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[Senate Hearing 109-174]
[From the U.S. Government Publishing Office]

                                                        S. Hrg. 109-174
 
                            ALASKA AVIATION

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

                             FIELD HEARING

                               before the

                         COMMITTEE ON COMMERCE,
                      SCIENCE, AND TRANSPORTATION
                          UNITED STATES SENATE

                       ONE HUNDRED NINTH CONGRESS

                             FIRST SESSION

                               __________

                              JULY 5, 2005

                               __________

    Printed for the use of the Committee on Commerce, Science, and 
                             Transportation

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       SENATE COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION

                       ONE HUNDRED NINTH CONGRESS

                             FIRST SESSION

                     TED STEVENS, Alaska, Chairman
JOHN McCAIN, Arizona                 DANIEL K. INOUYE, Hawaii, Co-
CONRAD BURNS, Montana                    Chairman
TRENT LOTT, Mississippi              JOHN D. ROCKEFELLER IV, West 
KAY BAILEY HUTCHISON, Texas              Virginia
OLYMPIA J. SNOWE, Maine              JOHN F. KERRY, Massachusetts
GORDON H. SMITH, Oregon              BYRON L. DORGAN, North Dakota
JOHN ENSIGN, Nevada                  BARBARA BOXER, California
GEORGE ALLEN, Virginia               BILL NELSON, Florida
JOHN E. SUNUNU, New Hampshire        MARIA CANTWELL, Washington
JIM DeMint, South Carolina           FRANK R. LAUTENBERG, New Jersey
DAVID VITTER, Louisiana              E. BENJAMIN NELSON, Nebraska
                                     MARK PRYOR, Arkansas
             Lisa J. Sutherland, Republican Staff Director
        Christine Drager Kurth, Republican Deputy Staff Director
                David Russell, Republican Chief Counsel
   Margaret L. Cummisky, Democratic Staff Director and Chief Counsel
   Samuel E. Whitehorn, Democratic Deputy Staff Director and General 
                                Counsel
             Lila Harper Helms, Democratic Policy Director

                            C O N T E N T S

                              ----------                              
                                                                   Page
Hearing held on July 5, 2005.....................................     1
Statement of Senator Stevens.....................................     1

                               Witnesses

Barton, Mike, Commissioner, Alaska Department of Transportation 
  and Public Facilities..........................................    20
    Prepared statement...........................................    22
Blakey, Hon. Marion C., Administrator, Federal Aviation 
  Administration.................................................    10
    Prepared statement...........................................    13
Casanovas, Karen E., Executive Director, Alaska Air Carriers 
  Association....................................................    40
    Prepared statement...........................................    42
Dennis, Jerry, Executive Director, The Medallion Foundation......    32
Harding, Richard, Senior Vice President, PenAir..................    29
    Prepared statement...........................................    30
Mineta, Hon. Norman Y., Secretary, Department of Transportation..     2
    Prepared statement...........................................     4
Poe, Pat, Regional Administrator, Federal Aviation 
  Administration, Alaska Region..................................    18
Plumb, Morton V., Director, Anchorage International Airport......    26
Thompson, Rick, Alaskan Regional Vice President, National Air 
  Traffic Controllers Association................................    33
    Prepared statement...........................................    35

                                Appendix

Brown, Phil, Director, Alaska Region, National Association of Air 
  Traffic Specialists (NAATS), prepared statement................    49

                            ALASKA AVIATION

                              ----------                              

                         TUESDAY, JULY 5, 2005

                                       U.S. Senate,
        Committee on Commerce, Science, and Transportation,
                                                 Anchorage, Alaska.
    The Committee met, pursuant to notice, at 9:30 a.m. in the 
Loussac Library, Anchorage, Alaska, Hon. Ted Stevens, Chairman 
of the Committee, presiding.

            OPENING STATEMENT OF HON. TED STEVENS, 
                    U.S. SENATOR FROM ALASKA

    The Chairman. Good morning, I thank you all for being here. 
Thank you for making the trip to Alaska. It's an honor to have 
you both here to testify today.
    As you know, Alaska depends on aviation more than any other 
state. Over 70 percent of our cities and towns are reached by 
air; that's year-around. And as you know, instead of cars and 
buses, we have airplanes and aircraft.
    Alaska has 7 times more licensed pilots than the national 
average. About 21,000 active pilots; nearly 10,000 registered 
aircraft. Our state accounts for 20 percent of the air space 
that you administer.
    And as our skies get more congested, it's important to 
utilize this air space effectively and efficiently.
    We have new innovations such as Capstone and Medallion; and 
both have had your full support. We thank you for that. I look 
forward to your testimony in this regard.
    We have very substantial reliance upon the program for 
Essential Air Service, as you know, and that Essential Air 
Service gives us access to hospitals, mail service, food, and 
basic supplies. We've also been working with you on lighting. 
It's very difficult to assure essential lighting for Alaska's 
rural airports, and we've managed to obtain substantial funds 
in the last 4 years, and I'm pleased to say that we have had 
additional infrastructure for nearly 50 communities through 
that program, and we're hopeful that by the time Alaska reaches 
our 50th anniversary of statehood every--every runway in the 
state will have runway lights.
    I could go on and on listening to the two of you. You're 
great friends of Alaska and personally. And I welcome you to 
this beautiful state. We have some spectacular weather for you.
    Mr. Mineta, Norm. Please have your say.

        STATEMENT OF HON. NORMAN Y. MINETA, SECRETARY, 
                  DEPARTMENT OF TRANSPORTATION

    Mr. Mineta. Thank you very much, Mr. Chairman.
    Let me, first of all, thank you for the invitation to 
appear at this hearing. It's always a pleasure to join you here 
in Alaska, particularly when the sun shines most every hour of 
the day. I couldn't get over the fact that at 11 o'clock last 
night it still seemed like 6 o'clock at home.
    The Chairman. Norm, they see us all night in the summer and 
we leave tracks in the winter.
    [Laughter.]
    Mr. Mineta. Administrator Blakey and I are here to discuss 
several important issues related to aviation in Alaska. The 
United States Department of Transportation is very well aware 
of the absolutely critical role that aviation plays in the 
lives of all Alaskans.
    In addition to its important place in Alaskan society, 
aviation faces unique conditions here that set it apart from 
the Lower 48 in many respects.
    Administrator Blakey will testify about the significant 
work of the Federal Aviation Administration in promoting and 
enhancing safety.
    I will speak about the aviation programs that are within my 
own offices that have a direct daily impact on aviation and air 
service in the State of Alaska.
    Mr. Chairman, I ask unanimous consent that my written 
statement be included as part of the hearing record.
    The Chairman. It will be. Thank you.
    Mr. Mineta. The Department of Transportation's Office of 
International Aviation and--or Aviation and International 
Affairs, has worked to liberalize air service markets 
throughout the world, and we have had considerable success. And 
in terms of these liberalized markets, they have allowed for 
expanded flow of goods and people that benefit our economy and 
those of our trading partners.
    Since coming into office, the Bush Administration has 
executed 17 new Open Skies Agreements, for a total of 71 Open 
Skies Agreements with other economies in force at the present 
time.
    Our liberalization efforts provide the foundation for the 
kind of growth in air services that have benefited the Ted 
Stevens Anchorage International Airport, which is a natural 
transfer for routes between the Lower 48 states, the moving 
Asian economies, and Europe.
    As a result of these actions, as well as the tremendous 
work of the FAA and their Alaska region Administrator, Pat Poe, 
and the outstanding leadership of Mort Plumb, the director of 
the Ted Stevens Anchorage International Airport, and the 
infrastructure improvements that have been made at the airport, 
the level of air cargo activity in Anchorage has increased 
substantially in recent years.
    The number of air cargo landings has increased from less 
than 14,000 in 1988, to more than 42,000 in 2004. A more than 
threefold increase.
    In fact, our recent landmark agreement with China has 
resulted in more than 20 additional all cargo flights by U.S. 
carriers in and out of Anchorage each week.
    We will continue to work actively to open international air 
service markets to the benefit of businesses, communities, and 
consumers in Alaska, and everyone else in the continental 
United States.
    As you know so very well, with respect to programs and 
activities that are focused within the state, the Department 
administers the Essential Air Service Program and sets air 
transportation rates for intra-Alaska bypass mail.
    I can assure you that the Department is committed to 
insuring that air service in Alaska is frequent, safe, and 
affordable for passengers and freight shippers, as well as for 
the United States Postal Service.
    Under the EAS program, the Department provides a safety net 
level of air service to the smallest and most isolated 
communities. Given that air service is typically the only 
access to Alaskan villages, the Department has regarded EAS to 
these remote communities as a very high priority; and we give 
great weight to the needs and opinions of the affected 
communities.
    For example, we have just this year increased air service 
to Akutan from the prior subsidized level because we recognize 
that, with the growth in that market, traffic could not be 
reasonably accommodated with the previous lower level of 
scheduled service.
    Likewise, we also selected Alaska Airlines to provide 
subsidized service at Adak, and notwithstanding another 
proposal, for a million dollars less per year, because we 
recognize the extreme isolation of Adak and the need for jet 
aircraft to fly the 1200 miles to Anchorage.
    However, the story is different in the Lower 48, and I 
would like your support in working with the Congress in making 
some much needed structural changes to the program. While some 
subsidized communities in the Lower 48 are indeed isolated; 
many others are not. I think it is fair to say that subsidized 
air service is not truly essential for too many communities in 
the Lower 48.
    If the program is not refocused on only the communities 
that are most in need, the costs threaten to grow even larger. 
So I stand willing to work with you and the Committee on ways 
we can all make the EAS program better, because it is currently 
not structured in a way that makes sense for the current state 
of air transportation in our country.
    Mr. Chairman, due to your leadership and strong efforts, 
Congress passed the Rural Service Improvement Act of 2002, 
which significantly revamped the bypass mail system within the 
state of Alaska.
    The two main goals of RSIA were, one, to increase the 
amount of flying with larger aircraft under Part 121 Safety 
Standards; and, two, to reduce the Postal Service's 
expenditures.
    While the industry is still adjusting to the new law, the 
early returns are that both of your main objectives are being 
met.
    RSIA recognized that two central problems with the bypass 
mail system had developed since its inauguration. First, a 
class of carriers had developed and focused on mail to the 
exclusion of passengers and freight. RSI compared air service 
in Alaska to a three-legged stool that supports passengers, 
freight, and mail service. And it recognized that if there was 
focus by any party on only one leg of the stool, such as mail, 
the overall stool would be weakened.
    Second, RSIA recognized that the longstanding simple mail 
rate structure of separate bush and mainline classes of mail 
ignored the increasing development of modern turbo-prop 
equipment and the potential benefits they presented to 
passengers from their greater speed and safety and to the 
Postal Service from their lower costs.
    To fully realize those advances, RSIA divided the single 
bush mail rate into three separate classes. Putting the goals 
of larger, safer aircraft in conjunction with reduced Postal 
Service expenditures produced a win-win result.
    RSIA directed the Department to carve out three separate 
bush rates, which we have done. In rough terms, the new Part 
121 rate developed by the Department is one half the former 
unitary rate; the Part 135 rate is the same as the former 
unitary rate; and the seaplane rate is double than the earlier 
single rate. The new rates have resulted in more equitable, and 
I believe, more efficient air services.
    In closing, Mr. Chairman, let me reaffirm the Department's 
commitment to small community air service, especially in 
Alaska.
    We look forward to working with you and the Members of your 
Committee as we continue to work toward these objectives.
    [The prepared statement of Secretary Mineta follows:]

        Prepared Statement of Hon. Norman Y. Mineta, Secretary, 
                      Department of Transportation

    Mr. Chairman, thank you for inviting me to this hearing. It is a 
pleasure to join you here in Alaska. Administrator Blakey, Regional 
Administrator Poe and I all appreciate this opportunity to discuss with 
you important issues related to aviation in Alaska. The U.S. Department 
of Transportation is well aware of the absolutely critical role that 
aviation plays in the lives of all Alaskans. In addition to its 
important place in Alaskan society, aviation faces unique conditions 
here that set it apart from the rest of the United States in many 
respects. So we are here today to address a number of the aviation 
issues that matter most to your constituents. In that regard, 
Administrator Blakey will testify about the significant work of the 
Federal Aviation Administration (FAA) in promoting and enhancing 
safety. But first, I will speak about the aviation programs within my 
own office that have a direct, daily impact on aviation and air service 
in the State of Alaska.
    As an initial matter, the Office of International Aviation has 
worked for many years to liberalize air service markets throughout the 
world--and we have had considerable success. Liberalized markets allow 
for expanded flows of goods and people that benefit our economy and 
those of our partners. Recently, we have signed Open Skies agreements 
with India and Indonesia and obtained much greater access to China. Our 
liberalization efforts provide the foundation for the kind of growth in 
cargo services that have benefited Ted Stevens International Airport, 
which is a natural transfer hub for routes between the lower 48 states, 
the booming Asian economies, and Europe.
    In connection with the Department's actions generally to open 
opportunities for air cargo activities, in 2004, new federal 
legislation was passed that substantially augments the liberal air 
cargo transfer rights that existed at Alaskan airports prior to this 
legislation due to the Department's earlier actions. As a result of 
this legislation, foreign carriers may now transfer and carry 
international origin or destination cargo between Alaska and other 
points in the United States that was previously prohibited by federal 
law.
    As a result of the above actions by the Department and the 
Congress, as well as the infrastructure improvements made by the 
airports, the level of air cargo activity at Anchorage has increased 
substantially in recent years. The number of air cargo landings has 
increased from less than 14,000 in 1988 to more than 42,000 in 2004, a 
more than three-fold increase. As these numbers show, when carriers are 
given liberal opportunities to serve an airport and the airport takes 
steps to make its facilities attractive, this can lead to substantial 
increases in the level of operations at that airport. We will continue 
to work actively to open international air service markets to the 
benefit of businesses, communities and consumers in Alaska and everyone 
else in the United States.
    As you know, with respect to programs and activities that are 
focused within the state, the Department administers the Essential Air 
Service (EAS) program and sets air transportation rates for Intra-
Alaska Bypass Mail. With regard to both of these responsibilities, I 
can assure you that the Department is committed to ensuring that air 
service in Alaska is frequent, safe, and affordable, for passengers and 
freight shippers, as well as for the Postal Service.
    It is clear that air service in Alaska, as well as the rest of the 
country, has changed dramatically over time. In the days before airline 
deregulation, there was a sign outside a Wien Air Alaska station 
advising prospective passengers that if they did not arrive within one 
hour of the scheduled flight, Wien would bump the passenger in favor of 
delivering an extra 200 pounds of mail or freight from its backlog. The 
competitive pressure of deregulation was designed to help address such 
issues of poor service for passengers, freight, and mail.
    In administering the EAS program, the Department ensures that 
communities receive a safety-net level of service when they are too 
small or too remote to receive market-driven service. Likewise, with 
the Department setting mail rates in Alaska, the Department ensures 
that carriers are fairly compensated for transporting the mail, and 
also that mail, freight, and passenger service work in tandem like the 
``separate legs of a stool.''
    The critical importance of mail and air service to Alaska's 
regional hubs and villages will continue for the foreseeable future. 
The Department seeks to ensure that there is an integrated 
transportation system that can provide benefit to all. This challenge--
and Mr. Chairman, I do not use the word ``challenge'' lightly--requires 
that the Federal Government wisely manage programs affecting intra-
Alaska service.

Essential Air Service Program (EAS)
    The Department has administered the EAS program since deregulation 
of the airlines in 1978. The laws governing EAS have not changed 
significantly since its inception more than 25 years ago 
notwithstanding the dramatic changes that have taken place in the 
airline industry. Under that program, the Department provides a safety-
net level of air service to the smallest and most isolated communities. 
Given that air service is typically the only access to Alaskan 
villages, the Department has regarded EAS to these communities as a 
very high priority.
    Although we take our fiscal responsibilities quite seriously, the 
Department has not administered the EAS program in a way as to merely 
minimize our expenditures. We give great weight to the needs and 
opinions of the affected communities, as mandated by Congress in 
section 41733(c)(1)(d) of the statute. For example, we have just this 
year increased air service to Akutan from the prior subsidized level, 
because we recognized that with the growth in that market, traffic 
could not be reasonably accommodated with the previous, lower level of 
scheduled service. Likewise, we selected Alaska Airlines to provide 
subsidized service at Adak, notwithstanding that there was another 
proposal for a million dollars less per year in subsidy, because we 
recognized the extreme isolation of Adak, and the need for jet aircraft 
to fly the 1,200 miles to Anchorage.
    However, the story is different in the lower 48 states, and I would 
like your support in working with the Congress in making some much-
needed structural changes to the program. While many communities in the 
lower 48 are indeed isolated, many others are not. Many communities are 
within 40-50 miles of an airport with plenty of jet service but, 
because it might be categorized as a small hub, those communities are 
entitled to subsidized air service. And that can be the case even 
though many, if not most, air travelers in the community drive to the 
nearby airport because they prefer its broader array of prices and 
services.
    Under current law, a community's eligibility for inclusion in the 
EAS program has been based only on whether it was listed on a carrier's 
certificate on the date the program was enacted--October 24, 1978. Once 
subsidized service was established, there was little incentive for 
active community involvement to help ensure that the service being 
subsidized would ultimately be successful. I can tell you anecdotally 
that many EAS communities in the lower 48 do not even display their 
subsidized EAS flights on their homepages, but do show the availability 
of air service, especially low-fare service, at nearby hubs. As a 
result, EAS-subsidized flights are frequently not well patronized and 
our funds are not being used as efficiently or effectively as possible.
    As you know, in 2003 the Administration began proposing significant 
reforms for the EAS program. Under the Administration's proposal, 
communities are asked to become partners in the financing of their air 
services. In exchange, they are given a much bigger role in determining 
the nature of that service. As a result, currently eligible communities 
would remain eligible, but would have an array of new transportation 
options available to them for access to the national air transportation 
system. In addition to the traditional EAS of two or three round trips 
a day to a hub, the communities would have the alternatives of charter 
flights, air taxi service, or ground transportation links. Regionalized 
air service might also be possible, where several communities could be 
served through one airport, but with larger aircraft or more frequent 
flights.
    Under the Department's proposal, community participation would be 
determined by the degree of its isolation from the national 
transportation system. The most remote communities (those greater than 
210 highway miles from the nearest large or medium hub airport) would 
be required to provide only 10 percent of the total EAS subsidy costs. 
Communities that are within a close drive of major airports would not 
qualify for subsidized air service, but would receive subsidies 
constituting 50 percent of the total costs for providing surface 
transportation links to a nearby airport with better service. 
Specifically, communities within: (a) 100 driving miles of a large or 
medium hub airport, (b) 75 miles of a small hub, or (c) 50 miles of a 
non-hub with jet service would not qualify for subsidized air service. 
All other EAS communities would have to cover 25 percent of the subsidy 
costs attributable to the provision of air service.
    The proposed small-hub and non-hub criteria are important. Under 
current law, communities located within 70 miles of a large or medium 
hub are not eligible for subsidized air service, on the principle that 
passengers find driving to such nearby service too attractive an 
alternative for the subsidized service to compete against. Our proposal 
extends that same principle in a measured way to small hubs and non-
hubs offering jet service, applying tighter proximity standards in line 
with the smaller size of the alternate service.
    We believe that this approach would allow the Department to provide 
the most isolated communities with air service that is tailored to 
their individual needs. Importantly, it provides communities in the 
program greater participation, control, and flexibility over how to 
meet their air service needs, and a far greater incentive to promote 
the success of those services. In this time of fiscal constraint, 
Congress would be recognizing the need to responsibly trim the costs of 
the program, while simultaneously protecting the needs of those 
communities most deserving of support.
    I am well aware that the proposed requirement of a local 
contribution has not been well received by many. But this is one of the 
few federal programs that does not have any local contribution. In the 
Department's Small Community Air Service Development Program, we have 
found that many communities are willing and able to make contributions 
to improve their local air services. As with that program, the local 
contributions in the reformed EAS program would not have to be made by 
local governments--for example, local businesses or the state 
government could provide the needed financial support. Nonetheless, I 
understand the concerns you have expressed about this in the past. In 
that respect, I stand willing to work with you and the Committee on 
ways we can all make the EAS program better, because it currently is 
not structured in a way that makes sense for the current state of air 
transportation in this country.

Rural Service Improvement Act of 2002 (RSIA)
    Due to your efforts, Mr. Chairman, Congress passed the Rural 
Service Improvement Act of 2002, which significantly revamped the mail 
system within the state. The two main goals of RSIA were to increase 
the amount of flying with larger aircraft under Part 121 safety 
standards and to reduce the Postal Service's expenditures. While the 
industry is still adjusting to the new law, the early returns are that 
both of your main objectives are being met.
    As background, the Postal Service is responsible for paying for the 
delivery of mail within Alaska, as well as ensuring that mail is 
equitably tendered to qualifying carriers, while the Department is 
charged with setting the rates that the Postal Service pays the 
airlines. Under the bypass system, goods bound for the communities, 
including critical food and medicine moving as mail, bypass the 
physical facilities of the Postal Service. Instead, the bypass shipper 
is directed to deliver the mail shipment directly to a particular 
airline, where a Postal Service official weighs, tracks, and records 
the shipment before its embarks.
    RSIA recognized that two central problems with the mail system had 
developed since its inauguration. First, a class of carriers had 
developed that focused on mail to the exclusion of passengers or 
freight. RSIA compared air service in Alaska to a three-legged stool. 
It recognized that if there was focus by any party on only one leg of 
the stool, such as mail, the overall stool would be weakened. For 
illustration, if there is only enough traffic at a village to support 
four round trips a week, that village is clearly better off receiving 
passenger and mail combination service each of those four days, rather 
than mail-only service on two days and passenger-only service on those 
other two days. RSIA encouraged just such a result by establishing two 
separate pools for passenger and freight carriers for each village. 
Passenger carriers transporting more than 20 percent of total 
passengers in a village were to share 70 percent of the mail, and 
freight carriers transporting more than 25 percent of the freight in a 
village were to receive 20 percent of the total mail to that village. 
The remaining ten percent of the mail was reserved, for a five-year 
transition period, for the carriers that did not qualify for either of 
those two pools. RSIA contemplated those mail-only carriers would 
either convert to passenger/freight service or go out of business. 
Before RSIA, three carriers relied more heavily on mail than any of the 
other bush carriers--Bellair, Village Aviation, and Servant Air. Mail 
constituted more than 95 percent of each of those carriers' total 
traffic, and each carrier has since ceased operations, though Servant 
is now operating under new ownership and management. The mail from 
those three carriers is now available to support combination passenger 
and freight service by the surviving carriers. (For a comparison of 
carrier traffic from calendar year 2000, before RSIA, to that of 
traffic in 2004, see Appendix A.)
    Second, RSIA recognized that the longstanding simple mail rate 
structure of separate bush and mainline classes of mail ignored the 
increasing development of modern turboprop equipment, and the potential 
benefits they presented to passengers from their greater speed and 
safety and to the Postal Service from their lower costs. To fully 
realize those advances, RSIA divided the single bush mail rate into 
three separate classes. Putting the goals of larger, safer aircraft in 
conjunction with reduced Postal Service expenditures produced a win-win 
result. With respect to saving the Postal Service money, service with 
larger bush aircraft is more cost efficient in moving larger volumes of 
mail in larger markets.
    Previously, the Department had set a single bush mail rate for all 
carriers operating equipment with a payload of less than 7,500 pounds 
(about 30 seats). RSIA directed the Department to carve out three 
separate rates: for 19-seat or larger aircraft operating under the more 
stringent FAA Part 121 standards; for smaller aircraft operating under 
Part 135; and a separate rate for seaplane aircraft, recognizing the 
higher cost of operating to villages accessible only by those aircraft. 
The Department has done as RSIA dictated: last year we issued 4 orders 
establishing these new rates. In rough terms, the new Part 121 rate 
developed by the Department is one-half of the former unitary rate, the 
Part 135 rate is the same as the former unitary rate, and the Seaplane 
rate is double that earlier single rate. Because larger Part 121 
service is operationally limited to the biggest airports and 
economically to the largest villages with the most mail, and Seaplane 
operations to the smallest, the Postal Service is clearly saving 
significant funds from this restructuring of bush mail rates.
    RSIA also tried to ensure that passengers at larger villages be 
served with larger 19-seat aircraft operating under more stringent FAA 
Part 121 operating standards. With the goals of saving the Postal 
Service money and encouraging Part 121 service, the Department 
established another class rate based on the costs of more expensive 19-
seat Part 121 aircraft, such as ERA Aviation's Twin Otters, which have 
short takeoff and landing capabilities lacking in other 19-seat 
equipment. Only Twin Otters and smaller Part 135 aircraft are capable 
of landing at very short runway airports. Without the Department 
creating a mail rate intermediate between the high cost of Part 135 
service, and the low cost of regular Part 121 service, those short 
runway communities served by ERA's Twin Otters would have lost that 
service in lieu of less commodious Part 135 aircraft, and the Postal 
Service would have had to pay more for it as well.
    I should also mention that the Department has recently granted the 
Postal Service an exemption to pay more than the Part 121 rate, but 
still less than the Part 135 rate, on a market-by-market basis, in 
order to ensure that carriers would continue to operate with Part 121 
service to many communities rather than remove seats from aircraft to 
fall within the Part 135 rate. Although the exemption is currently on 
appeal, and accordingly I am limited in what I can say about it, I do 
believe that this decision is consistent with RSIA's aims and helps 
ensure that unintended consequences of a three-rate structure do not 
redound to the detriment of Alaskan consumers or the Post Office.
    In closing, Mr. Chairman, let me reaffirm the Department's 
commitment to small community, and especially Alaska, air service. We 
look forward to working with you and the Members of this Committee as 
we continue to work toward these objectives. Thank you again. This 
concludes my prepared statement. I will now ask that Administrator 
Blakey discuss a few safety issues. At the end of her prepared remarks, 
I will be happy to answer any of your questions.

                     Mail as a Percentage of All Scheduled Traffic for Alaska Bush Carriers
                                               Calendar Year 2000
----------------------------------------------------------------------------------------------------------------
                                                                                                  Total Volume
                                                           Freight                             (Mail Volume as a
            Carrier & Designator               Psgrs.       (PEQ)    Mail (PEQ)      Total         Percent of
                                                                                                   Carriers)
----------------------------------------------------------------------------------------------------------------
1. Bellair (BEL)                                      0        65.0     9,466.4       9,531.4              99.32
2. Camai (Villiage, VLA)                             52       305.9    14,532.6      14,890.5              97.60
3. Servant (SVA)                                      0       139.1     5,110.2       5,249.3              97.35
4. Yute (YUT)                                         6       713.3    17,099.8      17,819.1              95.96
5. Olson (OAS)                                        9        61.9     1,640.3       1,711.2              95.86
6. Taquan (TQA)                                       8         6.8       221.9         236.7              93.75
7. Alaska Central  Express (YTU) 1/                   0    17,814.1   137,626.8     155,440.9              88.54
8. Illiamna Air Taxi (IAT)                          361       419.7     4,516.1       5,296.8              85.26
9. Tanana (TAN)                                   4,293       510.9    14,928.7      19,732.6              75.66
10. Jim Air (JMA)                                   347        73.3     1,179.6       1,599.9              73.73
11. Larry's (LFS)                                 7,681         964    19,482.2      28,127.2              69.26
12. Arctic Transportation (RYA)                       0      19,221    30,896.8      50,117.8              61.65
13. Arctic Circle (ASE)                           1,242    10,681.4    18,443.9      30,367.3              60.74
14. Baker (BKR)                                   4,180        57.0     6,480.4      10,717.4              60.47
15. Smokey Bay (SKB)                                394        32.1       564.7         990.8              56.99
16. Ellis (ELL)                                     361        28.7       247.1         636.8              38.80
17. Inland (INL)                                    566         3.4       352.9         922.3              38.26
18. Frontier (FFS)                               41,628     4,929.9    21,003.4      67,561.3              31.09
19. Cape Smythe (CSY)                            41,839     5,672.3    19,221.1      66,732.4              28.80
20. Grant (GRT)                                  61,084       316.3    23,374.0      84,774.3              27.57
21. Hageland (HAG)                               82,006     6,698.4    32,813.7     121,518.1              27.00
22. Alaska Seaplane (AKS)                             0     1,242.0     4,180.0       5,422.0              77.09
23. 40-Mile Air (WRB)                             2,536       942.1       998.8       4,476.9              22.31
24. Spernak (SNK)                                    67        30.0        27.1         124.1              21.84
25. Wright (WAS)                                 14,865     2,384.0     4,674.3      21,923.3              21.32
26. Bering (BER)                                 51,504     9,126.8    15,929.3      76,560.1              20.81
27. Wings of Alaska (WOA)                        31,585     3,591.7     8,220.8      43,397.5              18.94
28. Penninsula (PNA)                            175,129     6,888.9    39,040.8     221,058.7              17.66
29. Ward (WRD)                                       66         3.6        13.8          83.4              16.55
30. ProMech (PRH)                                38,492     5,378.0     7,527.7      51,397.7              14.65
31. Warbelow (WAL)                               33,574     5,526.8     6,125.3      45,226.1              13.54
32. Island Air Service (IAS)                     19,621     1,974.5     3,059.1      24,654.6              12.41
33. LAB                                          25,655     4,948.0     2,221.3      32,824.3               6.77
34. Skagway (SKG)                                 9,980     1,030.0       453.4      11,463.4               3.96
35. Haines (HNS)                                  8,251       565.5       352.5       9,169.0               3.84
36. ERA 1/                                      435,057     8,779.7    15,304.2     459,140.9               3.33
37. FS Air Service (FSA)                            984        70.6         0.0       1,054.6               0.00
38. Gulf Air Taxi (GAT)                             399       107.8         0.0         506.8               0.00
39. Katmai (KAT)                                  7,549       238.9         0.0       7,787.9               0.00
40. Northern Air Cargo (NET)                          0        71.9         0.0          71.9               0.00
----------------------------------------------------------------------------------------------------------------
    Totals                                    1,101,371   121,615.3   487,331.0   1,710,317.3             28.49
----------------------------------------------------------------------------------------------------------------
1/ Carrier in litigation. An all-cargo operator, its business model was to use B-1900 equipment to transport
  mainline mail.
2/ Carrier provided a great deal of service with mainline equipment.
Note: 200 pounds of mail or freight is one PEQ (passenger equivalent).

                     Mail as a Percentage of All Scheduled Traffic for Alaska Bush Carriers
                                               Calendar Year 2004
----------------------------------------------------------------------------------------------------------------
                 Carrier name                    T110 Rpax   Frt. PEQs   Mail PEQs   Total PEQs    Mail percent
----------------------------------------------------------------------------------------------------------------
Olson Air Service                                        0          28         390           417           93.39
Baker Aviation, Inc.                                   419          48       1,999         2,466           81.06
Taquan Air Service                                   2,022         210       4,926         7,158           68.82
Tanana Air Service                                   2,105         507       4,418         7,030           62.84
Alaska Central Express                                   0      23,293      39,295        62,589           62.78
Inland Aviation Services                             2,468         577       4,673         7,718           60.54
Arctic Circle Air Service                            1,851      13,187      19,838        34,876           56.88
Larrys Flying Service 1/                             2,183         367        3200         5,751           55.65
Bellair, Inc. 1/                                         0         596         727         1,323           54.96
Arctic Transportation                                    0      30,228      28,285        58,514           48.34
Village Aviation 1/                                      0       5,592       4,169         9,761           42.71
Ellis Air Taxi, Inc.                                   271          17         202           490           41.30
Cape Smythe Air Service                             28,685       4,093      21,298        54,076           39.38
40-Mile Air                                            343         194         257           794           32.40
Servant Air, Inc.                                    1,630          53         777         2,460           31.58
Grant Aviation                                      65,997         582      29,524        96,103           30.72
Bering Air, Inc.                                    59,804      11,216      30,465       101,485           30.02
Hageland Aviation  Service                         135,745       9,206      57,619       202,570           28.44
Iliamna Air Taxi                                     7,902         517       3,284        11,703           28.06
Spernak Airways, Inc.                                  124         235         104           463           22.53
L.A.B. Flying Service, Inc.                         14,053        1087       3,818        18,958           20.14
Yute Air Aka Flight  Alaska                         11,323         120       2,865        14,309           20.03
Wright Air Service                                  18,140       3,357       5,316        26,813           19.83
Warbelow                                            35,565       3,884       9,719        49,168           19.77
Alaska Seaplane Service                              2,507         609         713         3,829           18.63
Frontier Flying Service                            136,876       9,647      31,414       177,937           17.65
Peninsula Airways, Inc.                            202,240      15,571      33,052       250,863           13.18
Island Air Service                                  14,544       2,962       2,265        19,771           11.46
Wings Of Alaska                                     33,526       4,565       4,462        42,553           10.49
Promech                                             25,336       1,915       2,688        29,939            8.98
Skagway Air Service                                 11,692         984       1,097        13,773            7.97
Smokey Bay Air, Inc.                                17,355       2,205       1,551        21,111            7.35
Era Aviation 2/                                    362,140       7,169      20,806       390,115            5.33
Katmai Air                                          10,232         724           0        10,956            0.00
----------------------------------------------------------------------------------------------------------------
    Totals                                       1,207,078     155,543     375,219     1,737,840          21.59
----------------------------------------------------------------------------------------------------------------
1/ No longer operating.
2/ About one-fourth of its operation is bush, the rest is mainline.
3/ Carrier's business model is to operate bush or small mainline equipment in mainline markets.

    Mr. Chairman, I will now like to ask Administrator Blakey 
to discuss the safety issues. And at the end of her prepared 
remarks, we will be more than happy to answer any questions 
that you may have.
    Thank you very much, Mr. Chairman.
    The Chairman. Thank you very much. I appreciate that.
    Ms. Blakey.

      STATEMENT OF HON. MARION C. BLAKEY, ADMINISTRATOR, 
                FEDERAL AVIATION ADMINISTRATION

    Ms. Blakey. Thank you, Mr. Chairman. And good morning to a 
very distinguished group. It's wonderful to be back here in 
Alaska.
    I have to say, every time I am here I am overwhelmed with 
what a magnificent state Alaska is.
    Known as the Final Frontier, from where I sit, it is really 
the front door on aviation safety in the United States. I'm 
very excited to see what's going on.
    When I was here 2 years ago, I made it to the Arctic 
Circle. I flew on a Capstone-equipped float plane and on 
medivac aircraft as well. Senator Stevens, you've long 
maintained from the floor of the Senate that Alaska is unique. 
How right you are.
    Because of advances in Alaska, it's really a showplace for 
what you can do in aviation.
    Aviation literally is a lifeline to many of the communities 
in this state. And because of that, I very much appreciate the 
continued efforts of your Committee to work with us and the 
aviation community to make Alaskan aviation as safe and 
efficient as possible.
    A few years ago it became clear that we needed to take a 
different approach to aviation safety in Alaska. The 
significant safety improvements that have been achieved in 
recent years in Alaska demonstrate the real commitment of 
everyone that's been involved. Alaska has become literally a 
national asset for innovation.
    You know, when I first came to the FAA, we put in place a 
strategic business plan--our Flight Plan we call it--with 
specific objectives and performance targets. Alaska is the only 
state mentioned by name in the FAA's flight plan. This is both 
because of the extreme importance of aviation to Alaska, and 
the FAA's commitment to continue to work with our partners in 
Alaska to keep improving the state's safety record. I'm very 
happy to report, it's working.
    In 1999, OSHA said that being a commercial airline pilot is 
the most hazardous job in Alaska. Not anymore. Since then, the 
first phase of Capstone has been successfully completed, and 
Phase II is well under way. In 1999, there were only 10 cameras 
providing timely weather information to Alaskan pilots. We've 
increased that several fold. There are 55 out there now.
    What's more, today we have the Medallion Foundation working 
with both commercial and with general aviation operators to 
spur the implementation of safety concepts. We're also making 
inroads in terms of Alaska's infrastructure as well. Back then, 
Alaska received 77.8 million in Airport Improvement Program 
funds; last year that number was 219 million. Each of these 
improvements is turning the tide on aviation in Alaska.
    And please indulge me for just a moment to brag a bit more 
about our state here. In a nutshell, Alaska is a model for the 
rest of us on how to improve, how to translate technology into 
safety.
    As I said a moment ago, I've flown in a Capstone-equipped 
aircraft--in fact, several times--and seen firsthand the type 
of information that's provided to the pilot. Let me tell you, 
and explain the difference during the flight. Automatic 
Dependence Surveillance Broadcast, which most pilots refer to 
as ADSB, is key to having a pilot have accurate and timely 
information about other aircraft, terrain, and weather. And let 
me emphasize that last one: weather is so critical up here.
    The initial focus of Capstone's first phase was the YK 
Delta area, specifically 160,000 square miles all around 
Bethel. This area of the state had historically had an accident 
rate that was 2 to 4 times higher than the rest of Alaska. But 
in 2003, the accident rate was below average for the rest of 
the state for the first time.
    From 2000 to 2004, the accident rate of Capstone-equipped 
aircraft decreased by 47 percent versus other aircraft without 
it.
    The numbers would indicate that moving forward with this 
exceptional program is a good, solid idea. So we're working on 
it. We're working with Phase II which expands to southeastern 
Alaska, in the Juneau area; and Phase III extends the program 
statewide.
    We haven't stopped there. By placing weather cameras 
throughout the state, we've certainly come a long way since the 
first weather camera was on the roof of your building in 
Anchorage. Today, we have 55 cameras throughout the state; an 
investment of $7 million. Twelve new sites are scheduled to be 
up and running by this October. This concept, I think, is 
stunning in its simplicity. Most good ideas tend to come from a 
very simple idea when you get down to it.
    The pilot goes on-line, and gets two images for each 
location. The first shows what a site would look like in a 
perfectly clear-day situation. The second shows current weather 
conditions. For example, pilots can now learn what the 
visibility is in the mountain pass they face, and whether they 
want to fly through it before they take off. In many instances, 
they may decide not to fly, to hold off on that flight for a 
while, depending upon what they see. And that's long before 
they set foot in the aircraft. So they really can make good 
decisions.
    You know, pilots have a maxim that rings especially true: 
It's better to be on the ground wishing you were in the air 
than in the air wishing you were on the ground.
    Last year this website got over 2.3 million hits. That 
number should increase by another million this year, we think.
    Pilots flock to a good idea, and that's just what they're 
doing with the weather cameras.
    Our safety programs in Alaska need to be nimble, and that's 
the approach we're taking. The community here has shown that 
it's unafraid to test new technologies, and that's making a 
real difference.
    Turning to infrastructure investment, we've increased our 
AIP investment in Alaska to 131 million a year since 1999. It's 
clear that the money is being well spent. And, you know, a 
great deal of the credit for safety improvements that have been 
made must be given to the users of the system themselves.
    I'm pleased you've asked Jerry Dennis from the Medallion 
Foundation to appear on the next panel. That organization has 
done some really remarkable work, and needs to be applauded. 
The Medallion program is voluntary and industry-led, and it's 
one that the FAA supports through a grant arrangement. Alaska's 
air carriers created the program and are participating because 
they voluntarily wanted to exceed FAA requirements; and it's 
making a difference. Their success has led to Medallion 
creating a component for general aviation as well. Which I have 
to say, seems to be greeted with overwhelming enthusiasm by the 
GA community.
    You've only got to see how insurance companies award 
premiums to pilots and carriers of Medallion participants to 
understand how seriously this program is being taken. Both 
Jerry Dennis and Dick Harding, Medallion's executive director 
and president, deserve great credit for the creativity and the 
willingness to make a contribution to aviation safety well 
beyond the State of Alaska. They're working with the GA 
community; they're working with us in Washington to see how 
this can expand.
    Finally, I'd like to acknowledge the spirit of aviation in 
Alaska, which I think we both agree, was personified by Tom 
Wardleigh. He was a master pilot, a master mechanic, and the 
elder statesman of Alaska aviation. Tom's vision is now Tom's 
legacy. First, I'm pleased to say, that Jan is here today to 
share this occasion.
    That's why I'm so pleased, with her in the audience, to 
announce the creation of a national safety award in his honor. 
The first recipient will be announced next year.
    You know, Tom urged us to strive for exceptional customer 
service, to be a proving ground for new ideas. Tom knew if we 
could make an idea work in Alaska with all the challenges here, 
it would have benefits throughout the country. And that's 
exactly what's happening today. And that's the reason this is a 
national award. Because he was right. The many lives he touched 
will not soon forget Tom Wardleigh, and that's as it should be.
    So, once again, Mr. Chairman, I'm very pleased to be here 
in Alaska. I think you can tell. Blue skies, fresh air, and 
enthusiasm for aviation. I'll tell you, it's my kind of place.
    With that, I'm happy to answer any questions.
    Thank you.
    [The prepared statement of Ms. Blakey follows:]

        Prepared Statement of Marion C. Blakey, Administrator, 
                    Federal Aviation Administration

    Good Morning, Chairman Stevens and Members of the Committee. It is 
a great pleasure to be here today in Alaska to testify, along with 
Secretary Mineta and Regional Administrator Poe. Improving aviation 
safety and lowering accident rates in Alaska, have been a major focus 
of efforts by the Federal Aviation Administration (FAA) over the last 
decade, and I'm proud to acknowledge, also by the aviation community in 
Alaska. The aviation community here has demonstrated a strong 
commitment to safety. After all, the aviation system is what connects 
Alaska's cities, towns, villages, businesses and families. I believe we 
in the FAA have a good news story to tell about improvements in 
aviation safety in recent years, and an even better story to tell about 
future efforts to expand and build upon the successes already achieved.
    Today I would like to highlight a few areas of interest to the 
Committee: the Capstone and Medallion programs, the growing use of 
weather cameras, particularly in remote locations, and the very 
practical benefits of the Rural Alaska Lighting program.
    As I've often said, aviation safety will always be the first 
priority at the FAA. Every decision we make is with the safety of the 
flying public in mind. Let me begin this morning by describing how 
serious the FAA is in pursuing the goal of increased aviation safety in 
Alaska. When I first came to the FAA, we put in place a strategic 
business plan--we call it our Flight Plan--with specific objectives and 
performance targets. The FAA's Flight Plan for 2004-2008 lists among 
the safety objectives for the next 5 years a specific objective, 
``Reduce Accidents in Alaska.'' The stated strategy is to expand and 
accelerate the implementation of safety and air navigation improvements 
programs here. It is noteworthy because no other state was listed 
individually, only Alaska. Why, you might ask, does the FAA Flight Plan 
have a specific objective of improving aviation safety in Alaska? The 
answer is simple, Alaska has been called the ``flyingest state in the 
union.'' It is a place where schoolchildren board aircraft to travel to 
school, instead of a bus. When someone in a village is ill and needs 
medical attention, they will most likely be transported to the hospital 
via aircraft. As an essential mode of everyday transportation, aviation 
must be a safe mode.
    A 1999 study by the National Institute on Occupational Safety and 
Health (NIOSH) ranked being a commercial airline pilot as the most 
hazardous occupation in Alaska. Clearly, a focused, dedicated, 
multifaceted, approach to improving aviation safety in Alaska was 
needed. I am happy to say the approach we are taking, one that 
represents the collective efforts of aviators, the State of Alaska, and 
the FAA, is working.
    The most promising initiative with potential for broad application 
to a range of hazards, including terrain, other airborne traffic, and 
weather, is the Capstone demonstration program in the Alaska Region. 
Capstone is a technology-focused safety program in Alaska that seeks 
near term safety and efficiency gains in aviation by accelerating 
implementation and use of modern technology, in both avionics and 
ground system infrastructure. The key enabling technology on which 
Capstone is based is Automatic Dependent Surveillance-Broadcast (ADS-
B). ADS-B gives an aircraft with the requisite data uplink/downlink and 
cockpit display capabilities the same information about other aircraft 
in the vicinity as air traffic control now receives. Capstone Phase I, 
which began in 1999, included the installation of government-furnished 
Global Positioning System (GPS) driven avionics suites in 200 
commercial aircraft serving the region around Bethel, Alaska, known as 
the Yukon-Kuskokwim Delta Region (YK Delta), consisting of over 160,000 
square miles. One of the two approved datalink technologies for ADS-B, 
the Universal Access Transceiver (UAT) also provides an uplink for 
weather information via Flight Information Services-Broadcast (FIS-B). 
The weather data is displayed on the same multifunction cockpit display 
used for the ADS-B display of traffic, and for terrain data.
    Through 2004 the FAA Alaskan Region Capstone Program has achieved 
significant safety and efficiency results. Capstone equipped aircraft 
have had a consistently lower accident rate than non-equipped aircraft. 
From 2000 through 2004, the rate of accidents for Capstone-equipped 
aircraft dropped significantly--by 47 percent. Also, the rate of 
accidents for Yukon-Kuskokwim Delta Region-based air carriers has been 
falling since 2001, and is now at the lowest rate since 1990. 
Historically, the rate of air taxi accidents within the YK Delta has 
been 2 to 4 times the rest of Alaska, but in 2003 the accident rate for 
the region was below the rest of the state for the first time. That is 
real progress.
    Phase II of Capstone will expand the coverage to southeast Alaska, 
in the Juneau area, and Phase III contemplates expanding the program to 
cover the entire state. Also as part of Phase II, additional technology 
infrastructure will be deployed. New Area Navigation (RNAV) and 
Required Navigation Procedure (RNP) arrival and departure procedures 
will continue to be developed for the airports recommended by the 
industry for upgrade to Instrument Flight Rule (IFR) access. RNAV 
procedures provide flight path guidance incorporated in taxi 
procedures, with minimal instructions required during departure by air 
traffic controllers. RNP is on-board technology that promises to add to 
capacity by allowing pilots to fly more direct point-to-point routes 
reliably and accurately. Key benefits of RNAV and RNP include more 
efficient use of airspace, with improved flight profiles, resulting in 
significant fuel efficiencies to the airlines. An airport-to-airport 
Global Positioning System (GPS)/Wide Area Augmentation System (WAAS) 
based route structure will be mapped between all IFR airports. Aircraft 
avionics equipage is key to an accelerated implementation strategy; 
therefore Capstone will continue to pursue affordable avionics so that 
aircraft owners will have a range of choices appropriate to their 
operational needs. This includes both creating options for equipage and 
a strategy to ensure that all aircraft in Alaska are equipped.
    In addition to technology improvements, the FAA has also undertaken 
safety management and training efforts in partnership with the aviation 
community here to increase safety awareness and reduce aircraft 
accidents. In joint efforts with the Medallion Foundation, a non-profit 
aviation safety organization that provides management resources, 
training and support to the Alaskan aviation community, the FAA is 
funding a program known as the Five Star Shield program, which is an 
enhanced safety management system. The Medallion Five Star Shield 
program takes a business-like approach to safety, providing for the 
setting of goals as well as planning and measuring performance in 
specific areas through the use of system safety concepts. The program 
is voluntary, and focuses on establishing and sustaining an elevated 
level of safety performance through: the development of a safety 
culture that holds safety as a core value; continuous professional 
development of individual skills and competence; proactive sharing of 
operational control responsibilities; hazard identification and risk 
management; and management practices that support the organization's 
safety objectives.
    The Five Stars in the Medallion Five Star Shield program include 
numerous methods for improving safety. To earn the First Star, each air 
carrier must establish a safety program which, at a minimum, should 
include safety meetings and audits, the use of root-cause analysis, 
hazard identification, incident investigations, and a viable emergency 
response plan. The Five Star program also requires a classroom training 
program for pilots, mechanics and ground service personnel, as well as 
required training on a PC-based computer simulator. Two annual check 
rides are required to receive this second Star, and annual pilot 
proficiency check rides are required to keep the Star. The Third Star 
involves operational risk management. A dynamic system that provides 
analytical tools as well as a system of checks and balances to 
proactively identify hazards and manage risks is required. The carrier 
must have an operational risk management system that quantifies the 
risks for each flight, including weather, airport, and crew readiness. 
The total risk score determines if the flight is conducted normally, if 
more management evaluation is required for release of the flight, or if 
the flight is cancelled. The Fourth Star concerns maintenance and 
ground service operations, requiring specific training and manning 
levels. The Fifth Star is an internal audit program, which requires 
incorporation of a proactive internal audit system that focuses on the 
use of systems safety principles, as well as regulatory compliance. 
This is a comprehensive audit program requirement intended to allow the 
operator to continuously monitor their operating systems and provide 
for continuous improvement. Medallion has specific detailed 
requirements.
    The FAA is supporting the Medallion Foundation in the 
implementation of this program. Once an applicant has received all five 
Stars, and passed an independent audit, they may be certified for the 
Medallion Shield, which is attested to by a decal displayed on the 
aircraft, and can be used on uniforms and promotional materials. In 
order to maintain shield status, the operator must successfully pass an 
audit each year. If the operator fails to pass the audit, or Medallion 
on-site inspectors notice that a specific activity represented by a 
star is not being properly addressed on a continuing basis, the star 
and shield may be revoked. A direct benefit of the Shield program for 
operators is that the insurance industry has agreed to provide 
favorable rates for Shield carriers.
    It's worth noting here that the FAA and the Medallion Foundation 
are not just focused on improving safety in commercial operations, but 
are also targeting improvements to safety in the general aviation (GA) 
community as well. Our efforts in this area are coordinated through the 
Medallion Flyer General Aviation Program, which is proving to be quite 
popular among the GA community. Interested pilots begin by submitting 
an application to the Medallion Foundation, which will then issue the 
pilot a free copy of the FAA ``Back to Basics--Runway Safety'' CD. 
After that, the pilot is invited to attend the FLYER Step II course, 
which provides access to free usage of Medallion state-of-the-art 
flight training devices. During this course, pilots are provided with 
tools designed to help establish a personal safety program. They are 
also introduced to hazard assessment and risk management techniques. 
Pilots also receive important information on flying in ``white out'' 
and ``flat'' light conditions, risk assessment, pilot/ATC 
communications, and Alaska flying tips.
    The Capstone and Medallion programs clearly demonstrate that better 
information, better training, and better risk-management procedures can 
contribute significantly to reductions in aviation accidents and save 
lives. People here in Alaska can be very proud of the progress they've 
made. Alaska has set an example for the rest of the country.
    The on-going and increasing deployment of weather cameras in 
numerous parts of Alaska is another beneficial use of technology that 
can dramatically improve aviation safety by providing near real-time 
information to help with pilot decision making and risk management. 
There are currently 55 operational locations for weather cameras, which 
stretch into every region of the state, and 12 more operational sites 
will be available in 2005. Many of these weather cameras are positioned 
in or near mountain passes and other geographical features which are 
often used by pilots to navigate on their flights. The other feature of 
these cameras that is so beneficial to pilots is that they are often 
located at rural airports where there are no weather observers, and no 
other means to find out what current weather conditions are prior to 
deciding to take off. They are also co-located with automated weather 
systems, providing additional visual information previously only 
available at those few sites with a weather observer.
    These cameras, all of which can be viewed at one website, http://
akweathercams.faa.gov , provide two images from each camera located at 
the site. One image is a file photo of the area within the camera's 
range on a clear, sunny day. The other image is a real-time photo, 
which is refreshed every 10 minutes, of the exact same view as the file 
photo. This provides an instant visual comparison of weather 
conditions, precipitation, cloud cover, ceiling, and visibility.
    The real value in these weather cameras is that they help pilots 
decide whether to even begin their flight, based on weather conditions, 
rather than have the pilots have to make difficult and hazardous 
decisions once they have encountered the deteriorating weather 
conditions in flight. Flight service specialists also have access to 
the weather camera images, and routinely brief pilots on the weather 
camera images when they call for a pre-flight briefing and during their 
flight, providing the most up-to-date information on the weather camera 
images to help pilots make that ``go or no-go'' decision. During an 
independent study conducted between December 2002 and March 2003 by 
Parker Associates, Inc., 68 percent of the reported decisions made 
based on weather cameras were to cancel or delay a flight due to 
weather. Air carriers, commercial operators, and general aviation 
pilots can avoid the cost of fuel from flights that must be diverted or 
repeated due to bad weather. Cameras have a positive financial impact 
on an industry undergoing economic challenges. Our website for the 
cameras has received 1.3 million ``hits'' in 2003, 2.3 million ``hits'' 
in 2004, and we expect the number of ``hits'' to increase by another 1 
million this fiscal year--a real testament to how important real time 
knowledge of weather conditions is for pilots.
    Turning now to another area of interest to this Committee, I would 
like to briefly highlight the FAA's Rural Alaska Lighting Program 
(RALP). The goal of the Rural Alaska Lighting Program is to install 
airport lighting in communities with limited access to 24-hour medical 
facilities, to provide better access and improved lighting for 
aeromedical services. The Program is comprised of three tiers. Tier One 
is Medium Intensity Runway Lighting (MIRLs) or permanent edge lighting 
at those airports that meet minimum safety requirements. Tier Two is 
portable, battery-powered lights for communities or airports that are 
unable to accommodate permanent edge lights. Tier Three is Precision 
Approach Path Indicator (PAPI) and Runway End Identifier Lights (REILs) 
to support approach procedures at airports.
    This program began in 2001 with a study that identified 63 
communities needing the improved lighting. Federal funding began in 
FY02. In addition to the $35 million that has been appropriated for 
this effort so far under the FAA's Facilities and Equipment program, 
the Airport Improvement Program has provided the funding for necessary 
runway pavement or runway safety area improvements. All of the 63 
communities have received at least an interim solution to provide for 
24 hour VFR aeromedical access. Twenty-six of the 63 communities have 
also received permanent lighting solutions. An additional 19 
communities will have permanent lighting solutions by 2010. The final 
18 communities have complicated land and/or environmental issues, but 
we will continue to work with the State of Alaska to resolve all 
outstanding issues.
    Finally, Mr. Chairman, I want to take a moment to mention the great 
contributions to aviation safety in Alaska made by a true visionary, 
Tom Wardleigh. Mr. Wardleigh shared his vision for the future of 
aviation in Alaska with you and all Alaskan aviators in testimony to 
this body in 1999. That vision is now part of Mr. Wardleigh's legacy. 
The FAA is pleased to announce the creation of a new National safety 
award in honor of the late Thomas Wardleigh, Master Pilot, Master 
Mechanic, elder statesman of aviation. As with so many of this region's 
innovations, Mr. Wardleigh's contribution to aviation safety is now a 
national asset. Tom urged the FAA to strive for exceptional customer 
service and to be a proving ground for new ideas. He was a visionary 
who knew that if we could make an idea work in Alaska with all of its 
challenges, it would benefit all of aviation.
    Mr. Wardleigh's wife, Jan, is with us today. I hope she is pleased 
with our memorial to him. I know that this award has special meaning 
for you, Mr. Chairman, as I have been told that you received your 
floatplane rating from Tom just a few years ago.
    In conclusion, Mr. Chairman, let me reiterate what I said at the 
outset of my testimony today--aviation safety is, and always will be, 
the first priority at the FAA. These programs I have discussed are the 
leading edge of efforts to improve aviation safety for everyone, and 
Alaska is once again showing the way. Thank you, Mr. Chairman, for the 
opportunity to testify today on such an important topic. I would be 
happy to answer any questions you may have.

    The Chairman. Thank you very much, Ms. Blakey.
    Mr. Secretary, we seem to be going through a transition 
here now. We've traditionally had the hub-and-spoke type of 
transportation for local aviation, commercial aviation, that 
was the same, you know, throughout the Nation for a while. 
Their hubs and the major airlines flew in those hubs and out of 
them on a slope basis. That seems to be changing in our state, 
and I don't know if you've noticed it nationally, but as we go 
to this new phase now, as you mentioned bypass mail, we're 
going to have more direct flights from Anchorage to the 
destination that used to go through the hub and then on to the 
destination. But the larger cargo planes, they're going to go 
straight in. That, I think may increase the demand for 
Essential Air Service, as you review it.
    Clearly, that is the essential thing for us to maintain the 
seats as well as get the mail to the small villages, small 
communities for our state. But I would urge you as you go into 
the review of Essential Air Service, and I think it does need 
review. We look forward to working with you on it, our 
Committee. But I urge you to look at the changes here in our 
state before you make final decisions on EAS. Has anyone 
brought this change to your attention?
    Mr. Mineta. Absolutely. There's no question that the hub-
and-spoke system and the embedded costs that it produces for 
the airlines is something that they're shifting, and there's a 
change in the paradigm of the hub-and-spoke to more point-to-
point. And, as you've indicated, as we go more to point-to-
point, there will be increased use of the Essential Air 
Service. And I think that's part of the picture that we're 
looking at in the Lower 48 as it--as the increase occurs, the 
question about given the limited financial resources and how do 
we make sure that we spread it out as evenly and as efficiently 
and as fairly as possible. And that's where we would do the 
consultation with you and the Committee to see where we go in 
the future.
    The Chairman. Thank you for that. And I appreciate your 
statement.
    One question came to my mind. On these Open Skies 
negotiations, do you negotiate cargo-only flights?
    Mr. Mineta. No, these are all both inclusive of passenger 
and cargo. There are some places like in--it was in Indonesia 
when we did the Open Skies Agreement, we started with cargo, 
and then phased in the passenger piece of it. And so the 
passenger piece will kick in in 2006. But we started out with 
the cargo only.
    So, it can vary from each country, but generally, what we'd 
like to get to eventually, is Open Skies for both cargo and 
passenger, and--but we will phase it in depending on the 
negotiations with the--with that country.
    The Chairman. Ms. Blakey, I'm glad you mentioned Tom 
Wardleigh. I look forward to working with you on this national 
award that will recognize anyone in the country that is worthy 
of honoring for contributions to aircraft, airline, and airway 
safety. He was not only a great person, he was really the 
original person to suggest the Medallion program. But he also 
was great fun and my flight instructor. So I miss him very 
much.
    I do thank you both. I've got a series of witnesses. I look 
forward to working with you while you're here.
    I think the very fact that you're here will give you an 
opportunity to witness even further some of the things we're 
doing, both Medallion and Capstone. I actually flew a few years 
ago Christmas, one of the first flights into the Bethel region 
testing Capstone and it was just a wonderful flight. And I've 
seen it improve since then. I wish I've had more time to fly. I 
think other people around here can have a great opportunity to 
really fly in safety and that is a wonderful thing.
    I do thank you also for the cameras. I personally have used 
the cameras. I think the public ones most used is the one which 
runs through the pass in Lake Clark and from time to time I may 
get calls that they may not be functioning properly. I'm 
pleased to say Mr. Poe responds and makes it function.
    I'm happy to have you here today. And thank you from coming 
to Alaska.
    Mr. Mineta. Thank you very much, Mr. Chairman.
    The Chairman. I have to say, Norm, I've visited Norm Mineta 
Airport. I always thought you had to be dead to have an airport 
named after you.
    [Laughter.]
    The Chairman. I'm glad the two of us are still here.
    The next panel is Pat Poe, the regional administrator of 
the FAA, the Alaska region; Mike Barton, the commissioner of 
the Alaska Department of Transportation and Public Facilities.
    I note for the record that the Lieutenant Governor is here, 
Mr. Loren Leman. Nice to see you here.
    Mr. Poe, in view of the fact that Ms. Blakey has already 
testified, do you have an opening statement?

STATEMENT OF PAT POE, REGIONAL ADMINISTRATOR, FEDERAL AVIATION 
                 ADMINISTRATION, ALASKA REGION

    Mr. Poe. I don't have an opening statement. But I do have 
words I'd like to share with the Chairman and the guests here, 
if I might.
    The Chairman. Thank you very much.
    Mr. Poe. First, I'd like to offer a recall, Mr. Chairman it 
was in 1999 I first arrived and had the privilege to testify 
before you and others at a hearing similar to this. And that 
was a long hearing. That lasted several hours, many people 
testified, all on aviation.
    At the conclusion of that, you offered comments to the 
effect that it was the first time perhaps you had ever seen 
government and industry actually working together. And if that 
proved to be true, perhaps that would make the difference in 
terms of aviation safety.
    What I would like to report is what has happened since 
then, and what differences have been made and measured.
    First, I would say that I came to Alaska, like many people, 
I think, for the adventure; but you stay because of the people. 
You stay because of the dedication to aviation and the fact 
that it's truly the conduit through which commerce moves, 
education, medevac, and the transportation system as a whole.
    The second thing I learned here was that all of the pilots 
are both progressive and aggressive. I mean, I've never met a 
bashful pilot yet in Alaska, you don't have to ask for their 
opinions, because you're going to get them anyway. And that has 
served me very well.
    And last, I would say Alaskans expect results and they want 
it to be measured, and that is what we have done.
    The Capstone program, arguably, is one of the most measured 
programs of recent times. The evaluations began before the 
first aircraft was ever equipped. To date, we have three 
studies that have been done: the University of Alaska in 
cooperation with the Mitre Corporation; and most recently 
Embry-Riddle University, has produced studies from the 
inception through April of 2005.
    Capstone Phase I represents now over a million flight 
hours. Very strong data upon which to make findings, and as 
Administrator Blakey pointed out, the differential between 
accidents in Capstone-equipped versus non-Capstone-equipped 
airplanes, 47 percent.
    The Chairman. We'd like to have copies of that for the 
record and perhaps we'll take the summaries and make them part 
of this hearing record. *
---------------------------------------------------------------------------
    * The information referred to has been retained in Committee files.
---------------------------------------------------------------------------
    Mr. Poe. I would be delighted, sir. They're here for your 
use.
    The Chairman. Thank you.
    Mr. Poe. Second, I would like to mention, just briefly, the 
flight following the aspect of Capstone. This is the ability to 
track Capstone-equipped airplanes with 1-second updates with 
precise accuracy. That has a variety of efficiencies for the 
carriers themselves, for the passengers, for the movement of 
goods and services. But also in search and rescue it has an 
enormous impact.
    Two years ago in Marshall, Alaska, night flight, one soul 
on board, didn't arrive at the destination, middle of winter. 
No emergency locator transmission from the aircraft. Aircraft 
had crashed. Practically no way to find it.
    The center here in Anchorage ran back the tape using the 
technology that the Administrator mentioned, automatic 
dependent surveillance broadcast, and pinpointed the accurate 
location of the airplane. I've actually met the pilot, the one 
that made the flight. Flew to that coordinate, put on night-
vision goggles, and in 3 minutes spotted the airplane; pilot 
inside with two broken legs. That's a life saved. Every life 
saved, according to OMB, has a measure of $3 million. I don't 
think any of us like to think in those terms, but when you look 
at programs like Capstone, weather cameras, rural lighting 
projects, Medallion, Circle of Safety, the list is long, I'm 
pleased that it's long. These programs all work together in 
their solution. The safety record is truly extraordinary.
    Internationally, I recall the first International Advanced 
Aviation Technology Conference that we had here in Anchorage, 
hosted by the Alaska Aviation Coordination Council, the 
University of Alaska in Anchorage, and the FAA. And you, Mr. 
Chairman, were kind enough to come and speak at that 
conference.
    Since then, we have had an additional conference, we've had 
multiple visitors from many, many different countries. Most 
recently, the World Bank was here. They're looking at what we 
have done in Alaska to solve similar needs in the countries 
around the world.
    I found it interesting and rewarding that Australia has 
announced that they will start using ADSB for air traffic 
surveillance and separation. They've acknowledged they're the 
second country in the world to do that. The first being the 
United States of America, right here at our center in 
Anchorage, on January 1, 2001, gives you an idea how far into 
the future we've traveled together.
    Recently, Congress urged the FAA to look at the weather 
camera issues in the mountain passes. You've mentioned Lake 
Clark Pass, one of our most popular and most necessary 
locations. I am pleased to announce that by this time next year 
we expect to have Ptarmigan and Rainy Pass cameras installed, 
and by the end of that year, operational. Merrill Pass, the 
following year. As you know, these are some of the most 
terrain-challenged corridors for aviation in Alaska; and 
accordingly, they have attending risk.
    I think perhaps, in summary, I would say that Alaska, I 
think, has chosen to make a difference for itself, and I think 
the community has worked together. The State of Alaska, the air 
carriers and operators in the audience, the University of 
Alaska, the industry, and the FAA have all been working 
together toward a common result.
    At the outset, when you said perhaps working together could 
make a difference, the Administrator has mentioned some of the 
remarkable gains in safety. I would just like to highlight one 
thing, if I might.
    During the decade of the 1990s based on NTSB, National 
Transportation Safety Board statistics, we were averaging about 
180 accidents a year in Alaska. Year before last, we had 117 
accidents. Last year 100. Those are remarkable gains. And the 
effort that will be necessary to sustain them is the same 
effort that got us this far, and that is, if we all work 
together, we'll continue to make improvements.
    Thank you, Mr. Chairman.
    The Chairman. Thank you very much. I've got some questions, 
but let's hear first from Commissioner Barton.

 STATEMENT OF MIKE BARTON, COMMISSIONER, ALASKA DEPARTMENT OF 
              TRANSPORTATION AND PUBLIC FACILITIES

    Mr. Barton. Thank you, Mr. Chairman. And I want to thank 
you for your personal support of aviation in Alaska over the 
years. It's made a difference.
    I will confine my remarks primarily to those issues that 
impact our rural communities and the 256 rural airports that 
the state owns and operates.
    Mr. Plumb will address issues relating to the two 
international airports operated by the state.
    I want to start by expressing our thanks to the FAA for its 
ongoing cooperative relationships with the state over the 
years.
    The Essential Air Service Program remains a critical 
support for safe scheduled service with 34 Alaskan communities 
out of a total of 216 that are eligible. In some cases, that 
service is made possible by this program as the only way that 
many Alaskans can get the medical help and other vital services 
that they need.
    The state has a strategic goal to improve runways at 24-
hour VFR standard in communities that depend on air medical 
evacuation. A 1999 Congressional study identified 63 
communities that did not have this capability. That list is our 
target.
    Runway edge lights and identifier lights and precision-path 
indicators when installed on a 3,300-foot runway allow 24-hour 
VFR access.
    Congress has made special appropriations of $38 million for 
this program. And with these special appropriations, we've 
temporarily improved medical access by deploying portable 
emergency lights for helicopter landing zones at all 63 
communities. And since 1999, we have improved 26 of the 63 
airports to 24-hour standards, and will complete another 14 by 
the end of 2008.
    Realistically, the entire list of 63 communities should 
have 24-hour medical access by 2015. The continuing support of 
the Congress and yourself is greatly appreciated.
    The FAA and all of those in the aviation community in 
Alaska should be commended for their efforts in aviation 
safety. The reduction in incidents and accidents that have been 
achieved in Alaska is remarkable, and the Capstone program has 
contributed significantly to this reduction. You've heard a lot 
about this program and will hear more, but please know that the 
State of Alaska fully supports an accelerated implementation of 
Capstone.
    And further, the Medallion program has made significant 
contributions to aviation safety.
    Although we are blessed with natural bounty, we never like 
to see migratory birds on our airports. In fact, we've spent an 
inordinate amount of time and money managing this federal 
resource at our certified airports. Ironically, we dedicate 
State resources to hire federal employees to keep federal birds 
off state airports.
    [Laughter.]
    Mr. Barton. We clearly support more federal participation 
in the management of those federal resources.
    The application of a National Environmental Policy Act, as 
well as Section 4(f) of the Department of Transportation Act of 
1966, needs to be clarified. At some point in time, a decision 
is made to designate a piece of ground as an airport. It seems 
that designation identifies the dominant use and clearly 
specifies the objective for a designated piece of land. I'm not 
advocating running roughshod over the environment as these 
airports are developed. I am advocating common-sense 
application of NEPA, 4(f), and other environmental laws for 
lands that have long been designated for airport purposes.
    With the help of Congress and FAA, the AIP program for 
state-owned and operated airports in Alaska has grown from $61 
million to $205 million in the last 5 years.
    Alaska has benefited tremendously from the AIP program, and 
we are grateful, particularly in our rural communities where 
our airports are our highways. That's not to say that we don't 
have unmet needs. The cost of construction in rural Alaska is 
very expensive. At most locations in rural Alaska, the 
materials and equipment needed must be barged in from hundreds 
of miles away during a very short summer construction season.
    We could easily double our AIP investment and still find 
ourselves behind. I urge Congress to more fully fund FAA 
operations from sources other than the trust fund so that more 
of the trust fund can be invested in airport improvements.
    In closing, I want to emphasize how important air travel 
and the infrastructure that supports aviation is to Alaska. 
From our international airports on down to the smallest village 
strip, our airport system is simply crucial to the state's 
economy, local economies, and the health and well being of all 
Alaskans.
    Alaska comprises 20 percent of the land mass of the United 
States, but has less road mileage than Fairfax County, 
Virginia. Our air transportation infrastructure is the glue 
that holds our communities together.
    Alaskans appreciate the continuing support of the Congress 
for aviation and the recognition of the importance of aviation 
to Alaska is gratifying as well.
    Thank you, Mr. Chairman.
    [The prepared statement of Mr. Barton follows:]

 Prepared Statement of Mike Barton, Commissioner, Alaska Department of 
                  Transportation and Public Facilities

    Thank you, Mr. Chairman. We in Alaska appreciate that you have 
convened this field hearing to gain a better understanding of the many 
issues unique to Alaska aviation.
    I will confine my remarks primarily to those issues that impact our 
rural communities and the 256 rural airports that the state owns and 
operates.
    I would start by expressing our thanks to the FAA for its ongoing, 
cooperative relationship with the state over the years. We have found 
that our agencies share a common mission of providing the 
infrastructure for air transportation in a very large, difficult, and 
often inhospitable area. The willingness of the staff at FAA to face 
these challenges together with their state counterparts continues to 
produce mutual benefits.

Essential Air Service
    This government program remains a critical support for safe, 
scheduled passenger service to 34 Alaska communities, out of a total of 
216 communities that are eligible. In some cases, the service made 
possible by this program is the only way that many Alaskans can get the 
medical help and other vital services that they need.
    The state, in developing our comments on each subsidy offer, gives 
careful consideration to the efficacy of the route subsidized, the 
carriers competing, and the impact to the community, all with an eye 
towards funding the most effective program.

Runway Lighting
    The state has a strategic goal to improve runways to a 24-hour VFR 
standard in communities that depend on air medical evacuation. A 
Congressional study conducted in 1999 identified 63 communities that 
did not have 24-hour VFR capability. That list is our target. Runway 
edge lights, end identifier lights, and precision approach path 
indicators, when installed on a 3,300-foot runway, allow 24-hour VFR 
access.
    Congress has also made special appropriations of $38 million to the 
FAA for this program. We have worked cooperatively with the FAA to 
apply these monies to the communities on the list of deficient airports 
to install lighting and navigation systems.
    With the special appropriations, we have temporarily improved 
medical access by deploying portable emergency lights for helicopter 
landing zones at all 63 communities. These lights facilitate safer 
evacuation by Coast Guard and National Guard helicopters in life and 
death situations. A few civilian operators have also become certified 
to use these portable lights.
    Since 1999 we have improved 26 of the 63 airports to 24-hour 
standards, and will complete another 14 by the end of 2008. Twenty-
three more communities will await a permanent solution. There is a plan 
in place for them. Realistically, the entire list of 63 communities 
should have 24-hour medical access by 2015. At that time, more than 
$500 million will have been invested in these communities, including 
the $38 million and more than $470 million we are dedicating from the 
AIP program to bring those airports up to required standards.
    The continuing support of Congress is greatly appreciated.

Safety
    The FAA and all of those in the aviation community in Alaska should 
be commended for their efforts in aviation safety. The reduction in 
incidents/accidents that has been achieved in Alaska is remarkable. The 
Capstone program has contributed to this reduction, as well a achieving 
a large improvement in access for aviation in Alaska. This improved 
access results from the fact that better weather reporting means a 
better IFR success rate, and therefore more completed flights. Enough 
has been or will be said about this program, but please know that the 
State of Alaska fully supports an accelerated transition to a new 
national airspace system using space-based navigational aids.
    Also, the Medallion program has made a significant contribution to 
aviation safety. You will hear much about the good this program has 
done, but simply stated, since many state employees fly to all corners 
of the state, we all look for the Medallion logo on each airplane we 
board.

Wildlife Management
    Although we are blessed with natural bounty, we never like to see 
migratory birds on our airports. In fact, we spend an inordinate amount 
of time and money managing this federal resource at our certified 
airports. Ironically, we dedicate state resources to hire federal 
employees (USDA) to keep federal birds off state airports. Recent 
interpretation of the Migratory Bird Act of 1918 requires that we cease 
construction activities if birds are found to be nesting on the 
airports. This creates undue hardships, delays, and increased costs 
during our abbreviated summer construction season.
    We clearly support more federal participation in the management of 
those federal resources.

Wetlands
    The application of the National Environmental Policy Act, as well 
as section 4(f) of the Department of Transportation Act of 1966 (49 
U.S.C. 303(c)), to all airports, including rural airports, needs to be 
clarified. At some point in time a decision was made to designate a 
piece of ground as an airport. It seems that designation identifies the 
dominant use, and clearly specifies the objective for the designated 
land.
    I am not advocating running roughshod over the environment as these 
airports are developed. I am advocating common sense application of 
NEPA, Sec. 4(f), and other environmental laws to lands that have been 
long designated for airport purposes. A great deal of time and money is 
spent on living up to the letter of the law. Stringent application of 
these laws results in added cost and protracted delays in needed 
projects. Recognition of the primary purpose of lands designated as 
airports should be incorporated into the implementation of 
environmental laws at airports. We believe that the small footprints of 
disturbance from our rural airport construction should allow us to 
conduct environmental analyses, rather than a full NEPA statement.

AIP Program
    With the help of Congress and FAA, the AIP program has grown from 
$61 million to $205 million in the last 5 years. Alaska has benefited 
tremendously from the AIP program, particularly in our rural 
communities, where airports are our highways, and we are grateful.
    This is not to say that we don't have unmet needs. The cost of 
construction in rural Alaska is expensive. At most locations, the 
materials and equipment needed to construct an airport must be barged 
in from hundreds of miles away during a very short summer construction 
season. As communities grow and everyone focuses on improved levels of 
service such as those identified in the 1999 medical access study, we 
could easily double our AIP spending and still find ourselves behind.
    I urge Congress to more fully fund FAA operations from sources 
other than the trust fund, so that more of the trust fund can be 
invested in airport improvements. I suggest, too, that the primary 
passenger entitlement formula be reviewed and possibly modified. In 
this fiscal year, Alaska's rural primary airports will earn $29 million 
in passenger entitlements. Our identified needs list for primary 
airports totals $535 million.

TSA
    We in Alaska are as concerned about transportation security as any 
state in the nation. We fully support the efforts to protect the 
traveler and our nation's security. We have many transportation assets, 
such as the oil pipeline and terminal, the Port of Anchorage, the oil 
fields, and others, the loss or disruption of which would be a severe 
blow to our state and the country.
    As it is currently structured, the TSA has three separate 
organizations in Alaska. We believe that the three organizations could 
be streamlined into one to provide consistent security oversight within 
Alaska.
    We believe, also, that at Alaska's rural airports, transportation 
security can be achieved in a more efficient manner than at present. 
Transportation security programs at these airports should be based on 
threat analysis.
    As transportation security is presently implemented at Alaska's 
rural airports, oftentimes the number of TSA employees outnumbers other 
airport employees. If a threat-based approach were used, security 
interests in Alaska could be met with considerably less investment.

Closing
    In closing, I want to emphasize how important air travel, and the 
infrastructure that supports aviation, is to Alaska.
    From our international airports on down to the smallest village 
strip, our airport system is simply crucial to the state's economy, 
local economies, and the health and well being of all Alaskans.
    Across the far reaches of Alaska, our air transportation 
infrastructure has become the glue that holds our communities together.
    Alaskans appreciate the continuing support of the FAA and the 
Congress for aviation in Alaska. This recognition of the importance of 
aviation to Alaska is gratifying to all of us.
    I thank you for the opportunity today, and will answer any 
questions the members may have for me.

    The Chairman. Thank you very much. As you were talking, it 
reminds of a comment that I made--I think that GPS made more 
difference to our aviation than any other technology. Would you 
agree with that?
    Mr. Barton. It certainly has made a tremendous difference.
    The Chairman. And Capstone is tied right into that, isn't 
it?
    Mr. Barton. Yes, it is.
    The Chairman. Can you tell me--our Committee is also 
reviewing the whole communications pattern now. We're going 
into broadband, wireless, and so many new communication 
technologies. Are any of them going to affect the concept of 
our airways control or things like that, Capstone?
    Mr. Barton. I think Mr. Poe is more qualified to answer 
that.
    Mr. Poe. The answer is yes. When the technology is 
affordable and available. By that I mean, for instance, in 
Capstone we've already demonstrated that we can take a 
Capstone-equipped aircraft, fly outside of any ground-based 
navigation aid, and using the system at hand which was General 
Dynamics Iridium and go directly from the aircraft to the 
satellite, down into our center. Which means, in effect, we can 
track and provide air traffic services anywhere in Alaska 
without additional ground structure. We, being Capstone and the 
FAA, have invested money and are looking at this, and doing the 
research on it.
    At this point, it's not mature and robust enough to support 
that application.
    I understand that the Department of Defense is also doing 
some work in that regard, and we would hope that their 
successes can be passed on to us.
    The Chairman. You mentioned Capstone in terms of the second 
and third phase. Do you have a plan that you're going to 
attempt to take it national?
    Mr. Poe. We have a plan that is beyond the concept. In 
fact, we have concept options, and we're working diligently 
right now with the Mitre Corporation supporting us. We've had 
extensive input from the aviation community and interests and 
industry here. By this September, it is our intent--ours being 
the FAA Alaskan region--to make a presentation of our proposals 
and alternatives to the senior management of the FAA in 
Washington, DC. Their advice and influence will help shape what 
that plan is.
    The Phase II plan, which is being implemented in Southeast, 
takes advantage of the Wide Area Augmentation System. And the 
day that became active, we opened up air space in Southeast 
Alaska, 41,000 feet along 1,500 miles of air route, where for 
the first time we were no longer held, if you will, hostage to 
ground navigation aids. That is the precursor of the 
transition, sir, from ground base to satellite technologies in 
air traffic services.
    The Chairman. The system was partially modified in Alaska 
and adapted in test phase; is that true?
    Mr. Poe. This system being----
    The Chairman. The Capstone?
    Mr. Poe. Alaska Airlines--if you're referring to Alaska 
Airlines?
    Alaska Airlines predated Capstone in using something called 
RNP, which is Required Navigation Procedures. And a special 
approach down Gastineau Channel into Juneau, Alaska. RNP was 
groundbreaking in aviation. That doesn't sound like the right 
term in aviation, but it certainly opened up the rest of the 
world for that application, and RNP is one of the technologies 
and approaches that's being used by Alaska Airlines in other 
places in the Lower 48, and it's one that we, the FAA, are 
promoting nationwide.
    The Chairman. Mr. Barton, have you discussed with the 
Department of Transportation and the FAA the impact of this 
requirement of 10 percent match from villages for Essential Air 
Service?
    Mr. Barton. We have not yet, Mr. Chairman. We're watching 
that very carefully and intend to enter into that dialogue.
    The Chairman. Knowing some of them as I do, I think some of 
them can't make that payment. I would wonder if we could work 
out some concept of more broader application so that more than 
one village would contribute something for that--at least have 
some way that there's a pool of money to meet the requirements 
for an Alaska match without really imposing on some villages a 
match that I don't think they can make.
    Mr. Barton. There is no question that a number of the 
villages have a great deal of difficulty meeting that match 
requirement. We will have to work something out along those 
lines.
    The Chairman. Are there any other systems being tested now 
in the Alaska region that we have not discussed here today?
    Mr. Poe. Yes, sir. We've recently completed a test in 
Fairbanks, Alaska using laser technology to hold short lines to 
prevent runway incursions. That product was available through 
the Galaxy Corporation. Under a licensed to Greatland Laser 
from Alaska. And the results of that evaluation are just now 
becoming available.
    The evaluation was done by our technical center in Atlantic 
City, New Jersey. The results to date do not appear to justify 
the deployment of that technology for hold short lines and 
things of that nature.
    The areas of improvement have been documented, and that 
evaluation is ongoing, and we're working with the manufacturer.
    The Chairman. Does that technology have any application to 
the rural villages where the needs for lighting is just 
imminent?
    Mr. Poe. The--I think as it becomes more--if I can use the 
term, mature and robust, in that it moves from R&D into a 
certified state, I think that technology would have a place in 
the inventory. And by ``the inventory,'' I mean the things that 
sponsors, such as the State of Alaska, could use in an AIP 
grant proposal.
    Right now these remain early days for that technology.
    The only other thing I might mention, Mr. Chairman, is that 
there are different types of community outreach programs that 
are going on right now. I think many are the first in Alaska. 
The Circle of Safety, which is a consumer awareness and safety 
advocacy program. And most recently, an outreach into the 
general aviation community to address and focus upon those 
things general aviation pilots can do for themselves to the 
betterment of their safety record and to the benefit of their 
families.
    The Chairman. Thank you both for your testimony.
    Mike, I'm constrained to ask, how can you tell a Federal 
bird from an Alaska bird?
    [Laughter.]
    Mr. Barton. It's one that's subject to the Migratory Bird 
Treaty Act. That's the best way.
    The Chairman. You made a good suggestion. We will take a 
look at that.
    Thank you both very much.
    Our last panel is the panel of Morton V. Plumb, the 
Director of Anchorage International Airport; Rick Thompson, 
Alaska Region, Vice President of the National Air Traffic 
Controllers Association; Jerry Dennis, the Executive Director 
of the Medallion Foundation; Richard Harding, PenAir; and Karen 
Casanovas, executive director of the Alaska Air Carriers 
Association.
    I don't know if you can all find a seat there. I'd like to 
see if we can just have your comments, and then see if there's 
any questions that I should put to you before we finish.
    Dick, I know that George has pointed out to me in the paper 
yesterday that you announced your 40th anniversary.
    Mr. Harding. Thank you very much.
    The Chairman. Mort.

STATEMENT OF MORTON V. PLUMB, DIRECTOR, ANCHORAGE INTERNATIONAL 
                            AIRPORT

    Mr. Plumb. Good morning, Mr. Chairman, and Members of the 
Committee. My name is Mort Plumb, and I'm the director of the 
Ted Stevens Anchorage International Airport.
    I appreciate the opportunity to speak with you today about 
our airport.
    Since the beginning of air field operations more than 50 
years ago, Anchorage International has grown into the No. 1 
airport--cargo airport based on landed gross weight, and fourth 
ranking airport in the world based on cargo tonnage. We expect 
Anchorage's air cargo operations to continue the growth based 
on Asia-U.S. trade, and new federal legislation authorizing 
liberalization for foreign and domestic air carriers who use 
Anchorage as a transfer hub.
    Alaska's strategic position on the Pacific Rim, despite 
high fuel prices, is another contributing factor to Anchorage's 
cargo ranking. Faced with narrowing margins, many carriers are 
capitalizing on the payload versus range equation.
    Last week marked the 1-year anniversary of the airport's 
new C Concourse, and plans are currently underway for $143 
million retrofit of the A and B Concourse to bring them up to 
seismic code.
    In addition to structural improvements, our airport will 
see upgrades from air carriers to include the arrival of the 
A380 for FedEx and UPS in 2008 and 2009, respectively. The 
airport has been preparing its air field with the help of FAA 
LOI funds--thank you--to accommodate these aircraft.
    AIP funding formula changes concern us, Mr. Chairman. In 
the most recent budget bill, an effort was made to change the 
funding formula, and ultimately reduce cargo entitlements in 
the Airport Improvement Program, better known as AIP.
    Based on this formula change, Anchorage's cargo 
entitlements would be reduced from 14.6 million to 6.8 million. 
Such a reduction in cargo entitlements would directly impact 
Anchorage's ability to provide the infrastructure required to 
support the substantial growth in global air cargo traffic in a 
national transportation system. It's critical to Anchorage to 
maintain a 3.5 cargo entitlement rate with no cap.
    Senator Stevens, you were very instrumental in increasing 
the cargo entitlement rate from 3 percent to 3.5 percent and 
removing the cap for total amount of cargo entitlements funding 
to any one airport.
    Anchorage is the only airport in the Nation that relies so 
heavily on cargo entitlements. Anchorage currently accounts for 
nearly 13 percent of all cargo traffic in the United States. 
Because Anchorage serves a critical transit point for a large 
proportion of the international air cargo to and from the 
United States, funding for our airport, our cargo support for 
infrastructure is truly a national, not merely a local, 
concern.
    Congress has proposed raising the passenger facility charge 
rate from 3.50 to $8 per plane passenger. For some airports, 
increased PFCs can cover cargo entitlement losses. As an 
example, Memphis is the second largest cargo airport in the 
United States. A formula change would reduce cargo funding for 
Memphis by $7.4 million; but they would be able to increase 
general airport funding by over 23 million by raising the PFC. 
This is not the case for our airport.
    The airport, along with Cathay Pacific, would again ask for 
your assistance to get the Transit Without Visa Waiver Program 
reinstated in Anchorage. After being assured many times that 
DHS would reinstate this vital program, to date it remains 
suspended.
    This program allows passengers traveling from one foreign 
country to another foreign country to transit the U.S. without 
obtaining a U.S. visa. To date, the program remains suspended. 
Unlike all other airports in the nation, the passengers on the 
ATP program that fly through Anchorage arrive and depart on the 
same aircraft, the same carrier, and the same flight. As to 
visa-waiver flights, Anchorage is merely a transfer stop--
excuse me, simply a transit stop, not a transfer stop.
    It is Cathay's desire to offer passenger service between 
Anchorage and Hong Kong, but they are unable to do this until 
the Transit Without Visa Program is reinstated, at least for 
secure facilities such as ours.
    I would recommend you support a pilot test program at the 
Anchorage Airport.
    We recommend more flexibility for AIP spending. Current FAA 
regulations are very restrictive on the ability of airports to 
use their entitlement funding. If the regulations were more 
flexible, airports would have the ability to use the funding 
more efficiently. For example, special condition 9 of the AIP 
grant agreement precludes us from purchasing essential pieces 
of equipment using AIP funds.
    Federal agency space requirements are problematic for 
airports around the country. Federal agencies operating at 
airports should be required to pay for space to insure that 
space requirements are reasonable, and to encourage the 
agencies to use space efficiently, without duplication, and 
reduce costs to the airlines.
    Airports are increasingly asked to reduce the cost to 
carriers and to find new and creative ways to generate 
additional non-aeronautical revenues. At the same time, 
airports are being asked by federal agencies to increase space 
allocated to the agencies. With the exception of TSA, all 
agencies have laws in place that require airports to build and 
furnish space at no cost to agencies. The function these 
agencies provide are invaluable to the safety and security of 
our country, but building extravagant and duplicate facilities 
for agencies is a waste of scarce resources. So, as long as the 
law requires airports to build facilities with no cost to the 
federal agencies, there is no incentive for the agencies to be 
practical with their requirements.
    With regard to TSA, we have a very good working 
relationship with the leadership. However, Anchorage has 
promised that new security requirements would be reimbursed by 
TSA. To date, these commitments have not been fulfilled. In 
fact, Ted Stevens Anchorage International Airport's LOI 
application is now No. 23 on the list for funding. To date, 
Anchorage has spent 19.6 million to fund TSA-mandated 
enhancements at Concourse C, and is projected to spend another 
15 million in Concourse A and B.
    We are very proud of our float plane accommodations at Lake 
Hood. It arguably takes honors as the largest and busiest 
seaplane base in the world. Given the critical importance of 
generation aviation to Alaska, we would appreciate any possible 
support for more or alternate general aviation facilities.
    In conclusion, the Ted Stevens Anchorage International 
Airport serves as a critical transit and transfer point for a 
large proportion of international air cargo to and from the 
United States. Our airport is not merely a part of the national 
air transportation system, but a critical international 
strategic location.
    Senator Stevens, Secretary Mineta, Administrator Blakey, 
thanks to all your relentless efforts, we have seen our cargo 
entitlements increase and our new cargo legislation adopted to 
enhance and maintain our competitive Anchorage in the global 
marketplace.
    We thank you for your continued support. This is truly an 
important contribution you're making to the future economic 
well being of our state and the security of our country.
    Thank you, Mr. Chairman.
    The Chairman. Thank you very much Mort.
    We'll move on. Mr. Thompson is the Alaska Regional 
President for the National Air Traffic Controllers Association.
    I guess I'm correct, Dick, you're next in line? We're just 
going to go down that line. All right.
    Mr. Harding. Me next?
    The Chairman. Sorry.

  STATEMENT OF RICHARD HARDING, SENIOR VICE PRESIDENT, PenAir

    Mr. Harding. Good morning, Chairman Stevens, guests. Thank 
you for allowing me the opportunity to testify today with 
regard to my experience with the Capstone program.
    The successes described by Administrator Marion Blakey this 
morning could not have been achieved without combined effort of 
the FAA and the aviation community working closely together.
    I came to Alaska as a young pilot in 1970 with a fresh ATP 
certificate in my pocket after learning to fly in California. I 
believe at that time there were more VORs in the Los Angeles 
Bowl area than in the entire State of Alaska. The transition 
was like going to a foreign country where few navigation aids 
and many of the runways that were what somebody would expect in 
a Third World country. Runways have changed a great deal, 
especially in the last couple of years with the additional 
funding. We've got some excellent runways now. It's not par 
with the Lower 48, but we're getting there gradually, and 
thanks to the additional funding. The nav aids, however, are 
about the same as we had when I came in the 1970's.
    In 1977, a group of air carrier operators met with the FAA 
and some representatives from UPS Technologies to discuss what 
could be done to improve navigation communication in Alaska. We 
were told that with the new technology they could produce 
almost anything we could conceive. And everything we see today 
in Capstone is what we dreamed of then, ADSB stands for 
Automatic Dependence Surveillance Broadcasts. ADSB is automatic 
in that there is no pilot input necessary. It's dependent on a 
series of satellites rather than high maintenance ground-based 
facilities. It gives us capability of surveillance by our 
operation centers. Aircraft can see each other and we can be 
surveilled by air traffic control.
    The unit in the aircraft also has the ability to broadcast 
as well as receive. The pilot can select any of three displays 
in the cockpit. A moving map display which shows weather, 
traffic, or terrain. Today our pilots don't want to fly without 
it. Customers, passengers love it.
    We had a little old lady that was going to one of the 
villages during the beginning stages of this program. She came 
up to find out when her plane was going to arrive and she 
believed--only about half of our airplanes were equipped, and 
she asked, ``Is the airplane that I'm going to be flying in 
have Capstone stuff in it?''
    One of the advantages in small aircraft is the passengers 
can see the panel and can see this moving map. Most flying in 
rural Alaska is done with these small aircrafts servicing more 
than 200 communities that are not on any road system. Aircraft 
have to fly at low altitudes to maintain visual conditions 
because there are no low-altitude airways connecting the 
villages, nor approaches to the runways upon arrival. The 
Capstone program has provided a means with emerging technology 
to address both of these issues making aviation in rural Alaska 
safer and more efficient to the traveling public. Capstone has 
GPS approaches at communities that have no other instrument 
approach procedures. In Southeast Alaska Capstone has been 
instrumental in designing and creating low-altitude airways 
outside of the icing areas that allow aircraft to utilize air 
space that was never available before.
    Capstone was the first to use the Wide Area Augmentation, 
the WAAS system that Congress has previously funded. When the 
FAA completes the WAAS testing in the rest of Alaska, 
communities will have all-weather access with precision 
approaches that were not previously available to them. It will 
mean all-weather, 24-hour access to medical services not 
available today.
    Many of the communities that have instrument approaches do 
not have radar coverage to altitudes below 5,000 feet. With 
Capstone equipment on board, air traffic control can now see 
traffic on the same screen that they can see high-flying radar 
targets. This technology enables controllers to merge traffic 
safely, as they do in the rest of the country. All progress 
accomplished today is in accordance with the FAA concepts for 
the future national air space system.
    The Capstone program is demonstrating how rapid 
transmission to the new NAS can be accomplished. The government 
surely cannot afford to operate a system side by side for an 
indefinite transition period. So it's essential that the 
government and industry continue to work together.
    With the Capstone project emerged a council of industry 
leaders, such as members of the air carriers, manufacturers, 
aviation groups such as Alaska Air Carriers Association, and 
several government organizations. This new group, the Alaska 
Aviation Coordination Council, developed a 5-year strategic 
plan that includes all of the areas that the FAA Administrator, 
Marion Blakey, had previously mentioned.
    During the time I have been flying in Alaska we have gone 
from the oldest, most outdated navigation system to the cutting 
edge navigational equipment. We are all working for the same 
goal: To improve aviation safety in Alaska.
    The Medallion program addresses culture by providing 
guidance, getting pilots and management involved in the safety 
process. The Capstone program is a technology center of the 
partnership. It is necessary on both working together to make a 
difference.
    We in Alaska aviation have been fortunate to have the 
relentless support of Senator Stevens. We have also had the 
backing of the FAA administrator, Marion Blakey, and Secretary 
Mineta. Together we have reduced the aviation accident rate and 
are providing an example of what can be done with a national 
air space transportation system.
    Thank you, Mr. Chairman, for allowing this time.
    [The prepared statement of Mr. Harding follows:]

  Prepared Statement of Richard Harding, Senior Vice President, PenAir

    Good morning, Chairman Stevens, Senator Inouye and Members of the 
Committee. Thank you for allowing me the opportunity to testify today 
with regard to my experience with the Capstone program. The successes 
described by Administrator Blakey could not have been achieved without 
the combined efforts of the FAA and the aviation community working 
closely together.
    I came to Alaska as a young pilot in 1970, with a fresh ATP pilot 
certificate in my pocket after learning to fly in California. I 
believe, at that time, there were more VORs in the Los Angeles bowl 
area than in the entire State of Alaska. The transition was like going 
to a foreign country. There were few navigational aids and many of the 
runways were what one would expect to find in a third world country.
    In 1997, a group of air carrier operators met with the FAA and some 
representatives of UPS Technologies to discuss what could be done to 
improve navigation and communication in Alaska. We were told that with 
the new technology, they could produce almost anything we could 
conceive. Everything we see today in Capstone is what we dreamed of 
then. ADSB stands for Automatic Dependent Surveillance Broadcast. ADSB 
is automatic, and no pilot input is necessary. It is dependent on a 
series of satellites, rather than high maintenance ground based 
facilities. It gives us surveillance capability by our operations 
centers, other aircraft, and Air Traffic Control. The unit in the 
aircraft also has the ability to broadcast, as well as receive. A pilot 
can select any of the three displays in the cockpit, on a moving map 
display, weather, traffic or terrain. Our pilots don't want to fly 
without it. Our passengers love it. We had one in the beginning that 
asked the gate when her flight would be ready and if it had that 
``Capstone stuff '' In small aircraft the passengers can usually see 
the pilot's panel.
    Most of the flying in rural Alaska is done with these small 
aircraft, servicing more than 200 communities that are not on any road 
system. Aircraft have to fly at low altitudes in visual conditions 
because there are no low altitude airways connecting them, nor 
approaches to the runways upon arrival. The Capstone program has 
provided a means with its emerging technology to address both these 
issues, making aviation in rural Alaska safer and more efficient for 
the traveling public. The latest independent safety analysis reports 
accidents in the Capstone demonstration area have been reduced by 47 
percent.
    Capstone has initiated the installation of more than 40 GPS 
approaches at communities that have no other instrument approach 
procedures. In Southeast Alaska, Capstone has been instrumental in 
designing and creating low altitude airways, outside of icing areas, 
that allow aircraft to utilize airspace that was never available 
before. Capstone was the first to use the Wide Area Augmentation System 
that congress had previously funded. When the FAA completes WAAS 
testing in the rest of Alaska, communities will have all weather 
access, with precision approaches, that were not previously available 
to them. This will mean all weather, 24-hour access to medical service, 
that is not available today.
    Many of the communities that have instrument approaches do not have 
radar coverage at altitudes below 5,000 feet. With Capstone equipment 
on board, Air Traffic Control can now see traffic on the same screen 
they see high-flying radar targets. This technology enables controllers 
to merge traffic safely, as they do in the rest of the country. All the 
progress accomplished to date is in accordance with the FAA concepts 
for the future National Airspace System. The Capstone Program is 
demonstrating how a rapid transition to the new National Airspace 
System can be accomplished. The government surely cannot afford to 
operate dual systems side-by-side for an indefinite transition period, 
so it is essential that government and industry continue to work 
together.
    From the Capstone project emerged a council of industry leaders 
such as members of air carriers, manufactures, aviation groups such as 
the Air Carriers Association, and several government organizations. 
This new group, the Alaska Aviation Coordination Council developed a 
five-year strategic plan that includes all of the areas FAA 
Administrator Blakey had previously mentioned.
    During the time I have been flying in Alaska, we have gone from the 
oldest, most outdated navigation system, to cutting edge navigational 
equipment. We are all working toward the same goal, to improve aviation 
safety in Alaska. The Medallion program addresses the culture by 
providing guidance in getting pilots and management involved in the 
safety process. The Capstone program is the technology side of the 
partnership. It is necessary to have both working together to make the 
difference.
    We, in Alaskan aviation, have been fortunate to have the relentless 
support of Senator Stevens. We have also had the backing of the FAA 
Administrator Marion Blakey. Together, we have reduced the Alaskan 
aviation accident rate and are providing an example of what can be done 
in the National Airspace System.
    Thank you for allowing me the opportunity to speak today.

    The Chairman. Thank you very much. Glad to have you here.
    Just go right on down the line. Mr. Dennis.

 STATEMENT OF JERRY DENNIS, EXECUTIVE DIRECTOR, THE MEDALLION 
                           FOUNDATION

    Mr. Dennis. Thank you, Mr. Chairman.
    Good morning, Chairman Stevens. My name is Jerry Dennis. I 
am the Executive Director of the Medallion Foundation. I do 
appreciate the fact that the Committee has chosen to have this 
hearing here, and specifically would like to thank you for 
inviting me to talk to the Medallion Foundation.
    More than 32 years ago I came to Alaska as an NTSB 
investigator. At that time, the accident rate was much higher. 
In fact, during my time with the safety board, I personally 
averaged 110 accident investigations a year, which is far more 
than the total number of mishaps in Alaska that was attested to 
by Mr. Poe just a few moments ago. When you consider that we 
had three investigators all averaging about the same, you can 
see there's been a considerable improvement.
    However, flying in Alaska in the 1970s and 1980s is not 
like flying in Alaska today. Or, actually, is it?
    In 1979 I was part of the NTSB special study on air taxi 
safety in Alaska. Except for the advancements in technology, 
almost every item we've discussed in that study has been echoed 
in succeeding studies, including the one referenced by the FAA 
Administrator in her testimony earlier today. It is significant 
that the same problems were identified not by one additional 
study, but by 4 separate studies. How can this be?
    I believe it is because we are a highly regulated industry 
and have been doing the same things over and over again. All 
the time using the FAA regulations as our safety net. Einstein 
had an interesting definition for ``insanity'': Doing the same 
thing over and over again and expecting different results.
    I believe that the Medallion Foundation has broken that 
mold, and the key is not additional regulations or another 
safety program. But, instead, it is dedicated people armed with 
the license to learn in the industry and educating others using 
a back-to-basics, one-on-one training philosophy.
    A quick review will show that every major reduction in 
aircraft accidents has resulted from a change in technology. It 
is because of these improvements that the focus has not been on 
manufacturers, but on more tangible technological solutions. 
However, the accidents are still occurring and the pilot is 
still cited as a causal factor in more than 70 to 75 percent of 
the mishaps.
    The Capstone technology being discussed here today has 
reduced accidents and is a wonderful tool. I'm hear to say, the 
Medallion Foundation Five Star Shield Program is also a very 
valuable tool that is focused on human factors and the 
organization. It has also reduced accidents throughout Alaska.
    This program is unique in that it was developed by the 
industry, not the government. It is based on the belief that 
the individuals doing the job usually know more about what is 
wrong than anyone else. And 9 times out of 10, they also know 
the answer to the problem. The Medallion programs are based on 
this concept and they're a step above the regulations. A 
voluntary process that has higher safety goals that can be 
tailored to each operator based on their needs and 
requirements.
    Why is this program working? One of the primary reasons is 
because it's good business and demonstrates that safety can be 
a profit center. The Senior Vice President of PenAir, Mr. 
Richard Harding, sitting to my right, has stated on numerous 
occasions that the shield program has reduced their 
occupational exposure by as much as 60 percent. When you look 
at the cost of workers' compensation today, that equates to 
real dollars.
    Another reason, and a big one, is that the program is 
proactive, not reactive. It is based on what people do right, 
not how to prevent the last accident.
    Another important part of this success story is the 
relationship we have with the FAA. This type of program would 
have been difficult, if not impossible, just 10 years ago. And 
even with this partnership approach, it still took well over a 
year to get the inspectors to acknowledge that we had something 
to offer.
    One other very important advantage that we have over any 
government agency is flexibility. We can change things as we 
see fit and do it now.
    In the past 3 years, we have instituted 6 improvements to 
the program. We still have oversight from the FAA, as our 
monthly meetings and quarterly reports will attest. But I 
believe that the FAA now looks on the Medallion Foundation as a 
tool they can use as well.
    I firmly believe that given the current evolution of the 
program in the next 6 to 9 months, the FAA will be able to use 
the Medallion programs to assist in their evaluation of an 
operator, and will be able to focus their resources on more 
troubled carriers.
    I also believe that using our process-based approach and a 
viable internal evaluation program will be the basis for a 
limited form of self-regulation that may change the nature of 
government oversight.
    The grant provided by Congress with the sponsorship of 
Senator Stevens has already changed aviation in Alaska. I 
believe that the programs being developed here, both Medallion, 
Capstone, weather cams, and others, will eventually be utilized 
in the Lower 48 and other parts of the world as well.
    In conclusion, I would like to thank you, Mr. Chairman, for 
the opportunity to testify on the subject. I would be happy to 
answer any questions you might have.
    The Chairman. Thank you very much.
    Mr. Thompson.

 STATEMENT OF RICK THOMPSON, ALASKAN REGIONAL VICE PRESIDENT, 
               NATIONAL AIR TRAFFIC CONTROLLERS 
                          ASSOCIATION

    Mr. Thompson. Good morning, Mr. Chairman. I appreciate the 
opportunity to testify today on Alaskan aviation issues.
    I'm a 20-year veteran air traffic controller at the 
Anchorage Air Traffic Control Center. NATCA has a long history 
of supporting new aviation technology and modernizing our 
nation's air traffic control system to meet the growing demand 
for aviation services.
    In Alaska we have a number of unique opportunities to be on 
the cutting edge of new technology. Today I'll address issues 
affecting those factors. NATCA is not interested in simply 
pointing out challenges; we are prepared to offer solutions. 
The issues we face are not insurmountable, rather they present 
opportunities for aviation stakeholders to provide input and 
expertise that allow us to continue to build Alaska's aviation 
infrastructure.
    The FAA is facing a nationwide air traffic controller 
retirement crisis. NATCA has been working secure funds to hire 
and train the next generation of controllers. Unfortunately, 
the slow pace of hiring has exacerbated the problem. Anchorage 
Center is staffed at 88 percent of its authorized control 
positions, and 15 percent of the work force will be eligible to 
retire in 24 months. The critical aviation network in Alaska 
cannot meet the needs of our state if this problem is not 
addressed.
    This situation has been exacerbated by Anchorage Center new 
sector staffing plan in the increase in the Anchorage's 
supervisor staffing because they hire directly from the control 
ranks. Management at the Anchorage Center unilaterally 
instituted a new sector staffing plan. Under the plan, 
controller resources are allocated based on meaningless metrics 
rather than user demand and safety. This plan does not fit the 
dynamic flow of the air traffic system. It has impeded quick 
responses to capacity, and consequently, reduced the margin of 
safety.
    We are open and willing to discuss the best most efficient 
use of staff. However, the FAA has rejected our offers to be 
included in such discussions. Anchorage Center has also 
increased the level of supervisor staff. A year ago there were 
12 first-level supervisors, resulting in a ratio of about 10 
controllers per supervisor. Today, the agency is hiring a total 
of 21 first-level supervisors, for a ratio of 5.5 controllers 
per supervisor. I have 2-year-old twins. There is more 
supervision of air traffic controllers in Anchorage Center than 
there is of my 2-years-olds at their day care.
    This does not improve the services in Alaska. This only 
serves the bureaucracy, and reduces our ability to deliver 
services to our users.
    Today we face a number of issues modernizing ATC 
infrastructure. Regular preventative maintenance of 
communication, navigation, and surveillance systems is needed 
to insure the reliability of the NAS. The FAA has decided to 
resurrect parts of a failed Alaskan test under the new name 
Reliability Center Maintenance.
    The agency states that the necessary analysis has been 
completed to validate the event-based approach to maintaining 
the safety-critical equipment. Yet the decision was made before 
our work group chartered to study the problems was ever 
convened. NATCA asked that the agency hold an open discussion 
with stakeholders prior to implementing this program.
    We opposed eliminating 24-hour air traffic control services 
at Fairbanks International Airport. Fairbanks Air Traffic 
Control Tower is a 24-hour tower and approach control which 
handles over 927,000 passengers per year. Fairbanks 
International is the economic, transportation, medical, 
financial and government hub of Interior Alaska. A reduction of 
services is not efficient, effective, or safe.
    The cost savings did not justify the safety and economic 
impact of reduced services. The FAA/NATCA liaison program 
allowed for the involvement of air traffic controllers and 
technical experts in modernization efforts. It has resulted in 
cost savings, on time deployment, and successful implementation 
of new technology. However, on June 28th the FAA informed NATCA 
that it is terminating this effort due to budget constraints. 
This includes George Lloyd from Anchorage Tricon who has been 
serving as the ANB 500 liaison responsible for Capstone and 
ADSB for the past year.
    NATCA supports the full and complete development of 
Capstone initiative to use ADSB as an air traffic control tool 
in Alaska. The Capstone program has enhanced the safety of the 
entire operations in Alaska. NATCA believes the FAA should 
concentrate its Capstone program resources on completing air 
traffic control concepts contained in Phase I--approach control 
services for Bethel--before moving to Phase II--approach 
control services for Juneau.
    Aircraft operators in the Bethel area have been looking for 
the FAA to provide control surveillance approach control 
services in order to increase the capacity of the Bethel 
Airport during the special VFR and IFR operations. This goal 
can be reached. NATCA supports this objective, and we have 
worked to insure these new services can be provided. However, 
development problems continue. Last week FAA management made 
the decision to turn the Capstone information off Anchorage 
Center's radar screens. This was the result of data integrity 
problems of unknown origins created by--creating an 
unacceptable safety risk. Management was aware of the problems 
for weeks, but did not inform the controllers of the mounting 
concerns prior to disabling the data.
    NATCA recognizes the significant safety potential of the 
ADSB technologies in air traffic control tool. However, in its 
current state, the Capstone program lacks the proper oversight 
and direction needed to be successful in fielding a fully 
integrated air traffic control tool.
    NATCA is prepared and willing to work with the agency 
completing Capstone Phase I and Phase II. I ask that the FAA 
fully engage NATCA in the critical discussions that must take 
place.
    By working together to address the decisions at hand, we 
can move rapidly to provide Bethel and Juneau system users to 
need services in an efficient and timely manner.
    The Capstone office has also created a plan to divest 
ground-based navigational aids in Alaska and shut down Alaska's 
long-range radars. To my knowledge, this plan was developed 
without the input of system users and air traffic controllers 
in Alaska. NATCA asks that any plan with such a magnitude and 
impact on Alaskan aviation be discussed in an open and public 
forum.
    Thank you for this opportunity to testify on Alaskan 
aviation issues. On behalf of NATCA and the Alaskan air traffic 
controllers, we look forward to working with you and your staff 
to ensure that our air traffic control system remains the 
safest and most efficient in the world.
    And I'll be happy to answer any questions that you may 
have.
    [The prepared statement of Mr. Thompson follows:]

 Prepared Statement of Rick Thompson, Alaskan Regional Vice President, 
              National Air Traffic Controllers Association

    Good morning Mr. Chairman, I appreciate this opportunity to testify 
today on Alaskan aviation issues. I am Rick Thompson, Alaskan Regional 
Vice President for the National Air Traffic Controllers Association. 
NATCA represents about 20,000 FAA safety-related professionals in a 
variety of positions including air traffic control specialists, 
engineers, architects and pilots. I am also a 21-year veteran air 
traffic controller at the Anchorage Air Route Traffic Control Center 
(ZAN).
    I am honored to represent these aviation safety professionals and 
to speak on their behalf today. NATCA has a long history of supporting 
new aviation technology, modernizing and enhancing our nation's air 
traffic control system and working to ensure we are prepared to meet 
the growing demand for aviation services. In Alaska, we have had a 
number of unique opportunities to be on the cutting edge of new 
technology. Today, I want to address a number of issues--Anchorage 
Center Staffing, NATCA's involvement in air traffic control 
modernization and the Capstone project, air traffic control 
infrastructure decisions, and controller retention issues in Alaska. 
NATCA is not interested in simply pointing out challenges; we are 
prepared to offer solutions. The challenges we face are not 
insurmountable, rather they present opportunities for aviation 
stakeholders to provide input and expertise that will allow us to 
continue to build the aviation infrastructure in Alaska, maintain and 
enhance the global leadership we inherited, and meet the needs of our 
community.
Anchorage Air Route Traffic Control Center (ZAN) Staffing
    As the Committee is aware, the FAA is facing a nationwide air 
traffic controller retirement crisis. NATCA has been working for years 
to secure the much-needed funds to hire and train the next generation 
of air traffic controllers. Unfortunately, the slow pace of hiring has 
only exacerbated the problem. In fact, there are 1,000 fewer 
controllers in the FAA than just 2 years ago.
    In the December 2004 Air Traffic Controller Workforce Plan, the 
agency states that it plans to hire 1249 air traffic controllers in 
FY06. And, for the first time, the agency acknowledged that its prior 
hiring policy of one hire for one retirement is not adequate because of 
the time needed to train a new controller. Yet, their budget request 
provided $24.9 million to hire 595 air traffic controllers. It seems 
they only intend to hire the other 654 controllers based on attrition--
contrary to their acknowledgement that one for one hiring is not 
adequate. Considering the projected losses in 2005, this plan does not 
keep pace with current demand.
    At Anchorage Center, there are currently 112 air traffic control 
specialists on board, only 88 percent of the number required under the 
FAA's system (127). Of those currently on board, 15 percent are 
eligible to retire in the next 24 months. Simply put, Mr. Chairman, the 
critical aviation network in Alaska cannot meet the needs of our state 
if this problem is not addressed.

Air Traffic Organization
    A primary stated objective of the new Air Traffic Organization was 
to reduce the layers of management between Chief Operating Officer and 
the delivery of air traffic services (controllers). Specifically, the 
stated goal was to reduce from 11 to 6 the layers of management between 
the COO and the air traffic controllers. NATCA supported this 
initiative. Unfortunately, Anchorage Center is moving in the opposite 
direction. About a year ago, there were 12 first level supervisors 
resulting in a ratio of about 10 controllers per supervisor. Today, 
there are 18 first level supervisors and the agency is planning to hire 
another three for a total of 21 first level supervisors or a ratio of 
5.5 controllers per supervisor. I have two-year-old twins. There is 
more supervision of air traffic controllers at Anchorage Center than 
there is of my two-year-old twins at their daycare. Alaska State law 
requires one daycare worker per six kids under the age of two, and at 
age three it is only a 10-to-1 ratio.
    The increase in first level supervisors is costly, inefficient and 
only serves to further exacerbate the air traffic controller staffing 
problem as supervisors are picked directly from the controller 
workforce. It has not made the system or Anchorage Center operations 
safer. Now we simply have more people watching fewer people talking to 
more airplanes. In addition, the number of second level supervisors has 
also increased at Anchorage Center. And, the agency plans to add 
another level of management at the top of their three Regional Service 
Areas. The ATO was supposed to streamline the system, but in Alaska it 
has served only to bloat the bureaucracy, increasing the costs and 
reducing our ability to deliver service to our users.
    In May 2005, management at Anchorage Center unilaterally instituted 
a new ZAN sector staffing plan. Under this plan resources are allocated 
based on a meaningless metrics rather than user demand and safety. 
Areas are now staffed at 60 percent regardless of the volume and 
complexity of traffic. Thus during periods of low traffic volume, 
controllers are plugged in when they could be performing other assigned 
duties such as training, proficiency work or reading the daily 
briefings. Conversely, in times of peak traffic volume when additional 
controllers are needed, none are available. The new staffing plan does 
not fit the dynamic flow of the air traffic system. In fact, it impedes 
quick responses to capacity demands and consequentially reduces the 
margin of safety. NATCA and the Anchorage Center controllers are open 
and willing to discuss the best and most efficient use of resources and 
staff. However, the FAA has rejected our subject matter expertise and 
declined to include us in any such discussions or decisions.

Reliability Centered Maintenance
    The FAA is radically changing the existing proven system of 
maintaining and certifying navigational aids, radars, and air traffic 
control communication frequencies. Five years ago, the FAA tested a 
revised maintenance program for navigational aids in Alaska called 
Corporate Maintenance Philosophy (CMP). Under this program, regular 
preventative maintenance of communication, navigation and surveillance 
systems was no longer conducted. Only when the equipment failed would 
someone be sent for repairs. While that might work for the Maytag 
repairman and your washing machine, it did not work for air traffic 
control critical equipment, which in Alaska is often in remote 
locations with no road access. Ultimately, the number of important 
navigational aids out of service because of failures in Alaska 
escalated and escalated, and the program failed.
    Unfortunately, the FAA has decided to resurrect parts of this 
program under a new name, Reliability Centered Maintenance (RCM). The 
agency states the necessary engineering analysis has been completed to 
validate the event-based approach of maintaining this safety critical 
equipment. Yet, the decision was made before the workgroup chartered to 
study the problem ever convened. RCM's purpose is to cut costs by 
deferring maintenance on sites that the FAA deems are unimportant or 
too costly to maintain. It did not work 5 years ago under CMP and it 
will not work today under the new title of RCM.
    NATCA is very concerned that the agency is reinstating this failed 
program. If the navigational aids, communication frequencies and radars 
are not properly maintained, the reliability of the NAS will suffer. 
Air traffic routes and approaches to airports may not be available when 
needed adding time and financial burdens to the users and the flying 
public. Since the aviation system in Alaska is the sole lifeline for 
many communities, this program will have a significant impact. 
Accordingly, NATCA believes the agency should hold an open forum to 
receive feedback from the system users prior to implementation. Our 
community understands the importance of a reliable aviation system and 
critical decisions should not be made from FAA in Washington without 
any input from those who know and understand Alaska aviation.

Fairbanks Air Traffic Control Tower
    Fairbanks Air Traffic Control Tower (FAI) is an instrumental flight 
rule tower and approach control facility that handles over 927,000 
passengers per year. Fairbanks International Airport is the economic, 
transportation, medical, financial, and government hub of interior 
Alaska. In fact, the airport serves as the alternate for Ted Stevens 
Anchorage International Airport. During low IFR conditions (below 
arriving aircraft approach minimums) aircraft scheduled to land at 
Anchorage are often diverted to Fairbanks.
    The Fairbanks approach control facility also handles traffic to and 
from the Fort Wainwright Army Base home of the 1st Brigade, 6th 
Infantry Division (Light) and the Eielson Air force Base which is the 
northernmost U.S. fighter wing in the world, the 354th Fighter Wing's 
A/OA-10 Thunderbolt II and F-16 Viper aircraft. Eielson is also home to 
Cope Thunder, the largest aerial exercise in the Pacific region, held 
four times a year.
    Earlier this year, the FAA announced its plan to eliminate 24-hour 
air traffic control operations at 42 towers nationwide as a way to cut 
costs. Fairbanks Air Traffic Control Tower is on the list. Initially, 
the agency's FY06 budget submission assumed a $2 million cost savings 
yet in recent testimony the agency has stated the savings could be $6 
million for eliminating services at all 42 towers during the overnight 
hours.
    NATCA strongly opposes efforts by the FAA to reduce service and 
thus reduce the margin of safety. Air traffic is no longer experiencing 
the effects of the post September 11, 2001 decline. The agency states 
that flight activity during any period where the tower is unmanned will 
be handled by the appropriate en route center or TRACON. These 
facilities are already doing more with less. In the case of Fairbanks, 
Anchorage Center would assume responsibility for activity at the tower. 
However, the air traffic controllers at Anchorage Center are not 
familiar with the airport and cannot see the runways. They will not be 
able to tell a pilot if there is a problem with the weather, debris on 
the runways, maintenance on the airport surface, etc. In addition to 
commercial traffic, most of these towers handle emergency landings, 
diverted passenger flights, delayed traffic, major air freight 
operations, and military operations 24 hours a day.
    NATCA recognizes the budgetary issues facing the agency and the 
industry. In fact, we have offered several cost savings measures--that 
do not reduce capacity or safety--to authorizers, appropriators and 
agency officials. We believe the FAA's budget is sufficient to meet the 
needs of the system but the agency continues to make unwise spending 
choices. Turning the lights off in these towers is not efficient, 
effective or safe. The cost savings do not justify the safety and 
economic impact of reduced service.

Air Traffic Control Modernization
    For over a decade, NATCA has been working day and night with the 
FAA to move new technologies into the workplace as quickly, efficiently 
and safely as possible. FAA modernization is an ongoing process and 
NATCA has been directly involved in every technology project from its 
inception. This collaboration and teamwork has been instrumental in 
ensuring the success of vital technology projects from en route 
modernization (Display System Replacement) to runway safety technology 
(Airport Surface Detection Equipment). However, on June 28, 2005 the 
FAA informed NATCA that it is terminating the liaison program effective 
July 29, 2005 due to budget constraints. This includes George Lloyd 
from Anchorage TRACON who has been serving as the AND-500 Liaison 
responsible for Capstone and ADS-B for the past year.
    The liaison program has routinely demonstrated success and has been 
commended by FAA management officials and contractors. In fact, a 
November 2004 Government Accountability Office report emphasized the 
need to involve controllers ``early and throughout FAA's ground systems 
approval process.'' The report found that when the FAA did not involve 
air traffic controllers and technical experts, its new air traffic 
control systems experienced cost over-runs and schedule delays. And 
just this week, ATO Chief Operating Officer Russ Chew praised the 
collaborative effort that marked the successful implementation of new 
technology (ATOP) at New York Center that provides satellite coverage 
of oceanic air traffic. The agency's action is short-sighted and will 
only hamper air traffic control modernization efforts.

Capstone
    NATCA supports the full and complete development of the Capstone 
initiative to use Automatic Dependent Surveillance (ADS-B) as an air 
traffic control tool in Alaska. The Capstone Program has enhanced the 
safety of visual flight rule (VFR) operations in Alaska's difficult 
terrain and challenging weather conditions. However, we are concerned 
with the FAA's lack of focus in properly completing ADS-B's 
technological development into a fully integrated and useful air 
traffic control tool.
    A primary goal for ADS-B in Alaska is to become an integrated, 
seamless air traffic control tool for the instrument flight rule (IFR) 
environment by providing new and expanded radar services via Phase I 
(the Bethel area) and Phase II (the Juneau area). As you are aware, the 
aircraft operators in the Bethel area have been looking for the FAA to 
provide true radar approach control services in order to increase the 
capacity of the Bethel Airport during SVFR and IFR conditions. This 
goal can be reached. NATCA supports this objective and we have worked 
to ensure this new service can be provided remotely by controllers at 
Fairbanks approach control.
    On December 31, 2000, Yute Air Flight 103 contacted Anchorage 
Center requested and received the first ever ADS-B vector for the ILS 
18 approach at Bethel. Since that demonstration flight almost 5 years 
ago, Alaskan air traffic controllers have been waiting for the FAA to 
provide the necessary equipment and staffing so we can provide this 
enhanced service.
    In September 2002, the FAA Alaskan Region completed a study 
recommending a dedicated approach control service for Bethel be 
established using ADS-B technology and that the service be provided by 
Fairbanks approach control. NATCA supports this decision.
    In May 2003, the FAA Alaskan Region finally gave NATCA a notice to 
bargain over the numerous issues involved with Bethel approach services 
being remote to Fairbanks. With the establishment of a new service a 
number of major items must be addressed including control room 
equipment, staffing, training, procedures and in this case the needed 
approval of the use of Terminal rules (3 nm spacing between aircraft) 
versus en route rule (5 nm spacing between aircraft), plus software 
functionality enhancements (I.E. 4096 adjustable codes).
    NATCA and the FAA Alaskan Region spent a considerable amount of 
time and effort and made major progress addressing these issues. Then, 
in April 2004 with the Air Traffic Organization's (ATO) implementation, 
I received a letter from the FAA withdrawing themselves from 
negotiations and consequentially ending productive work on the Bethel 
Approach Control project. NATCA remains perplexed by the agency's 
action.
    NATCA believes that the FAA should concentrate its Capstone Program 
resources on completing the air traffic control concepts contained in 
Phase I (approach control services for Bethel) before moving to Phase 
II (approach control services for Juneau). Under the FAA's scattered 
approach to implementation, only 5 of the 10 ADS-B ground based 
transceivers in the Bethel area are being used for air traffic control 
purposes today.
    Rather than working with NATCA in an open and constructive 
environment to quickly address the issues inherent in providing new air 
traffic control services, the FAA has been increasingly evasive, 
secretive and appears to lack the clear direction to quickly complete 
Capstone Phase I and Phase II. There are numerous failed past examples 
of air traffic control tools and equipment that the agency has tried to 
field without controller input. Case in point is the Advanced 
Automation System of the 1990s which resulted in an overly complex, 
unusable system costing the taxpayers over $1 billon.
    NATCA recognizes the significant potential of ADS-B technology as a 
successful air traffic control tool. However, in its current state, the 
Capstone program lacks the proper oversight and direction needed to be 
successful as a fully integrated air traffic control tool. NATCA is 
prepared and willing to work with the Agency in completing Capstone 
Phase I and II. Respectfully, I ask that the Committee direct the FAA 
to fully engage NATCA in the critical discussions that must take place. 
By working together to address the many issues at hand, we can move 
rapidly to provide the Bethel and Juneau air traffic control system 
users and the flying public the needed services in an efficient and 
timely manner.

Capstone Phase III/Decommissioning of Alaskan Navaids
    The Capstone office hired MITRE Corporation to create a plan for 
the divestment of Ground Based Navigational Aids (GBNA) in Alaska. The 
report states that ``preliminary results indicate that 83 of 118 legacy 
GBNAs (the term for current Navaids) can be divested under this 
strategy (approximately 70 percent).'' It acknowledges that this 
proposed strategy is different from the current FAA strategy in the 
lower 48 in that, ``it implies full Wide Area Augmentation System 
(WAAS) equipage for aircraft based in the state (Alaska) and that it 
does not retain a coverage-based backup structure based on GBNAs''. In 
addition, the report did not consider military operations.
    To my knowledge, this plan was developed without the input of FAA 
air traffic, the system users, and the air traffic controllers in 
Alaska. MITRE has also informed Anchorage Center that they have been 
commissioned by Capstone to study shutting down Alaska's long range 
radars beginning with two sites on the west coast.
    NATCA asks that any study of such magnitude and impact on Alaskan 
aviation be discussed in an open and public forum. That discussion 
should at a minimum include the commercial operators, general aviation, 
military users, the public at large and the air traffic controllers who 
daily operate the system.

COLA vs. Locality Pay for Air Traffic Controllers
    The retirement benefits of civilian federal employees stationed in 
Alaska, Hawaii, Guam, Puerto Rico and other non-foreign duty locations 
outside the contiguous 48 states are lower than their counterparts in 
the continental United States. As a result, Alaska continues to lose 
experienced air traffic controllers who transfer out of state in order 
to qualify for the higher retirement benefits. Accordingly, NATCA 
support a transition from cost-of-living allowances (COLAs) to locality 
pay.
    The U.S. Government pays COLAs to white-collar civilian Federal 
employees in Alaska, Hawaii, Guam and the Commonwealth of the Northern 
Mariana Islands, Puerto Rico, and the U.S. Virgin Islands. On August 
17, 2000, the United States District Court of the Virgin Islands 
approved the settlement of Caraballo et al. v. United States, Civil No. 
197/27 (D.V.I.). Caraballo was a class-action lawsuit in which the 
plaintiffs contested the methodology Office of Personnel Management 
(OPM) used to determine COLA rates. The settlement resulted in revised 
procedures to survey prices, set a base COLA rate for each site, and 
created a less volatile process to revise COLA rates.
    OPM surveys the prices of over 200 items, including goods and 
services, housing, transportation, and miscellaneous expenses in each 
of the three primary allowance areas (Alaska, the Pacific Islands, and 
the Caribbean) once every three years and in the Washington, DC, area 
each year. The current COLA rate for Alaska is 25 percent. The Alaskan 
survey will result in a COLA reduction of one percent per year for 
federal employees in Anchorage, Fairbanks and Juneau starting in 
January 2006. The reductions will continue until the new lower target 
rates of Anchorage 13 percent, Fairbanks 16 percent, and Juneau 19 
percent are reached. The next OPM survey of Alaska is scheduled for 
early 2006.
    The significant gap in retirement benefits is a result in the 
difference between COLA and locality pay. COLA is authorized by section 
5941 of Title 5, United States Code and Executive Order 10000 (as 
amended). COLA is based on the difference between the cost of goods and 
services in the DC metro area vs. the cost of a similar package of 
goods and services in each respective COLA area. COLA is exempt from 
federal income tax and does not count toward for federal retirement 
benefits.
    The provision for locality pay is set in the Federal Employees Pay 
Comparability Act of 1990 (FEPCA) and does not apply outside CONUS. 
Locality pay is a measure of the cost of labor in a geographic area. 
Locality pay is not exempt from federal income tax and is included in 
determining federal retirement benefits.
    Look at two air traffic controllers under the Civil Service 
Retirement System (CSRS)--one working at Anchorage Center and one 
working at Seattle Center--with the same base salary ($90,000/yr.) and 
the same pay grade (ATC-10). Upon retirement the Seattle controller 
will receive at least $619 per month more in retirement than the 
Anchorage controller. This is because the Seattle controller qualifies 
for 16.53 percent locality pay which is added into his retirement while 
the Anchorage controller receives COLA.
    Today, the ``rest of U.S.'' locality rate is 11.72 percent and the 
nation's top locality rate (San Francisco) at 26.39 percent. As 
locality rates continue to progressively grow so will the disparity in 
retirement benefits between the two systems. Historically, COLA has 
remained flat but beginning in January 2006, COLA rate reductions will 
become a reality. The resulting inequity causes actual and potential 
staffing problems in non-foreign areas, especially for employees 
nearing retirement.
    OPM has stated that they believe the COLA program should be phased 
out in favor of a more market-oriented approach to pay. The FAA enacted 
locality pay through FAA Order 3550.15 in March 1993. The Order states 
that, ``The provisions are expected to aid work force stability and 
improve efforts in attracting the skilled and diverse workers needed to 
sustain the tradition of FAA achievement.'' NATCA requests your support 
in implementing a transition from COLA to locality pay--a transition 
that is fair to FAA employees and helps serve the government as a 
retention and recruiting tool for Alaska, the Pacific islands, and the 
Caribbean.
    Thank you for this opportunity to testify on Alaskan aviation 
issues. On behalf of NATCA and the Alaskan air traffic controllers, we 
look forward to working with you and your staffing to ensure that our 
air traffic control system remains the safest and most efficient in the 
world. I am happy to answer questions that you may have.

    The Chairman. Thank you very much.
    Ms. Casanovas.

STATEMENT OF KAREN E. CASANOVAS, EXECUTIVE DIRECTOR, ALASKA AIR 
                      CARRIERS ASSOCIATION

    Ms. Casanovas. Good morning, Chairman Stevens. I'm Karen 
Casanovas, the Executive Director for the Alaska Air Carriers 
Association. And we are here, again, to educate everyone and 
advocate for aviation. And we take this as an honor to speak 
before you today concerning crucial aviation issues, and also, 
since we know Alaska aviation travel is the way of how we 
travel, we'll address the issues and challenges facing 
commercial air carriers in our state.
    As a pilot yourself, Mr. Chairman, you know that--and 
understand that there's a wide variety of services provided by 
airlines and transportation companies around this state. We 
have the single pilot operator to the turbo prop, to the 
rotorcraft, even to the float plane operator. And since there 
is a wide and diverse group of carriers performing services 
around the state who are fulfilling essential roles in Alaska's 
transportation infrastructure, many are already strapped by 
rising fuel costs for security demands.
    Prior to my current management position, I served in 
several capacities for many different air carriers around the 
state over the last 30 years, and I, too, can attest to those 
varieties in the unique aviation companies which are conducted 
under the Federal Aviation Regulations Parts 121 and 135.
    Key issues certainly are utilization, maintainability, and 
scheduling. And one of the issues we have found recently and a 
challenge is on occasion FAA's inability to have manuals 
reviewed, equipment improved, or maintenance checks.
    Operating conditions continue to be frustrating for airline 
operators, and something must be done to stop the downward 
spiral in service to the industry. Solutions might include an 
evaluation of pending manual approvals for aircraft 
certifications and a creation of a process that would utilize 
timelines for reviewing, with quantifiable goals to meet those 
projects and complete them.
    In some locations perhaps financial backing would be needed 
to staff additional positions. In Alaska we've been very 
fortunate under the leadership of FAA's Regional Administrator 
Pat Poe, and also Flight Standards Manager John Duncan. They 
have been working with us and have been trying to come up with 
solutions to meet the air carriers' needs.
    Next, however, since about 70 percent, certainly, of our 
communities are not connected to the outside world, or even to 
each other, our concerns are with proposed changes to 49 CFR 
Part 175 which we feel are not practical and certainly restrict 
the fundamental nature of routine travel transportation in 
Alaska.
    The restriction to only one lighter to destinations where 
survival mandates reliable fire-starting equipment certainly is 
not enough for passengers traveling for hunting, fishing or any 
wilderness activities, or anybody conducting surveying or 
construction work. Carrying of more than one lighter on one's 
person certainly can be accomplished with the same level of 
safety when a passenger is limited to just one lighter.
    Also, many rural Alaskans rely on subsistence hunting as 
part of their lifestyle, and restricting them to 11 pounds of 
ammunition when traveling to remote locations and when there 
are no other options to purchase additional ammunition is not 
practical. This existing exemption has demonstrated a need in 
air transportation for Alaskans and we haven't seen any adverse 
history or safety concerns previously.
    To further address one more item under the proposal 
described, transportation to locations where there's no phone 
service is also a concern to us. Requiring air carrier 
operators to employ staff to monitor telephones where there is 
no practical solution or reason for that, we would also suggest 
language exempting this requirement for small aircraft within 
the State of Alaska.
    Moreover, an obligation to remain in constant communication 
between noncertificated airports and the pilot in command is 
not achievable, and this rule will likely be violated simply 
because commercial carriers will not have the means to comply.
    Next on the topic of the proposed National Air Tour Safety 
Standards, our association believes the objective to reduce 
accidents in the sight-seeing industry will affect scheduled 
operators who conduct air tours as part of their business.
    The changes will trickle down to other tourism-related 
commerce, as well as impact employees of those companies as 
they reduce their service or go out of business.
    An estimated three quarters of our membership would see a 
fallout of between $15 and $18 million over a 10-year period. 
Air tours provide higher yields for certificate holders which 
subsidize the flat, less profitable margins of Essential Air 
Service. Certainly, businesses around the state, even those 
that have been in business for 22 years, under this proposed 
rule, there would be no guarantee that they would still remain 
in business.
    Since tourism is the second largest private-sector employer 
in the state, our proposal would be to continue to employ 
safety programs such as the Capstone and Medallion program. And 
results in improved safety lie projects such as this, and also 
the implementation of the analysis of the Wide Area 
Augmentation System, WASS, to achieve weather reporting and 
also training for navigational aids, rather than more 
regulatory constraints. We feel that that would be a better 
solution.
    We would recommend that this NPRM be withdrawn, and funding 
continue for both Capstone as well as the Medallion programs.
    Mr. Chairman, the Alaska Air Carriers Association 
appreciates your co-sponsorship with Senator Inouye of Senate 
Bill 84, which would exempt certain sight-seeing flights from 
taxes on air transportation.
    We also appreciate your continued support for the Medallion 
Foundation and--truly a program that is changing the culture of 
aviation across the state.
    In order to continue to improve aviation safety, however, 
we feel we need additional moneys directed toward weather 
access and global positioning systems, and those specific 
projects outlined in the Alaska Aviation Coordination Council's 
Strategic Plan. Regarding weather accesses, Mr. Harding 
mentioned previously, it would be certainly a shame to have a 
situation in rural Alaska where an 8-year-old girl, for 
instance, would be the victim of a domestic violence and maybe 
a gunshot wound and she's out in a remote location, and because 
pilots don't have access to that weather, they're not able to 
provide medical need for her in a timely manner.
    Only through trust and collaboration with our partners in 
the government for the future will we be able to create a 
valuable, safer environment for passengers here in the State of 
Alaska.
    Thank you very much for the opportunity to comment today. 
Do not hesitate to call on the Alaska Air Carriers Association 
as a resource for future aviation issues.
    [The prepared statement of Ms. Casanovas follows:]

 Prepared Statement of Karen E. Casanovas, Executive Director, Alaska 
                        Air Carriers Association

    Good morning Chairman Stevens and Members of the Committee. My name 
is Karen Casanovas and I am the Executive Director for the Alaska Air 
Carriers Association. It is an honor to speak before you today 
concerning crucial issues facing aviation commerce. Since air travel is 
a way of life for Alaskans, I'll address the issues and challenges 
facing commercial air carriers in our state.
    Our organization's mission is to provide educational training, 
advocate for the interests of aviation in the public process, and act 
as a facilitator of aviation-related information. Additionally, we 
provide resources for insurance, security, safety, air-space, or 
weather reporting issues and act as a conduit between government and 
industry leaders. Our Association (AACA) was founded in 1966 and 
represents over 160 commercial air carriers and businesses throughout 
the nation.
    As a pilot yourself, Senator Stevens, you are aware of the wide 
variety of services provided by the aviation industry in our state. 
With a current grim economic situation for several of our members, the 
Alaska Air Carriers Association membership firmly believes that the 
Federal Government officials in high level decision-making positions 
should support aviation businesses not hinder them. Air carriers 
performing services around the state are fulfilling essential roles in 
Alaska's transportation infrastructure and are already strapped by 
rising fuel costs and security demands.
    Prior to my current management position, I served in various 
capacities for Alaskan air carriers, having spent over 30 years in this 
industry, and can attest to the existing widely diverse types of 
operations in Alaska. There are many different and unique aviation 
companies that are conducted under parts 121 and 135 of the Federal 
Aviation Regulations (FARs). They are single engine airplanes to turbo 
prop equipped aircraft or rotorcraft and float plane operators. Some 
current proposals, however, would ignore these differences in operating 
requirements.
    Key issues for air carriers are throughput, resource utilization, 
reliability, availability, maintainability and scheduling. Without 
government staff to check-off mandated federal requirements, an air 
carrier is not able to utilize their aircraft. This in turn causes lack 
of reliability to meet customer needs, and therefore affects their 
bottom line by not being able to maintain the demand for their 
services.
    One challenge facing the industry today is the FAA's unavailability 
for manual reviews, equipment approvals or maintenance checks. 
Operating conditions continue to be frustrating for airline operators 
and something must be done to stop the downward spiral in service to 
the industry. Solutions include an evaluation of pending manual 
approvals or aircraft certifications, and the creation of a process 
that utilizes timelines for review with quantifiable goals for 
completing these projects. In some locations, financial backing is 
needed to staff additional positions.
    Next, since 70 percent of our communities are not connected to the 
outside world or even each other, our concerns are with certain 
proposed changes to 49 CFR Part 175, which are not practical and accrue 
from the fundamental nature of routine air transportation in Alaska.
    The restriction of only one lighter to remote destinations where 
survival mandates reliable fire-starting equipment is not enough for 
passengers traveling for hunting, fishing, wilderness recreation, 
surveying or construction work. Carrying of more than one lighter on 
one's person can be accomplished with the same level of safety provided 
when a passenger is limited to only one lighter.
    Many rural Alaskans rely on subsistence hunting as part of their 
lifestyle and restricting them to 11 pounds of ammunition when 
traveling to remote locations and where there are no regular options 
for purchasing small arms ammunition is not practical. The existing 
exception has a demonstrated need in Alaskan air transportation with no 
adverse safety concerns or history.
    To further address the Research and Special Programs Administration 
(RSPA) 02-11654, previously described, transportation to locations 
where there is no phone service it is not realistic to require all air 
carriers to have personnel monitoring telephones. Requiring these 
operators to employ staff to monitor phones is not practical and we 
suggest language exempting this requirement for small aircraft operated 
with the State of Alaska. Moreover, an obligation to remain in constant 
communication between a non-certificated airport and the Pilot-in-
Command is not achievable and this rule will likely be violated simply 
because commercial operators will not have the means to comply.
    On the topic of the proposed National Air Tour Safety Standards, 
(FAA-1998-4521) our association believes the objective to reduce 
accidents in the sight-seeing industry will affect scheduled operators 
who conduct air tours as part of their business. These changes will 
trickle-down to other tourism related commerce, as well as impact 
employees of these companies as they reduce service or go out of 
business. An estimated three quarters of our membership would see a 
fall out of between 15-18 million dollars over a ten-year period. Air 
tours provide higher yields for certificate holders, which subsidize 
the flat, less profitable margins of essential air service.
    Since tourism is the second largest private sector employer in the 
state, our proposal would be to continue to increase safety through 
programs such as Capstone and the Medallion Foundation. Results in 
improved safety lie in projects such as further analysis of the Wide 
Area Augmentation System (WAAS) to achieve weather reporting and 
training in use of navigational aids, rather than more regulatory 
constraints. We recommend that this Notice of Proposed Rulemaking 
(NPRM) be withdrawn and that funding continue for both the Medallion 
and Capstone programs.
    Senator Stevens, the Alaska Air Carriers Association appreciates 
your co-sponsorship with Senator Inouye of Senate Bill 84, which would 
exempt certain sightseeing flights from taxes on air transportation. We 
also appreciate your continued support of the Medallion Foundation, a 
program that is changing the culture of aviation in Alaska. In order to 
continue to improve aviation safety, however, we need monies directed 
toward weather access and Global Positioning Systems (GPS) and those 
specific projects outlined in the Alaska Aviation Coordination 
Council's strategic plan.
    Thank you for the opportunity to comment today and do not hesitate 
to call on the AACA as a resource for aviation issues in the future.

    The Chairman. That's a very fine list of items that you've 
covered.
    I'm sorry that my Co-Chairman, Senator Inouye is not with 
us. He had a personal problem that prevented him in coming to 
Alaska at this time.
    What would you say the No. 1 priority of the association is 
on this list of objectives?
    Ms. Casanovas. Providing infrastructure for transportation 
throughout the state. Currently, we have about roughly 67 
airports that are GPS-equipped, and if we could have the 
additional approximately 219 airports which are awaiting the 
GPS procedure development, I think that would certainly be a 
case where we could have some assistance. One hundred million 
over 4 years could certainly provide the state and transition 
us from what we see as inadequate navigational aids right now 
to providing full coverage and, again, through the Capstone 
program, we can then have the ADSB and the other portions of 
that which are so valuable to the carriers around the state.
    The Chairman. Mr. Plumb, you too had a nice long list of 
suggestions and items to cover. What's your No. 1 priority?
    Mr. Plumb. Mr. Chairman, I would say to insure we have our 
funding for our cargo entitlements would be No. 1, and 
reinstatement of the ATP program would be No. 2.
    The Chairman. Are we ready for this enormous plane that's 
coming here? This--what is it? 380?
    Mr. Plumb. Yes, sir. We've been preparing for 5 years. And 
thanks to your support and an LOI letter of intent for $51.2 
million, we have--we have a plan for Group 6 routing or the 
A380's, more commonly known. It will be coming down the--what 
is now today or tomorrow will be runway 7; yesterday or a week 
ago it was 6. But 7 Right will be a Group 6 capable. We will 
have the capability to come up a Kilo taxiway to Romeo, up 
Romeo that serves UPS and Federal Express, and the new taxiway 
Yankee will also have. So we will have a complete circuit and a 
runway for Group 6 aircraft.
    The Chairman. You've really been very complimentary of the 
Capstone and Medallion. We're going to deal with Medallion 
again this afternoon. But are there any things that you think 
we can do in Washington to assist in the concept--and I'm 
talking to Harding right now--the concepts of either Capstone 
or Medallion to carry them further?
    Mr. Harding. We certainly appreciate all the support that 
you've given us. We have a request for further funding on the 
Medallion; and, of course, that is always helpful.
    We've talked to Mr. Sabatini about taking some of the 
concepts that we're using in the Medallion and using them in 
other programs, and we cannot do that with the funding that we 
get for Alaska. However, that funding is for what we're doing 
in Alaska. But any of the programs that we develop we're 
certainly willing to share with anyone else that you suggest.
    The Chairman. OK.
    Mr. Harding. And we really appreciate your continued 
support.
    The Chairman. Thank you. We'll be back looking at that.
    And talk about Medallion, Mr. Dennis. Have you visited 
other states? Are we going to see an expansion of Medallion in 
other states as we have--we anticipate Capstone will go forward 
in other states?
    Mr. Dennis. Senator, we've talked about that with several 
other individuals, including Mr. Sabatini and Administrator 
Blakey.
    We're looking more in relation to using the Medallion 
concept as a template and doing it as a regional basis, because 
it is a partnership. It is something that needs to be done in 
concert with the FAA because the programs do impact the FAA. 
And we need their support, as well as the local support, for 
the development of a program that is applicable to a local 
area.
    Florida is certainly not like Alaska. Texas, Southern 
California, each one has unique problems. But the process, the 
concepts and the templates, they are transferred.
    The Chairman. The concept really is this voluntary 
participation by the industry in areas and entities involved in 
the industry, getting together to try and find out if they 
could have a different approach to safety and work it out with 
the FAA so that you could experiment on concepts that would 
reduce accidents and injuries, sufficiency in compliance with 
the FAA. Isn't that the concept?
    Mr. Dennis. That is, in essence, what we're discussing, 
sir, yes. But it's a voluntary program. It's above the 
regulatory requirements. It must meet the regulatory 
requirements, obviously, but it is over and above the 
regulatory requirements and it takes it a step above. Even from 
the--apart from the one RGA fire program. That also is a 
voluntary program which has its roots within the five-star 
program that initially was developed.
    The Chairman. How much time has it taken for the individual 
industry participants to really work out the Medallion? What's 
been the workflow of the voluntary commitment of time?
    Mr. Dennis. That would depend, sir, entirely upon the 
operator. And recognizing that we have carriers, we have 66 
different carriers within the program right now, and they range 
in complexity from Alaska Airlines and PenAir, Frontier Flying 
and a number of larger carriers, down to single-pilot 
operations. Single-pilot operation, quite obviously, it's more 
onerous on them because of their particular workload in just 
running their business. So we're modifying, that's why I 
mentioned that this is developed and we have this one-on-one 
concept where we do go out and work with the operator and try 
to take the burden off of them, we've tried to meet the 
requirements that have been set forth by us in our Memorandum 
of Agreement with the FAA.
    The Chairman. Mr. Thompson, I think as Chairman of Commerce 
I'm spending more time now on the question of the future 
airways for the United States, airways management, than I ever 
dreamt I would. We're coming into a new era with regard to 
spacing, with regard to the type of equipment we're using and 
to the whole system of integration almost on an automatic 
basis.
    When we look at this--I don't know how to say this without 
sounding a little negative, but I was initially approached by 
your organization to oppose Capstone all together. Now your 
testimony is that you're prepared to accept it, but you want to 
be more involved from a controller activity to sort of 
regulated. Am I misunderstanding?
    Mr. Thompson. I don't think that--yeah, I don't think 
you're directly getting me on that point. I can't say what the 
Capstone initially started, what the policy was. I'm not aware 
of--I've been a regional vice president for NATCA up here for 
almost 8 years. And we've always supported the concept--again, 
when we look at it from an APC perspective there's two pieces 
of Capstone: There's the VFR aspect, which the people--
gentleman in here have all testified. It works fabulous from my 
understanding of it. It's an incredible tool, video map and 
such.
    Then there's the air traffic control aspect. Since we're 
talking about moving IFR airplanes and separating them with the 
same use of radar, which we are, it's a fabulous tool. But it 
has to work seamlessly with the radar, and controllers have to 
be able to have the communication systems in place. In Bethel 
that's not a problem because the terrain is flat, we can speak 
to the pilots. As you go to Southeast in Juneau, some of these 
low-altitude routes that some of the people have testified here 
today, I'm aware are in place. But if they fly IFR at 2,000 
feet down the fjords of Southeast, today there's no 
communication system for the air traffic controller to speak to 
them if there's an issue or if they're needed to--missed 
approach or such. I understand there's methods to get there, 
and we want to get there. NATCA absolutely does.
    I firmly believe 100 percent that providing approach 
control services to Bethel will be fabulous to the users and 
the public. Once we can sequence the special VFR with the IFR--
Juneau same thing, once we can see to the ground with Capstone 
technology, and along with multilateration, I think it's going 
to be a fabulous tool. What we're really asking for is that the 
agency engage with us in those discussions.
    The Chairman. With the advent of the new small jet, 
business jet, personal jet, we're all familiar with them, 
they're going to be--I call them the mosquito fleet is coming 
in. Small, six to nine passengers, a jet, probably faster than 
before, very efficient. Made of composite materials. Lighter 
weight. And fast--not only faster, but really smaller so it's 
going to be a very interesting challenge. I think we have to 
work together to make sure that that system we can transition 
into a new system without delays, because, very clearly, 10 
years from now, the estimate is there will be twice as many 
aircraft in the airway system.
    I look forward to working with you. I think we all have to 
work together.
    I'm reminded a friend of mine told me of a Pacific northern 
pilot that flew into Juneau for year after year after year. And 
one day he flew in and it was clear and quit.
    [Laughter.]
    The Chairman. Seeing is believing. That Capstone system on 
a flight into Juneau, I've also flown in with that. It makes 
one tremendous difference. I hope we can incorporate all of 
these new advances into our system in Alaska. I look forward to 
working with all of you. We'll review all the comments you've 
made.
    These hearings--we'd hoped we would have more Senators 
here, but the 4th of July is still a problem getting other 
Senators to come. But a copy of this record will be provided to 
every Member of our Committee and to those committees that have 
any intersection with the problems we've discussed. For 
instance, the Finance Committee and others.
    And I look forward to working with you as we go through the 
year in terms of the legislation before our Committee that will 
affect us all.
    Thank you very much.
    [Whereupon, at 11:10 a.m., the Committee adjourned.]

                            A P P E N D I X

  Prepared Statement of Phil Brown, Director, Alaska Region, National 
             Association of Air Traffic Specialists (NAATS)

    Mr. Chairman and Members of the Committee, thank you for the 
opportunity to review with you today the National Association of Air 
Traffic Specialists (NAATS) assessment of future challenges facing the 
Alaska aviation community. Much of our work over the last several years 
has continued to focus on maintaining equal or better service for 
Alaska's flying public. The crucial services provided by Flight Service 
Station (FSS) personnel are essential to aviation in Alaska. Likewise, 
air traffic control and all of its associated functions in the FSS are 
government responsibilities--especially in Alaska where aviation is 
often the only lifeline for our communities. I will focus my remarks 
today on these subjects.
    The unique environment of Alaska means that our aviation community 
warrants increased attention. National aviation guidelines and 
evaluation formulas need to be continually adjusted to work in our 
great State so that Alaska aviation does not suffer under a one-size 
fits all policy. Mr. Chairman, when tough issues arise in the Senate, 
your well-known motto has always been, ``Do what's best for Alaska.'' 
There is no doubt that much of the cutting edge technology that you are 
being briefed on today will serve Alaska aviation well in the near and 
distant future. Having said that, one must not lose sight of the basic 
foundation this wonderful technology is being built upon. Clearly, 
there is nothing that replaces the Flight Service Station person on the 
ground providing often life-saving assistance to Alaska's bush pilots, 
air carriers, military pilots and recreation flyers. Mr. Chairman, 
well-trained, experienced human capital is the mortar holding this 
foundation together and maintaining this professional federal workforce 
is without a doubt, ``what is best for Alaska.''
    Mr. Chairman, the dedicated men and women who make up the federal 
FSS workforce are the integral key to saving lives and maintaining the 
safest Alaska aviation infrastructure possible. The Flight Service 
Station employees are often referred to as the ``other controllers.'' 
Air traffic control conjures up images of dimly lit rooms, lined with 
rows of dark screens, displaying a myriad of blips and lines. Each 
scope monitored by passionate individuals devoted to keeping apart an 
endless stream of traffic, issuing precise instructions, carefully 
formulated to protect the thousands of lives represented by the targets 
flowing in every direction. This is the image most people have of the 
dedicated individuals who monitor the skies for potential conflict. No 
less dedicated, yet almost unknown outside the aviation community, are 
the ``other controllers.'' Those air traffic control specialists 
devoted to helping pilots avoid the innumerable weather phenomena that 
are just as hazardous to aviation safety as other traffic. These, Mr. 
Chairman, are the individuals who work in the Flight Service Stations 
(FSS) across the nation; this workforce is the mortar that bonds the 
foundation of the safest aviation infrastructure in the world. Weather 
is a factor in an overwhelming majority of aviation accidents. Even 
with advances in technology, rapidly changing weather patterns still 
present a significant danger to flight safety. Flight Service Station 
professionals, working in highly technical environments, scan a 
kaleidoscope of weather charts and constantly updating weather data 
assisting pilots, both before and during flight to avoid potential 
dangers. Nowhere else in the nation are these potential weather dangers 
more prevalent than in Alaska where pilots navigate airspace one-fifth 
the size of the entire United States and half of the country's 
coastline.
    A major challenge facing the Alaska aviation community is 
maintaining this invaluable human capital in the Federal Flight Service 
Stations throughout our last frontier. While the Federal Aviation 
Administration (FAA) continues to struggle with reorganization and 
restructure in the new Air Traffic Organization (ATO), the 
privatization/outsourcing juggernaut commonly known as ``A-76'' 
continues to move forward. Mr. Chairman, this ill-advised and misguided 
``A-76'' initiative places aviation safety in the hands of a ``lowest 
bidder.'' We believe this presents a clear and present danger to 
aviation safety in Alaska. While federal FSS air traffic control 
specialists in Alaska are currently exempt from this privatization/
outsourcing initiative, there is no reasonable expectation or mandate 
preventing FAA officials from expanding their privatization efforts 
into our great state.
    Currently, the entire FSS community outside Alaska is in immediate 
danger of losing their Federal Government careers. Many of these 
dedicated men and women started their careers in the military and have 
spent a lifetime serving their country in the federal service. Now, 
many are in danger of losing their health and retirement benefits only 
months and in some cases days away from reaching their retirement 
goals. Mr. Chairman, it is simply wrong to toss aside employees and 
their families in this fashion. I respectfully encourage you, Mr. 
Chairman, to take a close, in-depth look at this entire outsourcing/
privatization effort of America's FAA Flight Service Stations. We are 
certain that the inaccurate cost-savings figures being touted by FAA 
representatives, the empty promises of ``soft landings'' for federal 
employees and the outright raiding of government employee pensions will 
shock and dismay you.
    Mr. Chairman, a number of years ago when the FAA was closing down 
and consolidating Flight Service Stations throughout Alaska the flying 
public rose up in opposition. Hearing this public outcry, Mr. Chairman, 
you asked a question that still echoes through the halls of the FAA 
today, ``What don't you understand about equal or better service?'' 
Your wise and insightful actions then laid the foundation for keeping 
our remote Flight Service Stations in Alaska open and lead to the 
develop of an Alaska Rotation Plan that addressed difficult staffing 
issues. Unfortunately, the Alaska Rotation Plan and our Alaska remote 
Flight Service Stations are under attack by FAA management once again. 
Absent any plausible rationale or cost-savings projections that have 
been shared with us, FAA management is systematically dismantling the 
Alaska Rotation Plan. Moreover, even as we speak today, plans are being 
executed to place kiosk stations at remote Alaska locations that will 
eventually replace the remote FSS. Mr. Chairman, this ``kiosk concept'' 
of self-serve air traffic control is the same plan that prompted your 
now infamous statement over 12 years ago . . .``What don't you 
understand about equal or better service.'' What's more disturbing Mr. 
Chairman is that it appears to be some of the same individuals 
revisiting this concept now that were involved then. History, truly 
does repeat itself and we respectfully request that you follow this 
matter closely. Replacing the experienced Flight Service Station 
professionals on the ground at remote locations with self-serve kiosks 
simply does not equate to ``equal or better service.''
    In conclusion, I thank you today Mr. Chairman and Members of the 
Committee for your time and for holding these hearings. Clearly, we 
have major challenges facing the Alaska aviation community. While 
finding a balance between cost-effectiveness, equal or better service 
and aviation safety is a daunting task; it is a task that we can and 
must achieve together. The National Association of Air Traffic 
Specialists sees this as an important and dynamic time in Alaska 
aviation history and we stand ready, willing and able to work in 
collaboration with the FAA and the aviation community toward achieving 
these goals.

                                  
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