are some caveats where we have 
had some follow-on criteria to assure that it is working 
properly, but the actual things, like the prioritization 
process, has been fully implemented.
    Mr. Shuster. So 10 have been fully implemented?
    Ms. Baker. Yes.
    Mr. Shuster. And then, again, talk about some of the 
things. How do you measure that, whether it is having a 
positive effect? I guess, if some of them have only just been 
approved, you haven't had time. But what is the process you go 
through to measure that to see if they are working and have the 
effect that we intended?
    Ms. Baker. Yes, we are continuing to work with industry to 
assure that we have a way to measure the effectiveness of what 
we put in place. We first started with phase 1 metrics, where 
measurements get put into place. Some of the information that 
we have had from an anecdotal standpoint was to get feedback on 
our approach. We had a 23-point plan to increase the ODA 
efficiency, and we met with industry to determine whether or 
not they felt that the changes that we had made were taking 
hold. The response that we got back was positive to neutral on 
what had occurred after the implementation.
    On the project prioritization process, we no longer have a 
queue, so we have zero wait time for the projects, so we 
measure that as a success.
    Mr. Shuster. Thank you.
    With that, I am going to recognize Mr. DeFazio and excuse 
myself. Mr. Davis is going to take the chair. So, again, I 
thank the witnesses for being here today.
    Mr. DeFazio. Thank you, Mr. Chairman.
    Dr. Dillingham, on page 3 of your testimony, you talk about 
some other countries do not accept FAA certification to conduct 
their own approval process, which can be lengthy. You don't 
list them. Could you provide a list?
    Dr. Dillingham. Yes, Mr. DeFazio, we can provide a list. 
But I can tell you now that we spoke to a sample of 
manufacturers that represented a good proportion of those who 
export to foreign countries. And we asked them to tell us about 
their experiences and which countries seem to present the 
greatest problems right now and what was the nature of those 
problems.
    What we were told is that it differs by country, but in 
terms of the top countries where they are experiencing the most 
problems, Europe and the issues behind the EC were related to 
cost, the cost of getting our products approved. And China was 
a top biller, and the issue for China was a combination of 
culture and their processes and procedures.
    You would have heard earlier about--as a matter of fact, 
you were the one who said it--about requesting----
    Mr. DeFazio. Detailed engineering and design criteria and 
coming over and observing the manufacturing process, and, of 
course, they are not going to copy it. Yeah, I got that. Right.
    Dr. Dillingham. So we will provide you the output from our 
survey of the manufacturers that we talk to.
    Mr. DeFazio. OK.
    So that leads me to Ms. Baker. I know you are somewhat 
constrained, but he does point to a number of things, the 
processes of these other nations in terms of reciprocity. And 
in dealing with the EU, I note that they charge for 
certification, and we don't. And I know there is a provision of 
appropriations bill that says that we have to authorize a 
charge, but wouldn't it be great if you had a tool to say, 
Well, if you charge, we are going to charge you. So when Airbus 
wants certified, well, you are going to pay the same charges 
that Boeing has to pay in Europe.
    Wouldn't that be reciprocal, and might that not get their 
attention?
    Ms. Baker. I am going to skirt that a little. I think----
    Mr. DeFazio. Well, I mean, let's say, how far along are you 
then in getting them to reduce these charges voluntarily out of 
the goodness of their heart? You know, do you expect that to 
happen real soon? Yes or no.
    Ms. Baker. If we are successful, by June. We are trying to 
get an agreement with them to make significant reductions in 
their charges.
    Mr. DeFazio. Yeah, but maybe it is a little more, a few 
more tools are necessary.
    And what about the Chinese, where we know what they are 
doing. What are we doing about that? I mean, they just want to 
be able to manufacture these things themselves. They are 
charging us--they send their people over here for 2 weeks for 
something that should take 1 day. We are required to pay for 
that. You know, are we working on some reciprocal arrangements 
with the Chinese that might get their attention?
    Ms. Baker. We do. We meet with them at least once a year, 
but, recently, we have been meeting with them quite a bit 
because we are conducting a shadow program of their ARJ21 
program right now. When we are aware of where they have 
overstepped their bounds, we have intervened.
    Recently, there was a situation where they were asking for 
much more information on the Robinson helicopter than they 
should be requiring just to operate the helicopter in their 
country. We intervened. We told them we did not feel that it 
was appropriate and in the spirit of our bilateral 
relationship, and they changed their process. And so we will 
then work with them----
    Mr. DeFazio. Good for you, and I hope you do a lot more of 
that.
    You know, we have the PASS testimony, which, unfortunately, 
wasn't available to be read or given here, but they are 
pointing to the fact that a lot of times inspectors only show 
up at, you know, an ODA once every couple of years, you know, 
that you don't have enough staff to really provide robust 
monitoring. I mean, do you feel comfortable about, you know, 
your capabilities? Are you using sort of targeting--I know that 
you try and target people you think are problematic and put 
more scrutiny on them. But it seems to me there just aren't 
enough inspectors.
    Ms. Baker. We use a systems approach to oversight which, I 
think, has shown to be very, very successful in the 
manufacturing of aircraft. We have done that for many, many 
years. We rely on a system, and then our people will intervene 
and do spot checks. If they find problems, then they will dig 
deeper and take the necessary action, whether it was a fine or 
just a corrective action to change the procedure so that they 
align with what the manufacturer is actually doing. We are 
evolving to that with engineering.
    As Ray testified, Boeing has a lot of engineers. They are 
very confident at what they do. We just need to assure that 
they are very versed in compliance with the regulations.
    Mr. DeFazio. OK. And just one other quick question. You 
know, when you give an ODA to a large organization, what is to 
prevent--in terms of your monitoring, what protections legally 
do we provide to the members of their ODA? I mean, do you think 
the firewalls are adequate? Are there special protections that 
are afforded? I know we have got the hotline, but that is 
generally for operational things more than these sorts of 
things. Do you think there are enough tools out there to avoid 
undue influence by companies that are trying to meet deadlines 
for new technology, for instance?
    Ms. Baker. Well, first, you have to start with the premise 
that everyone is aiming for a safe product. Once you have 
passed that, then you look at the individuals within the 
company. If they feel unduly pressured, they can come directly 
to the FAA and ask that we retain an item and intervene. We 
also require----
    Mr. DeFazio. Will they get protection at that point, some 
whistleblower or something?
    Yeah, I will be right with you Don. Yeah, well, Don, 
actually, the custom is--and I was very good before--that the 
ranking member gets a little more time. Yeah, well, that is 
true.
    Ms. Baker. He could if he went through the program for a 
whistleblower. When they come talk to us, it is usually not at 
that level. It is either a misunderstanding or something that 
we can work out. The other thing I wanted to note is in order 
to be an ODA, you have to assure that there is separation in 
the company and the person who is in charge of the ODA has high 
enough ranking within the company that they aren't unduly 
influenced----
    Mr. DeFazio. We will cut off at that point since the 
gentleman from Alaska has something urgent to add.
    Mr. Davis [presiding]. Gentleman's time is expired.
    Gentleman from Alaska is recognized.
    Mr. Young. Thank you, Mr. Chairman.
    Ms. Baker, section 313, from your perspective, what is the 
status of implementing that perspective?
    Ms. Baker. We have closed out two items. One was what they 
were envisioning would be a regulatory oversight body that was 
24/7 that you could go to, kind of like an op center. We 
decided to replace that with the Regulatory Consistency 
Communications Board, which then would vet the issues. So the 
24/7 kind of op center was set aside.
    And then we also have put forward means to train our 
employees.
    Mr. Young. When is the final time going to be?
    Ms. Baker. It is in process, so there are a number of 
things--just let me go back to what the main priority is. It is 
that big database in the sky that I talked about in my oral 
testimony. We have that proof of concept, but we have to do the 
beta testing, and then it will take probably another couple 
years before it would be implemented. And that is really the 
long----
    Mr. Young. I am going to make a suggestion. Just keep us 
informed, and I don't like dragging feet, you understand?
    Ms. Baker. Yes.
    Mr. Young. Second thing is your AFS and your AIR, are they 
working together to guide the manufacturers as well as the 
operators, or are they separated and don't talk to one another?
    Ms. Baker. We work very closely together. My office is 
right next to the Director of Flight Standards, and in the 
field, they work very cooperatively together. We have a group, 
called the Aircraft Evaluation Group, that is almost a part of 
my organization, providing the liaison between the two 
organizations.
    Mr. Young. That is important because, you know, I have 
watched agencies over my career here before you were born where 
they grow and they grow and they grow and they don't talk to 
one another, and that hurts the operator as well as the 
manufacturer of our aircraft, and where the ultimate goal is 
safety, not the building of an agency, so I am hoping that you 
work together.
    Mr. Hart, of the investigations of what you do, what was 
the percentage of pilot error versus aircraft error?
    Mr. Hart. Thank you for the question. What we generally see 
is system error in which good people try to do the right thing 
in difficult circumstances and then make mistakes. It is very 
difficult to say pilot error versus system error because it is 
a total system error involving the pilot and the airplane.
    Mr. Young. OK. Now, I don't which one--how many new 
regulations have the FAA passed in 2014?
    Ms. Baker. I don't know off the top of my head.
    Mr. Young. Would you guys find out for us, and the reason I 
ask that, again, regulation for regulation's sake doesn't 
accomplish the safety which we are trying to achieve.
    Ms. Baker. Yes.
    Mr. Young. I hear a lot of times you are short on money, 
but I see a lot of FAA activity that has nothing to do with 
safety. It has nothing to do with it, like moving a fence on a 
golf course. Lots of money spent. No reason for it. Putting 
fences in airports there is nobody around, lots of money. Lots 
of little things within the FAA itself that takes away, I 
think, is your ultimate goal is safety, not all this other 
stuff, and you grow and you grow and you forget what your 
ultimate goal is. But overall, I haven't had that--too many 
complaints yet. Most are minor from what I call civil aviation 
and again an overenthusiastic inspector, who hasn't been 
trained to be an inspector, so we will look at that. It is not 
your problem. We are just pursuing that.
    Mr. Chairman, I yield back.
    Mr. Davis [presiding]. The gentleman yields back.
    Mr. Larsen, the gentleman is recognized for 5 minutes.
    Mr. Larsen. Thank you. Mr. Hart, Chairman Hart, what 
concerns does NTSB--what concerns has the NTSB identified with 
FAA's certification efforts regarding new and novel technology, 
and what recommendations has the board made to FAA regarding 
the certification of new and novel technology?
    Mr. Hart. Thank you for the question. We have been looking 
at certification accidents for more than 20 years. The latest 
one that I mention in my oral testimony regarding the Boeing 
787 battery had a wrinkle of being a new technology accident, 
and I suspect we are going to see more of that as new 
technologies come in at an accelerating pace. The key to the 
process with new technologies is quality of the process. That 
is why we made recommendations ensuring that the broadest 
possible base of resources are consulted, in this case, looking 
at the lithium-ion battery. Since we knew the auto 
manufacturers had been using these batteries and had 
experiences with them, including some bad experiences, talk to 
them. We knew that the Defense Department had been putting 
lithium ion batteries in their equipment--good situations, bad 
situations--talk to them. The Department of Energy had a lot to 
inform the process, but they weren't consulted.
    We are looking at how to get the broadest base of expertise 
regarding new technologies. Also, we are looking to make sure 
that the FAA workforce is properly trained to stay up to speed 
with the development of the new technologies because otherwise 
they may not know that the sources that they are looking at 
aren't as broad as they could be. Then last but not least, we 
recommend looking with a systems perspective at the 
introduction of the new technologies.
    Mr. Larsen. Ms. Baker, is the FAA using outside experts to 
the extent that the agency is suggesting or how would you--how 
would you characterize what the FAA is doing relative to those 
recommendations?
    Ms. Baker. The FAA has extensive use of outside experts. We 
go to RTCA, ASTM, SAE was useful. We have used MITRE, used a 
number of outside venues to get the expertise.
    I think what Chris was highlighting is that one of the 
things that we all need to be cognizant of is that sometimes 
the knowledge is outside of the aviation sector, so we really 
need to reach out more broadly, and that would be something 
that we will take into consideration as we move forward.
    Mr. Larsen. All right. Can you, as well, Ms. Baker, discuss 
the accelerated use of ODAs and whether or not it has created 
oversight challenges with inspector's workload increasing 
beyond head count, and what assurance can you give the 
committee that the FAA will build a running ODA program while 
maintaining safety?
    Ms. Baker. Yes. I talked a little bit about the ODA 
scorecard in my testimony. Again, we are trying to look at what 
is going on nationally with all the ODAs, but then look at what 
is happening locally. We will not only track measures for our 
effectiveness in our oversight, but their effectiveness in 
compliance with the regulations, so we are going to be building 
on that. That will give me confidence that we can move further 
and further to a systems approach.
    In section 312, you probably know that we already have 
looked into expanding to delegate noise, emissions, and the 
instructions for continued airworthiness, so I think there are 
many areas where we can continue to expand very safely.
    Mr. Larsen. Expanding, but how can you ensure then that 
appropriate FAA oversight is spent--we talked in the previous 
panel how Boeing and many other companies, frankly, want to use 
ODA as fully as possible but still need the FAA sort of behind 
that in order to do auditing, do oversight, so on.
    Ms. Baker. Each ODA is required to put together a manual, 
and we audit to the manual every 2 years, and then we do spot 
checks along the way to see if they are truly doing the job as 
we would if we were in their shoes. I think that it has been 
effective and will continue to monitor that. We will be 
watching the results from our inspections of the ODAs and to 
determine whether or not we are finding an increased number of 
noncompliances to the regulations versus noncompliances of just 
following their manual. I think that will help keep a very good 
level of oversight.
    Mr. Larsen. OK. Dr. Dillingham, not that the FAA doesn't 
have enough to do, and we are not asking--not that we are 
asking you if they have enough to do, but in looking at the 
international certification side as you did, do you think the 
FAA needs to make its international certification to be as a 
higher priority if we are going to address these international 
challenges that you described in your testimony? Where do those 
fit?
    Dr. Dillingham. Thank you, Mr. Larsen, for the question. I 
would hesitate to suggest what FAA's priorities would be, but 
if you look at what is going on with international, the 
industry representatives that we talk to indicated that from an 
internal perspective, leave aside what happens once the 
application goes overseas, is that they think that FAA does not 
make this a high enough priority, that including the issue of 
getting full use of the ODA, the ODA program. I think from what 
we learn, what FAA is doing now with regard to working to make 
the bilaterals more efficient and more effective and working to 
get the concept of mutual acceptance of approvals from our 
longstanding partners, I think if that plays out, then the 
priority issue will be less of an issue going forward.
    Mr. Larsen. OK. Thank you, Mr. Chairman. Just one final 
note, Mr. Chairman. Not that I am pitching for a codel to the 
Paris Air Show, which by the way, you don't spend any time in 
Paris when you are at the Paris Air Show, just one walk around 
the pavilions at the Paris Air Show would let you know just how 
global the industry, aviation industry is and how important 
this issue of FAA certification international market is as 
well.
    Mr. Davis. OK.
    Mr. Larsen. On the other hand, if we want to take in the 
Paris show, that is fine, too.
    Mr. Davis. The gentleman from New York is recognized for 5 
minutes.
    Mr. Hanna. Thank you. Mr. Hart, Ms. Baker, I have Griffiss 
Air Force base, the former Griffiss Air Force base, my 
district, and as you know, it is one of the six sites selected 
for UAS tests, and it is becoming a little obvious that the FAA 
really hasn't done the rulemaking to allow them to move forward 
in the way that people anticipated because the questions that 
they need to answer really haven't even been asked yet, if that 
is fair, and that is a question.
    Given your experience with the FAA certification process 
and all these challenges, how do you plan on doing that, 
assuming it hasn't been done, and I don't think it has. How do 
we take advantage of these test sites? And what are you going 
to do--there is an estimated 500,000 of these devices in the 
country. How are you going to manage all that knowing that 
other countries are already using them, some of them Japan, for 
example, 20 years, and it is a tremendous opportunity for this 
country for all the reasons that, you know, I don't need to go 
into, and you are already busy and these sites are, for lack of 
a better word, they have the potential to linger and yet we 
have got a lot invested in them. I guess the question is what 
is going on? What can we anticipate? And how are you going to 
take advantage of Griffiss and help it grow?
    Ms. Baker. There is a lot going on. It is a very high 
priority of the Administrator to move out on UAS and to do it 
right. There are the activities with the rule on small UAS. Our 
aircraft certification office in L.A. actually certified a UAS 
on a restricted category-type of certificate to operate in the 
Arctic. We have also been working with the test centers so that 
they could get designees to issue airworthiness certificates so 
that that could facilitate them to do more work on our behalf 
and make them more self-sufficient. So again, I think that 
there is quite a bit going on.
    One of the other things that we are doing in our 
organization is we put together an advisory circular that would 
identify the level of rigor that should be applied to the size 
and complexity of the UAS because, as you know, some could fit 
in your hand and others could be as large as a 747. So we are 
trying to establish how you would handle all of those UAS. But 
it is an interaction with our organization, AVS, aviation 
safety organizations, which is inspectors and flight standards 
and our engineers but also with air traffic to ensure that they 
will blend into the national airspace safely.
    Mr. Hanna. But it doesn't feel like the FAA is up to the 
challenge right now, that they are behind. Would you believe--
do you believe that? I mean, is that fair?
    Ms. Baker. I don't think we would say we are behind. We are 
working very carefully to introduce them into our national 
airspace. Some of the countries that has utilized them have 
different situations. They are different environments that they 
are working in. They either have more open space or they have 
less general aviation population that is working in their 
airspace.
    Mr. Hanna. You don't think Iowa has a lot of open space?
    Ms. Baker. They do.
    Mr. Hanna. I mean, you don't think--where I live, they are 
taking advantage of these other countries to monitor vineyards, 
which we have, monitor animals.
    Ms. Baker. Uh-huh.
    Mr. Hanna. It doesn't--and these things are very 
controllable. I just wonder if there isn't a way to expedite 
the use of these at certain elevations, and I am familiar with 
the Supreme Court ruling, but my time has come to an end here 
but--yes, sir.
    Dr. Dillingham. Mr. Hanna, we have--we have a study 
underway looking at what it takes to get UAS into the national 
airspace for this committee, and we have--we have testified in 
the past that instead of the rule coming out when it was 
scheduled, the rule is going to be as much as 2 years late 
coming out. So what we have suggested is that there needs to be 
action taken in the interim, and some of those actions relate 
to the test sites, meaning get a greater use out of the test 
site, for example, giving them greater authority to allow 
testing and evaluation at the test site, look at ways in which 
things can be done now on an interim basis like section 333 of 
the regulation. Also, to take some lessons learned from other 
countries, particularly Canada, our northern neighbor, and talk 
about what you heard several times this morning, sort of a 
risk-management approach to the integration of UAS.
    So there are things that can be done, and we think that FAA 
is beginning to move in that direction because there is such 
a--almost a dam of industry and industry activities that are 
waiting----
    Mr. Hanna. There is a huge demand, yeah, and Griffiss Air 
Force base is waiting, you know.
    Dr. Dillingham. Yes, sir.
    Mr. Hanna. Thank you very much. My time is expired.
    Mr. Davis. Gentlelady from the District of Columbia is 
recognized for 5 minutes.
    Ms. Norton. Thank you very much, Mr. Chairman.
    Ms. Baker, I am about to have a town meeting in the 
District of Columbia because of complaints about noise over 
residential neighborhoods, and I asked Mr. Conner of Boeing 
whether or not noise was a part of the process. I think you 
yourself have testified that it is now part of the process.
    Now, what we found out was that when there were complaints 
in the past about flying over areas, residential areas, in this 
case in Virginia, what FAA did was simply to fly over areas in 
the District of Columbia. As a part of the Next Gen process, 
you are supposed to have quieter aircraft, and, of course, Mr. 
Conner testified they were quieter. We have asked for aircraft 
to be flown over the river.
    We are wondering whether when you get complaints about 
noise, why are we getting complaints about noise with all the 
new technology; and two, why would the FAA simply go from one 
area to another area to relieve those complaints? Do you have a 
system for relieving those complaints such as, for example, our 
suggestion in the Nation's Capital that you fly over the river 
where no one lives?
    Ms. Baker. The actual routing of the aircraft is a 
different part of the organization that I am not familiar with, 
but the noise of the aircraft, the actual noise levels are set 
by the EPA, and we work with companies like Boeing to make 
improvements.
    Ms. Norton. Noise is part of certification. Do you believe 
that considering Next Gen, and Next Gen is already in effect, 
to some extent, that the noise levels are consistent with 
increasingly flying over inhabited neighborhoods?
    Ms. Baker. The noise levels are set by the EPA, so what we 
would do is to assure that we can work with the manufacturers 
to ensure that the aircraft themselves are meeting the level 
of----
    Ms. Norton. Are you saying that EPA has told you that the 
noise levels are acceptable and that I should be talking to the 
EPA?
    Ms. Baker. They set the noise regulations, and we are 
delegated on their behalf.
    Ms. Norton. So here we have delegation on top of 
delegation?
    Ms. Baker. Yes.
    Ms. Norton. Let me ask a question that was never fully 
answered. It is very interesting and in some ways troubling to 
hear Mr. Conner testify, I think he raised this on his own 
accord, that FAA should not lose its own gold standard role. 
There was no question but that he feared that that was 
happening.
    I then asked him whether or not sequester and cuts had had 
any effect. He didn't say they were the cause of the loss of 
the gold standard, but he testified that those cuts had hurt, 
and he gave some specific ways in which they had hurt. Now 
leave aside China. This is my question. Why is the United 
States losing what had been the gold standard? What happened 
here, we are fine with you. What is the source of this loss of 
that lead role since there is no question, if you leave aside 
China, even the Europeans are second-guessing our role. I ask 
that of all three of you.
    Ms. Baker. Go for it.
    Dr. Dillingham. Ms. Norton, you know, we have heard that 
metric over the last couple of years about the U.S. being the 
gold standard, and in fact, the U.S. losing its position of the 
gold standard. I think that metric is more of a sort of an 
explanation that the world of aviation is changing. The 
manufacturers that we talk to had mixed opinions about whether 
the U.S. was the gold standard, or EASA was the gold standard 
or whatever, but what they were saying is, in the past, if the 
U.S. said OK, then it was OK. That was the gold standard, 
because if the U.S. approved it, it meant it was----
    Ms. Norton. So Dr. Dillingham----
    Dr. Dillingham [continuing]. Ready to go.
    Ms. Norton [continuing]. You are telling me it is not OK 
today?
    Dr. Dillingham. Well, there are some contributing factors 
to that. No one is saying that the U.S. standard of quality has 
changed, but what we see is, we see ICAO, the International 
Civil Aviation Organization, telling nation states that you 
must establish your own certification processes and apply those 
as you see fit. So instead of what it used to be that it could 
just go through, they are going through another process.
    Ms. Norton. So you don't think it casts any doubt on our 
standards here. It is just that everybody wants to do it his 
own way and wants to repeat what has already been done.
    Dr. Dillingham. Exactly. If--in other countries, those 
organizations have to pay for themselves, so automatically they 
are going to charge us, and no one is saying that, you know, 
our quality is any less. The world is just spinning with more 
civil aviation authorities in place.
    Ms. Norton. Can I ask you this: In terms of the training, 
Ms. Baker, of your own engineers, we understand there is a 
shortage. I don't know what it takes to be an engineer, if you 
have to be an engineer to be a certified engineer, but there 
are complaints of inadequate training, even from your own 
personnel. What are the difficulties you are encountering in 
certification of engineers so that you can feel confident that, 
in fact, the inspections should be recognized everywhere?
    Ms. Baker. When the engineers are hired by the FAA, they 
already come to us with an engineering degree, and most of the 
time with a lot of experience coming from a manufacturer of an 
aviation product. What Ray Conner----
    Ms. Norton. Do you do your own training?
    Ms. Baker. We do do our own training, and when there is new 
technology, we will send them out to training that is outside 
of FAA where there is the expertise for us to gain that 
knowledge from the absolute threshold of experienced people.
    What Boeing was talking about was systems engineering. We 
are currently hiring people with a lot of expertise in fields 
like structures and avionics. What we are moving towards is a 
systems engineer, someone who can look at the entire system and 
judge where they should be making the interventions and how 
they can improve the system. That is more of a process type of 
thing versus a specialty engineering.
    Ms. Norton. Thank you.
    Mr. Davis. The gentlelady's time is expired.
    The gentleman from North Carolina is recognized.
    Mr. Meadows. Thank you, Mr. Chairman. Thank you, Dr. 
Dillingham, for being back with us. It is good to see you 
again. I want to start with you to follow up. I know a lot has 
been discussed with regards to the ODA program, and it is my 
understanding that one of the biggest problems that we have is 
really with FAA engineers and specialists getting involved in 
the certification process, and essentially getting involved 
when the ODA has already authorized or conducted their review 
and duplicating efforts. And so in other words, the ODA is 
doing their job, and yet the FAA is retaining some of that 
work; is that correct?
    Dr. Dillingham. When we talked to manufacturers in 
preparation for this hearing, that was one of their concerns 
about the ODA.
    Mr. Meadows. So that is reoccurring? It is not just one 
stakeholder. It is multiple stakeholders that said that?
    Dr. Dillingham. Yes, multiple stakeholders said that, and 
we think part of the explanation is that when you go to an ODA 
and you start to assign those kinds of inspection 
responsibilities outside of the FAA, we are talking about a 
significant cultural change from the way the agency has been 
doing business for eons, and it takes time for that to be in 
place. And I think the recent----
    Mr. Meadows. So would you suggest more training on the FAA 
so they can understand the role of the ODA then? Because if it 
is a cultural change and you are saying that they are--they 
have got boundary lines that they are crossing over, how do we 
make sure that that happens in a very fast and effective manner 
so you don't lose out the competition from overseas?
    Dr. Dillingham. I think with as much speed as possible. As 
part of the 312, 313 recommendations, FAA has worked the ODA 
process and issued new guidance for how they are supposed to 
operate and their training and their oversight, so I think we 
are at the point now that change is possible and change in a 
relatively speedy time.
    Mr. Meadows. So you have issued the regulation. So is the 
training actually happening or not? Because it is one thing to 
write a regulation; it is another to implement it.
    Dr. Dillingham. That is a good question. I am going to ask 
Director Baker to take that on.
    Ms. Baker. Thank you, Gerald. Yes, it is. It is happening. 
We have an understanding by all of the engineers, if they are 
to retain, they need to document why it is that they are 
retaining. The order that was updated, such that there are 
categories. Inspectors would identify where they are retaining 
based on those categories. Again, we talked about the scorecard 
that we were developing. We just recently got some information 
back on some major ODA holders, and we found that it is 
amazing. There is a lot that is being delegated. In one 
particular case, 85 percent of the work didn't even require a 
notification letter to the FAA. Of the 15 percent that required 
the notification letter, only 5 percent was retained. What is 
happening is FAA keeps getting in the critical path to delivery 
of the aircraft.
    Mr. Meadows. So critical path means delays in 
certification, delays in the process, and losing money?
    Ms. Baker. It does. So that is why we take what they have 
identified as where they have retained and why they have 
retained it, and we will start to delve deeper in at the local 
level.
    Mr. Meadows. So if I would ask the stakeholders to give you 
a grade on your implementation, A through F, what would the 
stakeholders give the FAA in terms of a grade?
    Ms. Baker. Overall, we would probably get a C, but there 
are people who would grade us F and there are people that will 
grade us A. There are some organizations that are smaller and 
not having success at getting as much autonomy as they would 
like, and there are others that are still struggling.
    Mr. Meadows. All right. So how do we move it from a C 
overall and an F in some cases to an A or a B? Because it 
really is not about a grade. It is about competitiveness, it is 
about profit, it is about keeping market share, and really when 
you look at certification process, somebody is going to do it. 
It is either us or we are going to lose out to other 
competition, so how do we move that during this 
reauthorization, how do we address that effectively?
    Ms. Baker. Again, I don't know that it is a national 
solution. I really think that you have got to get down into the 
documentation that the employees are supposed to make when they 
retain something. What we found when we just did this recent 
survey was that there were some areas that were instructions 
for continued airworthiness. We have got that taken care of, so 
now the companies just need to ask for that authority. Noise. 
It is in a beta test that will start to reduce the work that 
FAA will be involved in. Emissions. We can do that now. They 
just need to ask for that authority.
    There are other areas where rules that were put in place 
recently and we were retaining them as the company gained 
experience, but now it is showing up as something that can be 
done nationally to reduce our involvement and then we will 
start to pull away where we can.
    Mr. Meadows. Well, as we go through this process--my time 
is expired, but as we go through this process, this is 
something that we will be looking at very acutely and very 
keenly, and so as you look at it, we look for specific 
recommendations on how we can address that. And I thank the 
chairman, and I yield back.
    Mr. Davis. The gentleman's time is expired. The gentleman, 
my colleague from Illinois, Mr. Lipinski, is recognized for 5 
minutes.
    Mr. Lipinski. Thank you, Mr. Chairman. I want to thank the 
witnesses for being here today. One of the biggest issues that 
I have been focused on during my time in this committee is 
streamlining the FAA's certification process to make sure that 
manufacturers can move innovative safety enhancing ideas from 
the design table to assembly line into the cockpit without 
months of delay in unnecessary cost which unfortunately has 
been happening all too often.
    First question I wanted to ask Ms. Baker, Ms. Baker, sorry. 
I was lead Democratic co-sponsor of the Small Airplane 
Revitalization Act. I was pleased that Congress recognized and 
responded to the challenges posed by the certification process. 
Many of us on this committee and many at DOT and FAA did the 
rewrite of part 23 rules as vital to safety innovation. So I 
want to ask, what steps have you taken to move this rule 
forward? And where is the rulemaking being vetted today? Has it 
been received by DOT and OMB?
    Ms. Baker. Yes. The part 23 rule is very important to us 
also. We have done a number of things to push the rule through 
as quickly as we possibly can. We have a dedicated technical 
team working on it. We have a headquarters attorney assigned 
solely to this particular rule. We meet weekly to look at the 
schedule for all of the rules, but we meet monthly to assure 
that there aren't any roadblocks to move the part 23 rulemaking 
forward. We are still working on it in our organization.
    Mr. Lipinski. OK. So it hasn't been received by DOT and the 
OMB yet? Can you assure this committee that the NPRM for part 
23 small airplane rule will be published by the summer?
    Ms. Baker. The official schedule has not yet been 
published. We have, again, worked as hard as we can to move it 
as quickly as possible, and we would be happy to keep you 
updated on the progress of the rule if you would like.
    Mr. Lipinski. I would. I definitely would like you do that, 
and it is important that we move this forward as quickly as 
possible.
    I want to follow up on part 23 with Mr. Hart. In your 
written testimony, you referenced general aviation safety, 
specifically loss of control mitigation as one of the items on 
your most wanted safety list. Data that Government and industry 
have used to develop recommendations show that loss of control 
counts for a significant portion of fatal accidents in general 
aviation. As I mentioned in the last question, the 113th 
Congress passed legislation that will enable safety enhancing 
features to be accelerated for part 23 category aircraft in 
order to address issues like loss of control accidents.
    How can efforts like this legislation help to achieve 
improvement in aviation safety?
    Mr. Hart. Thank you for the question, Mr. Lipinski. We are 
troubled that more than 40 percent of the general aviation 
accidents are related in one form or another to loss of 
control, and most of those are related to aerodynamic stalls. 
In addition to training, which is a continual problem, we 
recommend equipping general aviation airplanes more extensively 
with angle of attack indicators so that the pilot will have a 
more direct awareness of the angle of attack. The pilot already 
has indirect indication of the angle of attack, but we are 
looking for more direct and more immediate awareness of the 
angle of attack to help avoid aerodynamic stall.
    Mr. Lipinski. Are there any--you know, anything you could 
say what more needs to be done on this issue? I know the angle 
of attack indicator is very significant. Anything else you 
wanted to mention that is important here?
    Mr. Hart. The biggest complaint we hear generally from the 
Aircraft Owners and Pilots Association is that the angle of 
attack indicators are too expensive, and as usual, that goes 
back to a certification issue.
    Mr. Lipinski. What are your thoughts on FAA's current 
policies and regulations on retrofitting of new equipment onto 
existing GA aircraft?
    Mr. Hart. That is hard to generalize because in some cases, 
retrofitting is realistic; in some cases it is not. So it is 
hard to make a general statement. I could give you an answer if 
you had a more specific question regarding a specific retrofit 
type. For example, retrofit of shoulder belts is very difficult 
in some airplanes. Retrofit of angle of attack indicator is 
another story altogether. It is very difficult to generalize 
about all retrofitting.
    Mr. Lipinski. OK. With that, I will yield back. Thank you.
    Mr. Hart. Thank you.
    Mr. Davis. The gentleman yields back the balance of his 
time. I see we have nobody else to ask questions besides me. So 
I appreciate all three witnesses being here today, and I 
reserved my questions till the end for my colleagues to be able 
to leave me here alone with you and not hear all your 
responses. I will gladly then tell them all exactly what you 
said.
    First off, let me start with Director Dillingham. In your 
testimony, you indicate that the jury is still out as to 
whether the FAA is successfully carrying out implementation 
plans for certification. Can you give me, in your opinion, the 
best way the FAA could avoid the mistakes in the past when it 
comes to implementing these plans?
    Dr. Dillingham. Yes, sir. One of the problems that GAO has 
is we have--we have--we have been asked by this committee to 
look at a number of different instances where the 
implementation of initiatives or recommendations has been at 
the center of it, the implementation by FAA. And what we found 
is the definition of ``implemented'' and ``completed'' sort of 
varies from we just started to, we have got a plan to, we have 
actually done some things.
    So our answer to that is, you know, as part of 
congressional oversight is to make sure that there are some 
metrics by which the agency can be held accountable, metrics 
that include sort of a baseline metrics, where do we start; an 
interim metric, where are we now when the Congress asks again; 
and in the end, an outcome metric, what did we actually achieve 
related to what the objective of the initiative was?
    So we are very much into performance metrics and 
accountability so that we can get some consistency, and the 
Congress can know what it actually means when FAA says we have 
implemented 22 out of 30 or we have implemented 10 out of 14. 
It is kind of--it is hard for us to tell at this point without 
really digging, digging, and digging.
    Mr. Davis. All right. Well, welcome to our world. So in 
your opinion, basically, we should hold the FAA accountable to 
these metrics and these performance measures and ask more 
specific reasons why these performance measures are not being 
followed.
    Dr. Dillingham. Exactly. And what do they mean? I mean, it 
is OK to use the concept of implemented and completed, but what 
do they actually mean? What is the, you know, sort of where is 
the beef kind of answer.
    Mr. Davis. So what you are saying is the FAA is not clear?
    Dr. Dillingham. It varies in terms of when you ask the 
status of something. It varies as to what the term means.
    Mr. Davis. Absolutely. Well, thank you very, very much. 
Thanks for bearing with me, too.
    Chairman Hart, your testimony before us today highlights 
accidents and incidents where the agency has used its 
investigative authority to actually promote safety objectives. 
Can you elaborate on what the purview of the NTSB is today? And 
given the safety advances that have been made in aviation as 
well as other modes, how has the agency evolved since its 
inception?
    Mr. Hart. Thank you for the question. I know I look old, 
but I am not old enough to have been around since its 
inception, but I will do my best on answering that nonetheless. 
We recognize that there is a new environment today and we need 
to respond to that new reality. The new environment is new 
mostly because of huge IT advances, and so that is going to 
change the way that all of us do business, and we are looking 
to respond to that new reality.
    In the old days, after an accident, we would do our 
exhaustive investigation, identify all the links in the chain 
and come out with a report in 18 to 24 months. The report was 
very useful to management because they would say, I didn't know 
that happened in my airline every day, and it was very useful 
to the FAA who would say, I didn't know that happened in that 
airline every day. The worker bees, of course, knew about it 
because they did it every day.
    Fast forward 20 years, today we issue that same report, and 
by the time it hits the street in 18 to 24 months, because of 
the amazing advances that the industry has made through 
collaboration with the Government in collecting and analyzing 
data, there is a good chance they already know about the 
problems and they are already fixing those problems.
    So what is the value that we bring to that table? And that 
is one of my challenges is to make sure that we position 
ourselves strategically to add value to that equation because 
the industry has done very well, but there is always room for 
improvement, and our challenge is how do we play a strategic 
role in that improvement.
    Mr. Davis. Thank you. Thank you.
    Ms. Baker, my district is a very rural district in central 
Illinois. It is a district that includes many acres of 
agricultural land and large real estate tracts, and we have 
seen that unmanned aircraft, unmanned aerial vehicles are 
easily utilized to help not only on the production side of the 
agricultural sector, but also on the real estate side to ensure 
that property could be shown effectively since they are very 
large and very difficult for an individual to go walk the 
entire acreage of some of the tracts of land.
    So I am concerned about what I think is the FAA's somewhat 
slow activity in the rulemaking process. There is obviously a 
growing demand. All you had to do was hear the stories from the 
Christmas season about UAVs and how they were popular gifts. I 
didn't get one, so I hope maybe you did. But what is the status 
of the FAA's efforts to put a risk-based certification system 
in place for UAS?
    Ms. Baker. There are, again, various activities that are 
ongoing. If we are looking for an actual certification of it, I 
think we have got a good AC, and we have already shown that we 
can certify them in a restricted category and would like to 
continue to in that vein. But we are also issuing the 
exemptions, as Gerald mentioned, the section 333 of the last 
reauthorization to allow people to start to use these in areas 
where they can mitigate the possible damage to people and 
property.
    So I think that we have ways to accommodate many of the 
things that you are talking about now and will move on to make 
sure that we provide more and more opportunities in the future.
    Mr. Davis. Well, you granted 333 exemptions so far?
    Ms. Baker. No, no, the section 333 of the last 
reauthorization bill.
    Mr. Davis. Oh, you granted 13 in section 333, you granted 
13 exemptions so far, right?
    Ms. Baker. I am not--you might have a better number than I, 
but we knew we weren't doing a very good job at getting them 
out the door, and so just last week we pulled a group together 
and assured that they had everybody that needs to be involved 
in establishing the mitigations that are necessary to assure 
that we can do this safely and put them in one room so that we 
can get these out as quickly as possible. So they are building 
templates. What happened before was that there were offices 
that were remote from each other, and just the sheer need to 
send emails and stuff back and forth was causing delays. So we 
got everybody in one room, the attorneys, the engineers, the 
inspectors, everybody at one place so that we could churn up 
the volume.
    I would hope that in a week or two, you will see a lot more 
coming out of our doors. We have 120-day metric that we want to 
assure that we beat by quite a bit, and to do that, we have 
this group of people that are solely focused on just issuing 
those exemptions.
    Mr. Davis. I mean, I hope they are still not locked in the 
room right now.
    Ms. Baker. Almost. We probably bring them in pizza.
    Mr. Davis. I mean, we have 13 that have been granted. How 
many do you estimate have been requested, exemptions have been 
requested?
    Ms. Baker. I don't know what the count is now, but we are 
anticipating hundreds.
    Mr. Davis. In the hundreds. OK. And Canada has granted 
thousands of exemptions, and I mean, we just have some concerns 
over--we look to UAVs as part of our flight and part of our 
aviation sector for years to come, and there has got to be a 
way for us to be much more--much more receptive to the newness 
and much more receptive to ensuring that they don't provide any 
opportunity for incursions in and around our airports, and it 
is just simple rulemaking, it is simple procedures.
    We ought not to, in my opinion, look to the future with 
exemptions, and more so look at how do we implement them into 
our existing system. I would urge the FAA to do that, and as 
you know, as you come in front of this committee often, I will 
probably be asking you more.
    Is there any--are there any performance measures--you 
mentioned 120 days for the group now that you have gotten 
together locked in the room, and you expect that to actually be 
done before 120 days for all of the hundreds of applications?
    Ms. Baker. We have a metric for all exemptions to get them 
out within 120 days. That is regardless of whether it is on UAS 
or other things. What we are trying to do is to reduce the 
amount of time that it takes to get the UAS exemptions out 
because of the sheer volume.
    Again, if we can get templates, people can see what others 
are granted and make theirs as similar to the request as one 
that was already granted, it will expedite our ability to get 
them out.
    Mr. Davis. OK. Well, I look forward to working with you, 
and just as you offered to keep my colleague Mr. Lipinski up to 
date on part 23, I would actually ask that you also send that 
to my office, too.
    Ms. Baker. OK.
    Mr. Davis. All right. And thank you very much for your 
testimony. If there are no further questions, although I am 
still always haunted by former Chairman Young looking at all of 
us up here in front of you, if there are no further questions, 
I thank the witnesses for their testimony, and the members who 
are not here, for their participation. I ask unanimous consent 
that the record of today's hearing remain open until such time 
as our witnesses have provided answers to any questions that 
may be submitted to them in writing, and unanimous consent that 
the record remain open for 15 days for additional comments and 
information submitted by members or witnesses to be included in 
the record of today's hearing. Without objection, so ordered. 
The committee stands adjourned.
    [Whereupon, at 12:48 p.m., the subcommittee was adjourned.]
  
  
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